UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB
(Mark One)

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

                   For the fiscal year ended February 28, 2003

                                       OR

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

        For the transition period from _______________ to _______________

                         Commission file number 1-12680

                              ORYX TECHNOLOGY CORP.
           (Name of small business issuer as specified in its charter)

             Delaware                                             22-2115841
             --------                                             ----------
(State or other jurisdiction of                               (I.R.S. Employer
incorporation or organization)                               Identification No.)


4340 Almaden Expressway, Suite 220                                   95118
San Jose, California                                              ----------
----------------------------------------                           Zip Code)
(Address of principal executive offices)

Issuer's Telephone Number, including area code:                   (408) 979-2955
-----------------------------------------------                   --------------

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

                                                         Name of each exchange
     Title of each class                                  on which registered
     -------------------                                 ----------------------
Common Stock, $.001 par value                            NASDAQ SmallCap Market

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

                                      None
--------------------------------------------------------------------------------
                                (Title of class)

                                      None
 -------------------------------------------------------------------------------
                                (Title of class)


                                       1
<PAGE>

        Check whether the issuer (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such  shorter  period  that the Issuer 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 contained in this form,  and no disclosure  will be
contained,  to the  best of the  issuer'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. |_|

         Issuer's revenues from continuing operations for its most recent fiscal
year were $388,000.

         As of April 30, 2003,  1,836,335  shares of common stock and  preferred
stock  convertible  into 875 shares of common stock of Issuer were  outstanding.
The  approximate  aggregate  market  value of the shares of common stock held by
non-affiliates  of Issuer,  based on the  average of the  closing  bid and asked
prices  on April 30,  2003 of $0.65 and $0.91 per one share of common  stock was
approximately $1,154,564.(1)


                       DOCUMENTS INCORPORATED BY REFERENCE

None.

         Transitional  Small Business  Disclosure Format (check one): Yes |_| No
         |X|

         This Annual Report on Form 10-KSB contains  forward-looking  statements
within the  meaning of the  Private  Securities  Litigation  Reform Act of 1995,
particularly  statements  regarding market  opportunities,  market share growth,
competitive  growth,  new product  introductions  by our  licensees,  success of
research and development efforts by our licensees and customer acceptance of new
products. These forward-looking statements involve risks and uncertainties,  and
the cautionary  statements set forth below identify important factors that could
cause  actual  results to differ  materially  from those  predicted  in any such
forward  looking  statements.  Such  factors  include,  but are not  limited to,
adverse changes in general economic conditions, including adverse changes in the
specific markets for our products, adverse business conditions,  dependence upon
our licensees for the  commercial  success of our products,  adverse  changes in
customer  order  patterns,  increased  competition,  lack of  acceptance  of new
products, pricing pressures, lack of success in technological advancement,  lack
of  commercial  success of  portfolio  companies  we have  invested in and other
factors such as those listed in Risk Factors below.

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

(1) For purposes of this Report,  shares held by non-affiliates  were determined
by  aggregating  the number of shares  held by  officers  and  directors  of the
Issuer,  and by others who, to  Issuer's  knowledge,  own 5% or more of Issuer's
common stock, including shares of preferred stock convertible into common stock,
and subtracting  those shares from the total number of shares  outstanding.  The
price quotations  supplied by NASDAQ represent prices between dealers and do not
include  retail  mark-up,  markdown or commission  and do not  represent  actual
transactions.

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<PAGE>

                                     PART I

Item 1.  Description of Business.

         Oryx Technology  Corp. is the successor of Advanced  Technology,  Inc.,
which  was  incorporated  on April 21,  1976 in New  Jersey.  On July 25,  1993,
Advanced Technology formed Oryx as a wholly-owned  Delaware  subsidiary,  and on
September 29, 1993,  Advanced  Technology  merged with and into Oryx  Technology
Corp.  References to "Oryx," "we," "our" and "us" refer to Oryx Technology Corp.
and its consolidated subsidiary.

         As of February 28, 2003 we had an accumulated  deficit of approximately
$25.8  million.  We incurred  net losses of  approximately  $2.1 million for the
fiscal year ended  February 28, 2003 and $1.5 million for fiscal 2002. We expect
to  continue  to  incur  net  losses  and  these  losses  may  be   substantial.
Furthermore, we expect to generate significant negative cash flow in the future.
We will need to  generate  substantially  higher  royalty  fees to  achieve  and
sustain  profitability  and positive cash flow.  Our ability to generate  future
revenue and achieve  profitability  will depend on a number of factors,  many of
which are described throughout this section. If we are unable to generate higher
royalty fees, we will be unable to build a sustainable  business. In this event,
our share price and the value of your investment  would likely decline.  We must
raise  additional  capital  no later  than July 2003 to  continue  our  business
operations.  As a result of these  circumstances,  our independent  accountant's
report  on  our  consolidated   financial  statements  includes  an  explanatory
paragraph  indicating  that there is  substantial  doubt about Oryx's ability to
continue as a going concern.

         Introduction

         During  fiscal 1998 we  initiated a  restructuring  of our  operations.
Through  fiscal  1998,  we  designed,   manufactured  and  marketed  specialized
components,  analytical  equipment  and  instrumentation  products  for original
equipment  manufacturers,  in the information  technology industry.  We operated
three majority owned subsidiaries, focusing on three distinct market segments:

         o  power conversion products (Oryx Power Products Corporation);

         o  electrical surge protection products (SurgX Corporation); and

         o  materials  analysis and test  equipment  and  specialized  materials
            products (Oryx Instruments and Materials Corporation).

         During  the  later  part  of  fiscal  1998  we  embarked  upon a  major
restructuring program which resulted in:

         o  the sale on February 27, 1998 of the test  equipment  portion of the
            business of Oryx Instruments and Materials Corporation;

         o  the sale on March 2, 1998 of  substantially  all of the  business of
            Oryx Power Products Corporation in its entirety; and

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<PAGE>

         o  the sale on August  18,  1999 of the  remaining  operations  of Oryx
            Instruments  and  Materials  Corporation,  consisting  of the carbon
            target assembly and related materials coating business.

         Today we are a  technology  licensing  and  investment  and  management
services company with two primary focuses:

         o  collecting  royalties  for  our  SurgX  technology  from  our  SurgX
            licensees,   Cooper   Electronics   Technologies,   Inc.  and  IRISO
            Electronics, Ltd.; and

         o  maintaining  our  current   investments  and  providing   management
            services  primarily  to  one  portfolio  company,  S2  Technologies,
            through  our  investment  and  management  services  company,   Oryx
            Ventures, LLC.

         As a result of the  restructuring of our business,  we have disposed of
substantially all of our operating  businesses which accounted for substantially
all of our revenue. In the absence of increased royalty revenue from the sale of
our SurgX technology through our licensees, which to date has not occurred, such
restructuring has sharply reduced our revenues without creating opportunities to
offset the lost revenues.  The licensees of our SurgX  technology have, to date,
not been successful in shipping  products  incorporating our SurgX technology in
significant  volumes to generate  sufficient  royalties  to cover our  operating
costs and there can be no assurances  that they will be successful in generating
substantial sales of SurgX based products in the future.

         SurgX Corporation

         Business Overview

         SurgX Corporation, or SurgX, is the subsidiary through which we license
SurgX, our proprietary surge protection  technology.  The underlying  technology
developed by SurgX is currently licensed to two non-exclusive licensees,  Cooper
Bussmann,  or Cooper Electronics  Technologies,  and IRISO Electronics  Company,
Ltd., or IRISO.  Products  manufactured by these licensees and utilizing SurgX's
proprietary   technology   are   targeted   for  sale  to   original   equipment
manufacturers,   or  OEMs,   and  contract   manufacturers   in  the   computer,
communication,   and  electronics   industries  to  provide  protection  against
electrostatic  discharge, or ESD, events through discrete devices at the printed
circuit board level.

         Our  proprietary  SurgX  technology  for  over-voltage   protection  is
comprised of a specialized  polymer  formulation  containing  inorganic  solids,
metal  particles  and  adhesion-promoting  agents  which can be tailored for use
against surge threats at different  voltage and power levels. In fiscal 2002, we
transferred all trade secrets and manufacturing know-how for SurgX liquid to our
licensees to facilitate the manufacturing of SurgX liquid to our licensees.

         The  licensees  of  our  SurgX  technology  have,  to  date,  not  been
successful in shipping products incorporating our SurgX technology in volumes to
generate  sufficient  royalty  revenue and there can be no assurances  that they
will be successful in increasing sales of products based on our SurgX technology
in the future.

                                       4
<PAGE>


Licensees


         Cooper Electronics Technologies

         In fiscal  year  1997,  we  granted  to  Cooper  Bussman  an  exclusive
worldwide,  except for Japan,  license  for the  manufacture  and  marketing  of
surface mount and connector  array  components  using SurgX  technology.  Cooper
Bussmann is a leading  manufacturer  of fuses and its target market for products
incorporating  the SurgX technology is the electronics  market. In consideration
for this license,  Cooper Bussmann paid us $750,000 in development funding, and,
subject to terms of the license agreement,  became obligated to pay royalties to
us for  approximately  eleven  years based upon Cooper  Bussmann  sales of SurgX
surface mount  components  and  connectors.  In September of 1997,  this license
agreement was amended to extend its term to 20 years,  expand Cooper  Bussmann's
license rights for SurgTape for board-level  ESD  protection,  and provide SurgX
with a cash  advance  of $1.7  million,  in the form of  non-refundable  minimum
royalties to finance the development and  commercialization  of SurgTape,  which
was not  commercialized.  Pursuant to terms of the license  agreement,  the $1.7
million cash advance  provided Cooper Bussman with an exclusive  license through
June  2001.  Subsequently,  Cooper  Electronics  Technologies  did not  make the
required $1 million  royalty  payment  due  September  15, 2002 to maintain  its
exclusive  license to the SurgX  technology.  Therefore,  the license granted to
Cooper Electronics Technologies  automatically converted to a nonexclusive basis
as of September 15, 2002.

         During  fiscal  2000,   Cooper  Bussmann   formed  Cooper   Electronics
Technologies, Inc. to handle research, development,  manufacturing and sales and
marketing  functions for the P.C. board level electronic  circuit protection and
conditioning  products  within Cooper  Bussmann.  This effort  includes  several
technologies,   including  products   incorporating  SurgX  technology.   Cooper
Electronics   Technologies   has  a  worldwide   network  of  direct  sales  and
representative  entities and technical  distribution  groups responsible for the
promotion and sales support of its products including SurgX  electrostatic surge
protection devices.  Currently Cooper Electronics Technologies offer three SurgX
products:  0805 Chip Polymer ESD Suppressant,  41206 Four Element Array and 0603
Polymer ESD Suppressant.

         Cooper  Bussmann  utilizes  an Asian  based  contract  manufacturer  to
produce its SurgX  based  products.  During  calendar  2001,  due to slow market
conditions in the  electronics  industry in general  coupled with high levels of
inventory,  Cooper Electronics  Technologies' contract manufacturer  temporarily
suspended  manufacturing  SurgX components,  except for sample quantities of the
0603 ESD product for evaluation and  qualification  purposes.  In December 2001,
Cooper Electronics Technologies' contract manufacturer resumed the manufacturing
process starting with the 0603 ESD product,  which was released in January 2002.
The 0603 ESD product has been sold for use in cellular  devices,  PDA's, set top
boxes,  DSL type equipment.  The 0603 product  continues to gain popularity with
the designer  community due to the high  frequency  performance  and new pricing
policies aimed at replacing other devices traditionally used for ESD protection.
Cooper Bussmann has gained design wins at large customers like Canon, Panasonic,
Sanyo, Toshiba, Motorola, Siemens, Fujitsu and others like Sony are in process.

         Due to the transfer of SurgX product  manufacturing  offshore by Cooper
Bussmann and the  reorganization  of Cooper  Electronics  Technologies in fiscal
2000, sales of SurgX products by

                                       5
<PAGE>

Cooper Electronics  Technologies for fiscal 2001 were under three million units,
which was substantially lower than previously  anticipated.  Whereas during this
time frame SurgX products were designed in products  offered by more than thirty
OEMs, long lead times from design wins to production orders, competitive product
substitutions  and  cancellations of product  programs,  coupled the significant
downturn in the electronic  components market,  resulted in sales much below our
expectations.  Sales of SurgX  products in fiscal  2002 were also  significantly
lower than  anticipated,  with less than 18  million  units  shipped  during the
period, partially due to the overall slowdown in the electronic industry and the
inability  of our SurgX  polymer  technology  to meet more  stringent  technical
protection  requirements  of customers for new  integrated  circuit  devices and
fiber optic  amplifier  components.  However with the  concentrated  application
engineering and marketing effort,  Cooper Electronics  Technologies shipped well
over  30  million  devices   (combination  of  0603,  0805,  and  4  line  array
configurations)  in calendar 2002. For the first three months of fiscal 2004 the
order rate for SurgX products has been several times that for the same period in
the previous  year, as a result of the  technology  coming into wider use by the
circuit designers for a wider range of applications.  However,  the sales prices
of the devices are lower than expected in order to meet  competitive  pricing of
traditional protection devices.

         During fiscal year 2000,  all SurgX  research and  development  efforts
were transferred from Oryx to Cooper Electronics Technologies. In fiscal 2001, a
Cooper  Electronics  Technologies  polymer  devices  facility was established to
support  polymer  development,  manufacturing  and  marketing  activities.  This
facility  also  includes  technologies  for  several  other  Cooper  Electronics
Technologies' devices, such as supercapacitors. Cooper Electronics Technologies'
manufacturing  and process know-how have been utilized to improve the processing
yields, the consistency and the logistics of SurgX liquid manufacturing, and the
focused   marketing  and  application   engineering   effort  has  improved  the
integration  and  manufacturing  of SurgX liquid  technology  with  finished ESD
protection device manufacturing.  In late 2001, Cooper Electronics  Technologies
informed  us that unless it received  ongoing  significant  orders for its SurgX
based products,  it might  significantly  curtail its SurgX related  development
activities.   Presently  Cooper  Electronics   Technologies  is  continuing  its
development  efforts  on a level in line with its  perception  of the  potential
market size and sales opportunity for SurgX based products.

         In late calendar 2001,  Cooper  Electronics  Technologies  introduced a
0603 discrete  component  package with better  protection  capability  and lower
trigger  voltage  and is in the  process  of  prototype  development,  of a much
smaller footprint  component,  a 0402 package style in addition to other smaller
multi-line  variants.  The mass  production  version of the 0402 device is being
developed and had planned  introduction  of the first calendar  quarter of 2003,
which has been  delayed  until late in calendar  2003.  Currently,  research and
development  efforts  of  Cooper  Electronics  Technologies  include  activities
designed  to develop  market  driven  device  configurations  and to improve the
reliability of the SurgX products it sells, as well as new  development  efforts
toward improved  electrical  performance.  In addition,  for Cooper  Electronics
Technologies  to be able to  participate  in a more  significant  portion of the
potential market for ESD type transient voltage protection  devices  significant
electrical  performance  improvements  to the liquid  polymer  must be realized,
which will require  enhancements  to the current  polymer system to achieve much
lower  trigger  and  clamping  voltage  performance.  However,  there  can be no
assurance if, or at what level,  Cooper  Electronics  Technologies will continue
its development efforts.

                                       6
<PAGE>


         IRISO

         In November 1997, IRISO, a manufacturer of high engineering  connectors
and  precision  metal  pins for  electronic  equipment,  made an  investment  of
$500,000 in SurgX  Corporation in exchange for an equity  ownership  interest of
approximately   three  percent  of  the  total   outstanding   shares  of  SurgX
Corporation.  In  conjunction  with this  equity  investment,  IRISO  received a
fifteen-year co-license to manufacture and sell our SurgX technology exclusively
in Japan for board level ESD  protection.  These products are marketed under the
SurgX  trademarks.  In fiscal 1999, IRISO started volume production and sales of
0805 surface mount  components.  Sales in fiscal 2000 were  minimal,  with IRISO
shipping  production  quantities to two major OEMs and in lesser amounts to five
other  customers.  While  shipments  in  fiscal  2002 and  fiscal  2003  were up
significantly,  at  approximately  12 million  units for each year,  these sales
levels are much lower than  initially  forecasted.  Sales of SurgX  products  by
IRISO have been  negatively  affected by a  significant  downturn and  continued
weakness in the electronic components markets,  predatory pricing pressures from
competitors and by market requirements of improved ESD protection  capabilities,
which have not been yet  achieved.  IRISO is  currently  shipping to eight OEMs.
Additionally,  there are several customers  currently  evaluating IRISO products
incorporating the SurgX technology.  In fiscal 2001, IRISO paid Oryx $100,000 in
licensing  royalties for shipments  during the year. In fiscal 2002,  IRISO paid
its minimum licensing royalty obligation of $200,000 for the royalty year ending
October 2001 and made royalty payments  totaling $148,000 in fiscal 2003 for the
royalty year ending  October 2002,  which was below the minimum  annual  royalty
amount for IRISO to maintain  its  co-exclusive  license.  As a result,  IRISO's
license  converted  to a  non-exclusive  license for the  remaining  term of the
license agreement.  On April 1, 2003, for a one time fee of $200,000 we executed
an amendment to the license agreement  granting IRISO a non-exclusive  worldwide
license.

         In fiscal 2000,  IRISO launched a SurgX component in a standard passive
component  package  style,  its 0805 package.  Current  development  efforts for
future  products  are chip and  network  chip for  optical  devices and the next
generation cellular phone. Electrical performance  improvements of reduced clamp
voltage  (trigger  voltage) and  electrical  shorting must be achieved to create
additional sales opportunities.  Without these improvements, which have not been
achieved,  we expect that IRISO's sales volume of products  incorporating  SurgX
technology in the near term will only rise modestly.

         In  fiscal  2002 we  transferred  the  manufacturing  of  SurgX  liquid
material to IRISO in Japan. Future liquid manufacturing  enhancements and liquid
development  activities  will be borne by IRISO  with  limited  support  for our
internal development activities, which we terminated February 1, 2003.

         To expand the market for SurgX products,  we initiated discussions with
several companies  regarding  licensing our SurgX technology.  However,  we were
unsuccessful  in securing a license  with any of the four  companies  we were in
discussions with. Further,  there can be no assurance that we will be successful
in entering into a license  agreement for our SurgX  technology on an acceptable
commercial basis with any other third parties.

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<PAGE>


Market for SurgX Technology

         As  the  information   technology   industry   increases  capacity  and
performance, faster speeds, smaller chip geometries and lower operating voltages
are required.  These  developments have been accompanied by increases in product
susceptibility to failures from over-voltage threats mainly from ESD. Failure to
address these  problems can result in the  destruction  of chips and  circuitry.
These  threats can  originate  from inside or outside the products and can arise
from such factors as ESD, induced  lightning  effects,  spurious line transients
and other complex  over-voltage  sources.  During the last decade,  new products
have emerged to address  protection  of integrated  circuits  from ESD.  Related
specialized  products  range  from wrist  straps  worn by  electronics  assembly
workers, to special anti-static  packaging of both components and sub-assemblies
as well as board level protection devices such as diodes and varistors.

         The global market for all over-voltage protection devices was estimated
at  approximately  $1.5-1.8  billion in  calendar  2001.  Our  licensee,  Cooper
Electronics  Technologies,  believes due to the  persistent  electronics  market
slowdown,  coupled  with  downward  pricing  pressures  that the market in total
revenue  dollars  contracted in calendar  2002.  This market  includes some more
mature  transient  voltage  suppression,  or TVS,  devices such as gas discharge
tubes,  varistors,  and  diodes.  The  major  markets  targeted  for  new  surge
protection  devices and  technologies,  such as those  represented  by our SurgX
technology,  and are telecommunication,  automotive and computers. Gas discharge
tubes,  varistors,  and  diodes  are all used as  protection  from  over-voltage
transients. Our SurgX technology is a polymer based technology,  used to protect
against  the ESD type  over-voltage  transients.  However,  the  market  for the
relatively new polymer type TVS device with the low  capaciatance and leakage is
an expanding one with sales based on acceptance and device capability.

         Gas discharge  tubes are  traditionally  used for  protection of signal
lines  such as phone  lines,  computer  data line  communications  and  antennae
because low  capacitance  of the tubes does not interfere  with the bandwidth of
high frequency communication circuits. Gas discharge tubes are also used for the
protection of AC powerlines,  since they can handle high currents. Gas discharge
tubes are inherently bipolar, have low capacitance,  in the .5 to 2pF range, and
can handle high currents in the 5 to 20,000 amps range. A negative  attribute of
the gas  discharge  tubes is their slow turn on,  which  allows some of the over
voltage pulse to get through and damage sensitive  electronics,  and conversely,
the difficulty in turning off after the transient has ended.

         Varistors are typically  used for  protection of electronic  components
from transients  generated on the power lines supplying  electronic systems. The
varistor  is  bipolar in nature but has the  largest  capacitance  of the common
overvoltage protection devices,  commonly ranging between 200 to 10,000pF. Newer
varistor  devices have now appeared on the market with  capacitances as low as 5
pF  targeted  for the ESD  protection  area.  As long as the  varistor  is large
enough, it can handle high currents. Varistors' typical response times cited are
slow and current leakages are up to the milliamp range.

                                       8
<PAGE>

         Diodes offer the lowest costs,  tightest  clamping  voltage and fastest
response times of standard  over-voltage  protection  devices.  For this reason,
diodes have been the preferred  over-voltage  protection  device for  integrated
circuits  protection at the board level.  Diodes are used  extensively on signal
lines and on printed circuit boards used in communications, computer, industrial
and  automotive  electronics.  Diode  response times are one nanosecond or less,
however,  capacitances  are commonly greater than 10 to 100's of pF, the current
leakage  is in the  microamp  range,  and  the  response  to  voltages  is  only
unidirectional.  Diodes  include Zener diodes,  silicon  avalanche  diodes,  and
sidactors.  In some  specific  instances  switching  diodes  may also be used as
transient voltage surge diodes,  although these are not true suppressors and are
offered as low cost alternatives to Zeners and silicon avalanche diodes.

         SurgX is an over-voltage  protection  component,  which is designed for
extensive  use on  printed  circuit  boards.  It  addresses  many  of  the  same
applications  as  diodes  and some  varistors.  Like the  varistors  and the gas
discharge tubes,  SurgX is bipolar in nature,  allowing a single SurgX component
to replace two diode devices. The capacitance of SurgX devices is typically less
than 1/4  picofarad,  much  lower than that of any of the  standard  overvoltage
protection  components  it is  intended  to  replace.  SurgX  devices  have been
measured to be usable at very high frequencies  without  interfering with signal
transmission.  The low capacitance is particularly  important as the frequencies
of today's electronics go beyond 2 GHz.  Over-voltage  devices with capacitances
greater than 10 pF interfere with megahertz  signals.  The slow response time of
the gas discharge  tubes prohibits their use for ESD protection of signal lines,
even though they have the low capacitance required.

         SurgX  can  be  used  as  a  diode/varistor  replacement  in  many  ESD
over-voltage  transient  applications since it has nanoseconds response,  with a
fold back trigger response similar to a sidactor diode, low capacitance,  a very
small  footprint,  lower leakage current than either a diode or a varistor,  and
high current shunting capability. In larger packages with larger electrodes, the
energy  handling  capability  of SurgX  increases,  thereby  allowing its use in
applications  such as modems,  where gas  discharge  tubes and  varistors  would
typically be used.

         Though proven for performance and reliability,  each of the traditional
over-voltage protection technologies has only a narrow range of application.  In
addition,  none achieves the desired  combination of high speed,  elevated power
handling  capability,  low clamping  voltage and low  capacitance.  Furthermore,
present  conventional  devices and  methodologies  are  expensive for use on all
signal lines on a given circuit board.  SurgX components are intended to address
the low  capacitance  and low current  leakage  needs  required  for signal line
protection in electronics.

Primary Market Segment

         Our licensees,  Cooper  Electronics  Technologies and IRISO,  have sole
responsibility  for  marketing  products  using  our SurgX  technology.  The TVS
protection  function  traditionally  served  by the  discrete  TVS  diode is the
primary market targeted by our licensees. This market in total was approximately
$ 800 million in calendar 2001 and our licensee  believes due to the  persistent
electronics  market slowdown,  coupled with downward pricing  pressures that the
market in total revenue  dollars  contracted in calendar 2002.  The  contraction
reflects  probable caution by the designers due to cost pressure and the reduced
willingness to take a chance on a

                                       9
<PAGE>

new  technology.  This  market  consists  of two  segments:  the low energy high
frequency ESD type protection  where the SurgX device is optimal in its function
and the much lower clamp (trigger  voltage)  application  currently  outside the
SurgX specification  area. Each of these segments generated  approximately $ 400
million in total sales in calendar year 2001.  This includes the ESD  protection
part of the varistor  market.  However,  in order to fully  participate  in this
segment,  the SurgX  device must be designed to be capable of lower  trigger and
clamp voltage and cycle  capability,  in addition to higher  energy  capacity to
withstand higher transient  pulses.  Within these markets the most important use
criteria tend to be cost. After cost, the trigger voltage, level of capacitance,
response time, size, energy handling and leakage current are important criteria.
It is the  capacitance and leakage  criteria on which the SurgX  technology will
initially compete. The low capacitance  requirement of ESD protection devices in
many  circuit  designs  will  provide  the initial  entry into the diode  market
segment.  Our licensees are participating,  albeit very limited in scope, in the
low price,  high  volume  diode  market,  since they had found it  difficult  to
achieve product costs  competitive  with diodes or meet the required  electrical
performance.  However,  the high volume,  low-cost diode market will provide the
most significant opportunity for our licensees and they are currently evaluating
electrical  enhancement  initiatives  to be able to compete more  effectively in
this market.

Product Development

         The development requirements for the SurgX ESD devices include that for
lower trigger/clamp voltage polymer to be able to protect the chip sets designed
for new  higher  speed  data  protocols  such  as the  USB2,  IEEE1394  B(second
generation Firewire),  DVDI, and optical amplifier components.  In addition, the
device assemblies must include ever smaller footprint platforms and a variety of
arrays  for the  handheld  communications  device  platforms.  Finally,  the ESD
suppression products must be reliable and repeatable through increasingly larger
number of repeated  pulses and  possess  high MTBF (Mean Time  Between  Failure)
characteristics.  The latter is a part of the ongoing development process by our
licensee, Cooper Electronics Technologies.

         During fiscal year 2000,  all SurgX  research and  development  efforts
were  transferred  to  Cooper  Electronics  Technologies.   In  fiscal  2002  we
reinitiated limited SurgX liquid development activities to support our licensees
in improving electrical  performance of SurgX products. In order to continue our
limited  development  activities  we needed to  generate  additional  funding by
entering into new licenses for our SurgX technology. As a result of not entering
into new license agreements we terminated our limited development  activities as
of February 1, 2003.

Competition

         Other  than  conventional   manufacturers  of  over-voltage   transient
protective devices, the primary competitor to SurgX technology is a polymer base
over-voltage  protection product of Littlefuse,  Inc. As SurgX components become
price  competitive  and  available  in high  volumes  with  enhanced  electrical
performance  characteristics,   our  licensees  will  attempt  to  compete  with
conventional  over-voltage  transient  protection  manufacturers such as General
Semiconductor,  Harris Semiconductor,  Inc., Motorola Corp., Siemens Components,
Inc., Semtech, Vishay and


                                       10
<PAGE>


other  manufacturers  of varistors and zener  diodes.  The more broad use of the
polymer  (SurgX)  devices  depends on cost,  protection  performance,  packaging
format and ability to disseminate the application  information to the designers,
in that order.

         Intellectual Property

         Proprietary  protection  for our  products,  processes  and know-how is
important to SurgX's business. We have numerous patents issued and in process in
the US and foreign  countries.  We also rely upon trade  secrets,  know-how  and
continuing  technological  innovation  to develop and maintain  our  competitive
position.  Our policy is to file patent  applications to protect our technology,
inventions and improvements as soon as practicable. To the extent applicable, we
will continue to work on patent applications  currently in process at the Patent
Office.   However,  since  we  have  transferred  all  product  development  and
manufacturing  to our licensees,  it is the  responsibility  of our licensees to
file patent  applications  or amendments or otherwise  protect the  intellectual
property that they develop in connection with the licensed SurgX technology.

         The registration on the "SurgX"  trademark was granted by the US Patent
and Trademark Office on March 17, 1998.

         The two  foundation  patents  filed by  SurgX in 1995 on  manufacturing
processes,  methods of making the SurgX compositions and SurgX devices have been
divided by the U.S. Patent and Trademark Office into 11 different inventions for
filings as individual  patents.  In September  1998,  the US patent on the basic
method  of  manufacturing  SurgX  overvoltage   compositions  was  issued.  Four
additional  basic  patents  have  been  filed  on  other  aspects  of the  SurgX
technology,  including surface mount devices and connector  component designs. A
total of 6 US patents have been granted and 1 more has been approved, which will
issue as a US patent in mid-2002.  Foreign  patent  filings have been made in 10
countries plus the European countries on the two foundation patents and selected
foreign patent filings have been made on the other basic patents.  Eleven of the
foreign  patents have been granted.  The remaining US and foreign patents are in
process.  We believe  our  patents  and patent  applications  cover  significant
proprietary art in devices, processes and materials.

         We expect that our licensees will file improvement patent  applications
with respect to changes and improvements in the SurgX  technology.  There can be
no assurance, however, that such improvement patents will be granted.

         Oryx Ventures, LLC

         We  established  Oryx  Ventures,  LLC,  a  Delaware  limited  liability
company,  in May 2000 to act as an investment and management services entity for
us. Oryx  Ventures is a  wholly-owned  subsidiary  of Oryx and is managed by our
employees.  Previously,  Oryx has contributed  investment funds to Oryx Ventures
from its  existing  cash  balances.  At  present,  due to a lack of capital  and
adverse  conditions  in the capital  markets,  coupled with the  uncertainty  of
future  royalty  income from  SurgX,  we are  limiting  the  activities  of Oryx
Ventures to supporting  primarily one portfolio  company,  S2  Technologies.  In
addition,  due to the departure of our Chief Financial  Officer,  we are scaling
back on the services we provide to S2 Technologies and other companies. In order
to conserve cash  resources at Oryx, we have not actively  sought new

                                       11
<PAGE>


additional  investments  since September  2000,  except for  participating  in a
bridge loan in June 2001 and a Series B Preferred  financing in October 2001 and
March 2002 and a Series B-1 financing in May 2003 with our portfolio company, S2
Technologies.  Oryx will  receive all  profits  and losses  from Oryx  Ventures,
provided  that,  Philip  Micciche  Chief  Executive  Officer  of  Oryx,  Mitchel
Underseth, the former Chief Financial Officer of Oryx and Luis Borge, Controller
of Oryx will  receive an  aggregate  of 20% of the profits  distributed  by Oryx
Ventures upon liquidation or otherwise and Oryx will receive the balance of such
profits.

Currently,  Oryx  Ventures is providing  strategic  and  management  services in
several  areas  of  business,  including  administration,  operations,  finance,
marketing and sales primarily with one portfolio company, S2 Technologies.  Oryx
Ventures has received  equity and cash from S2  Technologies  for the management
services it is providing.

         To date, we have invested in three technology companies:

         o  LOTS  Technology,  Inc.,  a  developer  of digital  optical  storage
            technology;

         o  NetConversions,  an  early-stage,  data  marketing  company  with  a
            proprietary   technology  that  allows  for  real-time  analysis  of
            consumer online buyer behavior; and

         o  S2 Technologies,  Inc., an early-stage middleware and software tools
            development company.

         S2 Technologies, Inc. is actively engaged in business. LOTS Technology,
Inc.  went out of existence  during  fiscal 2003.  NetConversions  significantly
curtailed business operations in August 2001.

         LOTS  Technology  ("LOTS")  proprietary  technology  is  a  replacement
product for the high-end magnetic media drives that can no longer keep pace with
the growth in digital data storage. The company,  which developed the technology
with major funding from government contracts,  plans to supply large-volume data
storage  systems to three broad markets of commercial and government  customers,
including general purpose computing,  networked data storage,  digital video and
data acquisition  system  companies.  We made a direct investment of $500,000 in
this company and have  received  additional  equity in the form of stock options
for our  senior  advisory  services.  As of April  2001,  we had  fulfilled  our
obligations  under our management  service agreement and are no longer providing
any other services.  Our total equity ownership in LOTS is approximately 6.5% of
total equity  outstanding.  We recently discovered that LOTS was unsuccessful in
raising  additional  funds and  filed  for  bankruptcy.  We fully  reserved  our
$500,000  investment  in LOTS  during the  fourth  quarter  of fiscal  2001.  At
present,  we do not have any  reasonable  expectation of recovering our original
investment or any return thereon from LOTS.

         NetConversions,   Inc,   ("NetConversions")   has   a   solution   that
incorporates  an  innovative  approach to  behavior  profiling  and  promotions,
allowing  e-commerce  managers  maximum  flexibility  to  change  their  website
marketing.  The product is a turnkey ASP solution that requires  minimal  client
integration  and  engineering.  Oryx has  provided a bridge  loan of

                                       12
<PAGE>

$100,000 to  NetConversions  that is convertible to equity at a discounted rate.
We fully reserved our investment in NetConversion as of November 30, 2000 due to
industry  conditions  and  financing  issues.  In  August  2001,  NetConversions
significantly curtailed its business operations.  At present, we do not have any
reasonable  expectation  of  recovering  our original  investment  or any return
thereon from NetConversions.

         In August 2000, through Oryx Ventures, we invested $500,000 in Series A
Preferred of S2 Technologies.  In June 2001, we invested an additional  $250,000
in a bridge loan to S2  Technologies.  In October  2001, we  participated  in S2
Technologies'  second round,  Series B Preferred financing with an investment of
$1,105,000,  which  included  conversion  of the  $250,000  bridge  loan  and an
investment  of $855,000 in new funds.  In March 2002,  we invested an additional
$938,000  in  Series  B  Preferred  issued  by S2  Technologies.  In May 2003 we
participated  in  S2  Technologies'  Series  B-1  Preferred  financing  with  an
investment of $200,000.

         The price per share paid by the Company for the S2  Technologies  stock
in March  2002 was in excess of the net book  value per share of the  underlying
equity in net assets of S2 Technologies, resulting in goodwill of $897,000. This
goodwill  is  included  in the  Investment  balance.  Goodwill  is reviewed on a
periodic  basis  for  impairment.  As of  February  28,  2003 our  total  voting
ownership of S2 Technologies was approximately 44.2%, and our total ownership on
a fully diluted  basis,  was  approximately  40.8%.  After our  investment in S2
Technologies  in May 2003,  our total  voting  ownership of S2  Technologies  is
approximately  41.7%,  and our total  ownership  on a fully  diluted  basis,  is
approximately  38.9%. We are also providing senior management  advisory services
in exchange for additional equity, in the form of warrants, which is included in
the fully diluted ownership mentioned above, in S2 Technologies and cash fees.

         S2 Technologies' focus is to provide value-added tools that address the
development,  integration and verification phases of the embedded software.  The
goal  is to  increase  software  developers'  and  engineers'  productivity  and
decrease  the time it takes for their  products to reach  commercialization.  S2
Technologies  had  entered  into beta  agreements  with LSI  Logic  and  Emerson
Electric Co. and released  its first  product in March 2002.  Sales to date have
been  minimal  and are lower than  anticipated  primarily  due to the  depressed
economic environment.

         Given the limited  capital  resources of S2 Technologies at the time we
made our original  investment,  we began recognizing losses on our investment in
S2  Technologies  based  upon  our  pro-rata  share of the  Series  A  Preferred
financing.  Concurrent  with the  Series B  Preferred  financing,  we have  been
recognizing  losses on our  investment in S2  Technologies  based upon our total
equity ownership  percentage in S2 Technologies.  We have recognized  cumulative
losses  attributable  to our  ownership of S2  Technologies  of $1,858,000 as of
February  28,  2003 of which  $787,000  and  $814,000  are  included  in loss on
investments  in fiscal 2003 and 2002,  respectively,  and  impairment  losses of
$412,000  as of February  28,  2003.  At  February  28,  2003,  S2  Technologies
investment,  including  related goodwill was carried at $200,000.  In accordance
with  paragraph 40 of Statement 142, we have evaluated the carrying value of our
ownership interest in S2 Technologies for possible impairment in accordance with
paragraph  19(h) of  Opinion  18. As a result  of S2  Technologies  not  meeting
certain milestones established in fiscal 2003, we recorded an impairment loss of
$412,000 for the fiscal year ending  February 28, 2003.  The method to determine
the impairment loss was based upon Oryx's prorata share of S2 Technologies'  net
realizable value, which consists primarily of net available cash at February 28,

                                       13
<PAGE>


2003. If S2 Technologies does not achieve higher level of sales or cannot obtain
needed financing or such financing is dilutive to our equity ownership  interest
in S2 Technologies,  our investment  balance of $200,000 as of February 28, 2003
may be subject to additional impairment charges. While S2 Technologies is behind
in  achievement  of its financial  plan  objectives  and  milestones and overall
market  conditions for its products or services have delayed  sales,  we believe
with the success of numerous evaluation engagements and initial sales with large
multinational  companies,  S2 Technologies  will be able to raise capital in the
future to meet its funding requirements.

         Investors Risks

         Oryx  Ventures  activity is primarily  limited to providing  management
services to S2 Technologies. Our business strategy with Oryx Ventures involves a
number of special risks, including:

         o  being deemed as investment company and subjected to the requirements
            of the Investment Company Act of 1940; and

         o  the  significant  risk  associated with investment in small start-up
            companies,  given a very unreceptive  financing environment for such
            companies along with a general downturn in the overall economy.

         We may not be able to successfully  address these  problems.  Moreover,
our future operating results will depend to a very large degree on the financial
success of our portfolio  company S2 Technologies and upon our ability to assist
S2  Technologies  in becoming  cash flow positive or obtaining  their  follow-on
financing,  which,  in light of current  conditions  in the capital  markets for
high-technology  companies,  is likely to be difficult.  In addition, all of the
investment  opportunities  we have invested in are  early-stage  companies  with
limited  operating  histories and limited or no revenues.  To date,  none of our
portfolio  companies have met their projected  financial targets or provided any
return to their investors.  These  investments have had a negative impact on our
financial   statements.   At  present,   we  are  focusing  our  efforts  on  S2
Technologies.   However,  we  may  not  be  able  to  successfully   develop  S2
Technologies  or  any of our  other  portfolio  companies  and  there  can be no
assurances  that we will either recoup our  investments or receive any return on
our investment in any company in which we have invested.

Effects of Various Accounting Methods on our Results of Operations


         Our portfolio  companies  are early stage  development  companies  that
generate net losses,  and we expect these losses to continue in the future. On a
quarterly  basis we evaluate the carrying  value of our  ownership  interest and
advances in each of our  portfolio  companies  for possible  impairment.  In our
assessment of carrying value for each portfolio company, we consider achievement
of financial plan objectives and milestones, overall market conditions for their
products or services,  assessment of competitive technologies and the ability to
raise capital for future funding requirements.

                                       14
<PAGE>

         The various interests that we have acquired in our portfolio  companies
are accounted for by either the equity method or the cost method. The applicable
accounting  method used to record our investments in our portfolio  companies is
determined  by our voting  interest and the level of influence we exercise  over
each portfolio  company.  In general we use the equity method when our ownership
level  exceeds 20% but is not greater than 50%.  When our ownership is less than
20% and we do not exercise significant influence or effective control we use the
cost method.  Whether or not we exercise significant influence with respect to a
portfolio  company  depends on an evaluation of several factors  including:  our
management  capacity and decision  making  authority  relative to our management
services we provide to the portfolio  company,  level of  representation  on the
portfolio  company's  board of directors and level of voting  rights  associated
with our equity holdings.



         Our portfolio companies as of February 28, 2003 were:
<TABLE>
<CAPTION>

-----------------------------------------------------------------------------------------------------------------
                              Accounting       Date of Initial   Voting                Derivative Ownership
Company                       Method           Investment        Ownership             from Management Services
-----------------------------------------------------------------------------------------------------------------

-----------------------------------------------------------------------------------------------------------------
<S>                           <C>               <C>              <C>                   <C>
Lots Technologies             Cost Method      July 7, 2000      N/A                   0%
-----------------------------------------------------------------------------------------------------------------
S2 Technologies               Equity Method    July 20, 2000     44.2%                 1.1%
-----------------------------------------------------------------------------------------------------------------
Net
Conversions                   Cost Method      June 19, 2000     N/A                   0%
-----------------------------------------------------------------------------------------------------------------
</TABLE>

Costs to  support  Oryx  Ventures  activities  are  primarily  related to salary
expenses  associated  with  providing   management  services  to  our  portfolio
companies.  As  of  February  28,  2003  there  were  two  executives  providing
management services through Oryx Ventures to S2 Technologies. Effective November
30, 2002,  Mitchel Underseth,  the Company's Chief Financial  Officer,  left the
Company to join S2 Technologies.  Currently,  Oryx Ventures  receives equity and
cash fees as payment for providing management services to S2 Technologies.

         Research and Development

         In fiscal  year 2000,  we  transferred  all of our SurgX  research  and
development to Cooper Electronics Technologies, a subsidiary of Cooper Bussmann.
Cooper  Electronics  Technologies  has funded  substantially  all  research  and
development  activities  with respect to SurgX  technology for fiscal years 2002
and 2003. The total amount spent by us on research and development activities in
fiscal years 2002 and 2003 was $256,000 and  $209,000,  respectively.  In fiscal
2002 we reinitiated limited SurgX research and development activities to support
licensees in improving  electrical  performance of SurgX  products.  We were not
successful  in  contracting  with new  licensees  for our SurgX  technology  and
terminated all SurgX development activities in February, 2003.

                                       15
<PAGE>

         Regulation and Environmental Matters

         We are subject to various  federal,  state and local laws,  regulations
and  recommendations  relating  to  safe  working  conditions,   laboratory  and
manufacturing  practices,  and the use and disposal of hazardous or  potentially
hazardous substances. We no longer operate facilities that require practices for
controlling  and  disposing  of the  limited  amount  of waste  and  potentially
hazardous materials.

         Employees

         As of April 30, 2003,  we employed 2 people on a full-time  basis.  Our
full time  employees  consist of one  executive  officer and one  administrative
employee. Our employees are not covered by any collective bargaining agreements,
and we believe our employee relations are satisfactory.

                                       16

<PAGE>

                                  RISK FACTORS

         A purchase of shares of our common stock  involves  financial  risk. In
deciding whether to invest, you should carefully consider the following factors,
the  information  contained in our Form 10-KSB/A for the year ended February 28,
2002 and this Form  10-KSB and the other  information  that we have  referred to
you.

         It is especially  important to keep these risk factors in mind when you
read  forward-looking  statements.  These are  statements  that relate to future
periods and include statements about our:

         o  expected operating results;

         o  market opportunities;

         o  ability to compete; and

         o  stock price.

         Generally,  the words "anticipates,"  "believes,"  "expects," "intends"
and similar expressions  identify  forward-looking  statements.  Forward-looking
statements involve risks and uncertainties,  and our actual results could differ
materially from the results discussed in the forward-looking  statements because
of these and other factors.

         Forward-looking  statements are current only as of the date hereof.  We
do not have any obligation to inform you if forward-looking  statements,  or the
circumstances they are based on, change.


                                  Company Risks

We have a history  of losses,  expect  future  losses  and may never  achieve or
sustain profitability.

         As of February 28, 2003 we had an accumulated  deficit of approximately
$25.8  million.  We incurred  net losses of  approximately  $2.1 million for the
fiscal year ended  February 28, 2003 and $1.5 million for fiscal 2002. We expect
to  continue  to  incur  net  losses  and  these  losses  may  be   substantial.
Furthermore, we expect to generate significant negative cash flow in the future.
We will need to  generate  substantially  higher  royalty  fees to  achieve  and
sustain  profitability  and positive cash flow.  Our ability to generate  future
revenue and achieve  profitability  will depend on a number of factors,  many of
which are described throughout this section. If we are unable to generate higher
royalty fees, we will be unable to build a sustainable  business. In this event,
our share price and the value of your investment  would likely decline.  We must
raise  additional  capital  no later  than July 2003 to  continue  our  business
operations.  As a result of these  circumstances,  our independent  accountant's
report  on  our  consolidated   financial  statements  includes  an  explanatory
paragraph  indicating  that there is  substantial  doubt about Oryx's ability to
continue as a going concern.
                                       17

<PAGE>


There is a significant  risk that our corporate  restructuring  strategy from an
operating  company to a  technology  licensing  and  investment  and  management
services company may not be successful.

         During fiscal years 1998 and 1999 we disposed of  substantially  all of
our operating  businesses and we are now a licensing and  investment  management
services entity,  with our primary source of income deriving from royalties from
our SurgX technology  licensed to Cooper Electronics  Technologies and IRISO. In
the course of selling various  business units, we disposed of operations,  which
had accounted for substantially all of our revenues.  While we believe that this
downsizing has  substantially  reduced our losses and enabled us to focus on key
strategic  businesses,  the actual impact  cannot be certain.  In the absence of
increased sales of products  incorporating our SurgX technology by our licensees
and/or  investment  returns  from our  portfolio  companies,  which have not yet
materialized,  such  restructuring  has  sharply  reduced our  revenues  without
creating opportunities to offset equally the lost revenues.

Our  strategy of relying on licensing  royalties  and using the proceeds to fund
the acquisition of other businesses and technologies presents special risks.

         We have shifted the  strategic  focus of our business from an operating
business exploiting our own developed technologies to a licensing and investment
and management  services  business  where we intend to use the royalty  revenues
from our licensed  SurgX  technology  to fund  investments  by Oryx  Ventures in
start-up  technology  companies.  However,  due to lower than  expected  royalty
payments  received by us from licensing our SurgX  technology,  we have not made
additional  investments  beyond the three portfolio  companies we currently have
invested  in and we have no  current  plans to make any  future  investments  in
companies other than S2 Technologies.  Further, our management services business
is limited to the services we provide to S2 Technologies.  Our business strategy
with Oryx Ventures involves a number of special risks, including:

         o  adverse market conditions for development stage companies; and

         o  the  significant  risk  associated with investment in small start-up
            companies,  given a very unreceptive  financing environment for such
            companies along with a general downturn in the overall economy.

         We have struggled to successfully  address these  problems.  Our future
operating results will depend to a very large degree on the financial success of
S2  Technologies  and upon our  ability  to assist S2  Technologies  in  raising
additional funding. All of the investment  opportunities we have invested in are
early-stage  companies  with  limited  operating  histories  and  limited  or no
revenues.  To date,  none of our portfolio  companies  have met their  projected
financial  targets or  provided  any return to their  investors.  Our ability to
provide  further  funding  to  any  of  these  companies  is  negligible.  These
investments will continue to have a negative impact on our financial statements,
as they have had in the past.  Further,  we have  written  down the value of our
investment in LOTS and Net Conversions to zero. At present, our primary focus is
our  investment  in S2  Technologies.  As of February 28, 2003,  we had invested
approximately  a total of $2.5  million in S2  Technologies;  however,  the book
value of our investment in S2

                                       18
<PAGE>

Technologies  is only  $200,000 as of February 28,  2003,  after  recording  our
equity  method  share of S2  Technologies'  substantial  losses  and a  goodwill
impairment loss. We may not be able to successfully  develop S2 Technologies and
there can be no assurance  that we will either recoup our  investment or receive
any return on our investment in any company we have invested in.

We are dependent on the licensees of our SurgX technology for  substantially all
of our revenues.

         Our future  royalties  from the  licenses of our SurgX  technology  are
based solely upon the successful sales, marketing, manufacturing and development
efforts of our licensees.

         The license  agreements for our SurgX  technology no longer contain any
minimum annual royalty payment  requirements and royalty payments are based upon
product  sales.  There can be no assurance  that the  licensees  will pay us any
royalties or that these royalty payments will provide enough revenue to continue
to  support  our  operations.  In the case of Cooper  Electronics  Technologies,
minimum  royalty  payments  through  June 2001 had  already  been  satisfied  to
maintain its exclusive license. However, Cooper Electronics Technologies did not
make a $1  million  royalty  payment  due on  September  15,  2002  to  maintain
exclusivity and, at such time, its license of our SurgX technology,  pursuant to
the  terms  of the  license  agreement,  automatically  became  a  non-exclusive
license. IRISO had notified us that it had elected not to pay the minimum annual
royalty  for the  royalty  year  ended  October  2002.  As a result  of  IRISO's
election,  the license granted to IRISO converted to a non-exclusive license for
Japan for the remaining term of the license  agreement.  On April 1, 2003, for a
one-time  fee of  $200,000 we executed  an  amendment  to the license  agreement
granting IRISO a non-exclusive  worldwide  license.  To date, Cooper Electronics
Technologies  and  IRISO  have  shipped  only  limited  quantities  of  products
incorporating  SurgX technology to customers and there can be no assurances that
either of these  licensees will ever achieve any  significant  sales revenue for
SurgX  products.  Further,  there can be no assurances  that Cooper  Electronics
Technologies  or IRISO will continue their  respective  licenses with us. In the
event that either  licensee  terminates  its license  with us, we would suffer a
material  adverse  impact  on our  business  and  financial  condition.  We were
attempting  to find  additional  licenses of our SurgX  technology  but were not
successful in doing so.

We may not be able to raise sufficient funds to finance our internal  operations
or investments by Oryx Ventures.

         At present, our primary sources of revenue are from licensing royalties
payable  by the  licensees  of our SurgX  technology  and,  to a lesser  extent,
management  service fees from Oryx Ventures.  We have made  investments in three
portfolio  companies.  However,  we  currently do not have  sufficient  funds to
finance  any  further  investment  in new  companies.  We  anticipate,  based on
management's internal forecasts and assumptions relating to our operations, that
we will need to raise  additional  capital  to  satisfy  our  contemplated  cash
requirements  on or before July 2003.  However,  unless our  existing  licensees
increase sales of SurgX products which results in increased  royalty  revenue to
us, we will not have  sufficient  cash generated from operations to continue our
business in the period starting August 2003. Our present  business plan requires
us to raise  additional  funds.  We are in current  discussions  with respect to
sources of additional financing. However, there can be no assurance that we will
be  successful  in

                                       19
<PAGE>


obtaining  additional  financing or that such  additional  financing would be on
terms  acceptable  to us. As a result of these  circumstances,  our  independent
accountants'  opinion  with  respect to our  consolidated  financial  statements
included in our Form  10-KSB for the year ended  February  28, 2003  includes an
explanatory  paragraph  indicating  that these matters raise  substantial  doubt
about our ability to continue as a going concern.


We may incur significant costs to avoid investment company status and may suffer
adverse consequences if deemed to be an investment company.

         We may incur significant  costs to avoid investment  company status and
may suffer other  adverse  consequences  if deemed to be an  investment  company
under the  Investment  Company  Act of 1940.  Some equity  investments  in other
businesses made by us may constitute investment securities under the 1940 Act. A
company  may  be  deemed  to be an  investment  company  if it  owns  investment
securities  with a value  exceeding 40% of its total assets,  subject to certain
exclusions.   Investment  companies  are  subject  to  registration  under,  and
compliance  with, the 1940 Act unless a particular  exclusion or Commission safe
harbor applies.  If we were to be deemed an investment  company, we would become
subject  to the  requirements  of the 1940 Act.  As a  consequence,  we would be
prohibited from engaging in business or issuing our securities as we have in the
past and we might be subject to civil and criminal  penalties for noncompliance.
In addition,  certain of our contracts might be voidable,  and a court-appointed
receiver could take control of Oryx and liquidate our business.

         Although  our  investment  securities  currently  comprise  30%  of our
assets, fluctuations in the value of these securities or of our other assets may
cause this limit to be exceeded.  This would require us to attempt to reduce our
investment  securities as a percentage of our total assets. This reduction could
be attempted in a number of ways,  including the  disposition  of our investment
securities  in  S2  Technologies.   If  we  sell  investment  securities  of  S2
Technologies,  we may sell them sooner than we otherwise would.  These sales may
be at depressed  prices and we may never realize  anticipated  benefits from, or
may incur losses on, this investment.  Moreover, we may not be able to sell this
investment due to contractual restrictions or the inability to locate a suitable
buyer. Moreover, we may incur tax liabilities when we sell assets.

We depend on certain key employees,  and the loss of any of those  employees may
harm our business.

         Our performance is substantially dependent on the performance of Philip
Micciche,  our President,  Chief Executive Officer and Chief Financial  Officer.
The loss of the services of Mr.  Micciche or the key  employees of our portfolio
companies may harm our business. As of November 30, 2002, Mitchel Underseth, our
Chief  Financial  Officer  terminated  his  employment  with Oryx and  joined S2
Technologies,  one of our  portfolio  companies.  Mr.  Micciche  has assumed the
additional  role of Chief  Financial  Officer,  effective as of Mr.  Underseth's
resignation.

                                       20

<PAGE>


We  rely  on our  licensees,  Cooper  Electronics  Technologies,  and  IRISO  to
manufacture and market products incorporating our SurgX technology and there can
be no assurance that they will be successful in doing so.

         We rely exclusively on our licensees to manufacture and market products
incorporating our SurgX technology.  However, there can be no assurance that our
licensees  will be able to incorporate  manufacturing  process  improvements  in
products  using SurgX  technology  to further  reduce  product  cost and enhance
product performance to allow them to compete in the high volume, low price diode
market. To date our licensees have not been successful in generating significant
profits from the sale of SurgX products or in competing in this market.

         Further, manufacturing development results produced by our licensees in
the future will be influenced by numerous factors, including:

         o  our  licensees'   evaluation  of  the  potential   profitability  of
            continuing to sell SurgX products;

         o  the availability of funding for continuing research and development,
            sales and marketing activities;

         o  technological  developments  by our licensees,  their  customers and
            competitors;

         o  market acceptance of products incorporating the SurgX technology;

         o  our licensees'  capacity to develop and manage the  introduction  of
            new products.

We rely on our licensees  for research and  development  in connection  with our
SurgX technology.

         The  development,  design  and  manufacture  of  technology  constantly
undergo  rapid  and  significant  change.  We  rely  on  our  licensees,  Cooper
Electronics Technologies and IRISO, for technological  improvements to the SurgX
technology. Previously, we had provided limited research and development support
for our SurgX  technology but we terminated this activity  February 1, 2003. Our
success  will  depend  upon our  licensees'  ability to  maintain a  competitive
position with respect to our  proprietary  and other enhanced  technology and to
continue  to  attract  and  retain  qualified  personnel  in all  phases  of our
licensees'  operations.  Our  business  is, to a large  degree,  dependent  upon
enhancements  to the  SurgX  technology.  Critical  to our  success  and  future
profitability  will be the capacity of our licensees to improve this technology.
Product development and enhancement involve substantial research and development
expenditures  and a high degree of risk,  and there is no  assurance  that these
product development efforts will be successful,  will be accepted by the market,
or that such development  efforts can be completed on a cost-effective or timely
basis, or that there will be sufficient  funds to support  development  efforts.
There  can be no  assurance  that  future  technological  developments  by other
companies will not render  existing or proposed SurgX products  uneconomical  or
obsolete.  Furthermore,  there  can be no  assurance  that  our  licensees  will
continue  any  research  and  development  activities  with respect to our SurgX
technology or that,  without  funding from current or any future  licensees,  we
will have the  financial  capacity  to  support  any  research  and  development
activities  with respect to SurgX  technology  internally.  In  September  2001,
Cooper  Electronics

                                       21
<PAGE>

Technologies informed the Company that unless it receives significant orders for
its SurgX based products and/or finds other companies  willing to share in SurgX
development  cost,  it will  significantly  curtail or abandon all SurgX related
development   activities.   While  they  have  not  yet  abandoned   development
activities,  there can be no  assurances  they  will  continue  any  development
activities  related to SurgX  technology  in the future.  Without the  financial
support of the licensees of our SurgX technology, we will not have the financial
capacity to support and conduct SurgX research and development activities. There
can be no assurance that we will receive such support from our licensees.

We may experience  fluctuations in future  operating  results that may adversely
affect the price of our common stock.

         Our quarterly  operating results have in the past been, and will in the
future be, subject to significant fluctuation,  which could adversely affect the
price of our common  stock.  Our  operating  results  are  impacted  by numerous
factors, such as

         o  market acceptance of SurgX products;

         o  Cooper  Electronics  Technologies' and IRISO's continued  marketing,
            sales,  research  and  development  and  financial  support of SurgX
            technology;

         o  negative impact on our balance sheet due to the accounting treatment
            of our investment in portfolio companies.

         The  absence  of  increases  in  demand  for  products  using our SurgX
technology or delays in acceptance of products using SurgX technology would have
a material adverse effect on our operating results.

Potential  intellectual  property  claims  and  litigation  could  subject us to
significant liability for damages and invalidation of our proprietary rights.

         Litigation  may be  necessary  in the future to enforce our patents and
other intellectual property rights, to protect our trade secrets or to determine
the validity and scope of the proprietary rights of others.

         Litigation could harm our business and result in:

         o  substantial settlement or related costs,  including  indemnification
            of customers;

         o  diversion  of  our  or  our  licensee's   management  and  technical
            resources;

         o  discontinuing the use and sale of infringing products;

         o  expending   significant   resources   to   develop    non-infringing
            technology; and

         o  obtaining licenses to infringed technology.

                                       22
<PAGE>

         Our success is heavily dependent upon our proprietary technologies.  We
rely on a  combination  of patent,  trademark,  copyright and trade secret laws,
nondisclosure  and other  contractual  provisions,  and  technical  measures  to
protect our intellectual property rights. Our patents,  trademarks or copyrights
may be challenged  and  invalidated or  circumvented.  Our patents may not be of
sufficient  scope or strength or be issued in all  countries  where our products
can be sold. The expiration of some of our patents may harm our business.

         Others may  develop  technologies  that are  similar or superior to our
technologies, duplicate our technologies or design around our patents. Effective
intellectual  property  protection may be unavailable or limited in some foreign
countries.  Despite  efforts to protect  our  proprietary  rights,  unauthorized
parties may attempt to copy or otherwise  use aspects of  processes  and devices
that we regard as  proprietary.  Policing  unauthorized  use of our  proprietary
information  is  difficult,  and  the  steps  we  have  taken  may  not  prevent
misappropriation of our technologies.

                                 Industry Risks

If our licensees are unable to  successfully  compete in the market for products
using our SurgX technology, our business would be adversely affected.

         The  licensees of our SurgX  technology  are engaged in certain  highly
competitive and rapidly changing segments of the electronic  components industry
in which technological  advances,  costs,  consistency and reliability of supply
are critical to competitive position.  Our licensees compete or may subsequently
compete,  directly or  indirectly,  with a large number of companies,  which may
provide products or components  comparable to those provided by us. In addition,
competitors are likely to be larger,  better  capitalized,  more established and
have greater access to resources necessary to produce a competitive advantage.

We do not have the  financial  resources,  facilities  or  personnel  to perform
research and development and manufacturing operations if a licensee of our SurgX
technology terminates its license with us.

         We rely on our licensees,  Cooper  Electronics  Technologies and IRISO,
for  substantially all of our SurgX research and development and exclusively for
manufacturing of products incorporating our SurgX technology.  At present, we do
not  support   manufacturing   activities   internally  or  SurgX  research  and
development activities. Our business is significantly dependent upon enhancement
and  increasing  sales of  products  incorporating  the SurgX  technology.  Such
activities  involve  substantial  expenditures  and a high  degree  of risk.  At
present,  we do not have the  financial  resources,  personnel or  facilities to
support or manufacture  products  incorporating the SurgX technology.  If either
Cooper Bussmann or IRISO choose to terminate their license agreement with us, we
would not be able to support products incorporating the SurgX technology and the
market  position of SurgX  products as well as our  financial  results  would be
materially adversely affected.

         We are  substantially  dependent upon licensing  revenue  received from
Cooper Bussmann and IRISO, the licensees of our SurgX  technology.  The products
sold by these licensees are incorporated into a variety of electronics products.
The  current  downturn  and any future

                                       23
<PAGE>

slowdown in the market for electronics  products will adversely  affect sales of
products incorporating our SurgX technology which, in turn, will result in lower
royalty  revenue  received by us from our licensees.  This would have a material
adverse effect on our financial condition.

                                Investment Risks

We have not paid and do not intend to pay any dividends on our common stock.

         We have not paid any cash  dividends  on our  common  stock  since  our
inception and do not anticipate paying cash dividends on our common stock in the
foreseeable  future.  The future payment of dividends is directly dependent upon
our  future  earnings,  our  financial  requirements  and  other  factors  to be
determined  by our  board  of  directors,  as well as the  possible  consent  of
lenders,  underwriters or others. For the foreseeable  future, it is anticipated
that any earnings  that may be  generated  from our  operations  will be used to
finance our growth and will not be paid to holders of common stock.

The price of our common stock has been  volatile and may continue to  experience
volatility.

         The market price of our common stock has been,  and in the future could
be, significantly affected by factors such as:

         o  actual or anticipated fluctuations in operating results;

         o  announcements of technical innovations;

         o  new products or new contracts;

         o  competitors or their customers;

         o  developments with respect to patents or proprietary rights;

         o  changes in financial estimates by securities analysts; and

         o  general market conditions.

Our common stock has been delisted from The NASDAQ  SmallCap  Market and trading
in ORYX common stock may be more difficult.

         Our common stock was delisted from The NASDAQ SmallCap Market effective
as of January 10, 2003 due to noncompliance with Nasdaq's minimum  stockholders'
equity  requirement.  Our  common  stock now trades on the OTC  Bulletin  Board.
Delisting of our common stock from The NASDAQ SmallCap Market and trading on the
OTC  Bulletin  Board will likely make it more  difficult to trade shares of Oryx
common stock and for Oryx to raise funds through an issuance of our stock due to
generally  limited  trading  volume  on the  OTC  Bulletin  Board  and  lack  of
institutional  investor  interest  in and  research  analyst  coverage of stocks
traded on the OTC Bulletin Board.

                                       24
<PAGE>

Charter  provisions  may limit the voting power of holders or our common  stock,
and therefore minority  stockholders may not be able to significantly  influence
Oryx's governance or affairs.

         Our board of directors  has the  authority to issue shares of preferred
stock  and  to  determine  the  price,  rights,   preferences,   privileges  and
restrictions,  including voting rights, of those shares without any further vote
or action by  shareholders.  The rights of the  holders of common  stock will be
subject to, and may be  adversely  affected by, the rights of the holders of any
preferred  stock that may be issued in the future.  The  issuance  of  preferred
stock, while providing  flexibility in connection with possible acquisitions and
other corporate purposes,  could have the effect of making it more difficult for
a third party to acquire a majority of our outstanding voting stock.

The conversion or exercise of currently outstanding  convertible  securities and
warrants would result in significant dilution to holders of our common stock.

         As a result of various other transactions  previously entered by us, as
of February 28, 2003, there were outstanding  convertible securities and private
warrants  and options for the  conversion  and  purchase of up to  approximately
397,700 shares of common stock. This represents significant additional potential
dilution for our existing stockholders. The shares of common stock issuable upon
conversion of convertible securities or exercise of warrants are not included in
currently  outstanding  shares.  In addition,  as a result of the  anti-dilution
provisions  included in certain of these  convertible  securities,  there may be
further  dilution  based on the price at which we issue other  securities in the
future.

Item 2.  Description of Property.

         We presently  operate our  businesses  in one facility  located at 4340
Almaden Expressway,  San Jose, California. On August 7, 2001, we entered into an
agreement with  Hessling-Piper  Investments to lease our current offices,  a 550
square  foot  facility  in San  Jose,  California.  The  monthly  rental  fee is
$1,000.00 and the lease terminates August 10, 2003.

         The  property  described  above is in  satisfactory  condition  for the
purpose for which it is used.

Item 3.  Legal Proceedings.

         We know of no material  litigation  or claims  pending,  threatened  or
contemplated to which Oryx is or may become a party.

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

         During the fourth  quarter of our fiscal year ended  February 28, 2003,
no matters were submitted to a vote of security holders.

                                       25

<PAGE>

                                    PART II

Item 5.  Market for Common Equity and Related Stockholder Matters.

         Since our initial public offering of common stock and warrants on April
6, 1994 until  January  9,  2003,  our common  stock and  warrants  have  traded
principally on The NASDAQ  SmallCap Market under the symbols "ORYX" AND "ORYXW,"
respectively.  Commencing  January 10, 2003,  our common stock has traded on the
OTC Bulletin Board under the symbol "ORYX.OB." Prior to April 6, 1994, there was
no public market for our securities. The following table sets forth the high and
low sale prices for our common stock and warrants for the periods indicated,  as
reported by NASDAQ until January 9, 2003 and the OTC Bulletin Board  thereafter.
These quotations reflect prices between dealers, do not include retail mark-ups,
markdowns or commissions and may not necessarily represent actual transactions.


                                         Common Stock
                                      --------------------
                                      High             Low
2002 Fiscal year                      ----             ---
1st Quarter                           $11.25           $  3.50
2nd Quarter                           $  4.90          $  2.25
3rd Quarter                           $  6.25          $  3.20
4th Quarter                           $  6.09          $  3.65

2003 Fiscal year
1st Quarter                           $  4.80          $  1.85
2nd Quarter                           $  2.30          $  1.00
3rd Quarter                           $  1.44          $  0.34
4th Quarter                           $  0.90          $  0.26

         On April 30, 2003 the closing  price for our common stock was $0.65 per
share. As of April 30, 2003 the number of record holders of our common stock was
approximately 89.

         We have never paid cash dividends on our common stock,  however, we pay
a $0.50 annual dividend on outstanding  shares of preferred  stock. We presently
intend to retain  future  earnings,  if any,  to finance  the  expansion  of our
business and do not  anticipate  that any cash  dividends will be paid on common
stock in the  foreseeable  future.  Future  dividend  policy  will depend on our
earnings,  capital requirements,  expansion plans, financial condition and other
relevant  factors as well as the  possible  need to obtain the consent of any of
its lenders.

         The following table summarizes compensation plans (including individual
compensation  arrangements) under which our equity securities are authorized for
issuance as of February 28, 2003:

                                       26

<PAGE>

                                        EQUITY COMPENSATION PLAN INFORMATION

<TABLE>
<CAPTION>
                                                                                                Number of securities
                                                    Number of                                    remaining available
                                                 securities to be       Weighted-average         for future issuance
                                                   issued upon           exercise price              under equity
                                                   exercise of           of outstanding           compensation plans
                                                   outstanding              options,            (excluding securities
                                                options, warrants           warrants                 reflected in
                                                    and rights             and rights                 column (a))
                                                       (a)                    (b)                        (c)
                                                -------------------     ------------------     ------------------------
<S>                                                 <C>                     <C>                        <C>
Equity compensation plans approved by               247,839                 $ 14.75                    91,289
security holders
Equity compensation plans not approved by            50,000                 $  4.89                         -
security holders (1)
Total:                                              297,839                 $ 13.09                    91,289
</TABLE>

         (1)   Warrants   issued  to   Newport   Capital   Consultants   with  a
weighted-average  exercise price of $4.89 per share, issued in connection with a
marketing  agreement for investor  relation  services.  As of February 28, 2003,
these warrants have not been exercised.

Item 6.  Management's Discussion and Analysis or Plan of Operation.

         This Annual Report on Form 10-KSB contains  forward-looking  statements
within the  meaning of the  Private  Securities  Litigation  Reform Act of 1995,
particularly  statements  regarding market  opportunities,  market share growth,
competitive  growth,  new product  introductions  by our  licensees,  success of
research and development efforts by our licensees and customer acceptance of new
products. These forward-looking statements involve risks and uncertainties,  and
the cautionary  statements set forth below identify important factors that could
cause  actual  results to differ  materially  from those  predicted  in any such
forward  looking  statements.  Such  factors  include,  but are not  limited to,
adverse changes in general economic conditions, including adverse changes in the
specific markets for our products, adverse business conditions,  dependence upon
our licensees for the  commercial  success of our products,  adverse  changes in
customer  order  patterns,  increased  competition,  lack of  acceptance  of new
products, lack of success in technological  advancement,  our ability to attract
and retain key executives, adverse capital markets and other business conditions
that may negatively affect companies we have invested in and other factors.

         Business Segments

         Through  fiscal year 2003, we operated in two main  business  segments:
SurgX, a 97% owned subsidiary,  and Oryx Ventures, our investment and management
services  company.  Minority  interest  of  3%  in  SurgX  is  not  significant,
therefore,  it is not reflected in our financial  statements.  These  businesses
operate independently and are supported by a corporate segment providing for all
administrative,   accounting,  and  financial  activities.  As  noted  above  in
"Description  of  Business,"  during  fiscal year 1998, we embarked upon a major
restructuring  program.  This  resulted  in the  sale on  February  27,  1998 of
approximately 80% of our interest in Oryx Instruments and Materials  Corporation
and the sale on March 2, 1998 of

                                       27
<PAGE>

substantially  all of the  assets  and the  entire  business  of Power  Products
Corporation.  As  part  of  the  sale  of our  majority  ownership  position  in
Instruments  and  Materials,  we retained  certain assets from  Instruments  and
Materials  relating  to  sputtering  targets  assembly.  We sold this  remaining
business  during  the  second  quarter  of fiscal  2000,  for a cash  payment of
$400,000.  We retained  approximately  $280,000 in accounts  receivable for this
business  and the  purchaser of the business  assumed  substantially  all of the
liabilities  associated with this business.  In November 2002, we received a one
time royalty  payment for the sale of the  Intragene  technology  and  therefore
there will be no more revenue in the future related to the Intragene technology.
We took  these  steps to  reduce  losses  and  enable us to  concentrate  on our
electrostatic discharge protection business through our SurgX subsidiary.


         Segment/Subsidiary                   Businesses
         ------------------                   ----------
         SurgX Corporation                    o licensing SurgX technology

         Oryx Ventures, LLC                   o management services

                                              o investment in early stage
                                                development companies

         Critical accounting policies

         Management's  discussion  and analysis of our  financial  condition and
results of  operations  are based upon our  consolidated  financial  statements,
which have been  prepared in accordance  with  accounting  principles  generally
accepted in the United States of America.  The  preparation  of these  financial
statements  requires us to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses, and related disclosure of
contingent  assets and  liabilities.  On an on-going  basis,  we evaluate  these
estimates.  We base our estimates on historical  experience and on various other
assumptions  that are believed to be  reasonable  under the  circumstances,  the
results of which form the basis for making  judgments  about the carrying values
of assets and  liabilities  that are not readily  apparent  from other  sources.
Actual results may differ from these estimates  under  different  assumptions or
conditions.

         We believe the following critical  accounting  policies affect our more
significant  judgments and estimates used in the preparation of our consolidated
financial statements:

         Investments

         The various  interests that we have acquired in companies are accounted
         for under three broad methods: consolidation, the equity method and the
         cost method. The applicable  accounting method is generally  determined
         based on our voting interest in a company.

         Consolidation.  Companies  that we directly or  indirectly  control are
         accounted for under the consolidation method of accounting.  Under this
         method,  a company's  accounts are  reflected  within its  consolidated
         financial  statements and all  significant  inter-company  accounts and
         transactions are eliminated.

                                       28

<PAGE>

         Equity Method.  Entities where we can exercise  significant  influence,
         but  not  control,  are  accounted  for  under  the  equity  method  of
         accounting.  Whether  or not we  exercise  significant  influence  with
         respect  to a company  depends  on an  evaluation  of  several  factors
         including,  among  others,  representation  on the  company's  board of
         directors  and  ownership  level,  generally 20% to 50% interest in the
         voting  securities of the company  including  voting rights  associated
         with  our  holdings  in  common,   preferred   and  other   convertible
         instruments in the company. Under the equity method of accounting,  our
         share of the earnings or losses of these  companies are included in the
         equity  income  (loss)  section  of  the  consolidated   statements  of
         operations.

         Cost Method.  Companies  not  consolidated  or accounted  for under the
         equity method are  accounted  for under the cost method of  accounting.
         Under  this  method,  our  share of the  earnings  or  losses  of these
         companies is not included in its consolidated  statements of operations
         until dividends are paid.

         Impairment of investments and long-lived assets

         Our long-lived  assets include cost and equity method  investments  and
         goodwill resulting from our equity method investments.  We periodically
         evaluate the carrying value of our investments for impairment. The fair
         value of the long-term  investments is dependent on the  performance of
         the entities in which we have invested,  as well as volatility inherent
         in the external markets for these investments.

         In assessing  potential  impairment for these  investments  and related
         goodwill  we will  consider  several  factors  as  well  as  forecasted
         financial  performance  of the  companies we have invested in. If these
         forecasts  are not met,  we may have to  record  additional  impairment
         charges not previously  recognized.  During the year ended February 28,
         2003,  we  recognized  impairment  losses of  $412,000  related  to our
         investments in S2 Technologies.  In assessing the recoverability of our
         equity method goodwill,  we must make assumptions  regarding  estimated
         future cash flows and other  factors to determine the fair value of the
         respective  assets.  If these  estimates or their  related  assumptions
         change in the future, we may be required to record  impairment  charges
         for these assets not previously recorded.

         Revenue recognition

         Services  revenue  is for  management  services  pursuant  to time  and
         materials  contracts  and is  recorded  when  services  are  performed,
         contractually  payable and  collectibility  is probable.  Other revenue
         represents  royalty  revenue based upon license  agreements or per unit
         royalties which are recognized  when earned,  reported by the licensee,
         contractually payable and collectibility is probable.

                                       29
<PAGE>

         Allowance for doubtful accounts

         We maintain an allowance  for doubtful  accounts for  estimated  losses
         from the  inability of our  customers  to make  required  payments.  We
         evaluate our allowance for doubtful accounts based on the ageing of our
         accounts receivable, the financial condition of our customers and their
         payment  history,   our  historical   write-off  experience  and  other
         assumptions.

         Accounting for Income Taxes

         We record a valuation  allowance  to reduce our  deferred tax assets to
         the  amount  that is more  likely  that  not to be  realized.  While we
         consider historical levels of income, expectations and risks associated
         with  estimates  of future  taxable  income  and  ongoing  prudent  and
         feasible  tax  planning  strategies  in  assessing  the  need  for  the
         valuation  allowance,  in the event that we determine  that we would be
         able to realize  deferred tax assets in the future in excess of the net
         recorded amount, an adjustment to the deferred tax asset would increase
         income in the period such determination was made.

         Other income (expense)

         The Other income  (expense) in fiscal 2002  includes  equipment  rental
         income that is recognized when contractually  payable and collection is
         probable.

         The above listing is not intended to be a comprehensive  list of all of
our accounting policies. In many cases, the accounting treatment of a particular
transaction  is   specifically   dictated  by  generally   accepted   accounting
principles,  with no need for management's judgment in their application.  There
are  also  areas in which  management's  judgment  in  selecting  any  available
alternative  would not produce a materially  different  result.  See our audited
consolidated  financial  statements and notes thereto which begin on page F-1 of
this Annual Report on Form 10-KSB,  which contain accounting  policies and other
disclosures required by generally accepted accounting principles.

         Consolidated Results of Continuing Operations

         For the fiscal year ended February 28, 2003,  revenues from  continuing
operations  decreased  $217,000 or 36% from $605,000 for the year ended February
28, 2002 to $388,000  for the year ended  February  28,  2003.  The  decrease in
revenue was  primarily  attributed  to a decrease in  management  services  fees
generated  from Oryx  Ventures and  decreases in Intragene  royalty  revenue and
SurgX royalty  revenue.  Oryx Ventures  management  services fees decreased as a
result of limiting our efforts to one portfolio  company,  S2 Technologies.  The
decreases in our  Intragene  royalty  revenue was as a result of the  continuing
decline of the market for the  Intragene  technology  and the  decrease in SurgX
royalty was due to reduced royalty from our licensee,  IRISO as they elected not
to pay the annual  minimum  royalty to  maintain  its  co-exclusivity  in Japan.
Revenue in the future will be derived  primarily  from  royalties from our SurgX
technology  and to a lesser  extent  from  management  service  fees  from  Oryx
Ventures.  To date, the market  opportunity for our SurgX technology has not met
ours or our  licensees'  expectations  and there can be no  assurances  that our
licensees will continue to invest in SurgX related sales, marketing and research
and development activities.  While both SurgX licensees have recently experience
increased  interest and orders for SurgX  products , there can be no  assurances
that sales of SurgX  products  will  increase in the future,  if at all.  Future
royalty  revenues  will be based solely upon the  successful  sales,  marketing,
manufacturing and development efforts of our SurgX licensees.

                                       30
<PAGE>

         Cost of sales  decreased  $59,000 or 29% from  $205,000  for the fiscal
year ended  February 28, 2002 to $146,000 for the year ended  February 28, 2003.
The decrease is primarily  attributable  to the  elimination of cost  associated
with  providing  SurgX liquid to our  licensees  and to reduction of  management
services provided by Oryx Ventures.


         Our gross  profit  decreased  $158,000  or 40 % from a gross  profit of
$400,000  for the  fiscal  year ended  February  28,  2002 to a gross  profit of
$242,000 for the year ended  February 28, 2003. The decrease in gross profit for
the year ended  February  28,  2003 was  primarily  attributed  to a decrease in
Intragene  royalty  revenue,  SurgX royalty revenue and a decrease in management
services fees generated from Oryx Ventures.

         General  and  administrative  expenses  decreased  $124,000 or 11% from
$1,085,000  for the fiscal year ended February 28, 2002 to $961,000 for the year
ended February 28, 2003. The decrease in general and administrative  expenses is
attributed  to  an  overall  decrease  in  operating   expenses,   primarily  in
professional fees, investor relation expenses and facilities expenses, partially
offset  by an  increase  in  corporate  compensation.  We expect  the  operating
expenses to decrease in the future since we are taking  steps to reduce  overall
operating expense.

         Research  and  development  expenses  decreased  $47,000  or  18%  from
$256,000  for the fiscal year ended  February  28, 2002 to $209,000 for the year
ended  February  28,  2003.   This  decrease  is  primarily   related  to  lower
depreciation  expense,  recorded last year on research and development equipment
which we no longer own,  partially offset by an increase in salaries  associated
with our limited SurgX liquid  development  activities  during fiscal year 2003.
Research and development expenditures will decrease during fiscal 2004, since we
terminated the development  activities  related to performance  improvements for
our SurgX liquid  technology  in February  2003,  limiting  future  research and
development expenses to primarily legal expenses related to patent activities.


         For the fiscal year ended  February  28, 2003 we recorded  net interest
income of  $10,000.  This  compares  to $87,000 of net  interest  income for the
fiscal year ended  February 28, 2002.  The  decrease is mainly  attributable  to
lower balances of cash and cash equivalent and lower  effective  interest rates.
We anticipate  less interest income in the future since cash and cash equivalent
balance and interest rates have decreased.

         Investment loss from Oryx Ventures'  activities consists of recognition
of losses relating to our percentage  ownership share of S2  Technologies.  From
our  original  investment  in August 2000  through our  participation  in the S2
Technologies Series B Financing in October 2001, we recognized approximately 71%
of S2  Technologies'  losses,  which  reflected our  percentage of total capital
invested in this company.  Subsequent to the S2 Technologies  Series B Preferred
financing,  based on the addition of new  investors,  Oryx  recognized 35% of S2
Technologies'  losses that reflects Oryx's  percentage of equity ownership in S2
Technologies.  After  our  additional  investment  in S2  Technologies  Series B
Preferred financing in March 31, 2002, Oryx recognized 44.3% of S2 Technologies'
losses.  Since December 2002, we have been recognizing 44.2% of S2 Technologies'
losses.  Investment  loss from Oryx  Ventures  activities  were $787,000 for the
fiscal year ended  February 28,  2003,  compared to $814,000 for the fiscal year
ended February 28, 2002. The decrease in investment loss during fiscal year 2003
was due to recognizing  lower  percentage of losses,  partially offset by higher
losses recorded by S2  Technologies.  At February 28, 2003 the carrying value of
our S2 Technologies investment was $200,000.

                                       31
<PAGE>

         In accordance with paragraph 40 of Statement 142, we have evaluated the
carrying  value  of our  ownership  interest  in S2  Technologies  for  possible
impairment in accordance  with paragraph  19(h) of Opinion 18. As a result of S2
Technologies  not meeting  certain  milestones  established  in fiscal 2003,  we
recorded an impairment  loss of $412,000 for the year ending  February 28, 2003.
The method to  determine  the  goodwill  impairment  loss was based upon  Oryx's
prorata share of S2 Technologies' net realizable value, which consists primarily
of net available cash at February 28, 2003. If S2 Technologies  does not achieve
higher level of sales or cannot  obtain  needed  financing or such  financing is
dilutive to our equity  ownership  interest in S2  Technologies,  our investment
balance of  $200,000  as of  February  28,  2003 may be  subject  to  additional
impairment  charges.  While S2  Technologies  is  behind in  achievement  of its
financial plan  objectives and milestones and overall market  conditions for its
products or services have delayed sales, we believe with the success of numerous
evaluation engagements,  and initial orders with large multinational  companies,
and its  recent  May  2003  financing  round,  S2  Technologies  will be able to
successfully develop its business.

         Mark Underseth,  Chief  Executive  Officer of S2  Technologies,  is the
brother of Mitchel Underseth,  who was the Chief Financial Officer of Oryx until
November 30, 2002. Mitchel Underseth did not participate in Oryx's due diligence
or  negotiations  with  respect to Oryx's  investments  in S2  Technologies  and
abstained from voting or discussion when the Oryx Board of Directors  considered
this matter.  In December 1, 2002,  Mitchel  Underseth joined S2 Technologies as
their Chief Financial Officer.


         We  recorded  $37,000 as other  income  during  the  fiscal  year ended
February 28, 2003 primarily related to equipment rental income. This compares to
$198,000  net other income  recorded  last year  primarily  related to equipment
rental income and to reversal of accrual  associated with business  discontinued
in fiscal 1998.

         We believe our operating  losses will continue  through  fiscal 2004 as
the  anticipated  royalty  revenue from our SurgX and management  fees generated
from Oryx Ventures will not be sufficient to cover expected  expenses for fiscal
2004.

                                       32
<PAGE>

Segment Results

SURGX CORPORATION

                                                    February 28      February 28
(dollars in thousands)                                  2003            2002
--------------------------------------------------------------------------------
Revenues                                                $ 148          $ 200
Cost of sales                                               0             39
                                                        -----          -----
Gross Profit                                              148            161

Operating Expenses                                        209            287
                                                        -----          -----
Operating Loss                                          ($ 61)         ($126)
                                                        =====          =====


         Revenues  consisting  of SurgX  royalty  from IRISO were  $148,000  for
fiscal year ended  February  28, 2003  compared to $200,000  recorded for fiscal
year ended February 28, 2002.  Future SurgX  royalties will be based solely upon
the successful sales,  marketing,  manufacturing and development  efforts of our
licensees,  and we have no view of what level of revenue will be achieved in the
future, if any at all.

         Cost of sales decreased for the fiscal year ended February 28, 2002 was
$39,000  related to cost associated with providing SurgX liquid to our licensee.
We no longer have manufacturing cost since our licensees are manufacturing their
requirement of SurgX liquid.

         Operating  expenses  decreased  $78,000 or 27%,  from  $287,000 for the
fiscal year ended  February 28, 2002 to $209,000 for the year ended February 28,
2003. This decrease is primarily  related to depreciation  expense recorded last
year on research and development  equipment which we no longer own, offset by an
increase  in  salaries  associated  with our limited  SurgX  liquid  development
activities during this fiscal year.  Research and development  expenditures will
decrease  during fiscal 2004,  since we have terminated  development  activities
related to performance  improvements for our SurgX liquid  technology,  limiting
expenses primarily to legal expenses related to patent costs.

                                       33

<PAGE>

ORYX VENTURES, LLC

                                          February 28               February 28
(dollars in thousands)                        2003                      2002
--------------------------------------------------------------------------------
Revenues                                    $ 134                     $ 223
Cost of sales                                 146                       166
                                            -----                     -----
  Gross Profit                                (12)                       57

Operating Expenses                             20                       159
                                            -----                     -----
Operating Loss                              ($ 32)                    ($102)
                                            =====                     =====

         Revenues  consist of management and  consulting  fees provided to third
party companies in which Oryx Ventures does not have an equity investment and to
S2  Technologies,  Inc.  Revenues  for fiscal 2003  decreased  $89,000 or 40% to
$134,000 for the year ended  February 28, 2003 from  $223,000 for the year ended
February  28,  2002.  This  decrease  is  primarily  related  to  reductions  in
consulting  fees  provided  to third party  companies,  offset by an increase in
management  fees from S2  Technologies  where we  devoted  primarily  all of our
efforts.  We will have lower  revenue in fiscal 2004 since the scope of services
supplied to S2 Technologies  has been reduced due to them hiring their own Chief
Financial Officer.  In addition,  we are not actively pursuing new opportunities
to charge fees for management services to other companies through Oryx Ventures.

         Cost of sales is directly related to the allocated salaries  associated
with generating revenues. Gross profit reduction is related to an increase in of
cost  of  sales  in  relation  to  the  fixed  management  fees  charged  to  S2
Technologies.

         Operating  expenses  are  primarily  related  to  salaries  and  travel
expenses  associated  with  providing   management  services  to  our  portfolio
companies  where  we  receive  equity  in lieu of cash  remuneration.  Operating
expenses  decreased  $139,000 or 87%,  from  $159,000  for the fiscal year ended
February 28, 2002 to $20,000 for the year ended  February 28, 2003. The decrease
in  operating  expenses  is  primarily  attributed  to the  absence of  salaries
allocated  to  Oryx  Ventures,  as a  result  of  discontinuance  of  investment
activities.  We anticipate  the same level of operating  expenses  during fiscal
2004.

                                       34
<PAGE>

CORPORATE

                                             February 28         February 28
(dollars in thousands)                          2003                 2002
----------------------------------------------------------------------------

Revenues                                        $ 106               $ 182
Cost of sales                                       0                   0
                                                -----               -----
  Gross Profit                                    106                 182

Operating Expenses                                941                 895
                                                -----               -----
Operating Loss                                  ($835)              ($713)
                                                =====               =====

         Revenue in the corporate  business segment consists of royalty from our
Intragene  technology.  Revenue  decreased  $76,000 or 42% from $182,000 for the
year ended  February 28, 2002 to $106,000 for the year ended  February 28, 2003.
The revenue  decrease  was due to  significantly  lower sales of carbon  targets
using our Intragene technology.  $70,000 out of the $106,000 recorded as revenue
for the year ended February 28, 2003,  represents a one time royalty payment for
the sale of the Intragene technology and therefore there will be no more revenue
in the future related to the Intragene technology.

         The increase in operating expenses from corporate operations of $46,000
or 5% from $895,000 for the fiscal year ended  February 28, 2002 to $941,000 for
the fiscal  year ended  February  28, 2003  primarily  relates to an increase in
corporate  compensation  due to reduced  allocation of salary expense charged to
Oryx Ventures as salaries offset by an overall reduction in operating  expenses,
primarily in  professional  fees,  investor  relation  expenses  and  facilities
expenses.  We expect the  operating  expenses to decrease in the future since we
are taking steps to reduce overall operating expense.

         Liquidity and Capital Resources

         Our  working  capital  decreased  $1,702,000  or 84% from a surplus  of
$2,025,000  at February 28, 2002,  to a surplus of $323,000 at February 28, 2003
primarily  attributed  to cash used for  investments  by Oryx Ventures and a net
loss from operations  during fiscal 2003. Our ratio of current assets to current
liabilities was 3.5:1 at February 28, 2003 and 10.8:1 at February 28, 2002.

         Net cash used in  operations  was  $724,000  and $644,000 for the years
ended February 28, 2003 and 2002,  respectively.  This represents an increase of
$80,000 or 12%. Cash used in operation  consisted  primarily on operating losses
adjusted  for  non-cash  related  items,  which  includes  loss on  investments,
impairment  and  depreciation.  During  fiscal 2003,  decreases in other current
assets, as we collected other  receivables for equipment rental,  were offset by
decrease in accrued liabilities primarily related to lower compensation accruals
and lower professional fees accruals.

                                       35
<PAGE>

         Net cash used in investing  activities was $946,000 for the fiscal year
ended  February 28, 2003  compared to net cash used in investing  activities  of
$1,106,000  for fiscal 2002.  The net cash used in investing  activities for the
fiscal  year  ended  February  28,  2003  and  2002  consisted  primarily  of an
investment of $938,000 and $1,105,000,  respectively, in S2 Technologies' Series
B  Preferred  Stock by Oryx  Ventures.  We do not  expect  to have any  material
capital  expenditures for the year ended February 28, 2004. On May 5, 2003, Oryx
Ventures made an  additional  investment  of $200,000 in S2  Technologies.  As a
result  of this  latest  investment,  Oryx  now has an  equity  ownership  in S2
Technologies of approximately 38.9% on a fully diluted basis.

         Net cash used in  financing  activities  was $2,000 for the fiscal year
ended  February  28,  2003.  This  compares  to  $497,000  net cash  provided by
financing  activities  for the fiscal year ended  February  28,  2002.  Net cash
provided by financing activities for the fiscal year ended February 28, 2002 was
primarily  attributed  to  approximately  $499,000  in  proceeds  from a private
placement  of our  common  stock in October  2001.  On October  31,  2001,  Oryx
Technology Corp.  completed a private  placement of 162,338 shares of its common
stock at a purchase price of $3.08 per share, resulting in aggregate proceeds to
Oryx  Technology  Corp.  of $499,000.  The investors  also received  warrants to
purchase 37,975  additional  shares of Oryx Technology Corp.  common stock at an
exercise  price of $5.925 per share.  The common stock and warrants sold in this
private  placement have not been registered under the Securities Act of 1933, as
amended,  and may not be offered or sold in the United  States in the absence of
an  effective   registration   statement  or  an  exemption  from   registration
requirements.

         We do not  have  sufficient  capital  to meet our  anticipated  working
capital  requirements through fiscal year 2004. We must raise additional capital
through  public or private  financings  or other  arrangements  in order to have
sufficient  cash  to  continue  our  business  operations.  Due to  recent  cost
reductions  based upon our  internal  forecast  and  assumptions,  we  currently
estimate  that we will have to cease  operations  if we do not raise  additional
funding  on or  before  July  2003.  During  fiscal  year  2003,  we were not in
compliance with Nasdaq's minimum  stockholders'  equity  requirement to maintain
our listing on The NASDAQ  SmallCap Market and on January 10, 2003 our stock was
delisted  from The NASDAQ  SmallCap  Market  and now trades on the OTC  Bulletin
Board.  Delisting  of our common  stock will make it more  difficult  for use to
issue stock to raise additional funding.

         We are actively exploring financing  opportunities,  however, there can
be no assurance that we will be successful in raising any additional  funding at
all or in time to meet our financial  needs or that any such funding would be on
terms acceptable to us or in the best interest of our stockholders. If we cannot
raise additional capital on or before July 2003 on acceptable terms, we will not
be able to achieve our business objectives and continue as a going concern. As a
result of these circumstances, our independent accountants' opinion with respect
to our consolidated  financial  statements  included in this Form 10-KSB for the
year ended February 28, 2003 includes an explanatory  paragraph  indicating that
these matters raise  substantial  doubt about our ability to continue as a going
concern.


     Recent accounting pronouncements

         In July 2001, the FASB issued FASB Statements Nos. 141 and 142 (FAS 141
and FAS  142),  "Business  Combinations"  and  "Goodwill  and  Other  Intangible
Assets."  FAS  141  supercedes   APB  16  and  eliminates   pooling-of-interests
accounting  prospectively.  It also  provides


                                       36
<PAGE>

guidance on purchase  accounting related to the recognition of intangible assets
and  accounting  for  negative  goodwill.  FAS 142  changes the  accounting  for
goodwill from an amortization method to an impairment-only  approach.  Under FAS
142,  goodwill is tested  annually and whenever  events or  circumstances  occur
indicating that goodwill might be impaired. We adopted FAS 142 on March 1, 2002.
We have  evaluated  the impact of adoption of these  standards on our  financial
position and results of operations  and  determined  that the primary  impact is
that equity method goodwill is no longer amortized, but that it is still subject
to  impairment  guidelines  under APB No. 18. As of February 28,  2003,  we have
equity method goodwill recorded as a result of our investment in S2 Technologies
that is not subject to amortization.  This goodwill was generated after June 30,
2001 and as such no amortization was recorded during fiscal 2002. See note 4 for
discussion of goodwill impairment recorded in fiscal 2003.

         In  October  2001,  the  FASB  issued  FAS  No.  144,  "Accounting  for
Impairment or Disposal of Long-Lived Assets." FAS No. 144 addresses  significant
issues  relating  to the  implementation  of FAS No.  121,  "Accounting  for the
Impairment of Long-Lived  Assets and for  Long-Lived  Assets to Be Disposed Of,"
and develops a single  accounting  method under which long-lived assets that are
to be  disposed  of by sale are  measured at the lower of the book value or fair
value  less  cost to  sell.  Additionally,  FAS No.  144  expands  the  scope of
discontinued  operations to include all components of an entity with  operations
that  (1) can be  distinguished  from  the  rest of the  entity  and (2) will be
eliminated from the ongoing  operation of the entity in a disposal  transaction.
FAS No. 144 is  effective  for  financial  statements  issued  for fiscal  years
beginning  after  December  15,  2001  and  its  provisions  are  to be  applied
prospectively.  We adopted FAS 144 in fiscal 2003.  The  implementation  of this
standard did not have a material impact on our results of operations.

         In May  2002,  the  FASB  issued  FAS  No.  145,  "Rescission  of  FASB
Statements Nos. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." FAS No. 145 eliminates Statement 4 (and Statement 64, as it amends
Statement 4), which requires gains and losses from extinguishments of debt to be
aggregated  and, if material,  classified as an  extraordinary  item, net of the
related income tax effect. As a result,  the criteria in APB Opinion 30 will now
be used to classify  those gains and losses.  FAS No. 145 amends FASB  Statement
No. 13 to require that certain lease  modifications  that have economic  effects
similar to  sale-leaseback  transactions  be accounted for in the same manner as
sale-leaseback  transactions.  This amendment is consistent with the FASB's goal
of requiring  similar  accounting  treatment for transactions  that have similar
economic effects. In addition,  FAS 145 makes technical  corrections to existing
pronouncements.  While those  corrections are not substantive in nature, in some
instances,  they may change accounting practice. This statement is effective for
fiscal  years  beginning  after  May  2002  for the  provisions  related  to the
rescission  of  Statements  4 and  64,  and for all  transactions  entered  into
beginning  May 2002 for the  provision  related to the amendment of Statement 13
although early  adoption is permitted.  We do not expect the  implementation  of
this standard to have a material impact on our results of operations.

         On July 2002, the Financial  Accounting  Standards Board (FASB) adopted
FASB Statement No. 146 (FAS 146),  Accounting  for Exit or Disposal  Activities,
effective for exit or disposal  activities that are initiated after December 31,
2002,  with early  adoption  encouraged.


                                       37
<PAGE>

FAS 146 addresses significant issues regarding the recognition, measurement, and
reporting  of costs  that are  associated  with  exit and  disposal  activities,
including restructuring  activities that are currently accounted for pursuant to
the guidance  that the  Emerging  Issues Task Force (EITF) has set forth in EITF
Issue No. 94-3, Liability  Recognition for Certain Employee Termination Benefits
and Other  Costs to Exit an  Activity  (including  Certain  Costs  incurred in a
Restructuring).  A fundamental conclusion reached by the Board in this Statement
is that an entity's  commitment to a plan, by itself,  does not create a present
obligation to others that meets the definition of a liability.  Therefore,  this
Statement  eliminates the definition and  requirements  for  recognition of exit
costs in Issue 94-3.  This  statement  also  establishes  that fair value is the
objective for initial  measurement of the  liability.  The scope of FAS 146 also
includes (1) costs related to terminating a contract that is not a capital lease
and (2)  termination  benefits that employees who are  involuntarily  terminated
receive  under the terms of a  one-time  benefit  arrangement  or an  individual
deferred-compensation  contract.  We do not  expect  this  standard  will have a
material impact on our result of operations.

         In November  2002,  the FASB issued  FASB  Interpretation  No. 45 ("FIN
45"),  "Guarantor's  Accounting  and  Disclosure  Requirements  for  Guarantees,
Including Indirect Guarantees of Indebtedness of Others." FIN 45 requires that a
liability  be  recorded  in the  guarantor's  balance  sheet upon  issuance of a
guarantee. In addition, FIN 45 requires disclosures about the guarantees that an
entity has issued,  including a  rollforward  of the entity's  product  warranty
liabilities. We will apply the recognition provisions of FIN 45 prospectively to
guarantees  issued after February 28, 2003. The disclosure  provisions of FIN 45
are  effective.  At February 28, 2003,  no  guarantees  were issued by us and no
product warranty liability was recorded by the Company. The Company has included
additional disclosures in accordance with FIN45 in Note 9.

         In  December  2002,  the FASB  issued  SFAS No.  148,  "Accounting  for
Stock-Based  Compensation,  Transition  and  Disclosure."  SFAS No. 148 provides
alternative methods of transition for a voluntary change to the fair value based
method of accounting for stock-based  employee  compensation.  SFAS No. 148 also
requires that disclosures of the pro forma effect of using the fair value method
of  accounting  for   stock-based   employee   compensation  be  displayed  more
prominently  and in a  tabular  format.  Additionally,  SFAS  No.  148  requires
disclosure  of the  pro  forma  effect  in  interim  financial  statements.  The
transition and annual disclosure  requirements of SFAS No. 148 are effective for
fiscal year 2003. We have included  additional  disclosures  in accordance  with
SFAS No. 48 in Note 1.


         In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"),
"Consolidation of Variable Interest Entities, and Interpretation of ARB No. 51."
FIN 46 requires  certain  variable  interest  entities to be consolidated by the
primary  beneficiary of the entity if the equity  investors in the entity do not
have the  characteristics  of a  controlling  financial  interest or do not have
sufficient  equity at risk for the  entity to  finance  its  activities  without
additional  subordinated  financial  support  from  other  parties.  FIN  46  is
effective  for all new  variable  interest  entities  created or acquired  after
January 31, 2003. For variable  interest  entities  created or acquired prior to
February 1, 2003, the provisions of FIN 46 must be applied for the first interim
or annual period beginning after June 15, 2003. We are currently  evaluating the
effect that the  adoption of FIN 46 will have on our results of  operations  and
financial condition. We expect that the adoption of FIN-46 may have primarily an
impact on our investment in S2 Technologies Inc.

                                       38
<PAGE>

Item 7.  Financial Statements.

         The response to this item is submitted in Item 13.

Item 8.  Changes In and  Disagreements  With  Accountants  on Accounting  and
         Financial Disclosure.

         Not applicable.

Item 9.  Directors,   Executive   Officers,   Promoters  and  Control   Persons;
         Compliance with Section 16(a) of the Exchange Act.

         The  names  and ages of our  directors  and  executive  officers  as of
February 28, 2003 are as follows:

Name                               Position                                 Age
----                               --------                                 ---
Philip J. Micciche                 President, CEO and Director              69
Andrew Intrater                    Secretary, Treasurer and Director        41
Dr. John H. Abeles                 Director                                 58
Jay M. Haft                        Director                                 67
Doug McBurnie                      Director                                 60

         PHILIP J. MICCICHE has served as Oryx'  President  and Chief  Executive
Officer and as a director of Oryx since April 25, 1997.  From 1993 through 1995,
Mr.  Micciche  was Chief  Executive  Officer of AXCIS  Information  Networks,  a
provider of sports  information  data.  From 1990 through 1992, Mr. Micciche was
President of Dysan  International/Magnetics  L.P. and oversaw its initial public
offering in Hong Kong in 1991. From 1983 through 1990, he held several executive
management  positions at Xidex Corp.  From 1983 through 1985,  Mr.  Micciche was
Senior Vice President  Marketing at Xidex  Magnetics,  where sales increased $42
million in that  two-year  time period.  Xidex merged with Dysan Corp.  in 1985.
Prior to 1983, Mr.  Micciche held  positions as Chief  Executive  Officer,  Vice
President Sales, Product Sales Manager and Chief Engineer for various companies.
Mr. Micciche received his BSEE from Northeastern University in Boston.

         ANDREW  INTRATER has been a director,  Secretary  and Treasurer of Oryx
since its  organization  in July 1993.  He was  employed  in  various  executive
capacities with Oryx from July 1993 until March 1998, when he resigned following
the sale of Oryx' majority  ownership  position in Oryx  Instruments & Materials
Corporation,  since renamed as Oryx  Instruments

                                       39
<PAGE>

Corporation.  Mr.  Intrater  is  currently  the  Chairman  of the  Board of Oryx
Instruments   Corporation.   Mr.  Intrater  previously  held  various  executive
positions with ATI, the predecessor  corporation to Oryx and served as President
of ATI and was a director since 1983. Mr. Intrater received his B.S. in Chemical
Engineering from Rutgers  University and completed graduate studies in Materials
Science at Columbia University.

         JOHN H. ABELES, M.D. has been a director of Oryx since its organization
in July 1993 and served as Chairman of its board of directors  from October 1993
until April 1997.  Since March 1992,  Dr.  Abeles has been a General  Partner of
Northlea Partners Ltd., a private investment  partnership  headquartered in Boca
Raton, Florida. Since 1980, Dr. Abeles has also been President of MedVest, Inc.,
a business and  financial  consulting  firm.  Dr.  Abeles serves on the board of
directors of I-Flow  Corporation,  a publicly  traded company that  manufactures
infusion devices, DUSA Pharmaceuticals,  Inc., a publicly traded company,  which
is developing photodynamic therapy products,  Encore Medical Corporation,  which
is an  orthopedic  implant,  concern  and  Molecular  Diagnostics,  Inc.  f.k.a.
Ampersand Medical Inc., which is researching  medical diagnostic  equipment.  Dr
Abeles  received  his  Medical  degree  and a degree  in  Pharmacology  from the
University of Birmingham, England, in 1970.

         JAY M. HAFT has been a director of Oryx since  February  1995.  He is a
strategic and financial  consultant for growth stage companies.  He is active in
international   corporate  finance,   mergers  and  acquisitions,   and  in  the
representation of emerging growth companies.  Mr. Haft has been Managing General
Partner of GenAm "1" Venture Fund, an  international  venture capital fund and a
director of numerous public and private  corporations,  including Robotic Vision
Systems, Inc. (RVSI), Encore Medical Corporation, DUSA Pharmaceuticals,  Inc. He
is of counsel to Reed Smith LLP in New York and  previously a senior  partner of
Parker  Duryee  Rosoff & Haft in New York.  He is a former member of the Florida
Commission  of  Government  Accountability  to the People and a former  National
Trustee and  Treasurer of the Miami City Ballet,  and is currently a director of
Florida  International  University  and a member  of the  Advisory  Board of the
Wolfsonian Museum and the FIU Law School.

         DOUG MCBURNIE has been a director of Oryx since July 1997. Mr. McBurnie
is retired.  From September 1997 to December 1998, he was Senior Vice President,
in the Computer,  Consumer & Network Products Group, of VLSI Technology. In that
position he was responsible for VLSI's businesses in Advanced Computing, ASIC's,
Consumer Digital Entertainment and Local/Wide Area Networking.  Prior to joining
VLSI, Mr.  McBurnie was with National  Semiconductor  from May 1994 to September
1997  where  he  was  senior  vice  president  and  general   manager  of  their
Communications and Consumer Group. Previously, he was vice president and general
manager  of  National's  Local  Area  Network  Division.  Under his  leadership,
National  became the recognized  leader in networking  circuits,  one of the top
telecom  IC  suppliers,  and  made a strong  push  into  consumer  entertainment
markets.  Prior  to  joining  National  Semiconductor,  Mr.  McBurnie  held  key
executive  positions at a number of Silicon Valley  companies,  including  Xidex
Corporation,  Precision  Monolithics and Fairchild  Semiconductor.  Mr. McBurnie
holds a Bachelor of Arts degree in business  administration from Baldwin Wallace
College in Berea, Ohio.

                                       40
<PAGE>

         All directors are elected  annually by our stockholders and serve until
their respective  successors are duly elected and qualified.  There is no family
relationship between any director or executive officer of Oryx.

Board Committees and Meetings

Board of Directors

         During the fiscal  year  ending  February  28,  2003,  there were seven
meetings of the board of  directors.  Each board member  attended 86% or more of
the  aggregate of the meetings of our board of directors and the meetings of all
committees  of the board of  directors  on which he served,  except for a former
director who attended 33% of such meetings.

Compensation Committee

         The  compensation  committee  was  established  on March 28, 1995.  The
members of the  compensation  committee  are Dr. John H. Abeles and Jay M. Haft,
none  of  whom  is  an  employee  of  Oryx.  The  compensation  committee  makes
recommendations  with respect to compensation of senior officers and granting of
stock options and stock awards.  The compensation  committee met once during the
fiscal year ended February 28, 2003.

Audit Committee

         The  audit  committee  was  established  on March 28,  1995.  The audit
committee  is composed of three  members and  operates  under a written  charter
adopted by the board of directors.  The  responsibilities of the audit committee
are contained in the Audit Committee Report filed with our proxy statement.  The
audit  committee  during  fiscal year 2003  consisted of Andrew  Intrater,  John
Abeles and Doug  McBurnie.  Mr. Abeles and Mr.  McBurnie are  "independent,"  as
defined by Oryx policy and the National Association of Securities Dealers,  Inc.
listing standards. The board has determined to appoint one director to the audit
committee who is not  "independent" as defined by Oryx policy and the applicable
listing  standards.  All other audit committee  members are independent.  Andrew
Intrater  serves as the Secretary and Treasurer of Oryx and,  therefore,  is not
independent.  The board has  determined  to  appoint  Mr.  Intrater  as an audit
committee member because of his specific business  experience relative to Oryx's
business.  The board has further  determined that Mr.  Intrater's  position with
Oryx  will not  interfere  with his  providing  impartial  advice  to the  audit
committee and that Mr. Intrater's  service on the audit committee is in the best
interests  of Oryx and its  stockholders.  The audit  committee  met once  every
quarter during the fiscal year ended February 28, 2003.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

         Section  16(a) of the  Securities  Exchange  Act of 1934,  as  amended,
requires our directors and executive officers, and persons who own more than 10%
of a  registered  class of our equity  securities,  to file with the SEC initial
reports of  ownership  and reports of changes in  ownership  of common stock and
other  equity  securities  of Oryx.  Officers,  directors  and greater  than 10%
stockholders are required by the SEC regulation to furnish us with copies of all
Section 16(a) forms they file.

                                       41
<PAGE>

         To our  knowledge,  based  solely  on a review  of the  copies  of such
reports and amendments thereto furnished to us and written  representations from
the reporting persons that no other reports were required during the fiscal year
ended  February 28, 2003, we believe that all Section 16(a) filing  requirements
applicable to the officers,  directors and greater than 10% beneficial owners of
Oryx were complied with during the fiscal year ended February 28, 2003.

Item 10. Executive Compensation.

Cash Compensation

         The  following  table sets forth the total  compensation  earned by the
Chief  Executive  Officer and the other  executive  officers of Oryx whose total
salary  and  compensation   exceeded  $100,000  for  services  rendered  in  all
capacities for the year ended February 28, 2003,  February 28, 2002 and February
28, 2001.

                                      Summary Compensation Table

<TABLE>
<CAPTION>
Name and                    Fiscal                                        Other Annual          All Other
Principal Position          Year        Salary          Bonus             Compensation          Compensation
------------------          ------      ------          -----             ------------          ------------
<S>                         <C>         <C>             <C>               <C>                   <C>
Philip Micciche,            2003        $186,670        $   --            $  7,515 (1)          $       --
President & Chief           2002        $176,000        $   --            $  7,142 (1)          $       --
Executive Officer           2001        $176,000        $   --            $  6,228 (1)          $       --


Mitchel Underseth           2003        $154,808        $   --            $   --                 $  22,900 (2)
Chief Financial             2002        $ 90,500        $   --            $   --                 $      --
Officer                     2001        $ 90,500        $   --            $   --                 $      --
</TABLE>

         (1)  All other  compensation  consists of vehicle  allowance provide to
              Mr. Micciche

         (2)  Severance   payment  to  Mr.   Underseth  at  termination  of  his
              employment with Oryx.

         The following  table sets forth as to the Chief  Executive  Officer and
each of the  executive  officers  named  under the Summary  Compensation  Table,
certain  information  with respect to options to purchase shares of common stock
of Oryx as of and for the year ended  February  28,  2003.  We did not grant any
options to officers for the fiscal year ended February 28, 2003.

                                       42
<PAGE>

                             Year and Fiscal Year-End Option SAR/Values

<TABLE>
<CAPTION>
                                                                         Number of              Value of unexercised
                                                                         unexercised            in-the-money
                                                                         Options/SARS at        Options/SARS
                             Shares                                      FY-end (#)             at FY-end ($)
                             Acquired on         Value                   exercisable/           exercisable/
Name                         Exercise (#)        Realized ($)            unexercisable          unexercisable(1)
----                         ------------        ------------            -------------          ----------------
<S>                              <C>                 <C>                 <C>                    <C>
Philip Micciche                  -                   -                   88,003 / 0             0/0
Andrew Intrater                  -                   -                   40,565/  4,000         0/0
--------------------------------------------------------------------------------------------------------------------
</TABLE>

         (1)  Calculated on the basis of the closing price of $0.45 per share on
February 28, 2003 minus the exercise price.

Employment Agreements

         We entered into an employment  agreement  dated as of April,  2002 with
Mr.  Philip  Micciche,  Chief  Executive  Officer,  terminable  by either party,
providing for annual compensation of $200,004 to Mr. Micciche from March 1, 2002
through  February 28, 2004.  Bonuses or incentive  compensation  and  additional
stock option  grants may be paid or granted in the sole  discretion of the board
of directors.  In the event Mr.  Micciche is terminated  without cause by us, he
will  receive  all  compensation  and  benefits  for the  remaining  term of the
employment  agreement.  Starting January 1, 2003, Micciche agrees to permanently
defer $6667 per month and the total  amount  deferred is payable  only when Oryx
Technology is profitable for two  consecutive  quarters.  The payable  condition
will terminate on December 30, 2007.  The deferral  period will end February 29,
2004 or sooner if directed by the Board of Oryx.

         Pursuant to the  Amended  and  Restated  Operating  Agreement  for Oryx
Ventures, LLC, Philip Micciche, Mitchel Underseth and Luis Borge are entitled to
receive an aggregate of 20% of any distributions made by Oryx Ventures.

         We  currently  offer basic  health and major  medical  insurance to our
employees.  We have adopted a non-contributory 401(k) plan for our employees who
wish to participate on a voluntary basis, but no retirement,  pension or similar
program has been adopted by us.

Remuneration of Non-Employee Directors

         Each member of the board of directors who is not an employee of Oryx is
compensated  for his  services as  director  as follows:  $750.00 for each board
meeting  attended  in person,  and $250.00  for each board  meeting  attended by
telephone.  In addition,  each non-employee  member of the board of directors is
granted stock options under the director's  non-qualified  stock option plans as
described below.

                                       43
<PAGE>

Description of Incentive and Nonqualified Stock Option Plan

         On March 3, 1993,  we adopted  the  incentive  and  nonqualified  stock
option plan, or the plan, pursuant to which, 362,500 shares of common stock have
been reserved for issuance to officers, directors,  employees and consultants of
Oryx upon  exercise of options  granted under the plan.  The plan  terminated on
March 3, 2003 and no  additional  options will be granted  under this plan.  The
primary  purpose  of the  plan is to  attract  and  retain  capable  executives,
employees,  directors,  advisory board members and other consultants by offering
such  individuals  a greater  personal  interest in our business by  encouraging
stock ownership.  Options granted under the plan may be designated as "incentive
stock options" within the meaning of Section 422 of the Internal Revenue Code of
1986 or  nonstatutory  options.  The  plan  is  administered  by a  compensation
committee of the Board of Directors  consisting of outside  members of the board
of directors which will determine, among other things, the persons to be granted
options,  the number of shares subject to each option and the option price.  The
exercise  price of any  incentive  stock option  granted  under the plan must be
equal to the fair  market  value of the  shares on the date of  grant,  and with
respect to persons  owning more than 10% of the  outstanding  common stock,  the
exercise  price may not be less than 110% of the fair market value of the shares
underlying such option on the date of grant.  The exercise price of nonstatutory
stock  options may not be less than 85% of the fair  market  value of the shares
underlying  such  options,  and the term of such  nonqualified  options  may not
extend  beyond  ten  years  and one  week.  No  incentive  stock  option  may be
exercisable  more than ten years after the date of grant,  except for  optionees
who own more than 10% of the our common stock,  in which case the option may not
have a term greater than five years. The compensation committee has the power to
impose  additional  limitations,  conditions and restrictions in connection with
the grant of any option.

         There are issued and  outstanding  options to purchase an  aggregate of
226,839 shares of common stock pursuant to the plan. The following  officers and
key employees of Oryx have previously been granted options under the plan at the
weighted-average exercise prices described below as of April 30, 2003:

                           Number                               Average Exercise
Name                       of Shares                            Price
----                       ---------                            ----------------
Philip Micciche            88,003                               $        14.491
Andrew Intrater            44,565                               $        14.949


Directors' Non-Qualified Stock Option Plans

         At our 1995 annual stockholders' meeting, our stockholders approved the
establishment of the 1995 directors non-qualified stock option plan, or the 1995
directors plan, providing for grants to our non-employee  directors,  or outside
directors,  in order to attract and retain outside  directors who possess a high
degree of competence, experience, leadership and motivation.

                                       44
<PAGE>

         A total of 22,500  shares  of  common  stock  have  been  reserved  for
issuance  exercise of  non-qualified  options under the 1995 directors plan. The
1995 director's plan is administered by the compensation  committee of our board
of directors, which will at all times consist solely of outside directors. Under
the 1995 directors plan,  outside  directors  received options to purchase 4,500
shares of our common  stock,  effective  as of  February 6, 1995.  Each  outside
director who joins our board of directors subsequent to the approval of the 1995
directors  plan will initially  receive  options to purchase 4,500 shares of our
common stock,  effective as of the date he or she is appointed or elected to our
board of directors.  Each outside director will also receive options to purchase
1,500 shares of our common  stock at such time as his or her initial  grants are
fully vested.  All options  granted under the 1995  directors plan vest in three
equal annual  installments on the first,  second and third  anniversaries of the
date of the grant,  provided that the outside director continues to serve on our
board of directors as of such dates.

         At our 1996 annual stockholders' meeting, our stockholders approved the
1996  directors  non-qualified  stock option plan, or the 1996  directors  plan,
providing  for grants to our  outside  directors  in order to attract and retain
outside  directors  who  possess  a  high  degree  of  competence,   experience,
leadership and motivation.

         A total of 25,000  shares  of  Common  Stock  have  been  reserved  for
issuance upon exercise of  non-qualified  options under the 1996 directors plan.
The 1996 director's plan is  administered by the  compensation  committee of our
board of directors, which will at all times consist solely of outside directors.
Under the 1996 directors plan,  outside  directors  received options to purchase
3,000 shares of our common  stock,  effective as of April 1, 1996.  Each outside
director who joins our board of directors subsequent to the approval of the 1996
directors  plan will initially  receive  options to purchase 3,000 shares of our
common stock,  effective as of the date he or she is appointed or elected to our
board of  directors.  Ten thousand of the option  shares  granted under the 1996
directors  plan vest on the date of grant and the balance  vest in equal  annual
installments  on the  first  and  second  anniversaries  of the  date of  grant,
provided that the outside director  continues to serve on our board of directors
as of such dates.

         The  exercise  price of the  options  granted  under  the 1995 and 1996
directors plans will equal the fair market value of our common stock on the date
of  grant.  The  options  are not  transferable,  except  upon the  death of the
optionee.  In the event of an optionee's  disability,  all options  granted will
immediately  vest,  and in the event of an  optionee's  death,  all options will
similarly  vest but  expire  one year  thereafter.  In the  event  the  optionee
voluntarily  resigns  from the board of  directors or ceases to serve as a board
member,  options  that  are  vested  through  the  date of such  resignation  or
cessation  may be exercised  for a period of three months  thereafter.  Both the
1995 and 1996 directors plans provide,  respectively,  that such plan may not be
amended  more than once every six months,  other than to comport with changes in
the Internal Revenue Code of 1986, as amended,  the Employee  Retirement  Income
Security Act, or the rules thereunder.  The Compensation Committee has the power
to impose additional limitations, conditions and restrictions in connection with
the grant of any  option  under the 1995  directors  plan or the 1996  directors
plan.

                                       45
<PAGE>

         On October 22, 2001,  all directors,  excluding  directors and officers
were each granted non-statutory options to purchase 6,000 shares of Common Stock
at an exercise price of $3.95 under the Incentive and Non Qualified Stock Option
plan.  These options will vest in three equal annual  installments on the first,
second  and third  anniversaries  of the date of the  grant,  provided  that the
outside director continues to serve on our board of directors as of such dates.

Subsidiary Stock Plans

         In November 1995, our subsidiary,  SurgX  Corporation,  adopted a stock
option  plan under  which the board of  directors  of SurgX  granted  options to
management  to  purchase  Class B common  shares in the  subsidiary  at the fair
market value of such shares as determined by the SurgX board of directors. Class
B common shares authorized for issuance in SurgX are identical to the 10,000,000
shares  of Class A common  shares  owned by us,  except  that the Class A common
shares  possess a liquidation  preference.  1.5 million  shares of SurgX Class B
common shares are available for issuance under this stock plan. Such options are
not  transferable  except in the event of a public offering of the  subsidiary's
stock,  and may be re-purchased  by us at our option.  Grants under the plan are
for amounts,  vesting periods and option terms established by the SurgX board of
directors. As of April 30, 2003, there were no outstanding SurgX stock options.

Item 11. Security Ownership of Certain Beneficial Owners and Management

         The following  table sets forth  information  regarding the  beneficial
ownership of the our common stock as of April 30, 2003

         o  by each person who is known to us to be the owner of more than 5% of
            our common stock;

         o  by each of our directors;

         o  by each of our executive officers; and

         o  by all directors and executive officers of Oryx as a group.

         As of April 30,  2003,  there  were  issued and  outstanding  1,836,335
shares of our common stock.
<TABLE>
<CAPTION>

                                           Number of Shares of
Name and Address                           Common Stock                     Percent of Common Stock
or Identity of Group                       Beneficially Owned               Outstanding
--------------------                       -------------------              -----------------------
<S>                                             <C>                                  <C>
Philip J. Micciche (1)                          88,003                               4.8%
1100 Auburn Street
Fremont, CA  94538

Andrew Intrater (2)                             67,148                               3.6%
1100 Auburn Street
Fremont, CA  94538
</TABLE>


                                       46
<PAGE>

<TABLE>
<S>                                             <C>                                  <C>
Dr. John Abeles (3)                             56,933                               3.1%
2365 Northwest 41st Street
Boca Raton, FL  33431

Jay M. Haft (4)                                 16,265                                  *
1001 Brickell Bay Dr, 9th Fl.
Miami, FL 33131

Doug McBurnie (5)                               6,500                                   *
18346 You Bet Road
Grass Valley, CA 95945

Windstar Investments N.V. (6)                  108,422                               5.9%
200 East Broward Blvd.,
Suite 1900
Fort Lauderdale, FL  33302

VMR High Octane Fund (7)                       144,306                              7.9%
c/o Meespierson Fund Services
18-20 North Quay
Douglas, Isle of Man 1M991M

Crenshaw Investments (8)                       128,200                               7.0%
c/o Moore Stephens
L'Estoil Bloc C 31 Avenue
Princess Grace
MC98000 Monaco

All executive officers and                      234,849                             12.8%
Directors as a group (5 persons)
(9)
</TABLE>

         *    Represents less than 1% of the outstanding shares

         (1)  Represents shares subject to stock options exercisable as of April
              30, 2003 or within 60 days thereafter.

         (2)  Includes 26,583 shares of common stock held by Mr. Intrater.  Also
              includes 40,565 shares subject to stock options  exercisable as of
              April 30, 2003 or within 60 days thereafter.

         (3)  Includes  35,942 shares of common stock held by Northlea  Partners
              Ltd. of which Dr. Abeles is the General Partner. Also includes 938
              shares of common stock  issuable upon  exercise of certain  bridge
              warrants.  Includes  3,775  shares of common stock  issuable  upon
              conversion of warrants, held by Northlea Partners.  Includes 2,278
              shares of common stock  issuable upon exercise of certain  private
              placement  warrants.  Also includes 14,000 shares subject to stock
              options  exercisable  as of  April  30,  2003  or  within  60 days
              thereafter.

                                       47
<PAGE>

         (4)  Includes 14,000 shares subject to stock options  exercisable as of
              April 30, 2003 or within 60 days  thereafter.  Also includes 2,265
              shares of common stock issuable upon conversion of warrants.

         (5)  Represents shares subject to stock options exercisable as of April
              30, 2003 or within 60 days thereafter.

         (6)  Includes 50,755 shares of common stock issuable upon conversion of
              warrants.

         (7)  Includes  11,393 shares of common stock  issuable upon exercise of
              certain private placement warrants.

         (8)  Includes  24,304 shares of common stock  issuable upon exercise of
              certain private placement warrants.

         (9)  Includes an aggregate of 172,324 shares  issuable upon exercise of
              warrants and stock  options and  conversion  of  Preferred  Stock,
              included pursuant to notes (1)-(11).


Item 12.          Certain Relationships and Related Transactions

         In July 1998, we extended an unsecured loan in the aggregate  principal
amount of $35,000 to Mitchel  Underseth,  Chief Financial Officer and a director
of the Oryx pursuant to the terms of a promissory  note. The note bears interest
at a rate of 7% per annum and was paid in full on November 15, 2002.

         Oryx paid legal costs incurred by Philip Micciche,  our Chief Executive
Officer,  and  Mitchel  Underseth,   our  former  Chief  Financial  Officer,  in
connection  with  Comdisco,  Inc. v. Micciche,  Underseth,  et al filed in Santa
Clara County Superior  Court, in which Messrs.  Micciche and Underseth have been
named,  individually,  as  defendants.  At our  request,  Messrs.  Micciche  and
Underseth were named as advisors to DAS Devices,  Inc. prior to its  acquisition
by Applied  Magnetics in order to attempt to maximize our equity  investment  in
DAS  Devices.  Messrs.  Micciche and  Underseth  were named as  defendants  in a
lawsuit brought by Comdisco,  Inc. in connection  with alleged  defaults under a
leasing agreement  between Comdisco and DAS Devices.  Oryx had paid an aggregate
of $68,020 in legal expenses in connection with this matter. In May 28, 2002, we
received  $47,000  from our  insurance  carrier  as  reimbursement  of our legal
expenses related to this matter. This lawsuit has been settled.

         Through Oryx  Ventures,  we invested a total of $2,542,500 in Preferred
Stock of S2 Technologies  from July 2000 through  February 2003. Mark Underseth,
Chief Executive Officer of S2 Technologies is the brother of Mitchel  Underseth,
our former Chief Financial  Officer.  While acting as Chief Financial Officer of
Oryx,  Mitchel  Underseth  did  not  participate  in  Oryx's  due  diligence  or
negotiation with respect to Oryx's  investments in S2 Technologies and

                                       48
<PAGE>

abstained from voting or discussion when the Oryx Board of Directors  considered
this  matter.  Mitchel  Underseth is currently  Chief  Financial  Officer for S2
Technologies.

         In addition,  Mr. Micciche provides certain  management  services to S2
Technologies  in exchange for cash and  warrants to purchase  common stock in S2
Technologies.  S2  Technologies  issued  warrants to purchase  700,000 shares of
common stock for $0.001 per share,  of which 466,666 were exercised on April 01,
2002. As of February 28, 2003,  there were 233,334 shares were  outstanding,  of
which 145,834 were vested.  . We have recorded  $76,000 of revenue during fiscal
2003 related to the cash portion of the services provided,  but has not recorded
any amounts related to the warrants,  as the recoverability of the amount is not
considered probable for revenue recognition purpose.

Item 13.          Exhibits and Reports on Form 8-K.

         (a)      Financial Statements and Schedules

         The financial statements listed on the index to financial statements on
page F-1 are filed as part of this Form 10-KSB.

         (b)      Reports on Form 8-K

         We filed two reports on Form 8-K with the Commission  during the fiscal
quarter ended  February 28, 2003. On December 5, 2002, we filed a report on Form
8-K to report that Mitchel  Underseth  had  terminated  his  employment as Chief
Financial  Officer and resigned as a director of Oryx.  On January 15, 2003,  we
filed a report on Form 8-K to report  that our  common  stock had been  delisted
from The NASDAQ SmallCap Market.

         (c)      Exhibits

Exhibit No.                       Description of Exhibits
-----------                       -----------------------
2.2      Asset  Purchase  Agreement  dated as of June 1, 1999 by and between the
         Registrant and Oryx Advanced Materials, Inc. (1)

3.1      Certificate of Incorporation of the Registrant dated July 26, 1993 (2)

3.2      Bylaws of the Registrant dated July 26, 1993 (2)

3.3      Certificate of Amendment to Certificate of Incorporation dated July 23,
         1993 (4)

3.4      Certificate of Amendment of Certificate of Incorporation dated February
         7, 1996 (5)

3.5      Certificate of Amendment of Certificate of Incorporation dated June 15,
         2001 (20)

4.1      Specimen Common Stock Certificate (2)

4.2      Specimen Common Stock Purchase Warrant (2)

4.3      Warrant  Agency  Agreement  including  Statement  of Rights,  Terms and
         Conditions for Callable Stock Purchase Warrants (3)

4.4      Incentive and Nonqualified Stock Option Plan, as Amended (6)

4.4A     1996 Directors Stock Option Plan (6)

4.4B     1995 Directors Stock Option Plan (7)

4.5      Form of Promissory  Note issued to Series A Preferred  Stock  investors
         (2)

4.6      Unit Purchase Warrant (2)

                                       49
<PAGE>

4.7      Form of Warrants  issued to Yorkton  Securities,  Inc. in December 1996
         and February 1997 (9)

4.8      Nonstatutory Stock Option Agreement, dated as of March 1, 1998, between
         the Registrant and Bharat Shah (6)

4.9      Nonstatutory Stock Option Agreement, dated as of March 1, 1998, between
         the Registrant and Bharat Shah (6)

4.10     Nonstatutory Stock Option Agreement, dated as of March 1, 1998, between
         the Registrant and Paul Dickerson (6)

4.11     Nonstatutory Stock Option Agreement, dated as of March 1, 1998, between
         the Registrant and Thomas Landgraf (6)

4.12     Nonstatutory Stock Option Agreement, dated as of March 1, 1998, between
         the Registrant and Charles Ray (6)

4.13     Nonstatutory Stock Option Agreement, dated as of March 1, 1998, between
         the Registrant and Gary Sollner (6)

4.14     Warrant  dated as of  August  10,  1998,  between  the  Registrant  and
         Continental Capital & Equity Corporation (15)

4.15     Stock Warrant dated as of February 27, 1998, between the Registrant and
         KBK Financial, Inc. (15)

4.16     Warrant  dated as of July 7, 2001  between the  Registrant  and Newport
         Capital Consultants, Inc. (21)

10.1     Lease Agreement with Renco Investment  Company re: Fremont,  California
         office, a laboratory and manufacturing facility (2)

10.2     Lease Agreement with FINSA re: Reynosa, Mexico,  manufacturing facility
         (4)

10.3     Lease  Agreement  with  Greer   Enterprises  re:  Fremont,   California
         manufacturing facility (4)

10.4     Lease Agreement with  Hospitak/Meditron re: McAllen,  Texas,  warehouse
         facility (4)

10.5     Lease  Agreement with Security  Capital  Industrial  Trust re: Fremont,
         California manufacturing facility (5)

10.6     Lease Agreement with OTR, State Teachers  Retirement System of Ohio re:
         Mt. Prospect, Illinois office (5)

10.7     Lease Agreement with E.B.J. Partners LP re: Fremont,  California office
         and manufacturing facility (13)

10.8     Letter of Separation Agreement with Andrew Wilson (13)

10.9     Letter of Employment Agreement with Mitchel Underseth (13)

10.10    Letter of Employment Agreement with Philip Micciche (13)

10.11    Letter of Employment and Non-Competition Agreement with Andrew Intrater
         (2)

10.12    Agreement  for the  Purchase  and Sale of Stock with Intek  Diversified
         Corporation (2)

10.13    Asset Purchase Agreement with Zenith Electronics Corporation (2)

10.14    Promissory Notes issued in interim debt financing (2)

10.15    Common Stock Purchase Warrants issued in interim debt financing (4)

10.16    Placement   Agency   Agreement   between  the  Registrant  and  Yorkton
         Securities, Inc. dated February 8, 1996, as amended April 22, 1996 (5)

10.17    Form of  Subscription  Agreement  between  the  Registrant  and various
         investors in Yorkton Private  Placement dated February 29, 1996 and May
         13, 1996 (5)

                                       50
<PAGE>

10.18    Offering Memorandum dated February 8, 1996 and Supplement thereto dated
         April 22, 1996, relating to Yorkton private placement (5)

10.19    Settlement  Agreement  between the  Registrant  and Zenith  Electronics
         Corporation dated February 29, 1996, as amended April 16, 1996 (5)

10.20    Agreement  between the Registrant  and Cooper  Bussmann dated July 1996
         (13)

10.21    Agreement between the Registrant and National  Semiconductor dated June
         7, 1996 (13)

10.22    Agreement between the Registrant and LSI Logic dated September 30, 1996
         (13)

10.23    Agency Agreement  between the Registrant and Yorkton  Securities,  Inc.
         dated December 4, 1996, as amended January 23, 1997 (9)

10.24    Form of  Subscription  Agreement  between  the  Registrant  and various
         investors in Yorkton Private Placement dated December 4, 1996 (10)

10.25    Asset Purchase  Agreement  relating to the acquisition of Power Sensors
         Corporation by Oryx Power Products  Corporation dated December 19, 1996
         (8)

10.26    Stock   Purchase  and   Reorganization   Agreement  by  and  among  the
         Registrant,  Corus Investment,  Ltd. and Oryx Instruments and Materials
         Corporation Dated February 27, 1998 (11)

10.27    Stockholders' Agreement Dated February 27, 1998 (11)

10.28    Pledge Agreement Dated February 27, 1998 (11)

10.29    Promissory Note Dated February 27, 1998 (11)

10.30    Asset  Purchase  Agreement  by and among  the  Registrant,  Todd  Power
         Corporation  and Oryx Power  Products  Corporation  Dated March 2, 1998
         (12)+

10.31    License Agreement with IRISO Electronics Limited (14)

10.32    Stock Purchase Agreement with IRISO Electronics Limited (14)

10.33    Agreement with Office of Naval Research (14)

10.34    DAS Devices Inc. Preferred Stock Purchase Agreement (14)

10.35    Arvind Patel Separation Agreement (14)

10.36    Amended Cooper Bussmann License Agreement (14)

10.37    Revolving Account Transfer and Purchase Agreement (14)

10.38    First Amendment to Loan Agreement (14)

10.39    Revolving Credit Promissory Note (14)

10.40    Second Amendment to Loan Agreement (14)

10.41    Market Access Program  Marketing  Agreement dated as of August 7, 1998,
         by  and  between  the  Registrant  and  Continental  Capital  &  Equity
         Corporation (15)

10.42    Term  Promissory Note dated February 27, 1998 payable to KBK Financial,
         Inc. (14)

10.43    Loan Agreement dated May 29, 1997 with KBK Financial, Inc. (14)

10.44    Note and Stock Purchase Agreement and Release dated November 6, 1998 by
         and among the Registrant,  Corus  Investment LTD. and Oryx  Instruments
         and Materials Corporation. (16)

10.45    Promissory Note payable by Mitch Underseth dated July 15, 1998 (17)

10.46    Assignment  Agreement  between Philip J. Micciche and Registrant  dated
         November 24, 1998 (17)

10.47    Extension Rent Agreement between ProLogis LP and Registrant dated April
         12, 1999 (17)

                                       51
<PAGE>

10.48    Employment  Agreement between  Registrant and Phillip J. Micciche dated
         March 15, 1999 (18)

10.49    Oryx Ventures, LLC Operating Agreement dated as of May 18, 2000 (19)

10.50    Amendment No. 1 to Intellectual  Property  Rights License  Agreement by
         and between the  Registrant and Cooper  Bussmann,  dated April 10, 2000
         (19)

10.51    Consulting  Agreement  by and  between  Oryx  Ventures,  LLC and  Aptix
         Corporation  dated as of November 1, 2000 (services  provided by Philip
         Micciche) (19)

10.52    Consulting  Agreement  by and  between  Oryx  Ventures,  LLC and  Aptix
         Corporation dated as of November 1, 2000 (services  provided by Mitchel
         Underseth) (19)

10.53    Intellectual  Property  Rights  License  Agreement by and between SurgX
         Corporation and Cooper Bussmann dated as of October 2, 1997, as amended
         (14)

10.54    Manufacturing and Supply Agreement by and between SurgX Corporation and
         Cooper Electronics Technologies dated as of May 1, 2000 (19)

10.55    First Amendment to License  Agreement by and between the Registrant and
         Oryx Advanced Materials, Inc. dated as of March 1, 2001 (19)

10.56    Series  A  Preferred  Stock  Purchase   Agreement  by  and  among  LOTS
         Technology,  Inc.,  Oryx Ventures,  LLC and the other  investors  named
         therein dated as of July 30, 1999 (19)

10.57    Series  A  Preferred   Stock   Purchase   Agreement  by  and  among  S2
         Technologies,  Inc.,  Oryx Ventures,  LLC and the other investors named
         therein dated as of July 20, 2000 (19)

10.58    NetConversions,  Inc. Unsecured Convertible  Promissory Note payable by
         NetConversions,  Inc. to Oryx  Ventures,  LLC dated as of June 12, 2000
         (19)

10.59    Business  Consultant  and  Management  Agreement  by and  between  Oryx
         Ventures, LLC and LOTS Technology, Inc. dated as of June 13, 2000 (19)

10.60    Business  Consultant  and  Management  Agreement  by and  between  Oryx
         Ventures, LLC and S2 Technologies, Inc dated as of July 20, 2000 (19)

10.61    Employment  Agreement  by and  between  the  Registrant  and Phillip J.
         Micciche dated May 16, 2001 (19)

10.62    Amendment to Promissory Note for Mitchel  Underseth dated July 15, 2000
         (19)

10.63    Market Access Program  Marketing  Agreement dates as of July 7, 2001 by
         and between the Registrant and Newport Capital Consultants, Inc. (21)

10.64    Convertible  Promissory Note dated June 2001 payable by S2 Technologies
         to the Registrant (21)

10.65    Common Stock and Warrant  Purchase  Agreement dated October 31, 2001 by
         and between the Registrant and the Purchasers named therein (22)

10.66    S2 Technologies, Inc. Series B Preferred Stock Purchase Agreement dated
         October 18, 2001 by and between S2  Technologies,  Inc., the Registrant
         and the other Purchasers named therein (22)

10.67    Employment  Agreement  dated as of February 28, 2002 by and between the
         Registrant and Philip J. Micciche (23)

10.68    Amended and Restated Operating  Agreement for Oryx Ventures,  LLC dated
         as of February 28, 2002 (23)

                                       52
<PAGE>

10.69    Amendment  No.  2 to  S2  Technologies,  Inc.  Series  Preferred  Stock
         Purchase Agreement dated January 15, 2002 (24)

10.70    Amendment  No. 3 to S2  Technologies,  Inc.  Series B  Preferred  Stock
         Purchase Agreement dated March 18, 2002 (24)

10.71    Termination  and Purchase  Agreement by and between the  Registrant and
         Oryx Advanced Materials, Inc. dated as of November 11, 2002 (25)

10.72    Termination  of Employment  Agreement by and between the Registrant and
         Mitchel Underseth dated as of November 27, 2002 (25)

10.73    Amendment  to  Employment  Agreement  dated  December  23,  2002 by and
         between the registrant and Philip J. Micciche.*

21       Subsidiaries of the Registrant (5)

23.1     Consent of Independent Accountants*

99.1     Certification of Philip J. Micciche, President, Chief Executive Officer
         and Chief  Financial  Officer  Pursuant to 18 U.S.C.  Section  1350, as
         Adopted  Pursuant  to Section  906 of the  Sarbanes-Oxley  Act of 2002,
         filed herewith.*

*        Filed herewith.

+        Confidential  treatment  has been  requested  with  respect  to certain
         portions of these  Exhibits.  Such portions have been omitted from this
         filing and have been filed  separately with the Securities and Exchange
         Commission.

(1)      Previously  filed as an exhibit to the  Registrant's  Current Report on
         Form 8-K filed with the Commission on September 2, 1999.

(2)      Previously  filed  as  an  exhibit  to  the  Registrant's  Registration
         Statement  on  Form  SB-2  (Registration  No.  33-72104)  which  became
         effective on April 6, 1994 incorporated herein by reference.

(3)      Previously  filed as an exhibit to the  Registrant's  Current Report on
         Form 8-K filed with the Commission on March 27, 1995.

(4)      Previously  filed as an exhibit to the  Registrant's  Annual  Report on
         Form 10-KSB for the fiscal year ended February 28, 1995.

(5)      Previously  filed as an exhibit to the  Registrant's  Annual  Report on
         Form 10-KSB (as amended) for the fiscal year ended February 29, 1996.

(6)      Previously  filed  as  an  exhibit  to  the  Registrant's  Registration
         Statement  on Form S-8  (Registration  No.  333-62767)  filed  with the
         Commission on September 1, 1998 and incorporated herein by reference.

(7)      Previously  filed  as  an  exhibit  to  the  Registrant's  Registration
         Statements  on Form S-8  (Registration  No.  333-07409)  filed with the
         Commission on July 2, 1996 and incorporated herein by reference.

(8)      Previously  filed as an exhibit to the  Registrant's  Current Report on
         Form 8-K filed with the Commission on January 3, 1997.

                                       53
<PAGE>

(9)      Previously  filed as an exhibit to the  Registrant's  Current Report on
         Form 8-K filed with the Commission on February 21, 1997.

(10)     Previously  filed  as  an  exhibit  to  the  Registrant's  Registration
         Statement  on Form  S-3  Registration  No.  333-23317)  filed  with the
         commission on March 31, 1997 and incorporated herein by reference.

(11)     Previously  filed as an exhibit to the  Registrant's  Current Report on
         Form 8-K filed with the Commission on March 16, 1998.

(12)     Previously  filed as an exhibit to the  Registrant's  Current Report on
         Form 8-K filed with the Commission on March 23, 1998.

(13)     Previously  filed as an exhibit to the  Registrant's  Annual  Report on
         Form 10-KSB for the fiscal year ended February 28, 1997.

(14)     Previously  filed as an exhibit to the  Registrant's  Annual  Report on
         Form 10-KSB for the fiscal year ended February 28, 1998.

(15)     Previously  filed  as  an  exhibit  to  the  Registrant's  Registration
         Statement on Form S-3 Registration No. 333-63991 which became effective
         on September 22, 1998 and is incorporated herein by reference.

(16)     Previously  filed as an exhibit to the  Registrant's  Current Report on
         Form 8-K filed with the Commission on April 14, 1999.

(17)     Previously  filed as an exhibit to the  Registrant's  Annual  Report on
         Form 10-KSB for the fiscal year ended February 28, 1999.

(18)     Previously  filed as an exhibit to the  Registrant's  Annual  Report on
         Form 10-KSB for the fiscal year ended February 28, 2000.

(19)     Previously  filed as an exhibit to the  Registrant's  Annual  Report on
         Form 10-KSB for the fiscal year ended February 28, 2001.

(20)     Previously  filed as an exhibit to the  Registrant's  Current Report on
         Form 8-K filed with the Commission on June 19, 2001.

(21)     Previously filed as an exhibit to the Registrant's  Quarterly Report on
         Form 10-QSB for the quarter ended August 31, 2001.

(22)     Previously filed as an exhibit to the Registrant's  Quarterly Report on
         Form 10-QSB for the quarter ended November 30, 2001.

(23)     Previously  filed as an exhibit to the  Registrant's  Annual  Report on
         Form 10-KSB for the fiscal year ended February 28, 2002.

                                       54
<PAGE>

(24)     Previously filed as an exhibit to the Registrant's  Quarterly Report on
         Form 10-QSB for the quarter ended May 31, 2002.

(25)     Previously filed as an exhibit to the Registrant's  Quarterly Report on
         Form 10-QSB for the quarter ended November 30, 2002.

Item 14. Controls and Procedures.

         Based  on his  evaluation  of the  Company's  controls  and  procedures
conducted  within  90 days of  filing  this  report  on Form  10-KSB,  our Chief
Executive Officer,  who is also our Chief Financial Officer,  has concluded that
Oryx's  disclosure  controls and procedures  (as defined in Rules  13a-14(c) and
15d-14(c) promulgated under the Securities Exchange Act of 1934, as amended) are
effective. There have been no significant changes in Oryx's internal controls or
in other factors that could  significantly  affect those controls  subsequent to
the date of his evaluation.

Item 15. Principal Accountant Fees and Services

(1) Audit Fees. The aggregate fees billed to us for the years ended February 28,
2003 and February 28, 2002 for professional  services  rendered by our principal
accountant  for the  audit of our  annual  financial  statements  and  review of
financial  statements  included  in our Form 10-QSB  were  $62,000 and  $72,000,
respectively.

(2)  Audit-Related  Fees.  There were no fees  billed to us for the years  ended
February 28, 2003 and February 28, 2002 for  assurance  and related  services by
our principal  accountant that are reasonably  related to the performance of the
audit or review of our financial  statements and are not reported under Item (1)
above.

(3) Tax Fees.  The aggregate  fees billed to us for the years ended February 28,
2003 and February 28, 2002 for professional  services  rendered by our principal
accountant  for tax  compliance,  tax advice,  and tax planning were $15,000 and
$25,000 respectively.

(4) All Other  Fees.  There were no other fees  billed to us for the years ended
February 28, 2003 and  February  28, 2002 for products and services  provided by
our principal accountant,  other than the services reported in Items (1) through
(3) above.

(5) Our  audit  committee  pre-approves  all  auditing  and tax  services  to be
provided by our  principal  accountant on an annual basis prior to entering into
an  engagement  with our  principal  accountant  for such  services.  All  other
non-audit  services,  if any, must be  pre-approved  by our audit committee on a
case by case basis.  All services  described in Items (1) through (4) above were
pre-approved by our audit committee.

(6) All of the hours expended on our principal accountant's  engagement to audit
our  financial  statements  for the fiscal  year ended  February  28,  2003 were
attributed to work performed by our principal  accountant's full time, permanent
employees.



                                       55
<PAGE>

                                   SIGNATURES

         In  accordance  with  Section  13 or 15(d)  of the  Exchange  Act,  the
registrant  caused  this  Report to be signed on its  behalf by the  undersigned
thereunto duly authorized on this 29th day of May 2003.

                              ORYX TECHNOLOGY CORP.


                                          By: /s/ Philip J. Micciche
                                              -----------------------
                                              Philip J. Micciche,
                                              President, Chief Executive Officer
                                              and Chief Financial Officer

         In accordance  with the Exchange Act, this Report has been signed below
by the following persons on behalf of the registrant,  and in the capacities and
on the dates indicated.

<TABLE>
<CAPTION>
Signature                                Title                                                    Date

<S>                                      <C>                                                      <C>
/s/ Philip J. Micciche                   President, Chief Executive Officer,                      May 29, 2003
----------------------                   Chief Financial Officer and Director (Principal
Philip J. Micciche                       Executive Officer,
                                         Principal Financial Officer and Principal
                                         Accounting  Officer)


/s/ Andrew Intrater                      Secretary, Treasurer                                     May 29, 2003
-------------------                      and Director
Andrew Intrater


/s/ John H. Abeles                       Director                                                 May 29, 2003
------------------
John H. Abeles


/s/ Jay M. Haft                          Director                                                 May 29, 2003
---------------
Jay M. Haft
</TABLE>

                                       56
<PAGE>


I, Philip J. Micciche, certify that:

1. I have reviewed this annual report on Form 10-KSB of Oryx Technology Corp.;

2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4.  The  registrant's  other  certifying  officers  and  I  am  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

         a) designed  such  disclosure  controls and  procedures  to ensure that
         material  information   relating  to  the  registrant,   including  its
         consolidated  subsidiaries,  is made known to us by others within those
         entities, particularly during the period in which this annual report is
         being prepared;

         b) evaluated the effectiveness of the registrant's  disclosure controls
         and  procedures as of a date within 90 days prior to the filing date of
         this annual report (the "Evaluation Date"); and

         c)  presented  in  this  annual  report  our   conclusions   about  the
         effectiveness  of the disclosure  controls and procedures  based on our
         evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

         a) all significant  deficiencies in the design or operation of internal
         controls  which  could  adversely  affect the  registrant's  ability to
         record,   process,   summarize  and  report  financial  data  and  have
         identified  for the  registrant's  auditors any material  weaknesses in
         internal controls; and

         b) any fraud,  whether or not  material,  that  involves  management or
         other  employees  who  have a  significant  role  in  the  registrant's
         internal controls; and

                                       57

<PAGE>


6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: May 29, 2003

                                              /s/ Philip J. Micciche
                                              ----------------------
                                              Philip J. Micciche,
                                              President, Chief Executive Officer
                                              and Chief Financial Officer


                                       58


<PAGE>


Oryx Technology Corp.
Index to Consolidated Financial Statements
February 28, 2003 and February 28, 2002
--------------------------------------------------------------------------

                                                                      Page
                                                                      ----
Report of Independent Accountants..................................... F-2

Consolidated Balance Sheets at February 28, 2003
      and February 28, 2002........................................... F-3

Consolidated Statements of Operations for the
      years ended February 28, 2003 and February 28, 2002 ............ F-4

Consolidated Statement of Stockholders' Equity for the
      years ended February 28, 2003 and February 28, 2002............. F-5

Consolidated Statements of Cash Flows for the
      years ended February 28, 2003 and February 28, 2002............. F-6

Notes to Consolidated Financial Statements............................ F-7

                                      F-1
<PAGE>

                        Report of Independent Accountants


To the Board of Directors and Stockholders of
Oryx Technology Corp.


In our opinion,  the  accompanying  consolidated  balance sheets and the related
consolidated statements of operations, of stockholders' equity and of cash flows
present  fairly,  in all  material  respects,  the  financial  position  of Oryx
Technology  Corp.  and its  subsidiaries  at February  28, 2003 and February 28,
2002,  and the  results of their  operations  and their cash flows for the years
then ended in conformity with accounting  principles  generally  accepted in the
United States of America.  These financial  statements are the responsibility of
the Company's  management;  our responsibility is to express an opinion on these
financial  statements  based on our  audits.  We  conducted  our audits of these
statements  in  accordance  with auditing  standards  generally  accepted in the
United  States of America  which  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,  assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall  financial  statement  presentation.  We believe that our
audits provide a reasonable basis for our opinion.

The accompanying  consolidated  financial statements have been prepared assuming
the Company  will  continue as a going  concern.  As  discussed in Note 1 to the
consolidated  financial  statements,  the Company has suffered  recurring losses
from  operations and has an accumulated  deficit that raises  substantial  doubt
about its ability to continue as a going concern.  Management's  plans in regard
to these matters are also described in Note 1. These financial statements do not
include any adjustments that might result from the outcome of this uncertainty.


PricewaterhouseCoopers LLP


San Jose, California
May 9, 2003

                                      F-2

<PAGE>

<TABLE>
<CAPTION>

Oryx Technology Corp.
Consolidated Balance Sheets
---------------------------------------------------------------------------------------------------------------------
              Assets                                                                 February 28,       February 28,
                                                                                         2003                2002
                                                                                     ------------        ------------
<S>                                                                                  <C>                 <C>
Current assets:
  Cash and cash equivalents                                                          $    381,000        $  2,053,000
  Accounts receivable, net of allowance for doubtful
    accounts of $34,000 and $34,000                                                         5,000              14,000
  Other current assets                                                                     66,000             164,000
                                                                                     ------------        ------------
    Total current assets                                                                  452,000           2,231,000

Property and equipment, net                                                                 8,000               6,000
Investments                                                                               200,000             520,000
                                                                                     ------------        ------------
                                                                                     $    660,000        $  2,757,000
                                                                                     ============        ============

              Liabilities, Mandatorily Redeemable Convertible
                  Preferred Stock and Stockholders' Equity

Current liabilities:
  Accounts payable                                                                   $     12,000        $     10,000
  Accrued liabilities                                                                     117,000             196,000
                                                                                     ------------        ------------
    Total current liabilities                                                             129,000             206,000

Commitments and Contingencies (Note 9)

Series A 2% mandatorily convertible redeemable Preferred Stock $0.001 par value;
    3,000,000 shares authorized; 750 and 3,750 shares issued and outstanding
    at February 28, 2003 and 2002, respectively                                            18,000              89,000

Stockholders' equity:
  Common Stock, $0.001 par value; 25,000,000 shares
    authorized; 1,836,335 and 1,832,834  issued and oustanding
    at February 28, 2003 and 2002, respectively                                            18,000              18,000
Additional paid-in capital                                                             26,266,000          26,133,000
Accumulated deficit                                                                   (25,771,000)        (23,689,000)
                                                                                     ------------        ------------
      Total stockholders' equity                                                          513,000           2,462,000
                                                                                     ------------        ------------
                                                                                     $    660,000        $  2,757,000
                                                                                     ============        ============
</TABLE>
              The accompanying notes are an integral part of these
                             financial statements.

                                       F-3
<PAGE>


<TABLE>
<CAPTION>
Oryx Technology Corp.
Consolidated Balance Sheets
--------------------------------------------------------------------------------------------------
                                                                     Year Ended        Year Ended
                                                                    February 28,      February 28,
                                                                        2003              2002
                                                                    -----------       -----------
<S>                                                                 <C>               <C>
Revenue:
   Services                                                         $    58,000       $   197,000
   Services to related parties                                           76,000            26,000
   Other                                                                254,000           382,000
                                                                    -----------       -----------
                                                                        388,000           605,000
                                                                    -----------       -----------
Cost of Sales:
   Services                                                              42,000           133,000
   Services to related parties                                          104,000            33,000
   Other                                                                   --              39,000
                                                                    -----------       -----------
                                                                        146,000           205,000
                                                                    -----------       -----------
    Gross profit                                                        242,000           400,000
                                                                    -----------       -----------
Operating expenses:
   General and administrative                                           961,000         1,085,000
   Research and development                                             209,000           256,000
                                                                    -----------       -----------
    Total operating expenses                                          1,170,000         1,341,000
                                                                    -----------       -----------

Loss from operations                                                   (928,000)         (941,000)

Interest income, net                                                     10,000            87,000
Loss on investments, net                                               (787,000)         (814,000)
Goodwill impairment                                                    (412,000)             --
Other income (expenses)                                                  37,000           198,000
                                                                    -----------       -----------

Net loss                                                             (2,080,000)       (1,470,000)
Preferred stock dividends                                                (2,000)           (2,000)
                                                                    -----------       -----------
    Net loss attributable to Common Stock                           $(2,082,000)      $(1,472,000)
                                                                    ===========       ===========

Basic and diluted net loss per common share                         $     (1.14)      $     (0.85)
                                                                    ===========       ===========

Weighted average common shares used to compute basic and
   diluted net loss per share                                         1,834,000         1,724,000
                                                                    ===========       ===========
</TABLE>

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

                                       F-4

<PAGE>

<TABLE>
<CAPTION>

Oryx Technology Corp.
Consolidated Statement of Stockholder's Equity
-------------------------------------------------------------------------------------------------------------------

                                                              Common Stock        Additional
                                                      --------------------------   Paid-In       Accumulated
                                                        Shares       Amount        Capital         Deficit          Total
                                                      ---------   ------------   ------------   ------------    ------------
<S>                                                   <C>         <C>            <C>            <C>             <C>
Balance at February 28, 2001                          1,670,496   $     17,000   $ 25,587,000   $(22,217,000)   $  3,387,000


Issuance of Common Stock in private placement           162,338          1,000        498,000           --           499,000

Issuance of stock options in exchange for services         --             --           48,000           --            48,000

Net Loss                                                   --             --             --       (1,470,000)     (1,470,000)

Preferred Stock dividend                                   --             --             --           (2,000)         (2,000)
                                                      ---------   ------------   ------------   ------------    ------------
Balance at February 28, 2002                          1,832,834         18,000     26,133,000    (23,689,000)      2,462,000


Issuance of stock options in exchange for services         --             --           62,000           --            62,000

Conversion of Preferred Stock to Common Stock             3,501           --           71,000           --            71,000

Net Loss                                                   --             --             --       (2,080,000)     (2,080,000)

Preferred Stock dividend                                   --             --             --           (2,000)         (2,000)
                                                      ---------   ------------   ------------   ------------    ------------
Balance at February 28, 2003                          1,836,335   $     18,000   $ 26,266,000   $(25,771,000)   $    513,000
                                                      =========   ============   ============   ============    ============
</TABLE>
              The accompanying notes are an integral part of these
                             financial statements.

                                      F-5


<PAGE>

<TABLE>
<CAPTION>

Oryx Technology Corp.
Consolidated Statements of Cash Flows
-----------------------------------------------------------------------------------------------------------------

                                                                                       Year Ended      Year Ended
                                                                                       February 28,   February 28,
                                                                                           2003           2002
                                                                                       -----------    -----------
<S>                                                                                    <C>            <C>
Cash flows from operating activities:
  Net loss                                                                             $(2,080,000)   $(1,470,000)
  Adjustments to reconcile net loss to net cash used in operating activities:
    Loss on investments                                                                    787,000        814,000
    Goodwill impairment                                                                    412,000           --
    Loss from asset disposition                                                               --            6,000
    Depreciation and amortization                                                            6,000        124,000
    Provisions for doubtful accounts receivable                                               --           34,000
    Non-cash stock compensation                                                             62,000         48,000
      Changes in assets and liabilities
        Accounts receivable                                                                 68,000         12,000
        Other current assets                                                                98,000        (38,000)
        Other assets                                                                          --            1,000
        Accounts payable                                                                     2,000        (19,000)
        Accrued liabilities                                                                (79,000)      (156,000)
                                                                                       -----------    -----------
            Net cash used in operations                                                   (724,000)      (644,000)
                                                                                       -----------    -----------

Cash flows from investing activities:
  Capital expenditures                                                                      (8,000)        (4,000)
  Proceeds from assets disposition                                                            --            3,000
  Purchase of Investments                                                                 (938,000)    (1,105,000)
                                                                                       -----------    -----------
            Net cash used in investing activities                                         (946,000)    (1,106,000)
                                                                                       -----------    -----------

Cash flows from financing activities:
  Proceeds from sale of Common Stock                                                          --          499,000
  Payment of dividends on Preferred Stock                                                   (2,000)        (2,000)
                                                                                       -----------    -----------
            Net cash (used in) provided by financing activities                             (2,000)       497,000
                                                                                       -----------    -----------
Net decrease in cash and cash equivalents                                               (1,672,000)    (1,253,000)
Cash and cash equivalents at beginning of period                                         2,053,000      3,306,000
                                                                                       -----------    -----------
Cash and cash equivalents at end of period                                             $   381,000    $ 2,053,000
                                                                                       ===========    ===========
</TABLE>
              The accompanying notes are an integral part of these
                             financial statements.

                                      F-6


<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

1. The Company

         During fiscal 2000, Oryx Technology Corp. ("Oryx" or the "Company"),  a
Delaware corporation, and its subsidiaries completed its strategic repositioning
of  the  Company  to  a  licensing  entity.  During  fiscal  2001,  the  Company
established  a  subsidiary,  Oryx  Ventures,  LLC, to act as an  investment  and
management  services  entity.  At February 28, 2003,  the Company was  primarily
involved in the business of  licensing  its  proprietary  SurgX  technology  and
providing capital and management services to early stage development  companies.
The Company  transferred the research and development of its SurgX electrostatic
discharge  protection  technology  -- SurgX liquid  manufacturing  processes and
know-how to its  licensees.  As of such date,  the  Company's  primary  activity
associated  with  early  stage  companies  was  providing  management  services.
Although  the  Company  has made  several  investments  in several  early  stage
companies it has neither the  intention  nor the  resources to regularly buy and
sell such investments.  Thus,  investing does not constitute a major part of the
Company's  ongoing  operations  and  the  activities  of Oryx  Ventures  are now
primarily limited to management services.

         Liquidity

         From  inception  through  February 28,  2003,  the Company has incurred
substantial  losses and negative cash flows from  operations and, as of February
28, 2003, the Company had an accumulated  deficit of  $25,771,000.  For the year
ended February 28, 2003, the Company  recorded a net loss of $2,082,000 and cash
outflows from operating activities of $724,000.

         The Company does not have  sufficient  capital to meet its  anticipated
working  capital  requirements  through fiscal year 2004. The Company must raise
additional capital through public or private financings or other arrangements in
order to have sufficient cash to continue its business  operations.  The Company
is actively exploring financing opportunities however, there can be no assurance
that it will be successful in raising any  additional  funding at all or in time
to meet  its  financial  needs  or that  any  such  funding  would  be on  terms
acceptable  to the Company or in the best interest of its  stockholders.  If the
Company  cannot raise  additional  capital on or before July 2003 on  acceptable
terms, it will not be able to achieve its business  objectives and continue as a
going concern.

         The financial statements do not include any adjustments relating to the
recoverability  and  classification  of recorded asset amounts or to amounts and
classification  of liabilities that may be necessary if the Company is unable to
continue as a going concern.


2. Summary of Significant Accounting Policies

     Basis of presentation

         The  Company's  fiscal year ends on the last day of February.  The year
ended February 28, 2003 is referred to as fiscal 2003.

                                      F-7

<PAGE>

Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

     Principles of consolidation

         The  consolidated  financial  statements  include the  accounts of Oryx
Technology  Corporation  and its majority owned  subsidiaries.  All  significant
intercompany transactions and accounts have been eliminated.

     Use of estimates

         The  preparation of financials  statements in conformity with generally
accepted  accounting   principle  requires  management  to  make  estimates  and
assumptions  that  affect  the  reported  amount of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and reported  amounts of revenues and expenses  during the reporting
period.  Actual results could differ from those estimates,  and such differences
could be material and affect the result of operation reported in future periods.

     Cash and Cash Equivalents

         The Company  considers all highly liquid  instruments  with an original
maturity of three months or less to be cash equivalents.

     Concentration of credit Risks

         Our customers are  primarily  the  licensees of our  proprietary  SurgX
technology and the Intragene technology, and the companies we provide management
services.   The  Company   maintains   reserves  for  potential  credit  losses;
historically, such losses have been minor. The Company's accounts receivable are
principally derived from sales in the United States.

         All transactions are denominated in U.S. dollars. Significant customers
who  represented  10% or more of  revenue  for the  respective  periods  were as
follow:

                                               Year Ended          Year Ended
                                              February 28,        February 28,
                                                 2003                 2002

Iriso Electronics, Co. LTD                        38%                 33%
Oryx Advanced Materials, Inc                      27%                 30%
S2 Technologies, Inc                              20%                  4%
Cogency Software, Inc                             15%                  9%
Aptix Corporation                                  0%                 21%

     At  February  28,  2003  and  2002,  one and two  customers,  respectively,
     accounted for 100% of accounts receivable.

     Fair value of financial instruments

         Carrying  amounts of certain of the  Company's  financial  instruments,
including cash and cash equivalents,  accounts  receivable and accounts payable,
approximate  their fair value due to their relative  short  maturities and based
upon comparable  market  information  available at the respective  balance sheet
dates.  The Company  does not hold or issue  financial  instruments  for trading
purpose.

                                      F-8

<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

     Property and equipment

         Property and  equipment  are stated at cost.  Depreciation  is computed
using the  straight-line  method over the estimated  useful lives of the assets,
generally  three to ten years.  Leasehold  improvements  are amortized using the
straight-line  method over the shorter of the lease term or the estimated useful
lives of the assets.  The Company  periodically  reviews the  carrying  value of
property and equipment for impairment based upon estimated cash flows.

     Investments

         The investments in the Company's  portfolio companies are accounted for
by either the equity  method or cost  method,  based upon voting  interests  and
level of  influence.  See Note 4 for related  investment  activity.  The Company
periodically reviews the carrying value of investments for impairment based upon
estimated cash flows.

     Revenue recognition

         Services  revenue  is for  management  services  pursuant  to time  and
materials  contracts and is recorded when services are performed,  contractually
payable and collectibility is probable. Other revenue represents royalty revenue
based upon license  agreements or per unit royalties  which are recognized  when
earned,  reported by the licensee,  contractually  payable and collectibility is
probable.

     Allowance for doubtful accounts

         The Company  maintains an allowance for doubtful accounts for estimated
losses from the  inability  of its  customers  to make  required  payments.  The
Company evaluates its allowance for doubtful accounts based on the ageing of its
accounts receivable,  the financial condition of its customers and their payment
history, its historical write-off experience and other assumptions.

     Income taxes

         Deferred  income taxes are provided for temporary  differences  between
the  financial  reporting  basis and the tax basis of the  Company's  assets and
liabilities.  The benefits from utilization of net operating loss  carryforwards
will be reflected as part of the income tax provision if and when realizable.

                                      F-9

<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

     Net loss per share

         Basic and diluted  earnings  per share for the periods  presented  have
been computed by dividing loss available to common  stockholders by the weighted
average  common shares  outstanding  for the period.  Due to the net losses from
continuing  operations  incurred  in fiscal  2003 and  2002,  all  common  stock
equivalents (options,  warrants and preferred stock) outstanding were considered
anti-dilutive  and were excluded from the  calculations  of diluted net loss per
share. No adjustments were made to net loss  attributable to common stock in the
calculation  of basic or  diluted  earnings  per share in  fiscal  2003 or 2002.
Anti-dilutive securities and common stock equivalents at February 28, 2003 which
could be dilutive in future  periods  include  common stock  options to purchase
247,839  shares of common stock,  warrants to purchase  148,954 shares of common
stock,  750 shares of Series A preferred  stock which may be converted  into 875
shares of common stock and subsidiary stock options to purchase 14,000 shares in
the Company's SurgX subsidiary which could reduce the Company's share of profits
in the calculation of earnings per share in future periods.

     Comprehensive Income

         Comprehensive  income  includes  all changes in equity  during a period
from   non-owner   sources   including    unrealized   gains   and   losses   on
available-for-sale   securities.   There  is  no  difference  between  net  loss
attributable to common stock and comprehensive loss for all periods presented.

     Stock-based compensations

         The Company accounts for stock-based employee compensation arrangements
using the  intrinsic  value method  prescribed in APB 25  "Accounting  for stock
issued to employees" and related interpretations and, accordingly,  compensation
cost for stock  options is measured as the excess,  if any, of the fair value of
the Company's  stock at the date of grant over the stock option  exercise price.
Expense associated with stock-based  compensation is amortized on an accelerated
basis over the vesting period of the individual award consistent with the method
described in Financial  Accounting  Standards Board  Interpretation No. 28 ("FIN
28").  Under  SFAS No.  123 and EITF  96-18,  stock  options  awards  issued  to
nonemployees  are  accounted  for at their  fair value  using the  Black-Scholes
option pricing method. The fair value of each non employee stock option or award
is  remeasured at each period end until a commitment  date is reached,  which is
generally the vesting date.

         Had  compensation  cost for all the Plans been determined  based on the
fair value of each stock option on its grant date,  as  prescribed  in SFAS 123,
the  Company's  net loss and net loss per share in  fiscal  2003  would  have as
follows:

                                      F-10

<PAGE>

Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

                                                 Year Ended     Year Ended
                                                 February 28,   February 28,
                                                     2003           2002
                                                -------------    -----------
Net loss reported                               $  (2,082,000)   $(1,472,000)

Stock-based employee compensation expense
determined under fair value for all awards           (155,000)      (302,000)
                                                -------------    -----------
Pro forma net loss                              $  (2,237,000)   $(1,774,000)
                                                =============    ===========

Reported net loss per share                     $       (1.14)   $     (0.85)
                                                =============    ===========
Pro forma net loss per share                    $       (1.22)   $     (1.03)
                                                =============    ===========

         During fiscal 2003,  there were no options  granted.  The fair value of
each option is  estimated  on the date of grant using the  Black-Scholes  option
pricing model with the following  weighted  average  assumptions used for grants
during  fiscal  2002:  dividend  yields  of 0%,  expected  volatility  of  111%,
risk-free  interest rate of 3.92% and a weighted average expected option term of
five years.  The weighted  average fair value of options  granted  during fiscal
year 2002 was $2.96.  The  weighted  average  fair value of options to  purchase
common  shares of the  Company's  subsidiaries  were not material  during fiscal
years 2003 and 2002.

     Other income (expense)

         The Other income  (expense) in fiscal 2003 and 2002 includes  equipment
rental income that is recognized  when  contractually  payable and collection is
probable.

     Recent accounting pronouncements

         In July 2001, the FASB issued FASB Statements Nos. 141 and 142 (FAS 141
and FAS  142),  "Business  Combinations"  and  "Goodwill  and  Other  Intangible
Assets."  FAS  141  supercedes   APB  16  and  eliminates   pooling-of-interests
accounting  prospectively.  It also  provides  guidance on  purchase  accounting
related to the  recognition  of intangible  assets and  accounting  for negative
goodwill.  FAS 142 changes the  accounting  for  goodwill  from an  amortization
method  to an  impairment-only  approach.  Under  FAS 142,  goodwill  is  tested
annually and whenever  events or  circumstances  occur  indicating that goodwill
might be impaired. The Company adopted FAS 142 on March 1, 2002. The Company has
evaluated the impact of adoption of these  standards on its  financial  position
and results of operations and determined  that the primary impact is that equity
method  goodwill  is no  longer  amortized,  but  that it is  still  subject  to
impairment guidelines under APB No. 18. As of February 28, 2003, the Company has
equity method goodwill recorded as a result of its investment in S2 Technologies
that is not subject to amortization.  This goodwill was generated after June 30,
2001 and as such no amortization was recorded during fiscal 2002. See Note 4 for
discussion of goodwill impairment recorded in fiscal 2003.

         In  October  2001,  the  FASB  issued  FAS  No.  144,  "Accounting  for
Impairment or Disposal of Long-Lived Assets." FAS No. 144 addresses  significant
issues  relating  to the


                                      F-11
<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

implementation  of FAS No. 121,  "Accounting  for the  Impairment  of Long-Lived
Assets  and for  Long-Lived  Assets to Be  Disposed  Of," and  develops a single
accounting  method under which  long-lived  assets that are to be disposed of by
sale are  measured  at the lower of the book  value or fair  value  less cost to
sell. Additionally,  FAS No. 144 expands the scope of discontinued operations to
include  all  components  of  an  entity  with   operations   that  (1)  can  be
distinguished  from the rest of the entity and (2) will be  eliminated  from the
ongoing  operation  of the  entity in a  disposal  transaction.  FAS No.  144 is
effective  for  financial  statements  issued for fiscal years  beginning  after
December  15,  2001 and its  provisions  are to be  applied  prospectively.  The
Company adopted FAS 144 in fiscal 2003. The  implementation of this standard did
not have a material impact on the Company's results of operations.

         In May  2002,  the  FASB  issued  FAS  No.  145,  "Rescission  of  FASB
Statements Nos. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." FAS No. 145 eliminates Statement 4 (and Statement 64, as it amends
Statement 4), which requires gains and losses from extinguishments of debt to be
aggregated  and, if material,  classified as an  extraordinary  item, net of the
related income tax effect. As a result,  the criteria in APB Opinion 30 will now
be used to classify  those gains and losses.  FAS No. 145 amends FASB  Statement
No. 13 to require that certain lease  modifications  that have economic  effects
similar to  sale-leaseback  transactions  be accounted for in the same manner as
sale-leaseback  transactions.  This amendment is consistent with the FASB's goal
of requiring  similar  accounting  treatment for transactions  that have similar
economic effects. In addition,  FAS 145 makes technical  corrections to existing
pronouncements.  While those  corrections are not substantive in nature, in some
instances,  they may change accounting practice. This statement is effective for
fiscal  years  beginning  after  May  2002  for the  provisions  related  to the
rescission  of  Statements  4 and  64,  and for all  transactions  entered  into
beginning  May 2002 for the  provision  related to the amendment of Statement 13
although early adoption is permitted.  The Company does not expect this standard
will have a material impact on the Company's results of operations.

         In July 2002, the Financial  Accounting  Standards Board (FASB) adopted
FASB Statement No. 146 (FAS 146),  Accounting  for Exit or Disposal  Activities,
effective for exit or disposal  activities that are initiated after December 31,
2002,  with early  adoption  encouraged.  FAS 146 addresses  significant  issues
regarding  the  recognition,  measurement,  and  reporting  of  costs  that  are
associated with exit and disposal activities, including restructuring activities
that are  currently  accounted  for pursuant to the  guidance  that the Emerging
Issues  Task  Force  (EITF)  has set  forth in EITF  Issue No.  94-3,  Liability
Recognition for Certain Employee Termination Benefits and Other Costs to Exit an
Activity  (including  Certain Costs incurred in a Restructuring).  A fundamental
conclusion reached by the Board in this Statement is that an entity's commitment
to a plan, by itself,  does not create a present obligation to others that meets
the  definition  of  a  liability.  Therefore,  this  Statement  eliminates  the
definition and  requirements  for  recognition of exit costs in Issue 94-3. This
statement  also  establishes  that  fair  value  is the  objective  for  initial
measurement  of the  liability.  The  scope of FAS 146 also  includes  (1) costs
related  to  terminating  a  contract  that  is  not a  capital  lease  and  (2)
termination  benefits that employees who are  involuntarily  terminated  receive
under  the  terms  of  a  one-time   benefit   arrangement   or  an   individual
deferred-compensation contract. The implementation of this standard did not have
a material impact on the Company's result of operations.

                                      F-12

<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

         In November  2002,  the FASB issued  FASB  Interpretation  No. 45 ("FIN
45"),  "Guarantor's  Accounting  and  Disclosure  Requirements  for  Guarantees,
Including Indirect Guarantees of Indebtedness of Others." FIN 45 requires that a
liability  be  recorded  in the  guarantor's  balance  sheet upon  issuance of a
guarantee. In addition, FIN 45 requires disclosures about the guarantees that an
entity has issued,  including a  rollforward  of the entity's  product  warranty
liabilities.  The  Company  will  apply  the  recognition  provisions  of FIN 45
prospectively  to  guarantees  issued after  February 28, 2003.  The  disclosure
provisions of FIN 45 are  effective.  At February 28, 2003,  no guarantees  were
issued by the  Company and no product  warranty  liability  was  recorded by the
Company.  The Company has included  additional  disclosures  in accordance  with
FIN45 in Note 9.

         In  December  2002,  the FASB  issued  SFAS No.  148,  "Accounting  for
Stock-Based  Compensation,  Transition  and  Disclosure."  SFAS No. 148 provides
alternative methods of transition for a voluntary change to the fair value based
method of accounting for stock-based  employee  compensation.  SFAS No. 148 also
requires that disclosures of the pro forma effect of using the fair value method
of  accounting  for   stock-based   employee   compensation  be  displayed  more
prominently  and in a  tabular  format.  Additionally,  SFAS  No.  148  requires
disclosure  of the  pro  forma  effect  in  interim  financial  statements.  The
transition and annual disclosure  requirements of SFAS No. 148 are effective for
fiscal year 2003. The Company has included additional  disclosures in accordance
with SFAS No. 148 in Note 2.


         In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"),
"Consolidation of Variable Interest Entities,  an Interpretation of ARB No. 51."
FIN 46 requires  certain  variable  interest  entities to be consolidated by the
primary  beneficiary of the entity if the equity  investors in the entity do not
have the  characteristics  of a  controlling  financial  interest or do not have
sufficient  equity at risk for the  entity to  finance  its  activities  without
additional  subordinated  financial  support  from  other  parties.  FIN  46  is
effective  for all new  variable  interest  entities  created or acquired  after
January 31, 2003. For variable  interest  entities  created or acquired prior to
February 1, 2003, the provisions of FIN 46 must be applied for the first interim
or annual period  beginning  after June 15, 2003.  The Company  expects that the
adoption  of  FIN46  may  have  primarily  an  impact  on its  investment  in S2
Technologies, Inc.

         Reclassification

         Certain  reclassifications have been made to the fiscal 2002 amounts to
conform to the 2003 presentations.  These  reclassifications  did not change the
previously reported net loss or the total assets of the Company.

                                      F-13

<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

3. Details of Balance Sheet Components


                                                   February 28,     February 28,
                                                       2003              2002
                                                    ---------         ---------
Other current assets:
  Receivable from licensees                         $    --           $  79,000
  Security deposit on facility                          1,000             1,000
  Prepaid expenses                                     63,000            75,000
  Other                                                 2,000             9,000
                                                    ---------         ---------
                                                    $  66,000         $ 164,000
                                                    =========         =========

Property and equipment:
  Machinery and equipment                           $    --           $ 245,000
  Furniture and fixtures                               42,000            38,000
                                                    ---------         ---------
                                                       42,000           283,000
Less:  Accumulated depreciation                       (34,000)         (277,000)
                                                    ---------         ---------
                                                    $   8,000         $   6,000
                                                    =========         =========

Accrued liabilities:
  Compensation                                      $  28,000         $  54,000
  Professional fees                                    80,000           104,000
  Facilities                                             --              15,000
  Other                                                 9,000            23,000
                                                    ---------         ---------
                                                    $ 117,000         $ 196,000
                                                    =========         =========


4. Investments

         During fiscal 2001, the Company  established Oryx Ventures,  LLC to act
as an investment and management services entity.

         The  Company's   investment  portfolio  is  comprised  of  early  stage
development  companies that generate net losses,  and it expects these losses to
continue  in the  future.  On a  quarterly  basis,  the  carrying  value  of the
Company's  ownership interest and advances in each of its portfolio companies is
evaluated  for possible  impairment.  In assessing  the carrying  value for each
portfolio company,  the achievement of financial plan objectives and milestones,
overall  market  conditions  for  their  products  or  services,  assessment  of
competitive  technologies  and the ability to raise  capital for future  funding
requirements is considered.

         The various  interests  that the Company has acquired in its  portfolio
companies  are  accounted  for by either the equity  method or cost method.  The
applicable  accounting method used to record investments in portfolio  companies
is  determined  by the  Company's  voting  interest and level of  influence  the
Company exercises over each portfolio  company.  In general the Company will use
the equity method when its  ownership  level exceeds 20% but is not greater than
50%.  When the  Company's  ownership  is less than 20% and the Company  does not
exercise  significant  influence  it uses the cost  method.  Whether  or not the
Company  exercises  significant  influence  with respect to a portfolio  company
depends on an evaluation of several factors including:  its management  capacity
and decision making  authority  relative to the management  services the Company
provides to the  portfolio  company,  level of  representation  on the portfolio
company's  board of directors  and level of voting  rights  associated  with its
equity holdings.

                                      F-14
<PAGE>

Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

         To date, the Company has invested in three technology  companies:  LOTS
Technology,   Inc.,  a  developer  of  digital   optical   storage   technology,
NetConversions,  an  early-stage,  data  marketing  company  with a  proprietary
technology that allows for real-time analysis of consumer online buyer behavior,
and  S2  Technologies,  Inc.,  an  early-stage  middleware  and  software  tools
development company.

         LOTS  Technology  ("LOTS")  proprietary  technology  is  a  replacement
product for the high-end magnetic media drives that can no longer keep pace with
the growth in digital data storage. The company,  which developed the technology
with major funding from government contracts,  plans to supply large-volume data
storage  systems to three broad markets of commercial and government  customers,
including general purpose computing,  networked data storage,  digital video and
data  acquisition  system  companies.  The Company made a direct  investment  of
$500,000 in LOTS in July 2000 and has received  additional equity in the form of
stock options for senior advisory  services it has provided to LOTS. The Company
has  an  approximate  6.5%  equity  ownership  in  LOTS.  The  Company  recently
discovered that LOTS was unsuccessful in raising  additional funds and filed for
bankruptcy.  Based upon the adverse  conditions  of the private  equity  capital
markets the Company  fully  reserved its $500,000  investment in LOTS during the
fourth  quarter of fiscal 2001. At February 28, 2003,  the Company does not have
any reasonable expectations of recovering the original investments or any return
thereon from LOTS.

         NetConversions,  Inc,  ("NetConversions") has developed a solution that
incorporates  an  innovative  approach to  behavior  profiling  and  promotions,
allowing  e-commerce  managers  maximum  flexibility  to  change  their  website
marketing.  The product is a turnkey ASP solution that requires  minimal  client
integration and engineering.  The Company has provided a bridge loan of $100,000
to  NetConversions  that is  convertible  to equity at a  discounted  rate.  The
Company fully reserved its investment in  NetConversion  as of November 30, 2000
due to industry conditions and financing issues. In August 2001,  NetConversions
significantly  curtailed  its business  operations.  At February  28, 2003,  the
Company does not have any  reasonable  expectations  of recovering  the original
investments or any return thereon from NetConversions.

         In August 2000, through Oryx Ventures, the Company invested $500,000 in
Series A Preferred of S2 Technologies,  Inc. ("S2 Technologies").  In June 2001,
the Company invested an additional $250,000 in a bridge loan to S2 Technologies.
In October 2001,  the Company  participated  in S2  Technologies'  second round,
Series B Preferred  financing with an investment of  $1,105,000,  which included
conversion  of the  $250,000  bridge loan and an  investment  of $855,000 in new
funds.  In March 2002, the Company  invested an additional  $938,000 in Series B
Preferred issued by S2 Technologies. In May 2003, the Company made an additional
investment of $200,000 in S2  Technologies  Series B-1 Preferred Stock resulting
in a cumulative investment in S2 Technologies of 38.9% on a fully diluted basis.

         The Company is also providing senior  management  advisory  services in
exchange  for  a  cash  fee  and  additional  equity  in  S2  Technologies.   S2
Technologies' focus is to provide value-

                                      F-15
<PAGE>

Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

added tools that address the  integration  and  verification  phases of embedded
software.  The  goal  of  S2  Technologies'  products  is to  increase  software
developers' and engineers' productivity and decrease the time it takes for their
products  to  reach   commercialization.   S2  Technologies  entered  into  beta
agreements  with LSI Logic and  Emerson  Electric  Co.  and  released  its first
commercial product in March 2002. Sales to date have been lower than anticipated
due to the difficult economic  environment.  Given the limited capital resources
of S2  Technologies  at the time the Company made its original  investment,  the
Company began recognizing losses based upon the its pro-rata share of the Series
A Preferred  financing.  Concurrent with the Series B Preferred  financing,  the
Company began recognizing losses on its investment in S2 Technologies based upon
the Company's total equity ownership  percentage (35.1%) in S2 Technologies.  In
March  2002,  the  Company  made an  additional  investment  of  $938,000  in S2
Technologies  for  Series B  Preferred  Stock and the  exercise  of a warrant to
acquire 466,666 shares of S2 Technologies Common Stock resulting in a cumulative
investment in S2  Technologies  of 43.3%,  on a fully diluted basis.  Holders of
Series A Preferred  Stock and B Preferred  Stock have voting  rights  consistent
with the  voting  rights of  common  stockholders  and such  voting  rights  are
considered in the calculation of the Company's ownership in S2 Technologies. The
investment  loss with respect to the  Company's  investment  in S2  Technologies
consists of recognition of losses relating to the Company's percentage ownership
share of S2 Technologies  and impairment of equity method goodwill  arising from
our investment in S2  Technologies.  From the Company's  original  investment in
August 2000 through its participation in the S2 Technologies  Series B Financing
in October 2001, the Company  recognized  approximately  71% of S2 Technologies'
losses, which reflected the Company's percentage of total capital invested in S2
Technologies.  Subsequent to the S2 Technologies  Series B Preferred  financing,
based  on the  addition  of new  investors,  the  Company  recognized  35% of S2
Technologies'  losses,  which  reflects its  percentage  equity  ownership in S2
Technologies.  After the  Company's  additional  investment  in S2  Technologies
Series B Preferred  financing in March 31,  2002,  Oryx  recognized  44.3% of S2
Technologies'  losses.  Since December  2002,  the Company has been  recognizing
44.2% of S2  Technologies'  losses.  The price per share paid by the Company for
the S2 Technologies  stock in March 2002 was in excess of the net book value per
share of the  underlying  equity in net assets of S2  Technologies  resulting in
goodwill of $897,000. This goodwill has been included in the Investment balance.
The  Company  has  recognized  losses   attributable  to  its  ownership  of  S2
Technologies  of  $1,858,000  as of  February  28,  2003 of which  $787,000  and
$814,000 in fiscal 2003 and 2002 are included in loss on  investments  in fiscal
2003 and 2002, respectively and impairment losses of $412,000 as of February 28,
2003. At February 28, 2003, the carrying value of the Company's investment in S2
Technologies was $200,000.

         S2  Technologies  remains in the  "development  stage"  and  expects to
continue to generate  losses from  operations  until its products  have achieved
market  acceptance and recurring sales with  customers.  Sales to date have been
minimal and lower than expected, and therefore there can be no assurance that S2
Technologies  will achieve  these goals.  Due to lower than expected  sales,  S2
Technologies  will most likely  require  additional  funding and there can be no
assurance that such funding will be available,  or if such funding is available,
will be on terms which would be acceptable to S2  Technologies  or beneficial to
the Company's  equity ownership  interest in S2 Technologies.  As a result of S2
Technologies  not  meeting  certain  milestones  established  during  the  prior
quarter,  the Company recorded an impairment loss of $412,000 for the year ended

                                      F-16
<PAGE>

Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

February 28, 2003. The impairment loss was determined  based upon Oryx's prorata
share of S2 Technologies' net realizable value,  which consists primarily of net
available cash at February 28, 2003. If S2 Technologies  does not achieve higher
level of sales or cannot obtain needed  financing or such  financing is dilutive
to the Company's  equity ownership  interest in S2  Technologies,  the Company's
investment  balance  of  $200,000  as of  February  28,  2003 may be  subject to
additional impairment charges.

         Mark Underseth,  Chief  Executive  Officer of S2  Technologies,  is the
brother of Mitchel Underseth,  who was the Chief Financial Officer of Oryx until
November 30, 2002. Mitchel Underseth did not participate in Oryx's due diligence
or  negotiations  with  respect to Oryx's  investments  in S2  Technologies  and
abstained from voting or discussion when the Oryx Board of Directors  considered
this matter.  In December 1, 2002,  Mitchel  Underseth joined S2 Technologies as
their Chief  Financial  Officer.  The Company  recognized  $76,000 in management
service fees from S2 Technologies for the fiscal year ended February 28, 2003.

         Summarized  financial  information for S2  Technologies  for the fiscal
year ended February 28, 2003 is as follows:


<TABLE>
<CAPTION>
                                                 At February 28, 2003            At February 28, 2002
                                                 ----------------------------------------------------
<S>                                                 <C>                              <C>
Current assets                                      $   548,000                      $ 1,207,000
Non-current assets                                       49,000                           55,000
Current liabilities                                     168,000                          171,000
Non-current liabilities                                    --                               --
Redeemable preferred stock                            4,083,000                        2,801,000
Stockholders deficit                                 (3,654,000)                      (1,709,000)


                                                      Year ended                      Year ended
                                                  February 28, 2003               February 28, 2002
                                                 ----------------------------------------------------
Net Sales                                                31,000                             --
Loss from continuing operations                      (1,973,000)                      (1,365,000)
Net loss                                             (1,964,000)                      (1,355,000)
</TABLE>


5. Stockholders' Equity

Stock Split

On June 15,  2001,  the  Company's  Board of  Directors  approved a  one-for-ten
reverse stock split of the Company's  common stock. The reverse stock split took
effect on June 19, 2001. All historical share and per share amounts presented in
this Form 10-KSB have been restated to reflect this reverse stock split.

                                      F-17
<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

Warrants

During  fiscal 2002,  the Company  entered  into a seventeen  and one half month
marketing agreement with a third party for investor relations services.  In July
2001,  in  consideration  for the investor  relations  services  provided to the
Company by such third  party,  the Company  issued two  immediately  exercisable
fully  vested  warrants to  purchase  25,000  shares of common  stock each at an
exercise price of $6.52 and $3.26 per share, respectively. These warrants expire
five years from the date of issuance.  The Company  determined the fair value of
these  warrants to be $110,000,  which was  calculated  using the  Black-Scholes
option  pricing  model on the date of grant.  The fair value of the  warrants is
being  expensed on a  straight-line  basis over the period in which the services
are being performed. The Company recorded $62,000 and $48,000 of expense related
to these services for the years ended February 28, 2003 and 2002, respectively,.

In October 2001,  the Company sold 162,338  shares of common stock to a group of
accredited  investors in a private  placement,  resulting  in total  proceeds of
$499,000.  As part of this  transaction,  the  Company  issued to the  investors
five-year  warrants to purchase in aggregate up to a maximum of 37,975 shares of
the Company's common stock at an exercise price of $5.925 per share.


6. Series A 2% Mandatorily Redeemable Convertible Cumulative Preferred Stock

         The Company has authorized  3,000,000  shares of Preferred Stock with a
par value of $0.001  per share of which  45,000 of such  shares  are  designated
Series A 2% Mandatorily  Redeemable  Convertible Cumulative Preferred Stock (the
Series A Stock). Each share of Series A Stock may be converted, at the option of
the holder,  into  approximately  1.167 shares of Common Stock.  The Company had
reserved 875 and 4,376 shares of Common Stock for issuance  upon  conversion  of
the Series A Stock as of February 28, 2003 and 2002, respectively. During fiscal
2003,  a holder of Series A Stock  converted  3,000  units into 3,501  shares of
Common Stock. The holders of Series A Stock are entitled to receive a cumulative
dividend of $0.50 per share per annum,  subject to any  restrictions  imposed by
the Delaware General Corporation Law. The dividend is payable semi-annually.  In
the event of a liquidation  and to the extent assets are available,  the holders
of the Series A Stock are entitled to a liquidation  preference  distribution of
$25.00 per share plus accrued but unpaid dividends.  A change in the majority of
the voting control of the  outstanding  stock is considered a liquidation  event
which could cause the Series A stock to be redeemed.  Each share of the Series A
Stock is entitled to one vote per share on all  matters  submitted  to a vote of
stockholders of the Company.  The redemption  value is equal to the initial fair
value.

                                      F-18

<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

7. Stock Plans and Warrants

     Oryx Stock Plans

         In March 1993, the Company adopted the Incentive and Nonqualified Stock
Option Plan (the "1993  Plan").  The 1993 Plan provides for incentive as well as
nonstatutory  stock  options.  The  plan  terminated  on  March  3,  2003 and no
additional options will be granted under this plan.

         Options  under the 1993 Plan were granted at prices  determined  by the
Board of Directors,  subject to certain conditions.  Generally, these conditions
require  that the  exercise  price of options  granted may not be below 110% for
persons owning more than 10% of the Company's capital stock and 100% for options
issued to other persons for incentive  options,  or 85% of the fair market value
of the stock at the date of grant for non statutory options.  Options granted to
persons owning more than 10% of the Company's  capital stock may not have a term
in excess of five years,  and all other  options  must expire  within ten years.
Options vest over a period determined by the Board of Directors,  generally four
years,  and are adjusted pro rata for any changes in the  capitalization  of the
Company,  such as stock  splits and stock  dividends.  The  Company  has 362,500
shares  authorized  under the  Incentive and  Nonqualified  Stock Option Plan of
which 226,839 options were  outstanding with an average exercise price of $14.51
per share as of February 28, 2003.

         In 1995 and 1996, the Company adopted the 1995 and 1996 Directors Stock
Option Plan (the "Directors'  Plans").  The 1995 and 1996 Directors' Plan, which
expires in 2005 and 2006,  respectively,  provide for nonstatutory stock options
to be granted to  nonemployee  directors of the Company.  The Board of Directors
may terminate the Directors'  Plans at anytime at its discretion.  Options under
the Directors' Plans are granted at prices determined by the Board of Directors,
subject to certain  conditions  more fully  described in the  Directors'  Plans.
Generally,  these conditions  require that the exercise price of options granted
may not be below 110% for persons owning more than 10% of the Company's  capital
stock and 100% for options  issued to other  persons of the fair market valve of
the stock at the date of grant.  Options must expire  within ten years of grant.
The 1995 and 1996  Directors'  Plan  provides  that  each  nonemployee  director
receive  options  to  purchase  4,500 and  3,000  shares,  respectively,  of the
Company's  Common Stock.  Under the 1995 Director's  Plan,  shares vest in three
equal  annual  installments  of 15,000  shares on the  first,  second  and third
anniversaries of the date of the grant. Under 1996 Director's Plan, 1,000 shares
vest and are exercisable  upon grant with the remainder  vesting in equal annual
installments  on the first and second  anniversaries  of the date of grant.  The
Company has 22,500 shares  authorized  under the 1995  Directors'  Plan of which
12,000  options were  outstanding  with an average  exercise price of $17.02 per
share as of February 28, 2003.  The Company has 25,000 shares  authorized  under
the 1996 Directors' Plan of which 9,000 options were outstanding with an average
exercise price of $17.72 per share as of February 28, 2003.

         In fiscal 1999, as part of its sale of the Power Products business, the
Company issued non-statutory options under a special Stock Option Plan to former
key employees of Oryx Power Products to purchase a total of 20,500 shares of the
Company's  Common Stock at an exercise  price of $9.5 per share and 5,000 shares
at an exercise price of $2.50 per share. As of February 28, 2003,  there were no
outstanding options under this plan.

                                      F-19

<PAGE>

         A summary of stock option  activity under the 1993 Plan, the Directors'
Plans and other stock options granted is as follows:


                                                        Options Outstanding
                                                      --------------------------
                                                                     Weighted-
                                       Available                      Average
                                         For         Number of    Exercise Price
                                        Grant         Options       Per Share
                                      --------       --------       ---------
Balance at February 28, 2001            33,461        308,667       $   16.33

Options granted                        (36,000)        36,000       $    3.95
Options canceled and expired            22,575        (25,575)      $   21.37
                                      --------       --------
Balance at February 28, 2002            20,036        319,092       $   14.73

Options canceled and expired            71,253        (71,253)      $   14.67
                                      --------       --------
Balance at February 28, 2003            91,289        247,839       $   14.75
                                      ========       ========

         The following table summarizes information about employee stock options
at February 28, 2003:

<TABLE>
<CAPTION>
                                 Options Outstanding                     Options Exercisable
                          --------------------------------------    ------------------------------
                                     Weighted-Average
                                        Remaining   Weighted-                         Weighted-
    Range of                 Number    Contractual   Average          Number           Average
 Exercise Prices          Outstanding     Life    Exercise Price    Exercisable     Exercise Price
----------------          -----------     ----    --------------    -----------     --------------
<S>                         <C>            <C>    <C>                   <C>            <C>
$3.95 - 3.95                 24,000        8.6    $    3.95             8,000          $    3.95
$6.88 - 10.00                 9,275        0.9         8.19             9,275               8.19
$10.67 - 15.81              121,862        4.5        13.94           121,862              13.94
$17.90 - 23.13               92,702        3.7        19.26            89,639              19.19
                          -----------                               -----------
   Total                    247,839        4.5    $   14.75           228,776          $   15.41
                          ===========                               ===========        =========
</TABLE>

                                      F-20
<PAGE>

Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

     Subsidiary Stock Plan

         In November 1995, the Company's subsidiary, SurgX Corporation,  adopted
stock  option  plans  under  which the Board of  Directors  granted  options  to
management  to purchase  Class B common  shares in the  subsidiary at their fair
market values as  determined  by the Board of  Directors.  Class B common shares
authorized  for  issuance in the  subsidiary  are  identical  to the ten million
shares of Class A common shares owned by the Company,  except the Class A shares
possess a liquidation preference.  The Board of Directors authorized 1.5 million
shares of Class B common  shares to be available  for issuance  under this stock
plan. Such options are not transferable except in the event of a public offering
of the  subsidiary's  stock  or an  acquisition  of the  subsidiary,  and may be
repurchased by the Company at its option. Grants under the plan are for amounts,
vesting  periods  and  option  terms  established  by  the  Company's  Board  of
Directors.  The Company's ownership percentage of this subsidiary will change as
a result of future exercises of stock options and, to the extent this subsidiary
contributes  profits,  outstanding  subsidiary  stock  options  may  dilute  the
Company's share of profits in the calculation of earnings per share.

         At February  28, 2003,  there were 14,000 fully vested and  exercisable
options  outstanding  to  purchase  shares of SurgX  Corporation  class B common
stocks.  These  options  had an average  exercise  price of $0.80 and an average
remaining  contractual life of 2.4 years.  There was no activity under the SurgX
subsidiary  stock option plan during fiscal 2003.  During  fiscal 2002,  290,000
options at an average price of $0.80 expired.  At February 28, 2003 and February
28, 2002 there were 1,486,000 shares available for grant.

         During  fiscal 1998,  the Company sold 333,000  Class A shares of SurgX
Corporation  for net  proceeds of $485,000.  At February  28,  2003,  there were
10,333,000 Class A common shares of SurgX  Corporation  outstanding and with the
exception of 333,000 shares of SurgX Corporation sold in fiscal 1998, all of the
subsidiary Class A shares outstanding were owned by the Company.

                                      F-21
<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

     Warrants

         The following  warrants at February 28, 2003,  and the number of shares
of  the  Company's  Common  Stock  which  may be  purchased  at  exercise,  were
outstanding and exercisable at February 28, 2003:

<TABLE>
<CAPTION>
   Original            Issuable         Warrant           Warrant            Warrant
   Warrants             Common        Commencement      Expiration          Exercise
  Outstanding           Shares           Date              Date               Price

<S>                    <C>           <C>                 <C>                 <C>
      37,500            3,750        Oct. 1994           Oct. 2004           $2.000
     379,000           57,229        Nov. 1994           Oct. 2004           $2.000
      25,000           25,000        Jul. 2001           Jul. 2006           $3.260
      25,000           25,000        Jul. 2001           Jul. 2006           $6.520
      37,975           37,975        Oct. 2001           Oct. 2006           $5.925
-------------     ------------
     504,475          148,954
=============     ============
</TABLE>


8. Income Taxes

         Deferred income taxes reflect the tax effects of temporary  differences
between carrying  amounts of assets and liabilities for financial  reporting and
income tax purposes. The Company provides a valuation allowance for deferred tax
assets when it is more likely than not, based on currently  available  evidence,
that some  portion  or all of the  deferred  tax  assets  will not be  realized.
Management  believes that the available  objective  evidence creates  sufficient
uncertainty  regarding the realizability of deferred tax assets such that a full
valuation allowance is required at February 28, 2003.

         The tax effects of temporary  differences and  carryforwards  that give
rise to significant  portions of deferred tax assets and liabilities at February
28, 2003 and February 28, 2002 are as follows:

                                                  February 28,     February 28,
                                                      2003             2002
                                                 -------------------------------
Net operating loss carryforwards                 $ 7,501,000        $ 7,172,000
R&D credit carryforwards                             343,000            342,000
Other                                              1,210,000            704,000
                                                 -------------------------------
     Net deferred tax assets                       9,054,000          8,218,000
Valuation allowance                               (9,054,000)        (8,218,000)
                                                 -------------------------------
     Net deferred tax assets                     $       --         $      --
                                                 ===============================

         No  provision  for federal  income taxes has been  recorded  because of
losses incurred. The provision for (benefit from) income taxes reconciles to the
amounts  computed by applying the  statutory  federal rate to loss before income
taxes as follows:


                                                  February 28,     February 28,
                                                      2003             2002
                                                 -------------------------------
Statutory U.S. federal tax                       $ (708,000)       $ (500,000)
Valuation allowance with respect to
  federal deferred tax assets                       708,000           500,000
Other                                                     0                 0
                                                 ----------        ----------
     Effective tax                               $     --          $     --
                                                 ==========        ==========


         At February 28, 2003,  the Company had federal net  operating  loss and
research and development credit  carryforwards of approximately  $21,500,000 and
$160,000,  respectively.  The benefit derived from losses  attributable to stock
options will be recorded  directly to  stockholders  equity when realized rather
than as a reduction of the income tax provision.  Federal net operating loss and
research and development credit  carryforwards will expire on various dates from
2004 through 2021,  subject to certain  limitations.  In accordance with Section
382 of the Internal

                                      F-22
<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

Revenue Code, the amounts of and the benefits from net operating losses that can
be carried forward are limited in certain circumstances,  including a cumulative
stock ownership change of more than 50% over a three-year  period. The Company's
initial public offering and subsequent private placements triggered an ownership
change of greater than 50% and,  accordingly,  the future utilization of federal
net operating loss and research and development credit  carryforwards  generated
through the date of that offering may be limited.


9. Commitments and Contingencies

         The Company leases its facilities  under an operating lease  agreement,
which expires in August 2003.  Future  minimum lease  obligations  of $5,000 are
payable in the year ending February 28, 2004.

         Rental expense for the year ended  February 28, 2003 was $18,000.  This
compares to rental  expense for the year ended  February  28, 2002 of  $175,000,
offset by rent payments received from sublessees for $148,000.

         The Company enters into  agreements with customers in the normal course
of business that contain various  guarantees such as indemnification of its or a
third party's intellectual  property.  At February 28, 2003, the Company had not
recorded any liabilities associated with these guarantees.


10. Related Parties

         During fiscal 1999, the Company made a loan to an employee for $35,000,
at a rate of 7% per annum,  repayable at the earlier of July 15, 2000, or thirty
days after the debtor ceases to be a full-time employee of the Company.  The due
date of this loan was extended to November  15, 2002.  The loan was paid in full
during  fiscal 2003.  The  outstanding  balance was  approximately  $4,000 as of
February 28, 2002.

         Through  Oryx  Ventures,  LLC,  the  Company  has  invested  a total of
$2,543,000 in Preferred  Stock of S2  Technologies,  Inc. from July 2000 through
February  2003.  In March 2002,  the Company made an  investment  of $938,000 in
Preferred Stock of S2 Technologies and exercised portion of a warrant to acquire
466,666 shares of S2 Technologies Common Stock. In May 5, 2003, the Company made
an  additional  investment of $200,000 in S2  Technologies  Series B-1 Preferred
Stock  resulting in a cumulative  investment  in S2  Technologies  of 38.9% on a
fully diluted basis. Mark Underseth, Chief Executive Officer of S2 Technologies,
Inc. is the brother of Mitchel Underseth, who was the Chief Financial Officer of
Oryx until November 30, 2002.  Mitchel  Underseth did not  participate in Oryx's
due  diligence  or  negotiation  with  respect  to  Oryx's  transaction  with S2
Technologies, Inc. and abstained from voting or discussion when the Oryx's Board
of Directors  considered  this matter.  In December 1, 2002,  Mitchel  Underseth
joined S2 Technologies as their Chief Financial Officer.

         In addition,  Messrs. Micciche and Underseth provide certain management
services to S2 in exchange for cash and warrants to purchase  common stock in S2
Technologies.  S2

                                      F-23
<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

Technologies  issued  warrants to purchase  700,000  shares of common  stock for
$0.001 per share, of which 466,666 were exercised by the Company. As of February
28,  2003,  there  were  233,334  outstanding,   of  which  145,834  vested  and
exercisable.  The Company has  recorded  $76,000 of revenue  during  fiscal 2003
related to the cash portion of the services  provided,  but has not recorded any
amounts  related to the  warrants,  as the  recoverability  of the amount is not
considered probable for revenue recognition purpose.

11. Segment Information

         The Company  groups its  business  into two  operating  segments  and a
corporate  segment (as defined by SFAS No. 131  "Disclosure  about  Segments and
Enterprise and Related  Information."):  (i) SurgX, the subsidiary through which
it licenses its surge  protection  technology;  (ii) Oryx  Ventures,  the entity
which   provides   strategic   and   management   services  and   investment  to
technology-oriented  start-up  companies;  and (iii) the corporate segment which
supports and provides  administrative,  accounting and financial services to the
operating segments,  and collected royalties from its Intragene Technology until
November 2002.  Minority interest of 3% in SurgX is not significant;  therefore,
it is not reflected in our financial statements.


                                                    Year Ended      Year Ended
                                                    February 28,   February 28,
                                                        2003           2002
                                                    -----------    -----------
Revenues:
  Surgx                                             $   148,000    $   200,000
  Oryx Ventures                                         134,000        223,000
  Corporate                                             106,000        182,000
                                                    -----------    -----------
                                                    $   388,000    $   605,000
                                                    ===========    ===========

Operating loss:
  Surgx                                             $   (61,000)   $  (126,000)
  Oryx Ventures                                         (32,000)      (102,000)
  Corporate                                            (835,000)      (713,000)
                                                    -----------    -----------
                                                    $  (928,000)   $  (941,000)
                                                    ===========    ===========

Depreciation and amortization expense:
  Surgx                                             $      --      $   117,000
  Corporate                                               6,000          7,000
                                                    -----------    -----------
                                                    $     6,000    $   124,000
                                                    ===========    ===========

Identifiable assets:
  Surgx                                             $      --      $    80,000
  Oryx Ventures                                         205,000        534,000
  Corporate                                             455,000      2,143,000
                                                    -----------    -----------
                                                    $   660,000    $ 2,757,000
                                                    ===========    ===========

         Loss on investments, net of $787,000 and $814,000 and impairment losses
of $412,000 and $0 for the years ended February 28, 2003 and 2002, respectively,
relates to the Oryx Ventures segment losses on equity  investments.  Included in
identifiable  assets of Oryx  Ventures are $200,000 and $520,000 for fiscal 2003
and 2002,  respectively,  which  represent  the  carrying  value of  investments
accounted for under the equity method (see note 4).

                                      F-24
<PAGE>


Oryx Technology Corp.
Notes to Consolidated Financial Statements
--------------------------------------------------------------------------------

         The  Company   licenses  its   technologies   both   domestically   and
internationally and provides management services primarily domestically. Revenue
by geographic region is as follows:

                                            Year Ended     Year Ended
                                           February 28,   February 28,
                                              2003            2002
                                            --------        --------
Net Revenues:
  United States                             $240,000        $405,000
  Japan                                      148,000         200,000
                                            --------        --------
  Net Revenues                              $388,000        $605,000
                                            ========        ========

         All  sales  are  denominated  in  United  States  dollars.  All  of the
Company's assets are located within the United States.



12.      Subsequent events

         In May 5, 2003,  the Company made an additional  investment of $200,000
in  S2  Technologies  Series  B-1  Preferred  Stock  resulting  in a  cumulative
investment in S2 Technologies of 38.9% on a fully diluted basis.

                                      F-25