U.S. SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                  FORM 10-KSB/A


          (Mark One)

 X        ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
---       OF 1934 [Fee Required]

          For the fiscal year ended April 30, 1999

          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 number 33-75276

                            OMNI Rail Products, Inc.
                            ------------------------
                 (Name of Small Business Issuer in its Charter)

           Delaware                                      68-0281098
           --------                                      ----------
(State or Other Jurisdiction of             (I.R.S. Employer Identification No.)
 Incorporation or Organization)


                   975 SE Sandy Blvd. Portland, Oregon 97214
                   -----------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

                   (Issuer's Telephone Number (503) 230-8034

         Securities registered under Section 12(b) of the Exchange Act:

     Title of each class           Name of each exchange on which registered

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

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

Securities registered under Section 12(g) of the Exchange Act:

Common Stock $.01 Par Value
---------------------------
(Title of class)

Warrants to purchase Common Stock $.01 Par Value
------------------------------------------------
(Title of class)


     Check  whether  the issuer:  (1) filed all reports  required to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been  subject to such  filing  requirements  for the past 90 days.
Yes  X    No

     Check if there is no disclosure  of  delinquent  filers in response to Item
405 of Regulation S-B is not contained in this form,  and no disclosure  will be
contained,  to the  best of  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. $12,438,192.

     State the aggregate market value of the voting and non-voting common equity
held by  non-affiliates  computed by  reference to the price at which the common
equity was sold, or the average bid and asked prices of such common  equity,  as
of July 30, 1999. $851,000.

     State the number of shares  outstanding  of each of the issuers  classes of
common equity, as of July 30, 1999. 1,703,098 common shares.

<PAGE>


ITEM 7. FINANCIAL STATEMENTS



                     OMNI RAIL PRODUCTS, INC. AND SUBSIDIARY

                     (Formerly Creative Medical Development, Inc.)

                     Consolidated Financial Statements

                     April 30, 1999 and 1998

                     (With Independent Auditors' Report Thereon)

<PAGE>


                          INDEPENDENT AUDITORS' REPORT



The Board of Directors
OMNI Rail Products, Inc.:


We have  audited  the  accompanying  consolidated  balance  sheets  of OMNI Rail
Products, Inc. and Subsidiary (formerly Creative Medical Development,  Inc., the
"Company")  as of  April  30,  1999  and  1998,  and  the  related  consolidated
statements of operations,  stockholders'  equity  (deficit),  and cash flows for
each of the  years  in the  three  year  period  ended  April  30,  1999.  These
consolidated  financial  statements  are  the  responsibility  of the  Company's
management.  Our  responsibility is to express an opinion on these  consolidated
financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, 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.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the financial position of OMNI Rail Products,
Inc. and Subsidiary  (formerly Creative Medical  Development,  Inc.) as of April
30, 1999 and 1998, and the results of their  operations and their cash flows for
each of the years in the three year period  ended  April 30, 1999 in  conformity
with generally accepted accounting principles.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will  continue as a going  concern.  As discussed in note 13 to
the   consolidated   financial   statements,   the  Company  suffers   liquidity
constraints,  has significant debt maturities  within one year and has a working
capital  deficit.  In addition,  the Company has a  shareholder  deficit.  These
factors  raise  substantial  doubt  about its  ability  to  continue  as a going
concern.  Management's  plans in regard to these  matters are also  disclosed in
note 13. The  consolidated  financial  statements do not include any adjustments
that might result from the outcome of this uncertainty.



KPMG Peat Marwick LLP




Portland, Oregon
June 25, 1999

<PAGE>
<TABLE>
<CAPTION>


                            OMNI RAIL PRODUCTS, INC.
                                 AND SUBSIDIARY

                           Consolidated Balance Sheets

                             April 30, 1999 and 1998

                       Assets                               1999             1998
                                                            ----             ----
Current assets:
<S>                                                      <C>                <C>
    Cash                                                 $    36,280        393,877


    Accounts receivable, less allowance for doubtful
      accounts of $56,916 in 1999 and $68,776 in 1998      1,478,337      1,853,280
    Inventories, net                                       1,330,663      1,423,800
    Prepaid expenses and deposits                             51,241         52,158
                                                         -----------    -----------

              Total current assets                         2,896,521      3,723,115

Real estate and other assets held for sale                 1,400,000      1,618,275
Property, plant and equipment, net                         1,904,156      2,272,214
                                                         -----------    -----------

                                                         $ 6,200,677      7,613,604
                                                         ===========    ===========

            Liabilities and Stockholders' Deficit

Current liabilities:
    Accounts payable                                       1,480,166      1,884,679
    Accrued liabilities                                      879,995      1,459,092
    Notes payable                                          1,693,135      3,305,283
    Current portion of long-term debt                      1,373,412      2,136,376
                                                         -----------    -----------

              Total current liabilities                    5,426,708      8,785,430
                                                         -----------    -----------

Long-term debt, less current portion                       1,403,115        522,342

Commitments and contingencies

Stockholders' deficit:
    Convertible preferred stock, $.01 par value,
      25,000,000 shares authorized:
        Series B, 1,000,000 shares authorized, 195,619
         and 207,355 shares issued and outstanding in
         1999 and 1998, respectively                           1,956          6,221
    Common stock, 50,000,000 shares authorized, $.01
      par value, 1,703,098 and 1,841,586 shares issued
      and outstanding in 1999 and 1998, respectively          17,031         55,246
    Additional paid-in capital                             2,369,880      2,413,651
    Accumulated deficit                                   (3,018,013)    (4,169,286)
                                                         -----------    -----------

              Total stockholders' deficit                   (629,146)    (1,694,168)
                                                         -----------    -----------

                                                         $ 6,200,677      7,613,604
                                                         ===========    ===========


See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                     OMNI RAIL PRODUCTS, INC.
                                          AND SUBSIDIARY

                               Consolidated Statements of Operations

                             Years ended April 30, 1999, 1998 and 1997


                                                         1999            1998            1997
                                                         ----            ----            ----
<S>                                                 <C>               <C>             <C>
Net sales                                           $ 12,438,192      16,448,876      12,902,491
Cost of sales                                          9,100,437      13,446,678      10,557,688
                                                    ------------    ------------    ------------

              Gross profit                             3,337,755       3,002,198       2,344,803
                                                    ------------    ------------    ------------

General and administrative expenses                    1,117,020       1,586,956       1,137,978
Selling expenses                                         985,350       1,665,506       1,323,070
Research, development and engineering                    113,795         127,624          61,646
Restructuring charges                                   (130,435)      1,684,833            --
                                                    ------------    ------------    ------------

                                                       2,085,730       5,064,919       2,522,694
                                                    ------------    ------------    ------------

              Earnings (loss) from operations          1,252,025      (2,062,721)       (177,891)
                                                    ------------    ------------    ------------

Other income (expense):
    Interest expense                                    (537,952)       (772,984)       (827,095)
    Legal settlement                                        --              --          (334,500)
    Amortization of organization costs                      --          (237,955)       (119,249)
    Miscellaneous income                                 273,151         163,686         133,219
    Gain (loss) on sale of assets                        164,049          29,683         (25,156)
                                                    ------------    ------------    ------------

              Total other expense                       (100,752)       (817,570)     (1,172,781)
                                                    ------------    ------------    ------------

              Earnings (Loss) before income taxes      1,151,273      (2,880,291)     (1,350,672)

Provision (benefit) for income taxes                        --             1,894         (55,607)
                                                    ------------    ------------    ------------

              Net earnings (loss)                   $  1,151,273      (2,882,185)     (1,295,065)
                                                    ============    ============    ============


Basic earnings (loss) per share                     $       0.66           (1.56)          (1.24)
                                                    ============    ============    ============

Diluted earnings (loss) per share                   $       0.52           (1.56)          (1.24)
                                                    ============    ============    ============

Basic weighted common shares outstanding               1,735,473       1,844,242       1,042,098
                                                    ============    ============    ============

Diluted weighted common shares outstanding             2,232,940       1,844,242       1,042,098
                                                    ============    ============    ============



       See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                                OMNI RAIL PRODUCTS, INC.
                                                      AND SUBSIDIARY

                                   Consolidated Statements of Stockholders' (Deficit) Equity

                                            Years ended April 30, 1999, 1998 and 1997



                                  Preferred stock
                                     Series B                     Common stock            Additional                      Total
                             --------------------------    --------------------------      paid-in      Accumulated   stockholders'
                                Shares         Amount         Shares         Amount        capital        deficit   equity (deficit)
                                ------         ------         ------         ------        -------        -------   ----------------

<S>                          <C>            <C>            <C>            <C>            <C>            <C>            <C>
Balance, April 30, 1996             --      $      --        1,033,721    $    31,010    $ 1,328,990    $    72,964    $ 1,432,964

Issuance of common stock            --             --           37,248          1,117        116,383           --          117,500
Dividends                           --             --             --             --             --          (65,000)       (65,000)
Payment of stock dividend           --             --           77,809          2,334        186,478           --          188,812
Preferred and common shares
  issued in merger               207,355          6,221        702,715         21,082        812,755           --          840,058
Net loss                            --             --             --             --             --       (1,295,065)    (1,295,065)
                             -----------    -----------    -----------    -----------    -----------    -----------    -----------

Balance, April 30, 1997          207,355          6,221      1,851,493         55,543      2,444,606     (1,287,101)     1,219,269

Repurchase of stock puts            --             --           (9,907)          (297)       (30,955)          --          (31,252)
Net loss                            --             --             --             --             --       (2,882,185)    (2,882,185)
                             -----------    -----------    -----------    -----------    -----------    -----------    -----------

Balance, April 30, 1998          207,355          6,221      1,841,586         55,246      2,413,651     (4,169,286)    (1,694,168)

Repurchase of stock put                                         (5,944)           (59)       (18,693)                      (18,752)
Conversion of stock puts
  to debt                                                      (21,397)          (214)       (67,285)                      (67,499)
Cancellation of escrowed
  shares                         (11,736)          (117)      (111,147)        (1,111)         1,228                          --
Effect of one for three
  reverse split                                  (4,148)                      (36,831)        40,979                          --

Net income                                                                                                1,151,273      1,151,273
                             -----------    -----------    -----------    -----------    -----------    -----------    -----------

Balance, April 30, 1999          195,619    $     1,956      1,703,098    $    17,031    $ 2,369,880    $(3,018,013)   $  (629,146)
                             ===========    ===========    ===========    ===========    ===========    ===========    ===========


See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                     OMNI RAIL PRODUCTS, INC.
                                          AND SUBSIDIARY

                               Consolidated Statements of Cash Flows

                             Years ended April 30, 1999, 1998 and 1997


                                                              1999            1998          1997
                                                              ----            ----          ----
Cash flows from operating activities:
<S>                                                       <C>             <C>            <C>
   Net (loss) earnings                                    $ 1,151,273     (2,882,185)    (1,295,065)
   Adjustments to reconcile net (loss) earnings to net
      cash provided by operating activities:
         Depreciation and amortization                        161,417        587,552        491,642
         Legal settlement                                        --             --          334,500
         (Gain) loss on sale of assets                       (164,049)       (29,683)        25,156
         Asset impairment - write down of assets                 --        1,239,567           --
         Deferred income taxes                                   --             --          (55,607)
         Change in assets and liabilities:
           Accounts receivable                                374,943        (35,171)      (199,814)
           Inventories                                         93,137      1,070,943        296,361
           Prepaid expenses and deposits                          917        (31,478)         1,876
           Accounts payable                                  (404,513)       520,600        425,992
           Accrued liabilities                               (579,097)       377,038        306,383
                                                          -----------    -----------    -----------

              Net cash provided by operating activities       634,028        817,183        331,424
                                                          -----------    -----------    -----------

Cash flows from investing activities:
   Proceeds from sale of property, plant and equipment        842,557        571,038         17,166
   Purchase of property, plant and equipment                 (253,592)      (231,802)      (375,316)
   Proceeds from sale of securities                              --          752,573           --
                                                          -----------    -----------    -----------

              Net cash provided by (used in) investing
                 activities                                   588,965      1,091,809       (358,150)
                                                          -----------    -----------    -----------

Cash flows from financing activities:
   Net payment on notes payable                            (1,612,148)    (1,071,440)      (116,326)
   Payments on long-term debt                                (762,964)      (552,058)       (14,281)
   Proceeds from Subordinated Convertible debt                275,160           --             --
   Borrowings on Subordinated and other debt                  538,114           --             --
   Sale (repurchase) of stock                                 (18,752)       (31,252)       100,000
   Acquisition costs                                             --             --         (185,065)
                                                          -----------    -----------    -----------

              Net cash used in financing activities        (1,580,590)    (1,654,750)      (215,672)
                                                          -----------    -----------    -----------

              (Decrease) increase in cash                    (357,597)       254,242       (242,398)

Cash at beginning of year                                     393,877        139,635        382,033
                                                          -----------    -----------    -----------

Cash at end of year                                       $    36,280        393,877        139,635
                                                          ===========    ===========    ===========

Supplemental disclosure of cash flow information:
   Cash paid for:
      Interest                                            $   530,355        768,630        807,847
      Income taxes                                               --            1,894           --

Supplemental schedule of non-cash investing and
  financing activities:
   Stock dividend                                                --             --           65,000
   Issuance of common stock on conversion of debt                --             --           17,500
   Issuance of debt in exchange for common stock               67,499           --             --
   Effect of acquisition:
       Fair value of assets acquired                             --             --        2,255,123
       Liabilities assumed                                       --             --        1,230,000


See accompanying notes to consolidated financial statements.

</TABLE>
<PAGE>


                            OMNI RAIL PRODUCTS, INC.
                                 AND SUBSIDIARY

                   Notes to Consolidated Financial Statements

                          April 30, 1999, 1998 and 1997



(1)  Summary of Significant Accounting Policies

     Principles  of  Consolidation,  Description  of the  Company  and  Basis of
     Presentation
     ---------------------------------------------------------------------------

     The  consolidated  financial  statements  include the accounts of OMNI Rail
     Products,  Inc. (the Company,  a Delaware  corporation),  formerly Creative
     Medical Development, Inc. ("CMD", name changed during fiscal 1999), and its
     wholly-owned  subsidiary,  OMNI  Products,  Inc. All material  intercompany
     transactions   and  balances  have  been  eliminated  in  the  consolidated
     financial statements.  Effective April 30, 1997, CMD and OMNI International
     Rail Products, Inc. (OMNI),  completed an agreement and plan of merger. The
     transaction  between CMD and OMNI was considered a reverse  acquisition for
     financial  reporting  purposes  and was  accounted  for under the  purchase
     method of accounting.

     The Company designs,  engineers,  manufactures and distributes a variety of
     rubber,  rubber/concrete  and  concrete  premium  grade  railroad  crossing
     surface  products  primarily for the United States market.  OMNI's products
     are  approved  by all  major  North  American  Class 1  railroads,  such as
     Burlington  Northern-Santa Fe and Union Pacific and many regional railroads
     and transit  systems.  From its operating  facilities  in Illinois,  Texas,
     Oregon and through its  relationship  with key suppliers,  OMNI markets its
     products  to all 50 states and  Canada.  67% of the  Company's  fiscal 1999
     sales  were  concentrated  in the  three  largest  United  States  railroad
     companies (down from 72% in fiscal 1998) (Note 12).

     Inventories
     -----------

     The Company values  inventories at the lower of average  production cost or
     market (net realizable value). The Company determines cost on the first-in,
     first-out (FIFO) basis.

     Accounts Receivable
     -------------------

     The Company  extends sales credit to virtually  all of its customers  under
     specific  terms  and  conditions.  The  Company  performs  periodic  credit
     evaluations  of its  customers to determine  the extent of each  customer's
     allowable  credit  limit  and to  determine  the need for an  allowance  on
     potential credit losses.

     Property, Plant and Equipment
     -----------------------------

     Property,  plant and equipment are stated at cost. Depreciation is provided
     over the  estimated  useful  lives of the  assets  using the  straight-line
     method.  The estimated  useful lives for furniture,  vehicles and equipment
     are between three and ten years; buildings are forty years.

     Expenditures   for  additions  and  major   improvements  are  capitalized.
     Expenditures for repairs and maintenance are charged to income as incurred.

     Warranty
     --------

     The Company  provides a six-year  warranty for its products and establishes
     an accrual at the time of sale, based on historical warranty experience, to
     provide for estimated warranty costs.

<PAGE>


     Income Taxes
     ------------

     The Company accounts for income taxes under the asset and liability method.
     Under the asset and  liability  method,  deferred  income taxes reflect the
     future tax consequences of differences  between the tax bases of assets and
     liabilities  and  their  financial  reporting  amounts  at  each  year-end.
     Deferred tax assets and  liabilities  are measured  using enacted tax rates
     expected to apply to taxable  income in the years in which those  temporary
     differences are expected to be recovered or settled. The effect on deferred
     tax assets and liabilities of a change in tax rates is recognized in income
     in the period that includes the enactment date.

     Research and Development Costs
     ------------------------------

     The Company charges all research and development  costs associated with the
     development of products to expense when incurred.

     Advertising Expenses
     --------------------

     Advertising  expenses are charged to expense as incurred and were  $17,346,
     $44,424 and $102,310 for 1999, 1998 and 1997, respectively.

     Revenue Recognition
     -------------------

     Revenues are recognized when products are shipped.

     Stock Option Plan
     -----------------

     As  permitted  by  Financial   Accounting  Standards  No.  123  (FAS  123),
     Accounting for Stock-Based Compensation,  the Company measures compensation
     expense for its stock-based employee compensation plans using the intrinsic
     method prescribed by APB 25 Accounting for Stock Issued to Employees.

     Fair Value of Financial Instruments
     -----------------------------------

     At April 30, 1999 and 1998, the carrying value of cash, trade  receivables,
     accounts  payable  and  notes  payable  approximate  fair  value due to the
     short-term  nature of these  instruments.  At April 30, 1999 and 1998,  the
     fair value of the Company's  long-term debt approximates  carrying value as
     such instruments'  stated interest rates do not differ  significantly  from
     current market rates available to the Company.

     Basic and Diluted Net Earnings (Loss) Per Common Share
     ------------------------------------------------------

     In  1997,  the  Financial   Accounting  Standards  Board  issued  Financial
     Accounting  Standards No.128 (FAS 128), "Earnings Per Share" which replaced
     the calculation of primary and fully diluted  earnings per share with basic
     and diluted earnings per share.  Unlike primary  earnings per share,  basic
     earnings per share excludes any dilutive effects of options,  warrants, and
     convertible  securities.  Diluted  earnings  per  share is  similar  to the
     previously  reported fully diluted  earnings per share.  The calculation of
     diluted earnings (loss) per share for fiscal years ended April 30, 1998 and
     1997, excludes any potentially dilutive shares as such shares would have an
     antidilutive affect (Note 11). The Company adopted FAS 128 in fiscal 1998.

     Reverse Stock Split
     -------------------

     The Company effected a one-for-three  stock split to stockholders of record
     as of the close of  business  on  February  25,  1999.  Share and per share
     amounts for all periods presented have been adjusted to reflect the reverse
     stock split.

<PAGE>


     Use of Estimates
     ----------------

     The  preparation  of financial  statements  in  conformity  with  generally
     accepted  accounting  principles  requires management to make estimates and
     assumptions  that affect the reported amounts of assets and liabilities and
     disclosure  of  contingent  assets  and  liabilities  at  the  date  of the
     financial  statements  and the  reported  amounts of revenues  and expenses
     during  the  reporting  period.  Actual  results  could  differ  from those
     estimates.

     Impairment of Long-Lived Assets and Long-Lived Assets to be Disposed Of
     -----------------------------------------------------------------------

     The Company reviews long-lived assets and certain identifiable  intangibles
     for impairment  whenever events or changes in  circumstances  indicate that
     the carrying amount of an asset may not be recoverable.  Recoverability  of
     assets to be held and used is  measured  by a  comparison  of the  carrying
     amount of an asset to future net cash flows expected to be generated by the
     asset. If such assets are considered to be impaired, then the impairment to
     be recognized is measured by the amount by which the carrying amount of the
     assets exceeds its fair value. Assets to be disposed of are reported at the
     lower of the carrying amount or fair value less costs to sell.

     Recent Accounting Pronouncements
     --------------------------------

     The  Company  adopted  Financial  Accounting  Standards  No.130  (FAS 130),
     "Reporting  Comprehensive Income" and Financial Accounting Standards No.131
     (FAS  131),  "Disclosures  About  Segments  of an  Enterprise  and  Related
     Information"  in fiscal  1999.  FAS 130 requires  companies  to report,  in
     addition to net income, other components of comprehensive income, including
     unrealized  gains  or  losses  on  available-for-sale  securities,  foreign
     currency translation adjustments and minimum pension liability adjustments.
     The Company had no components of other  comprehensive  income during fiscal
     1999. FAS 131 requires an enterprise to report segment information based on
     how  management  internally  evaluates  the  operating  performance  of its
     business  units  (segments).  The Company's  operations are confined to one
     business  segment,  the  production and sale of premium  railroad  crossing
     materials.

     In 1998, Financial  Accounting Standards No.133 (FAS 133),  "Accounting for
     Derivative Instruments and Hedging Activities" was issued and is effective,
     as amended by FAS 137, for fiscal years commencing after June 15, 2000. The
     Company  will comply with the  requirements  of FAS 133 in fiscal year 2000
     and  does not  expect  the  adoption  of FAS 133  will be  material  to the
     Company's consolidated results of operations.


     Reclassifications
     -----------------

     Certain  reclassifications  have  been  made to the 1997  and 1998  balance
     sheets,  statements  of operation  and  statements of cash flows to conform
     with 1999 presentation.


(2)  Restructuring charges and Asset Impairments

     In fiscal year 1998, the Company recorded  restructuring charges associated
     with the shut down of two factories and charges  associated  with the write
     down and  liquidation  of  manufacturing  equipment.  These charges are the
     result of the Company's  refocus of its operation into producing  primarily
     concrete  and virgin  rubber  grade  crossings  and  elimination  of excess
     capacity in the Company's recycled rubber manufacturing  operations.  Total
     fiscal 1998  charges of  $1,684,833  included  $1,239,567  in write down of
     manufacturing  equipment to fair value,  $226,950 in costs  associated with
     plant shut downs and equipment liquidation, $158,316 in severance costs and
     $60,000  in  other   restructuring   charges.   Total  accrued  and  unpaid
     restructuring  costs  at the  end  of  1998  were  $249,295  not  including
     severance  costs  that were  accounted  for in  accrued  compensation.  All
     associated  charges were paid during  fiscal 1998 and 1999.  During  fiscal

<PAGE>


     1999,  the Company sold or disposed  virtually  all assets  written down in
     fiscal 1998,  at amounts at or below the assets'  written down values.  The
     Company  did not write down its  Lancaster,  PA facility in fiscal 1998 and
     sold the  facility at a gain of  approximately  $159,000  in the  Company's
     third quarter of fiscal 1999. In addition,  the Company wrote off excess or
     out of specification inventory as part of the restructuring.  During fiscal
     1999 the Company  recovered  certain costs  associated with the fiscal 1998
     restructuring  charge.  These recovered costs included accrued  anticipated
     lease charges of $105,435 and accrued severance charges of $25,000.


(3)  Inventories

     Inventories consist of the following at April 30, 1999 and 1998:

                                                   1999         1998
                                                ----------   ----------

        Raw materials                           $  175,692      383,527
        Finished goods                           1,179,971    1,054,828
                                                ----------   ----------

                                                 1,355,663    1,438,355

        Less allowance for excess or obsolete
           inventory                                25,000       14,555
                                                ----------   ----------

                 Inventories, net               $1,330,663    1,423,800
                                                ==========   ==========


     In conjunction with the fiscal 1998  restructuring,  the Company  wrote-off
     $812,840 of excess and out of  specification  recycled rubber inventory and
     included  such charge in Cost of sales.  Total fiscal  1999,  1998 and 1997
     inventory write-offs were $14,555, $1,085,000 and $571,200, respectively.



(4)  Property, Plant and Equipment

     Property,  plant and  equipment  consist of the following at April 30, 1999
     and 1998:

                                                1999         1998
                                             ----------   ----------

           Land                              $   93,024      217,593
           Buildings                            812,684    1,163,115
           Office furniture, manufacturing
              equipment and vehicles          1,587,694    1,382,915

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

                                              2,493,402    2,763,623

           Less accumulated depreciation        589,246      491,409
                                             ----------   ----------

                                             $1,904,156    2,272,214
                                             ==========   ==========


     Certain  property,  plant and equipment  serves as collateral for short and
     long-term debt obligations.  As discussed in note 2, certain  manufacturing
     equipment   was  written  down  during  1998  as  part  of  the   Company's
     restructuring

<PAGE>



(5)  Accrued Liabilities

     Accrued liabilities consist of the following at April 30, 1999 and 1998:

                                                   1999        1998
                                                ----------   ----------

         Warranties and other customer claims   $  353,635      268,902
         Accrued compensation                      206,416      486,520
         Accrued restructuring charges                --        249,195
         Accrued merger costs                         --         60,000
         Accrued interest                           80,162       72,565
         Other                                     239,782      321,910
                                                ----------   ----------

                                                $  879,995    1,459,092
                                                ==========   ==========


(6)  Notes Payable

     The  Company  has a  revolving  line  of  credit  totaling  $1,396,195  and
     $2,107,966  as of April 30, 1999 and 1998,  respectively,  under a Loan and
     Security  Agreement  ("Loan  Agreement")  with Finova  Capital  Corporation
     (Finova).  The line of credit allows the Company to borrow up to $3,500,000
     against 85% of eligible accounts  receivable and 50% of eligible inventory.
     Interest  on the line is at prime  rate plus 2.25% (10% and 10.75% at April
     30, 1999 and 1998, respectively),  with a minimum interest charge of $9,000
     per month.  The Company also has a capital loan payable to Finova  totaling
     $296,940 and $507,502 at April 30, 1999 and 1998, respectively,  payable in
     monthly  installments  of $12,500  plus  interest  of 11.5%.  At the end of
     fiscal  1998,  the  Company  also had a term  note  payable  to  Finova  of
     $689,815,  that was fully  paid at April 30,  1999.  The loans  payable  to
     Finova are secured by equipment and inventory.  The original  maturity date
     was  extended  from April 26, 1999 to August 31, 1999 as noted  below.  The
     Company is restricted from paying dividends by covenant with Finova.

     From time to time the Company has entered  into various  amendments  to the
     Loan Agreement with Finova. These amendments have modified the various loan
     agreements  providing for certain  changes to the underlying  provisions of
     the various notes.  One such amendment  extended the loans'  maturity dates
     until  August 31,  1999.  At the end of fiscal  1998,  the  Company  was in
     violation of certain financial and non-financial loan covenants,  including
     negative  covenants for cash  requirements for Senior Debt Coverage and Net
     Worth of Borrower.

     On  July  15,  1998,  the  Company  entered  into a  Forbearance  Agreement
     ("Agreement")  that  significantly   realigned  the  borrowing  arrangement
     between the Company and Finova. This Agreement, that continued through June
     1, 1999,  allowed the Company to borrow up to an  additional  $400,000 over
     the calculated  eligible borrowing balance ("Permitted  Overadvance"),  and
     deferred  installment  payments on the Company's  term debt.  The Permitted
     Overadvance  was  subject to an  interest  rate of 6.25% over prime and the
     term note  balance was  subject to the default  rate of interest at 2% over
     the stated note  interest  rate.  The  Agreement  also waived all prior and
     existing  defaults and put in place new  financial  covenants  based on the
     Company achieving forecast  operating  results.  These covenants included a
     requirement  to raise  $250,000  in  subordinated  financing  to aid in the
     financing of the Company.  A total of $275,160 was raised, in part, from an
     outside  investor and from two current  directors of the Company.  Also, as
     part of the Agreement, and as part of the Company's restructuring plan, the
     Company   entered  into   Modification   Agreements  and,  in  some  cases,
     Subordination  and Standstill  agreements with eight  unsecured  creditors.
     These  agreements  place the note holder into a  subordinate  position with
     Finova and extends payoff of any obligation over a five-year period.

<PAGE>



(7)  Long-term Debt

     Long-term debt is comprised of the following at April 30, 1999 and 1998:

                                                        1999           1998
                                                    -----------     -----------





     Note  payable  to  Capital   Consultants   in
        monthly installments of $13,631, including
        interest  at  10%,   payable  in  full  in
        December 1999, secured by real estate.      $   162,825         866,458

     Mortgage payable to financial  institution in
        monthly installments of $12,750, including
        interest  at  11.375%,  payable in full in
        December 1999, secured by real estate.        1,201,279       1,216,668

     Secured   convertible   subordinated   notes,
        interest   payable   monthly  at  8%.  Due
        October  2003 and January  2004,  with put
        option  for   payout  in  twelve   monthly
        payments  after second  anniversary  date.
        Convertible  into common  stock at $0.1932
        per share.  Subject to  Subordination  and
        Standstill Agreement with Finova.               275,160            --

     Subordinated   notes   payable   to   various
        individuals  and  entity,   interest  paid
        quarterly beginning October 15, 1999 at 7%
        interest  and  principal   paid  quarterly
        beginning  October  15,  2000,  with final
        payment  due July  15,  2003.  Subject  to
        Subordination  and  Standstill   Agreement
        with Finova.                                  1,077,114         575,592

     Other  note  and  capitalized   lease   with
        interest of 10%                                  60,149             --
                                                    -----------     -----------

                                                      2,776,527       2,658,718

     Less current portion                             1,373,412       2,136,376
                                                    -----------     -----------

               Long-term debt                       $ 1,403,115         522,342
                                                    ===========     ===========


     The aggregate  principal  repayments and reductions required in each of the
     years  ending  April 30,  2000  through  April 30,  2004 for the  Company's
     long-term debt is as follows:

                     2000                     $1,373,412
                     2001                        405,805
                     2002                        540,198
                     2003                        366,227
                     2004                         90,885
                                              ----------

                                              $2,776,527
                                              ==========

<PAGE>


(8)  Income Taxes

     The income tax (benefit) expense consists of the following:

                                             1999      1998       1997
                                             ----      ----       ----
       Current:
         Federal                            $  --        --         --
         State                                 --       1,894       --
                                            -------   -------    -------

                                               --       1,894       --
                                            -------   -------    -------
       Deferred:
         Federal                               --        --      (46,039)
         State                                 --        --       (9,568)
                                            -------   -------    -------

                                               --        --      (55,607)
                                            -------   -------    -------
       Total income tax (benefit) expense   $  --       1,894    (55,607)
                                            =======   =======    =======


     The  tax  effects  of  temporary   differences   and  net  operating   loss
     carryforwards  which give rise to  significant  portions  of  deferred  tax
     assets  and  deferred  tax  liabilities  at April 30,  1999 and 1998 are as
     follows:

                                                          1999         1998
                                                       ----------   ----------
 Deferred tax assets:
     Restructuring costs                               $   42,567      143,895
     Warranty reserve                                     135,654       91,028
     Legal settlement payable                             123,390      123,390
     Inventory write down                                   9,590      369,307
     Bad debt reserve                                      21,833       26,380
     Self-insurance reserve                                 9,313       22,490
     Other                                                 14,825       27,879
     Capital loss carryforward                            273,043      273,043
     Net operating loss carryforwards:
         Federal                                          852,724      767,970
         State                                            177,203       98,391
                                                       ----------   ----------
                                                        1,660,142    1,943,773
     Less valuation allowance                           1,246,759    1,657,570
                                                       ----------   ----------
             Net deferred tax asset                       413,383      286,203
                                                       ----------   ----------

 Deferred tax liability:
     Property, plant and equipment, due to
        differences in depreciation                       221,603       94,423
     Real estate held for sale                            191,780      191,780
                                                       ----------   ----------

             Net deferred tax liability                   413,383      286,203
                                                       ----------   ----------

             Net deferred tax assets and liabilities   $     --           --
                                                       ==========   ==========


<PAGE>

     The provision  (benefit) for income taxes differs from the amount of income
     tax determined by applying the applicable Federal statutory income tax rate
     to  earnings  (loss)  before  income  taxes  as a result  of the  following
     differences:

                                                1999      1998     1997
                                                ----      ----     ----

         Statutory federal income tax rate      34.0%   (34.0)%  (34.0)%
         State income taxes, net of federal
            income tax benefit                   4.4     (4.3)    (4.4)
         Change in valuation allowance         (35.7)    40.5     36.2
         Other                                  (2.7)    (2.1)    (2.1)
                                               ------   ------   ------

         Effective tax rates                     0.0%      .1%    (4.3)%
                                               ======   ======   ======


     The  Company  has a  valuation  allowance  of  $1,246,759,  $1,657,570  and
     $490,416, as of April 30, 1999, 1998 and 1997, respectively.  The change in
     the valuation allowance was ($410,811),  $1,167,154 and $490,416,  in 1999,
     1998 and 1997, respectively.

     At April 30, 1999 and 1998,  the Company had  approximately  $2,684,000 and
     $2,284,000,  respectively,  of net operating loss  carryforwards  to offset
     future  income for federal and state income tax purposes  which will expire
     2009 through 2019.

     A provision of the Tax Reform Act of 1986,  as amended,  requires  that net
     operating loss and credit carryforward utilization be limited when there is
     a more than 50%  cumulative  change in ownership of the Company in a 3 year
     period.  Such change in ownership may have occurred with the merger of OMNI
     into CMDI.  The  merger  affects  the CMDI  portion  of the  Company's  net
     operating loss carryforward or approximately $3,376,000,  and as such, this
     amount  is not  included  as a  deferred  tax  asset  or in  the  valuation
     allowance  above. The date of the change and the amount of loss and credits
     subject to the limitation  has not yet been  determined.  Accordingly,  the
     utilization of the net operating loss and credit carryforwards to remaining
     future years may be limited.  Any future change in the equity  structure of
     the Company may further limit the  utilization  of the net  operating  loss
     carryforwards.


(9)  Commitments and Contingencies

     Operating Lease Commitments
     ---------------------------

     The  Company   leases  office  space,   vehicles,   office   equipment  and
     manufacturing  equipment,  from a director of the  Company,  under  various
     operating lease  agreements that are either  month-to-month  or that expire
     during the next year.  The Company's  minimum  monthly lease payments under
     the various  cancelable  and  non-cancelable  lease  agreements are $6,074.
     Total future  minimum  lease  commitments  under  non-cancelable  leases is
     $8,743. In addition, the Company, as lessor, leases all of its space at its
     Grass Valley building, shown under real estate and assets held for sale. At
     present,  such rental  revenues exceed the costs to finance and operate the
     facility.  Future  minimum  lease  payments to be received on the Company's
     California  facility  are  $142,276  for fiscal 2000 and $42,046 for fiscal
     2001. Lease expense was  approximately  $91,500,  $159,000 and $108,000 for
     the years ended April 30, 1999, 1998 and 1997, respectively.

<PAGE>


     Royalty Agreements
     ------------------

     The  Company  assumed a royalty  agreement  with Red Hawk  Rubber Co.  (Red
     Hawk),  from Riedel  OMNI  Rubber  Products,  Inc.  The Red Hawk  agreement
     provides  that the  Company  pay a 5% royalty on all net sales of  products
     that were being  manufactured  at the time the  agreement  was signed until
     June 1999.  Any new products  developed  and  manufactured  by OMNI are not
     subject to the Red Hawk royalty agreement. Total royalty expense for fiscal
     years ended  April 30,  1999,  1998 and 1997 were  $167,103,  $113,725  and
     $137,994, respectively.

     Litigation
     ----------

     The Company is involved in various claims and legal actions  arising in the
     ordinary  course of business.  In the opinion of  management,  the ultimate
     disposition of these matters will not have a material adverse effect on the
     Company's  consolidated  financial  position,   results  of  operations  or
     liquidity.


(10) Stockholders' Equity

     Convertible Preferred Stock Series B
     ------------------------------------

     The  Company  has  authorized  1,000,000  shares  of  Series B  convertible
     preferred stock, of which 195,619 are issued and outstanding.  The terms of
     these shares are as follows:

          Voting
          ------
          Each share of Series B convertible preferred stock, until converted or
          canceled,  has the right to one vote equivalent to one share of common
          stock into which such preferred series could be then converted.

          Conversion
          ----------
          Each share of Series B convertible  preferred stock was convertible to
          a like number of common shares had the Company  reported  gross annual
          revenues of  $20,000,000  or annual  pre-tax  earnings  of  $1,500,000
          during either of the fiscal years ended April 30, 1998 or 1999.  These
          conversion  standards  were  not  met,  and  therefore  the  Series  B
          preferred  stock shall be canceled by the Company upon the issuance of
          its  fiscal  year  ended  April  30,   1999   consolidated   financial
          statements.

     Put Agreement
     -------------

     In February,  1997, two OMNI directors purchased shares in OMNI for a total
     of $67,499 at $3.25 per share. Simultaneously, put agreements were executed
     requiring  the Company to purchase  those shares at a price  equivalent  to
     $4.00 per share 120 days following the investment.  The put agreements with
     these two parties were not repaid  according to the put agreements and were
     subsequently converted to subordinated notes as of July 1998.

     Cancellation of Merger Shares in Escrow
     ---------------------------------------

     As part of the merger  between  CMD and OMNI ten  percent of the CMD common
     shares and  series B  preferred  shares  exchanged  for OMNI  shares in the
     transaction,   were  placed  in  escrow  ("Escrow  Shares")  pending  final
     valuation and settlement.  The final ownership ratio was adjusted  pursuant
     to the Merger  Agreement to reflect  differences that resulted from changes
     in  assets  of both  companies  between  the  date of  acquisition  and the
     settlement date of April 30, 1998. The  determination of final asset values
     was not  resolved  until August 1, 1998,  at which time 111,147  common and
     11,736  series B preferred  Escrowed  Shares  were  canceled to reflect the
     final ownership ratio.

<PAGE>

     Stock Options
     -------------

     The  Company's  1994  Amended  and  Restated  Stock  Option Plan (the plan)
     provides for  granting to employees  and  consultants  of either  incentive
     stock options or non-qualified stock options.  Incentive stock options must
     be granted at an exercise price not less than 100% of the fair market value
     per share at the grant date.  Non-qualified stock options generally must be
     granted at an exercise price of not less than 100% of the fair market value
     per share at the grant date,  although,  in certain cases may be granted at
     85% of fair market  value.  The term of options  granted  under the plan is
     generally ten years,  but in certain cases may be five years.  The right to
     exercise options granted is generally fully vested on the grant date.

     The following table presents historic stock option activity under the plan:

<TABLE>
<CAPTION>

                                   1999                1998                 1997
                            -------------------  -------------------  -------------------
                                       Weighted             Weighted             Weighted
                                       Average              Average              Average
                              Number   Exercise   Number    Exercise   Number    Exercise
                            of shares    Price   of shares   Price    of shares    Price
                            ---------    -----   ---------   -----    ---------    -----
<S>                          <C>        <C>       <C>       <C>        <C>        <C>
Outstanding at
  beginning of year          711,835    $ 2.67    689,199   $ 2.66     302,123    $ 2.90

Granted                      206,668      0.42     13,636     3.00     412,096      2.49
Exercised                       --         --        --        --         --         --
Forfeited                   (588,763)    (2.33)      --        --      (16,020)    (2.07)
Expired                         --         --        --        --         --         --
                            --------    ------   --------   ------    --------    ------

Options outstanding
  at April 30                329,740      2.67    711,835     2.67     698,199      2.66
                            ========    ======   ========   ======    ========    ======

Exercisable at April 30      206,407      2.63    711,835     2.67     698,199      2.66
                            ========    ======   ========   ======    ========    ======

</TABLE>

     The following table summarizes  information about stock options outstanding
     at April 30, 1999:

<TABLE>
<CAPTION>

                                 Outstanding                           Exercisable
               -----------------------------------------------  -------------------------
 Range of                    Weighted Average      Weighted                  Weighted
 exercise      Number of    remaining years of     average      Number of     average
   price        options      contractual life   exercise price   Options   exercise price
   -----        -------      ----------------   --------------   -------   --------------

<S>             <C>                <C>             <C>           <C>          <C>
$0.27 - 0.75    224,170            9.3             $  0.45       100,837      $  0.48
$2.16 - 2.70     58,794            5.9             $  2.38        58,794      $  2.38
$3.00 - 3.51     29,274            8.1             $  3.16        29,274      $  3.16
   $15.00        17,502            4.7             $ 15.00        17,502      $ 15.00
                -------                                          -------
                329,740                                          206,407
                =======                                          =======

</TABLE>
<PAGE>

     The Company adopted SFAS 123 in 1997, and pursuant to its provision elected
     to continue using the intrinsic-value  method of accounting for stock-based
     awards  granted to employees in accordance  with APB 25.  Accordingly,  the
     Company has not recognized  compensation expense for its stock-based awards
     to employees. The pro forma effects on net earnings (loss) of applying SFAS
     No. 123 for fiscal year ended 1999 was an expense of approximately  $37,000
     and pro  forma  effect on basic and  diluted  earnings  per share of $0.02.
     There is no effect on pro forma  net loss  from  applying  SFAS No.  123 to
     fiscal  years  ended  1998  and  1997.  The pro  forma  amounts  may not be
     representative  of future  disclosures  since the  estimated  fair value of
     stock  options  is  amortized  to  expense  over the  vesting  period,  and
     additional options may be granted in future years.

     The  weighted  average  fair  values of options at their  grant date during
     1999,  1998 and 1997,  where the exercise price equaled the market price on
     the grant date, were $0.45,  $0.41 and $0.41,  respectively.  The estimated
     fair value of each option grant is estimated on the date of grant using the
     Black-Sholes  option-pricing model with the following  assumptions used for
     grants  in  1999:  dividend  yield  of 0.0%;  expected  volatility  of 86%;
     risk-free interest rate of 6.35%; and expected life of 10 years.

     The Company  reserved  1,000,000  shares of common stock for issuance under
     the plan. At April 30, 1999,  there were 670,260 shares available for grant
     under the plan.  At April  30,  1999,  the  range of  exercise  prices  and
     weighted average  remaining  contractual life of outstanding  options under
     the plan was $0.27 - $5.00 and 7 years, respectively.

<PAGE>



     Warrants Outstanding
     --------------------

     CMD issued  warrants in  conjunction  with its initial  public  offering in
     1993,  prior to its merger with OMNI.  These warrants were due to expire on
     May 13, 1999. On May 4, 1999 the Company's board of directors  extended the
     exercise date of such warrants until November 15, 1999. The following table
     presents  warrants  outstanding at April 30, 1999, all of which were issued
     by CMD in consideration for service rendered,  debt and debt restructuring,
     or stock purchases and placements:

      Number of
       Common
       Shares                      Exercise                  Expiration
      Issuable                       price                      date
      --------                       -----                      ----

       17,500                     $   18.15                 May 13, 1999
      201,250                         19.50                 Nov. 15, 1999
       16,667                         30.00                 April 14, 2000



(11) Earnings Per Share

     The following  table  reconciles  basic  earnings per common share (EPS) to
     diluted EPS:

     For the year ended April 30, 1999

                                                      Weighted
                                                       Average    Per share
                                          Income       Shares       amount
                                          ------       ------       ------

       Income available to common
       Shareholders                     $1,151,273    1,735,473    $   0.66
       Effect of dilutive securities:
           Stock options                                 24,166       (0.01)
           Convertible notes                 7,315      473,301       (0.13)
                                        ----------   ----------    --------

       Diluted EPS                      $1,158,588    2,232,940    $   0.52
                                        ==========   ==========    ========

     The calculation of diluted earnings (loss) per share for fiscal years ended
     April 30, 1998 and 1997,  excludes any potentially  dilutive shares as such
     shares would have an antidilutive  affect.  Total common stock  equivalents
     not used in calculating  diluted EPS were 1,504,539  shares in fiscal 1999,
     and  represented  stock options and warrants with exercise  prices  greater
     than market price and  averaging of  convertible  debt.  Total common stock
     equivalents  not used in  calculating  diluted EPS for both fiscal 1998 and
     1997 was  approximately  332,150  shares and  represented  stock option and
     warrants with exercise prices greater than market price.


(12) Major Customers and Credit Concentration

     The  Company  does  business  with  and  extends  credit  to a  variety  of
     commercial  customers,  including all of the major  railroads in the United
     States,  major cities and  municipalities  throughout the United States and
     Canada.

<PAGE>


     The Company sells products to customers  primarily in the United States. On
     April  30,  1999  and  1998,  88%  and  71%,  respectively,  of  the  trade
     receivables were concentrated  within the domestic railroad  industry,  and
     12% and 29%,  respectively,  of trade  receivables  were with companies and
     distributors  located in foreign  countries.  Although the Company does not
     currently foresee a credit risk associated with its receivables,  repayment
     is somewhat  dependent  upon the financial  stability of the companies with
     which the Company does business.


(13) Going Concern

     As  reflected  in  the  accompanying  financial  statements,  current  debt
     maturities and other  short-term  commitments  exceed the Company's  liquid
     assets available to repay such  commitments.  In addition,  as discussed in
     Note 1, the Company has a significant  concentration  of Product sales with
     its top three  customers.  To finance debt  maturities,  management has and
     will continue to seek both debt and equity investors to provide  additional
     capital.  Management believes the Company will be profitable in fiscal 2000
     and is expecting to  refinance  its debt as discussed in Note 14.  However,
     there can be no assurance that the Company will be profitable,  will retain
     its largest customers,  or that it will be able to complete the refinancing
     of its debt.


(14) Subsequent Event

     Litigation Settlement
     ---------------------

     Subsequent  to the end of the  fiscal  year,  the  Company  entered  into a
     settlement  agreement with  Transcontinental  Capital Partners ("TCP") that
     ends the  litigation  between the Company and TCP.  The Company had accrued
     the full amount of the settlement as of the fiscal year end.

     Refinancing of the Company's Senior Debt
     ----------------------------------------

     Subsequent to year end the Company  negotiated an amendment with its senior
     lender Finova that provides an extension of a reduced credit facility ($1.8
     million) under similar terms and conditions that existed at year end, until
     August 31,  2000,  at  interest  of prime plus  1-1/2%.  The new  financing
     package also provides $600,000 of new term debt at prime plus 2.25% payable
     in 60 monthly  installments of principal and interest.  The Company had not
     yet  signed  the  new   financing   package  prior  issuing  its  financial
     statements.




<PAGE>

                                   SIGNATURES

     In accordance  with Rule 12b-15 of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.


                                          OMNI Rail Products, Inc.
                                          (Registrant)



                                          By /s/ Robert E. Tuzik
                                          ----------------------
                                          (Signature and Title)
                                          Robert E. Tuzik
                                          President and Chief Operating Officer

                                          Date: August 20, 1999
                                          ---------------------