SECURITIES AND EXCHANGE COMMISSION
                               WASHINGTON, D. C.

                       FORM 10-K (AMENDED 6 JANUARY 1997)

                    ANNUAL REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934



FOR FISCAL YEAR ENDED:  JUNE 30, 1996       COMMISSION FILE NO. 0-4076


                              EXOTECH INCORPORATED
               (Exact name of Registrant as Specified in Charter)


State or Jurisdiction of
 Incorporation or Organization:                      DELAWARE

IRS Identification No:                               54-0700888

Address of Principal Office:                         8502 Dakota Drive
                                                     Gaithersburg, MD. 20877

Registrant's Telephone Number:                       (301) 948-3060


                        SECURITIES REGISTERED PURSUANT TO
                       SECTION 12 (b) OF THE EXCHANGE ACT

                                      None

                        SECURITIES REGISTERED PURSUANT TO
                            SECTION 12 (g) OF THE ACT

                     Common Stock par value $0.10 per share.

Indicate by checkmark  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
requirement for the past 90 days.
                                                       Yes [x]           No [  ]

At June 30,  1996,  942,387  shares of Common  Stock were  outstanding,  and the
aggregate market value of the Common Stock of Exotech Inc. held by nonaffiliates
was approximately $56,750.

                       DOCUMENTS INCORPORATED BY REFERENCE

                                      NONE


<PAGE>


                                     PART I


ITEM 1.  GENERAL DESCRIPTION AND BUSINESS ACTIVITIES

         A.  General - There  have been no changes  in the  organization  of the
Company  during the past fiscal  year.  The Company has been neither a party to,
nor  contemplates,  any actions of bankruptcy,  receivership,  or reorganization
during the past or current fiscal years.  No material  assets were acquired,  no
acquisitions or dispositions  are  anticipated.  The basic nature and conduct of
the business is expected to continue as in the past.

         B.  Financial information about industry  segments - In the opinion  of
Management,  the  Company  has  one  industry  segment: (1)  electro-optics  and
electronic instrument systems and related services.

         1. Electro-optics  products - The Company's principal products are: (1)
a laser bacteria  colony counter used in food and drug processing and laboratory
testing  environments,  (2) a printed circuit board (PCIB) which  interfaces the
laser-scanner  instrument  with many  models of the  personal  computers,  (3) a
crystallographic  scanner that  evaluates the lattice  structure  orientation of
semiconductor  crystals on the basis of surface morphology  measurements,  (4) a
hand-held four  channel-ground  truth radiometer used for earth resource studies
in conjunction with the LANDSAT satellite and also independent  studies, and (5)
an  automated  spiral  plater that  precisely  and rapidly  dispenses  microbial
samples onto  rotating  agar plates used in  laboratories  performing  bacterial
enumeration work.

         These products are currently marketed world-wide.  Spiral Biotech, Inc.
is the  exclusive  representative  of  products 1, 2 and 5. These  products  and
related  service work have accounted for up to  approximately  93 percent of the
Company's  sales in the last two fiscal  years.  The others are sold directly by
the Company.  They are built for inventory in lots of 25 units, with two or more
lots of the well established products generally being sold in about one year. It
is  intended  that  these  products  will be updated  periodically  to keep them
abreast  of new  technological  developments  and will  remain  products  of the
Company.  In December 1994 the Company  accepted a contract from Spiral Biotech,
Inc. to design an automated spiral plater  (Autoplate) to replace the model that
was  being  imported  from  Holland.  In May 1995 a  demonstration  model of the
instrument was delivered and  subsequently  the Company received an order for 22
production  units.  This  production  was  scheduled for the first six months of
fiscal year 1996. A modulation  transfer function (MTF) tester, used for quality
control in the manufacture of low light level image intensifier tubes, is not in
regular  production but would be manufactured to fill  customers'  orders.  This
instrument was initially produced for the U. S. Army and delivered during fiscal
year 1979. The Company  developed an adapter assembly for these test instruments
that updates them to test the latest versions of image  intensifier  tubes. Over
the past fifteen  years the Company has  provided  support to the U. S. Army and
its contractors in the form of repair maintenance and calibration services.  The
contracts for these services were fixed price.  There was a government  contract
for these services in the past fiscal year and purchase  orders for  calibration
services  in  the  current  fiscal  year  are  being  received  from  government
contractors using five of the MTF tester systems.

         The Crystallographic Scanner, developed in fiscal year 1987, redesigned
into a manufacturing model in fiscal year 1988, was put into production in 1989.
The first unit was  delivered to the customer in May 1989.  An active  marketing
effort  through  correspondence  and  personal  contacts,  as well  as  personal
presentations,  is continuing to introduce this product to semiconductor crystal
growers,

                                      A-2

<PAGE>

processors  and  manufacturers.   However,  there  have  been  no  sales of this
instrument over the past four years.  The Company is currently  engaged with the
National  Institute of Standards and  Technology in a cooperative  R&D agreement
with the objective to calibrate the Exotech  Scanner  method with respect to the
Bragg Angle method of determining  crystal axis  orientation.  Validation of our
instrument's  capability  vis-a-vis the X-ray methods will overcome a persistent
impediment to sales of Exotech's  Scanner to producers of semiconductor  wafers.
There are well-known  potential  customers  that show continued  interest in the
scanner,  but  must be  convinced  of  correlation  with the  traditional  X-ray
results.

         Some of the  component  parts  for the  products  discussed  above  are
fabricated to the Company's  specifications and design. Other parts are standard
electronic or optical components  available  off-the-shelf.  The availability of
these  components  is  dependent  upon  several  independent  manufacturers  and
distributors.  Delays  due  to  strikes,  material  availability  or  scheduling
problems could adversely affect the Company's assembly and delivery schedules. A
few parts have only one source;  however,  the  suppliers  are proven,  reliable
businesses.  The Company  does not rely on foreign  sources  for raw  materials,
other than to the extent U. S. manufacturers acquire their supplies overseas. An
energy  crisis or fuel shortage  would have no more of an adverse  effect on the
Company  than on other  firms  requiring  lighting,  heat and modest  amounts of
electric power for offices and shops.

         Among  its  current  electro-optical  products  the  Company  holds  an
exclusive  license  and  foreign  patent  applications  on the  Crystallographic
Scanner.

         There are little or no seasonal variations in the business,  other than
for  radiometers  which tend to attract  greater  interest during the spring and
fall seasons.

         Working  capital is a  continuing  problem  for the  Company.  There is
currently  no  working   capital   financing   available   through  a  financial
institution,  although producer loans made by Spiral Biotech,  Inc. were used to
finance   colony  counter   production  in  prior  fiscal  years.   The  limited
availability of working capital results in occasional cash on delivery orders or
delays  in  paying  suppliers.  All  products  are  guaranteed  as to parts  and
workmanship  for a period  of six  months to one year.  The only  warranty  work
incurred  in the past year was repair of two Model 4000  Autoplates  and a Model
200 Vacuum Source at nominal cost.

         The colony counter, Autoplate,  crystallographic scanner and radiometer
products are used  principally  in the scientific  research and high  technology
manufacturing  communities  and therefore  customers tend to be  concentrated in
these areas of activities.

         Sales  in  July  and  August  1996  amounted  to  $70,300,   comprising
Autoplates, radiometers, vacuum sources and miscellaneous repair and calibration
services. Backlog in this segment at June 30, 1996 was $279,000.

         Business  performed for the  Government  is on a fixed-price  basis and
therefore  not  subject  to  renegotiation;  however,  the  contracts  could  be
terminated for non-delivery or failure to meet  specifications.  There are other
manufacturers  of the Company's  products,  most of them larger and with greater
resources available to fund development and production. Competition is very keen
for the available  market.  The Company strives to improve its existing products
and produce highly reliable state-of-the-art instruments.

         2. General  Description  of Business - Research and  development by the
Company in the past

                                      A-3

<PAGE>


affected  four  products:  (1)  bacteria  colony  counters;  (2)  four   channel
radiometers,  (3) data processors for bacteria colony counters  and,  (4)  Model
500   Crystallographic   Scanners.    In  fiscal  year  1992,  the  Company,  in
collaboration  with Spiral  Biotech,  Inc.,  engaged in  development of computer
controlled,  stepper motor actuated  automation for bacteria  colony plating and
counting  instruments.  The applications comprise coordinated precise motions on
as many as four axes.  The purpose of this work is to enhance the  technological
excellence and competitive edge of the next generation of the Company's products
for the microbiological  laboratory market. This work, completed in March, 1992,
resulted in a colony counter with automated features, and a proof-of-concept and
demonstration  model of a new spiral plater  instrument.  Total expenditures for
the spiral  plater  effort  amounted  to $63,000 of which  $20,000 was funded by
Spiral Biotech,  Inc. The preliminary  design of the new plating  instrument was
completed, and produced by Melvezi-Prolion, a development and manufacturing firm
in Holland.

         Following the  termination of importing of the instrument from Holland,
the Company,  early in 1995,  designed a replacement  instrument and, concurrent
with  development  work,  began  production  of 12 units on an order from Spiral
Biotech,  Inc. The order was  increased to 22 units in November  1995,  with the
final unit of this lot  shipped  in  February  1996.  A  follow-on  order for 25
instruments resulted in shipments of 18 more units prior to June 30, 1996.

         In the biotechnology instruments business,  autoplates, colony counters
and related  equipment  sales accounted for 82% of the year's sales, 5% from the
MTF parts,  calibration and maintenance;  and 13% from  miscellaneous  sales and
repair work.

         For the fiscal year ended June 30, 1996, as has been the case for prior
years,  the Company's  independent  auditors' report has included an explanatory
paragraph, following the opinion paragraph,  describing the existence of a going
concern uncertainty. Management has been advised that the principal cause of the
going  concern  uncertainty  is cash flow  shortage  which has caused  delays in
meeting some current obligations.  It is the opinion of Management that progress
in resolving cash flow related  problems,  although  elusive in the past several
years, will be re-established in fiscal year 1997 provided that modest increases
in instrument  sales,  and maintenance and repair work continue and that ongoing
demonstrations and trial applications of the Crystallographic  Scanner result in
sales of this product. Strengthening of revenues and stringent controls of costs
are necessary to enable profits from operations to remedy cash flow problems.

         The capital  expenditures,  earnings and competitive  position have not
been affected by compliance with Federal,  State or local regulations enacted to
control the discharge of materials into the environment or otherwise relating to
the protection of the environment.

         The Company and its subsidiary employ five persons;  two are classified
as  professional  and three as  semi-professional.  The  Company did not conduct
operations in foreign countries.

                                      A-4

<PAGE>


ITEM 6.  SELECTED FINANCIAL DATA

Selected Income Statement Data:

<TABLE>
<CAPTION>
                                 ----------------------------------  FISCAL YEAR  ---------------------------------

                                      1996              1995              1994             1993              1992
                                      ----              ----              ----             ----              ----
<S> <C>
Net Sales                          $367,259          $370,102          $437,330         $435,813          $432,139

Income before Taxes
& Extraordinary
 Credit                            (152,584)          (68,130)          (35,448)         (23,854)          (73,801)

Net Income (Loss)                  (152,584)          (68,130)          (35,448)         (23,854)          (73,801)

Per Share:
 Net Income (Loss)                     (.16)             (.07)             (.04)            (.03)             (.08)
</TABLE>


Selected Balance Sheet Data:

<TABLE>
<CAPTION>
                                 ----------------------------------  FISCAL YEAR  ---------------------------------

                                      1996              1995              1994             1993              1992
                                      ----              ----              ----             ----              ----
<S> <C>
Current Assets                     $563,209          $587,808          $643,836         $597,081          $497,326
Current Liabilities                 825,952           699,068           688,834          611,775           491,034

Working Capital                    (262,743)         (111,261)          (44,998)         (14,694)            6,292

Total Assets                        570,541           596,241           654,136          612,525           515,638

Stockholders' Equity
and Accumulated
Deficit                           $(255,411)        $(102,827)         $(34,698)             750            24,604
</TABLE>

                                      A-5

<PAGE>


ITEM 7.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               CONDITION AND RESULT OF OPERATIONS.

         The Company's  revenues of $367,259 were 1.0% lower than in fiscal year
1995,  and 16% lower than in fiscal  year 1994.  The  declines  over these years
related in part to  organizational  and personnel  disruptions  in the Company's
principal customer for biotechnology instruments,  Spiral Biotech, Inc., and the
sub-par quality of an imported automated plater instrument,  sold as a part of a
system including Exotech  products.  The Company's new product has replaced this
instrument.

         Sales of platers, laser bacterial colony counters and related accessory
equipment  increased  to $302,700  compared  to $89,800 in 1995 and  $200,200 in
1994. There were no sales of radiometers nor Crystallographic Scanners, although
radiometer sales were $16,400 and $27,700 respectively in 1995 and 1994. Service
and parts sales for Modulation  Transfer  Function Testers were $17,350 compared
to $9,000 and $57,000  respectively  in 1995 and 1994.  Service and  maintenance
sales for the broad range of laboratory instruments was down to $47,200 compared
to sales of $146,700 in the prior year and $85,700 in fiscal 1994.

         Continued efforts to control the cost of sales resulted in an operating
profit of $1,633  compared  to $2,057 in fiscal  year 1995 and a loss  $8,812 in
1994.  However,  the impact of  interest  and  research  and  development  costs
resulted in a net loss of $152,584  compared to losses of $68,130 and $35,448 in
1995 and 1994, respectively.

         An  increase in demand  notes  needed to sustain  development  of a new
automated  plater  instrument  caused an increase in interest expense to $29,817
compared to $26,822 in the prior year,  and $27,752 in fiscal  1994. A charge of
$129,000 was incurred in the past year for  research and  development  to search
out the combination of electronic and mechanical technology needed to design and
develop a  state-of-the-art  instrument  with strong sales potential in a highly
competitive  market.  In the opinion of Management,  that objective was achieved
through intense effort to deliver two  preproduction  prototypes and 14 units of
the new instrument in the second quarter of fiscal 1996.

         In  the  third  and  fourth  quarter  of  the  past  year,  orders  for
instruments and services were increased by Spiral Biotech,  Inc.  bringing sales
to about the level of the prior year and increasing  backlog to $279,000 at June
30, 1996,  compared to $81,000 one year earlier and $45,300 at the end of fiscal
year 1994. In the opinion of Management, recent improvements in the marketing of
the   biotechnology   products  will  rejuvenate  sales  of  the  laser  scanner
instruments together with increasing sales of the new automated plater.

         Despite  financial  limitations  that  have  impeded  marketing  of the
Crystallographic  Scanner  instruments,  management believes that the results of
on-going  collaborative  studies and demonstrations of capabilities will improve
the prospects of sales to the potential  customers who continue to show interest
in that instrument system.  Furthermore,  management is committed to explore the
prospects for collaborative arrangements with several well established suppliers
of manufacturing  equipment to the semiconductor producer industry as a means to
generate increased exposure and sales potential for this product.

         Over the past three fiscal years,  as in prior years,  the  independent
accountants' report has included an explanatory paragraph, following the opinion
paragraph,  describing  the  existence  of  a  going  concern  uncertainty.  The
accountants  have  advised  Management  that the  principal  cause for the going

                                      A-6

<PAGE>


concern  uncertainty is cash flow shortages  which have caused delays in meeting
current  obligations.  In the  opinion of  Management,  the past three  years of
seriously  depressed  markets  for the  Company's  products  caused  substantial
impediments to overcoming the qualification stated by the accountants. Continued
stringent  control of costs and cash  outlays has enabled the Company to sustain
high  quality  and timely  upgrades of its  products  while  nurturing  improved
results from marketing  efforts in a very  competitive  environment.  With a new
product now experiencing a good level of acceptance in the market, and growth in
the Company's backlog for its other biotechnology-related  products,  Management
believes  that  increasing  revenue  will  provide for  progress  in  generating
sufficient  cash to support  operations in fiscal year 1997.  Additionally,  the
opportunity  to build on the results of our current  activity will be pursued to
reactivate sales of the Crystallographic Scanner instruments and technology.

         The Company  continues to meet its cash flow  obligations,  although at
times  delayed in some cases of trade  payables and payroll,  with receipts from
sales and financing  activities  comprised of loans from the Company's President
and from Spiral  Biotech,  Inc., its principal  customer.  The loans from Spiral
Biotech are secured by ordered  instruments  in progress and range from 30 to 40
percent  of the  purchase  order  value  for the  total  order.  No loans are in
default.   The  fluctuations  in  accounts  payable  relate  to  the  amount  of
work-in-progress for products on order.

         It is noted that the Company's property, plant and equipment are nearly
fully depreciated.  However,  all essential items of these assets are maintained
in good repair and no  replacements  nor additions are  anticipated  in the next
year or more.

The   Company's   management   and   employees   continue  to  be  committed  to
reestablishing progress toward our goal of profitability.

                                      A-7

<PAGE>


                      EXOTECH INCORPORATED AND SUBSIDIARY
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                       FOR THE THREE YEARS ENDED JUNE 30

         Reference is made to Note 1 of the Notes to the Consolidated  Financial
Statements  for a  description  of operations of the Company and to Note 2 for a
description of the principal accounting policies followed by the Company.

<TABLE>
<CAPTION>
                                                          1996                      1995                     1994
                                                          ----                      ----                     ----
<S> <C>
REVENUES
Contract Sales                                        $367,259                  $370,102                 $437,330

COST OF SALES
Direct Cost and Overhead                               364,448                   363,721                  441,390
General and Administrative                               1,178                     4,324                    4,752
                                                         -----                     -----                    -----

TOTAL COST OF SALES                                    365,626                   368,045                  446,142
                                                       -------                   -------                  -------

OPERATING PROFIT (LOSS)                                  1,633                     2,057                  (8,812)

OTHER REVENUES
 (EXPENSES)
Miscellaneous                                            4,600                  (43,365)                    1,116
R&D Costs                                            (129,000)                        --                       --
Interest                                              (29,817)                  (26,822)                 (27,752)
                                                      --------                  --------                 --------

NET LOSS BEFORE TAXES                                (152,584)                  (68,130)                 (35,448)

INCOME TAXES                                                --                        --                       --
                                                      --------                  --------                 --------


NET LOSS                                            $(152,584)                 $(68,130)                $(35,448)
                                                    ==========                 =========                =========
Loss per
Common Share                                             (.16)                     (.07)                    (.04)

Weighted average number
of common shares
outstanding                                            942,387                   942,387                  942,387
</TABLE>

The accompanying notes are an integral part of these statements.

                                      A-8

<PAGE>



                              EXOTECH INCORPORATED

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(1)      DISCUSSION OF OPERATIONS AND REALIZATION OF ASSETS

For the fiscal year ended June 30, 1996, the Company had an operating  profit of
$1,633.  The Company had an operating profit of $2,057 in the prior fiscal year.
At June 30, 1996,  approximately  $75,000 of accounts  payable were more than 30
days old.

The accompanying  financial statements have been prepared on the "going concern"
basis of generally accepted accounting principles. The ability of the Company to
continue normal  operations is dependent upon its ability to obtain the required
amounts of working  capital to finance the existing  contracts,  to continue the
acquisition of additional  contracts,  and to pursue  instrument sales at prices
sufficient to recover costs and some profits.

Inventory of Crystallographic  Scanners have experienced no sales activity since
their  development  approximately  four years ago.  Efforts have  recently  been
intensified to develop a marketing  agreement  with an  established  marketer of
capital  equipment to the crystal growers and processors,  or  alternatively  to
sell the  products,  design  package,  software,  patents and licenses to larger
manufacturers  of instruments with a significant  presence in the  semiconductor
processing  equipment  market.  Should those  efforts  fail,  the company may be
forced  to charge  off the  carrying  value of  approximately  $243,000  against
income.

At June 30, 1996, the remaining value (backlog) of existing sales contracts were
approximately $279,000.

(2)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business
The Company is a manufacturer of  Electro-optical  instruments.  It performs the
research and development required for those products.

Principle of Consolidation
The accompanying  consolidated  financial statements include the accounts of the
Company and its subsidiary,  after  elimination of all significant  intercompany
transactions.

Revenue Accounting
The Company records revenue earned based on shipments of units of its products.

Inventory
Finished goods  inventory is stated on the basis of the lower of costs (average)
or market value.

Depreciation and Amortization
The Company uses a straight-line  method of depreciation  and  amortization  for
both tax and financial reporting purposes. The following time periods are used:

     DEPRECIATION:
                Laboratory equipment                  5 or 8 years
                Office furniture and equipment        5 years


                                      A-9

<PAGE>

     AMORTIZATION:
                Leasehold improvements                Life of lease
                Patents                               12 years

Depreciation  expenses  recorded  in  the  consolidated  statement of operations
are as  follows:   1994 - $3,809,  1995 - $2,454, and  1996 - $1,101,  including
amortization  of  patents  at  the  rate  of $928 in each  year.  The  Company's
limit for capitalization of property and equipment is $500 or more.

Income Taxes
Provisions  for  income  taxes  are  based on  pre-tax  income  reported  in the
financial statements, using the guidance of Financial Accounting Standards Board
Statement No. 109 (FAS #109) "Accounting for Income Taxes."  Differences between
income (loss) for financial  reporting purposes and tax reporting arise from (a)
the capitalization and amortization of research and development costs for income
tax  reporting  purposes,  but  deducting  these costs as expenses in the period
incurred  for  financial  statement  purposes;  and (b)  timing  differences  in
deducting  net losses on contracts.  There were no  provisions  for income taxes
required  in the three  year  period  ended June 30,  1996 due to the  operating
losses for each of those years.

At June 30, 1996, the Company had net operating loss  carryforwards  of $371,357
which  begin to expire in 1997.  The  Company  also has  incurred  research  and
experimental  expenses of $129,000 in 1996, and $54,368 in prior years that have
been  capitalized  to be  amortized  over a sixty  month  period  for income tax
purposes,  but have been expensed in the period incurred for financial statement
reporting.  While the  accounting  standard  allows  companies  to  recognize  a
deferred  tax asset on the tax effect of these timing  differences,  the Company
has provided a valuation  allowance  for the full amount since it is more likely
than not the deferred tax asset will not be realized.

The approximate tax effect of the carryforward and temporary  difference for the
three years ended June 30 consist of:

<TABLE>
<CAPTION>
                                                        1996                  1995                  1994
                                                      --------              --------              ------
<S> <C>
Net operating loss carryforward                      $148,543              $150,545              $119,923
Deferred research and
         experimental expenses                         48,174                 5,204                 8,673
Less: Valuation allowance                            (196,717)             (155,749)             (128,596)
                                                     ---------             ---------             ---------

Deferred Tax Asset - net                               - 0 -                 - 0 -                 - 0 -
                                                     =========             =========             =========

Net increase in valuation allowance                  $(40,968)             $(27,153)
                                                     =========             =========
</TABLE>

Following  is  a table reconciling the Company's accounting net loss for each of
the last three years ended June 30.

<TABLE>
<CAPTION>
                                                        1996                  1995                  1994
                                                      -------               -------               -------
<S> <C>
Accounting Net Loss                                  $152,584               $68,130               $35,448
Nondeductible expense                                                          (250)
Research and experimental costs:
    Capitalized on tax return                        (129,000)                  -                     -
    Tax amortization                                   21,574                 8,674                 9,874
                                                     --------              --------              --------
Taxable Net Loss                                     $ 45,158              $ 76,554              $ 45,322
                                                     ========              ========              ========
</TABLE>

                                      A-10

<PAGE>

Repairs and Betterments
Repairs are expensed as incurred. Betterments are capitalized and amortized over
the remaining useful life of the assets.

Accounts Receivable
Accounts receivable consist of amounts billed from sales as of June 30, 1996. In
the prior fiscal year an allowance for doubtful accounts was set up for $43,368.
This amount  represents a claim for product  development  costs from fiscal year
ended June 30,  1994.  This amount has since been  written  off, and there is no
allowance for doubtful  accounts as of June 30, 1996,  as the Company  considers
accounts receivable to be fully collectible.

Cash And Cash Equivalents
The Company  considers  all highly  liquid  debt  instruments  purchased  with a
maturity of three months or less to be cash equivalents.

Use of Estimates
In  preparing  financial   statements  in  conformity  with  generally  accepted
accounting principles,  management is required to make estimates and assumptions
that affect the reported  amounts of assets and  liabilities,  the disclosure of
contingent assets and liabilities at the date of the financial  statements,  and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from these estimates.

(3)      INVENTORY

Inventories are summarized as follows:
                                                     1996               1995
                                                     ----               ----

                Raw Materials                     $32,625           $ 32,625
                Goods in Process                  505,062            528,825
                Finished Goods                     14,000             14,000
                                                ---------          ---------
                                                 $551,687           $575,450

(4)      RESEARCH AND DEVELOPMENT COSTS

The Company's  accounting  policy is to write off research and development costs
as incurred.  In the fiscal year 1996,  $129,000 of R&D costs related to the new
Autoplate 4000 product were incurred and written off. There were no R&D costs in
the prior two years.

(10)     TRANSACTIONS WITH SHAREHOLDERS

Sales to a company  owned by a  shareholder  aggregated  $340,841,  $335,736 and
$340,397,  (about 93, 91 and 78 percent,  respectively,  of total sales) for the
fiscal years ended June 30, 1996, 1995 and 1994, respectively.  Amounts due from
such sales at June 30,  1996 and 1995 were  $11,073 and  $10,932,  respectively.
Sales were  consummated on terms similar to those  prevailing with  unaffiliated
customers.

                                      A-11

<PAGE>



(12)     VALUATION AND QUALIFYING ACCOUNTS

The following is a schedule of Valuation and Qualifying Accounts:

<TABLE>
<CAPTION>
                                                                Additions:
                                                  Balance       Charged to                            Balance
                                                Beginning        Costs and                             End of
         Description                            of Period         Expenses        Deductions           Period
         -----------                            ---------         --------        ----------           ------
<S> <C>
Allowance deducted from asset
 to which it applies:
   Allowance for Doubtful Accounts:
     Year Ended June 30, 1995                 $   -- 0 --          $43,368        $43,368(A)       $  -- 0 --

   Allowance for Depreciation:
     Year Ended June 30, 1996                     230,946              174                            231,119

     Year Ended June 30, 1995                     229,420            1,526                            230,946

     Year Ended June 30, 1994                     226,539            2,881                            229,420

   Allowance for Amortization
    of Patents:
     Year Ended June 30, 1996                       6,959              928                              7,887

     Year Ended June 30, 1995                       6,031              928                              6,959

     Year Ended June 30, 1994                       5,103              928                              6,031
</TABLE>

Note (A): Uncollected receivables written off.

                                      A-12

<PAGE>


Linton, Shafer & Company, P.A.
Certified Public Accountants
6 West Second Street
Frederick, MD  21701
301-663-5122

Principals: Edmond B. Gregory III, CPA, CBA
Kevin R. Hessler, CPA
Donald C. Linton, CPA, CFP
Joseph M. McCathran, CPA
Ronald W. Shafer, CPA


                     Consent of Certified Public Accountants


We have issued our report dated September 20, 1996,  accompanying  the financial
statements and schedules of Exotech,  Incorporated  and Subsidiary  contained in
the annual  report on Form 10-K of Exotech,  Incorporated  and  Subsidiary as of
June 30, 1996 and 1995, and for the years ended June 30, 1996, 1995 and 1994. We
consent to the use of the aforementioned  report in the amendments to Form 10-K,
as amended January 6, 1997.


                       /s/ Linton, Shafer & Company, P.A.
                       __________________________________

January 6, 1997

                                      A-13

<PAGE>


                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
                  (a), (b), (e)

NAME:                                       ROBERT G. LYLE (67)
                                            President, CEO of  the  Company  and
                                            subsidiary; Director
Business experience
during past 5 years                         Same as above, since 1977
Other Positions:                            None
Other Directorships:                        None

NAME:                                       JAMES G. PAULI (41)
                                            Treasurer   (2)  and  Director  (4);
                                            Member  of   Audit   Committee   (4)
Business experience                         -  Managing  Consultant,  Leader  of
during past 5 years                         Management Study Teams at Electronic
                                            Data  Systems,   Inc.,  Herndon,  VA
                                            Data   Systems    Consultants    and
                                            Designers (1)  
                                            -  Management     Analyst,     Price
                                            Waterhouse  Audit   and   Management
                                            Consulting Firm (5)
Other Positions:                            None
Other Directorships:                        None

NAME:                                       ANDREW WONG (43)
                                            Secretary and Director  (1);  Member
                                            of Audit Committee (1)
Business experience                         - Vice President, Marketing, General
during past five years                      Electric-Spacenet,   McLean, VA (1).
                                            Manager  of  Marketing  Function for
                                            Telecommunications         Division.
                                            Responsible for  selling  customized
                                            private  networks  to  businesses in
                                            the United States and  international
                                            markets.
                                            -  Director,   Business Development,
                                            COMSAT     Mobile    Communications,
                                            Bethesda, MD (4).   Responsible  for
                                            identification,     analysis     and
                                            implementation  of  mobile  wireless
                                            communications              business
                                            opportunities.

Other Positions:                            None
Other Directorships:                        Member,   Board    of    Engineering
                                            Advisors,   Univ.   of   California,
                                            Lawrence Livermore Laboratory (2)
----------------------
Note: All terms expire in December, 1997

               c. Not applicable.

               d.  There   are  no  family  relationships  between  any  of  the
above  listed  directors  and  any  other  director  or executive officer of the
Company.

               f. None of the directors or executive  officers have been subject
to  any  bankruptcy  or  insolvency   proceedings,   criminal  proceedings,   or
injunctions against dealing in investments during the past three years.

                                      A-14

<PAGE>


ITEM 11.       MANAGEMENT REMUNERATION AND TRANSACTIONS

               A. No individual in management received  remuneration of $100,000
or more.  Officers as a group of three  people  received no payments  except for
$3,900 in disbursements for the group health and life insurance premiums for the
Chief Executive Officer.

               B. No annuity,  pension or retirement benefits are proposed to be
paid to any director or officer in the event of his retirement.  No remuneration
payments are proposed to be made in the future,  directly or indirectly,  to any
director or officer by the Company or its  subsidiary  pursuant to any  existing
plan or arrangement.

               C. There  are  no  fees  paid  to  directors for services in that
capacity.

               D. No officer,  or director of the Company:  (1) received options
during the  reporting  period;  or (2)  exercised  options  during the reporting
period,  or (3) held options as of September 1, 1996. The officers and directors
of the Company as a group did not:  (1)  receive  options  during the  reporting
period, or (2) exercise options during the reporting period, or (3) hold options
as of September 1, 1996.

               E. Termination  of  employment  - the  Company has  no employment
termination  agreements  with officers or employees.

                                      A-15

<PAGE>


ITEM 12.       SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth,  as of September 27, 1996, the information  with
respect to common  stock  ownership  of each person  known by the Company to own
beneficially more than 5% of the shares of the Company's common stock, par value
$0.10 per share, and of all officers and directors as a group:

                                             AMOUNT AND NATURE OF            %
NAME AND ADDRESS                             BENEFICIAL OWNERSHIP          CLASS

Carter C. Chinnis                      Of Record             90,244
303 N. Vine Street                     Beneficially           1,200
Richmond, VA  23220                    Total                 91,444         9.70

Robert G. Lyle Of Record                                     68,242         7.24
41957 Brightwood Lane
Leesburg, VA  22075

William T. Stephens                    Of Record             96,449        10.23
PO Box 1096
McLean, VA  22075

Denzil C. Pauli                        Of Record            204,547        21.70
13021 Bluhill Road
Aspen Hill, MD  20906

Calvin S. Koonce                       Of Record            102,100        10.83
6550 Rock Spring Drive
Bethesda, MD  20817

Samuel Schalkowsky                     Of Record             92,076         9.77
4003 Woodlawn Road
Chevy Chase, MD  20014

Current  officers and  directors as a group own a total of 68,242,  representing
7.24% of Common Stock.

                                      A-16

<PAGE>


                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K

A.      1.     LIST OF FINANCIAL STATEMENTS IN PART II OF THIS REPORT.

                                                                   PAGE NO.
                                                                   --------
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS.................  10-11
CONSOLIDATED STATEMENTS OF OPERATIONS FOR THREE YEARS
 ENDED JUNE 30, 1996...............................................  12
CONSOLIDATED BALANCE SHEETS - JUNE 30, 1996 AND 1995...............  13-14
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE
 YEARS ENDED JUNE 30, 1996.........................................  15
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS'
 INVESTMENT - FOR THE THREE YEARS ENDED JUNE 30, 1996..............  16
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.........................  17-22

Schedules other than those listed above are omitted for the reason that they are
not required or are not applicable,  or the required information is shown in the
financial statements or notes thereto.

Columns  omitted from schedules  filed have been omitted because the information
is not applicable.

Individual  financial  statements  of the  Company  are  omitted  because  it is
primarily an operating  company and the subsidiary  included in the consolidated
financial  statements being filed in the aggregate does not have minority equity
interests and/or indebtedness to any person other than the parent in the amounts
which  together  exceed 5% of the total  consolidated  assets at the date of the
latest  balance  sheet filed  excepting  indebtedness  incurred in the  ordinary
course of business which is not overdue and which matures within one year of its
creation,  whether  evidenced by  securities or not, and  indebtedness  which is
collateralized by the parent by guarantee, pledge, assignment or otherwise.

A.      2.     PARENT AND SUBSIDIARY

         The Company has no parent. The subsidiary of the Company is:

                  NAME:   EXOTECH RESEARCH & ANALYSIS, INC.

                  STATE OF INCORPORATION:   DELAWARE

                  SECURITIES OWNED BY THE COMPANY:   COMMON STOCK, 100%

         The foregoing is included in the consolidated statements of the Company
and subsidiary.

                                      A-17

<PAGE>


A.     3.       EXHIBITS

1. Exhibit No. 1 is the Restated  Certificate  of  Incorporation  of the Company
which is hereby identified as a BASIC  DOCUMENT.  The  document  was  originally
filed  pursuant to a  Registration  Statement  (Form S-1) filed  on  November 8,
1968, and is incorporated herein by reference.

2.  Exhibit No. 2 is the By-Laws of the Company as revised  amended on April 16,
1971,  which is hereby  identified as a BASIC  DOCUMENT.  The document  has been
filed  pursuant to FORM 10-K for the fiscal year ended June  30,  1971,  and  is
incorporated herein by reference.

3. Exhibit  No.  3  is  a  specimen  copy  of  a  certificate  for the Company's
common stock,  par value $.10 per share, which is hereby identified as  a  BASIC
DOCUMENT.  The specimen was filed pursuant to  a  Registration  Statement  (form
S-1) filed on November 8, 1968, and is incorporated herein by reference.

         (a)  Exhibit  No.  3a is a  specimen  copy  of a  certificate  for  the
         Company's  common  stock,  par value $.10 per share,  reprinted  due to
         exhaustion of the initial supply.  This specimen copy was identified as
         a BASIC  DOCUMENT.  This  exhibit  was filed with Form 8 for the fiscal
         year ended June 30, 1975, and is incorporated herein by reference.

4. Exhibit No. 4 is a CERTIFICATE OF AMENDMENT OF CERTIFICATE  OF  INCORPORATION
- EXOTECH  SYSTEMS,  INC.  changing its name to EXOTECH  RESEARCH AND  ANALYSIS,
INC.  certified by the Secretary of the State of Delaware on  the  12th  day  of
August 1975,  which is  identified  as  a  BASIC  DOCUMENT.   The  document  was
originally filed with the Form 10-K for the fiscal year ended June 30, 1976, and
is incorporated herein by reference.

5.  Exhibit  No.  5  hereto  is  a  CERTIFICATE  OF OWNERSHIP AND MERGER merging
EXO-REALTY,  INC.  into  EXOTECH INCORPORATED,  certified  by the  Secretary  of
State,  State of Delaware on the 28th day of June,  1976,  which  is  identified
as a BASIC  DOCUMENT.  The document was  originally  filed  with  the  Form 10-K
for  the  fiscal  year  ended  June  30,  1976,  and  is  incorporated herein by
reference.


B.     No Form 8-K reports were filed in the fiscal year covered in this report.

                                      A-18

<PAGE>


                                   SIGNATURE


Pursuant to the  requirements  of Section 13 or 15 (d) of the  Securities Act of
1934, the Company has duly caused this amended Report to be signed on its behalf
by the undersigned, thereunto duly authorized.





  January 7, 1997              BY:        /s/ Robert G. Lyle
  _______________                   ___________________________________________
         DATE                       ROBERT G. LYLE, CHIEF EXECUTIVE OFFICER,
                                    PRINCIPAL ACCOUNTING OFFICER AND DIRECTOR



  January 7, 1997              BY:        /s/ James G. Pauli
  _______________                   ___________________________________________
         DATE                       JAMES G. PAULI, TREASURER AND DIRECTOR




  January 7, 1997              BY:        /s/ Andrew Wong
  _______________                   ___________________________________________
         DATE                       ANDREW WONG, SECRETARY & DIRECTOR

                                      A-19