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 29, 2000

                                       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.)


1100 Auburn Street, Fremont, California                             94538
----------------------------------------                         ----------
(Address of principal executive offices)                         (Zip Code)

Issuer's Telephone Number, including area code:                (510) 492-2080
-----------------------------------------------                --------------

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 Small Cap Market

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

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

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


<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 $755,000.

         As of April 30, 2000,  16,616,287  shares of common stock and preferred
stock  convertible  into  43,750  shares  of  common  stock of  Registrant  were
outstanding.  The  aggregate  market value of the shares of common stock held by
non-affiliates of Registrant,  based on the average of the closing bid and asked
prices on April 30, 2000: $2.2813 and $2.4375 quoted by the National Association
of Securities Dealers Automated  Quotation System ("NASDAQ"),  was approximately
$33,795,386.(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,  and
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
Registrant,  and by others who,  to  Registrant's  knowledge,  own 5% or more of
Registrant'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.



                                       1

<PAGE>

                                     PART I


Item 1.           Description of Business.

Introduction

         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.

         During 1998 we initiated a restructuring of our business  operations so
that today we have two primary focuses:

         o        collecting  royalties from our two licensees,  Cooper Bussmann
                  and IRISO  Electronics,  Inc.,  and  licensing  our  Intragene
                  technology to Oryx Advanced Materials, Inc.; and

         o        investing  in   technology   start-up   companies   through  a
                  majority-owned investment and management services company.

Oryx  Ventures, LLC

         We are in the process of  establishing  Oryx Ventures,  LLC, a Delaware
limited  liability  company,  to act as an investment  and  management  services
entity for us. Oryx Ventures will be majority  owned by Oryx and will be managed
by Oryx employees. We will contribute investment funds to Oryx Ventures from our
existing  cash balances and from our internal  cash flow  generated  from future
royalty income from licensing our SurgX and Intragene technologies.

         Oryx Ventures will invest such funds and provide management services at
the  direction  of its board of  managers,  primarily  with  technology-oriented
start-up  companies.  Oryx Ventures will typically invest in early stage funding
of technology  start-up  companies and will provide its  management  services to
these companies to leverage its capital investment and facilitate such companies
securing  more  substantial  funding  from third  parties.  Through a management
services  agreement,  Oryx  Ventures  will  provide  services  to its  portfolio
companies in exchange for equity in these companies. These services may include:
senior executive mentoring,  sales and marketing strategy,  business development
activities,  assistance  in fund  raising and  administrative  services  such as
accounting,  human  resources and  information  technology  services.  Oryx will
receive a portion of the  profits  and losses  from Oryx  Ventures  as well as a
portion  of  any  assets  distributed  by  Oryx  Ventures  upon  liquidation  or
otherwise.

SurgX Corporation

         SurgX Corporation,  or SurgX, is currently the subsidiary through which
we  license  our  surge  protection  technology.   The  underlying  technologies
developed by SurgX are currently licensed  exclusively to two licensees,  Cooper
Electronics Technology, Inc., or Cooper


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<PAGE>

Bussmann,  and IRISO Electronics Company,  Ltd., or IRISO. Products manufactured
by these licensees and utilizing SurgX's proprietary  technology are targeted to
be  sold  to  original  equipment  manufacturers,  or  OEMs,  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.

Business Overview

         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 calendar 1996,
the  formulation  originally  designed  in  1994  was  modified  to  fit  unique
requirements  of the  Cooper  Bussmann  manufacturing  process,  and to  improve
response   voltage   performance.   In  calendar  1998,  the   formulation   and
manufacturing  process was modified to  accommodate  new high  volume,  low cost
manufacturing process implemented by both Cooper Bussmann and IRISO. In calendar
2000 we are in the process of transferring  all trade secrets and  manufacturing
know-how  for SurgX  liquid to our  licensees  to  facilitate  the  transfer  of
manufacturing SurgX liquid from SurgX to our licensees.

Licensees

         In fiscal  year 1996,  we  undertook  a  strategic  review of the SurgX
business.  We  determined  that  it  would  be more  efficient  to  establish  a
relationship with one or more experienced  corporate  partners who could provide
the necessary high volume manufacturing and distribution channels.

Cooper Bussmann

         In fiscal  year  1997,  an  exclusive,  world  wide,  except for Japan,
license was granted to Cooper  Bussmann  for the  manufacture  and  marketing of
surface mount and connector array components using the SurgX(TM) technology.  In
consideration  for this license,  Cooper  Bussmann paid $750,000 in  development
funding,  and, subject to terms of the license  agreement,  was obligated to pay
royalties for approximately 11 years to SurgX based upon Cooper Bussmann's sales
of SurgX surface mount  components and  connectors.  In September of 1997,  this
license  agreement was amended,  extending  its term to 20 years,  expanding the
licensed  rights to Cooper Bussmann for SurgTape for board-level ESD protection,
and  providing  SurgX with  $1,700,000,  in the form of  non-refundable  minimum
royalties, to finance further the development and commercialization of SurgTape.
At this time,  SurgTape has not been  commercialized  and activities by SurgX to
develop SurgTape for board-level ESD protection have been abandoned.

         Cooper  Bussmann  is a leading  manufacturer  of fuses  and its  target
market for SurgX is the rapidly growing electronics market.  Cooper Bussmann had
initially  taken on the  manufacturing  of discrete  components  using SurgX. In
fiscal  2000,  to address the market  requirements  of high volume and low cost,
Cooper  Bussmann  initiated  offshore  manufacturing  through an Asian  contract
manufacturer.  The current capacity of this contract manufacturer is ten million
units per month with the ability to expand and handle increased  capacity in the
future to  accommodate  anticipated  demand  for  products  incorporating  SurgX
technology.  During fiscal


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<PAGE>

2000, Cooper Bussmann also formed Cooper Electronic Technologies, Inc. to handle
research and development, sales and marketing functions to support the marketing
of Cooper Bussmann products incorporating SurgX and other technologies.

         Due to the transfer of manufacturing offshore and the reorganization of
Cooper Bussman in fiscal 2000,  sales of SurgX  products were minimal.  However,
Cooper  Bussmann's  restructuring of its  manufacturing  and other operations is
facilitating its successful marketing of our SurgX technology and recently SurgX
technology has been designed-in  products offered by five major OEMs and is also
in active product evaluation with approximately 40 customers.

IRISO

         In November 1997, IRISO, involved in the manufacturing, development and
sales of high  engineering  connectors  and precision  metal pins for electronic
equipment,  made an investment of $500,000 in SurgX in exchange for an ownership
interest of approximately 3%. In conjunction with this equity investment,  IRISO
received  a 15-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 the 0805  surface  mount  components.  Sales in  fiscal  2000 have been
minimal  with  IRISO  shipping  production  quantities  to two major OEMs and in
lesser  amounts  to  five  other  customers.   Eleven  customers  are  currently
evaluating IRISO products  incorporating the SurgX  technology.  In fiscal 2000,
IRISO paid us $75,000  to  maintain  its  exclusivity  for the SurgX  license in
Japan.

Market for the SurgX Technology

         As  the  information   technology   industry   increases  capacity  and
performance,  it is requiring  faster speeds,  smaller chip geometries and lower
operating  voltages.  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 currently is
estimated at approximately  $2.1 billion and 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 technology are  telecommunication,
automotive and computers.  Sales of surge  protection  devices are divided among
varistors  (40%),  diodes  (40%),  and gas  discharge  tubes and surge  resistor
networks (20%).


                                       4

<PAGE>

         Gas discharge tubes,  varistors,  and diodes are all used as protection
from  over-voltage  transients.  Our  SurgX(TM)  technology  is a polymer  based
technology, used to protect against over-voltage transients.

         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 band width 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
handle the 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.  As
long as the varistor is large enough,  it can handle high  currents.  Varistors'
typical response times cited are slow.

         Diodes offer the 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,  capacitances are
commonly  greater  than 10 to 100's  of pF,  and the  response  to  voltages  is
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.  Like the varistor 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 one pF, lower
than  that  of any of  the  standard  overvoltage  protection  components  it is
intended to replace.  SurgX  devices can  therefore be used at high  frequencies
without   interfering   with  signal   transmission.   The  low  capacitance  is
particularly  important as the  frequencies of today's  electronics go beyond 10
mega hertz.  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 replacement in 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.


                                       5

<PAGE>

         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 cost,  low  capacitance  needs  required for signal line  protection  in
electronics.   The  major  suppliers  for  traditional  over-voltage  protection
products include General  Semiconductor,  Harris  Semiconductor,  Inc., Motorola
Corp., AVX, and Siemens Components, Inc.

Primary Market Segment

         Our licensees,  Cooper Bussmann and IRISO, have sole responsibility for
marketing  products  using our SurgX  technology.  The discrete TVS diode is the
primary  market  targeted  by our  licensees.  This market is  forecasted  to be
approximately  $900  million in calendar  year 2000 with an  estimated  forecast
annual average  growth rate of 8% in terms of dollar value,  and 11% in terms of
unit volume,  through  2003.  To a lesser  extent,  our  licensees  will seek to
participate in the varistor market,  which is approximately the same size as the
diode segment.  Within these markets the most important use criteria tends to be
cost. After cost, the level of capacitance, response time, size, energy handling
and leakage current are important  criteria.  It is the latter criteria on which
SurgX 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  have not focused on the low price,  high volume
diode market since,  to date,  they have not been able to achieve  product costs
competitive with diodes.  However, they are currently focusing on cost reduction
initiatives  to reduce  product cost to better  compete in the high volume,  low
price diode market.

         We  believe  that  our  technology  has  competitive   advantages  over
traditional  over-voltage  protection devices.  These include lower capacitance,
smaller  footprint on the board and potential lower cost.  Further,  SurgX has a
hidden price advantage  relative to a diode,  because one  bi-directional  SurgX
component does the function of two unidirectional diodes.  However, there can be
no assurances  that customers will value the advantages of SurgX(TM)  technology
such that they will change from the current  over-voltage  protection devices in
use.

Product Development

         Prior to fiscal year 2000,  SurgX  employees  were dedicated to product
development and SurgX's approach to the market consisted of two parallel product
paths: on board-level  ESD protection and on-chip ESD protection.  During fiscal
year 2000, all SurgX research and development efforts were transferred to Cooper
Electronic  Technologies,  Inc., a business unit of Cooper Bussmann dedicated to
technical  sales,  marketing and development  support of overvoltage  protection
technologies and other technologies of Cooper Bussmann.

         Our  first  product  group  was based on  board-level  ESD  protection,
incorporating SurgX's liquid polymer-based material into discrete ESD protection
components. In fiscal 1999 these products were produced and sold to end users in
limited quantities by Cooper Bussmann.  Due to market demand for high volume low
cost  components,  in fiscal  2000  both  IRISO and  Cooper


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<PAGE>

Bussmann,  with  the  assistance  of  SurgX,  focussed  on  developing  low cost
manufacturing  processes capable of producing up to 100 million units per month.
While  their  combined  current  manufacturing  capacity  for SurgX  products is
approximately  twenty  million  units per month,  their  existing  manufacturing
facilities are scaleable and existing  manufacturing capacity can expand readily
to meet increased demand for SurgX products.

         Cooper Electronic Technologies, Inc. is actively working on new product
development and has developed and introduced a four line array product which was
developed  to  address  the  requirements  of the  cellular  market.  It is also
developing a smaller  footprint  component,  an 0402 package style. In addition,
Cooper Bussmann has initiated a program to evaluate and develop low-cost product
offerings to compete directly with low-priced diodes.

         In fiscal 2000,  IRISO launched a SurgX component in a standard passive
component  package  style,  its 0805 package,  which is the focus of its current
development efforts for the SurgX technology.

         The second product group,  SurgTape,  was to provide on-chip protection
by placing SurgX-based tape inside the IC package on the leadframe. This product
has not been commercially developed due to inconclusive test results to date. We
concluded that expected  expenditures  necessary to test and commercialize  this
product did not warrant further  development.  However,  we have entered into an
agreement  with Rexam Image  Products  which will allow Rexam to  determine  the
technical  feasibility  of our  SurgTape  technology  for use in  on-board  line
transient protection and on-chip electrostatic discharge protection.  Rexam will
pay for this evaluation and, if the evaluation is positive,  we may enter into a
license agreement with Rexam for the Surg terms mutually acceptable to Rexam and
us.  Rexam  is a wholly  owned  subsidiary  of  Rexam  PLC,  a U.K.  based  high
technology  coated  films  company  with  annual  revenues of  approximately  $3
billion.

Competition

         Other  than  conventional   manufacturers  of  over-voltage   transient
protective  devices,  the main  competitor to the SurgX  technology  licensed to
Cooper  Bussmann and IRISO,  is  Littlefuse,  Inc. which has announced a polymer
base  over-voltage   protection  product,  which  compete  directly  with  SurgX
products.  As SurgX  components  become price  competitive and available in high
volumes,  our licensees will attempt to compete with  conventional  over-voltage
transient  protection  manufacturers  such as  General  Semiconductor,  Motorola
Corp., and AVX.

Evolution of Our Business

         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. This industry
includes   office   equipment,   computers,   telecommunications   and  consumer
electronics. Through fiscal 1998, we operated three majority owned subsidiaries,
focusing on three distinct market segments:

         o        power conversion products (Oryx Power Products Corporation);


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<PAGE>

         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.

         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.

Sale of Oryx Instruments and Materials  Corporation  (Test Equipment  Business).
Prior to February 27, 1998, Oryx Instruments and Materials Corporation,  or Oryx
Instruments and Materials,  designed,  manufactured and marketed test equipment,
specialized  materials  and  electromagnet  systems  for the hard disk drive and
semiconductor industries. On February 27, 1998, a third party acquired 8,000,000
shares of class A common stock of Oryx  Instruments and Materials for a purchase
price  of  $500,000.  As part of the  sale  transaction,  Oryx  Instruments  and
Materials then redeemed 8,000,000 shares of our holdings of 10,000,000 shares of
class A common stock for an aggregate price of $1,500,000. Original terms of the
redemption  included  $500,000  paid to us on the closing,  $333,000  payable on
February  27, 1999 and  $667,000  payable on February  27,  2000,  pursuant to a
promissory  note  and  stock  pledge  agreement.  As  part  of  the  sale,  Oryx
Instruments  and Materials  distributed  all the assets and  liabilities  of the
materials business segment and certain other assets of the instruments  business
segment to us. On November 24 1998, we sold our $1,000,000  promissory  note and
1,000,000 of our  2,000,000  shares of class A common stock for $500,000 in cash
to the majority  shareholder  of Oryx  Instrument  and  Materials.  We currently
retain an ownership interest in Oryx Business  Instruments and Materials of less
than 10.0%.

Sale  of  Oryx  Power  Products  Corporation.  On  March  7,  1998,  Todd  Power
Corporation,  or Todd,  acquired  substantially  all of the properties,  assets,
rights, business and certain liabilities of Oryx Power Products Corporation,  or
Power  Products,  for a purchase  price of  $2,000,000  in cash and a contingent
additional  amount of up to $4,000,000 to be calculated  based upon future sales
of certain of Power Products'  specified  products to named customers during the
fourteen  month  period  immediately  following  the  sale.  Sales  during  this
fourteen-month  period (ended May 1, 1999) were at a level whereby there were no
amounts due out of the total $4,000,000  contingent payment. We will not receive
any further  payments  from the sale of Power  Products.  The  disposal of Power
Products has been accounted for as a discontinued  operation and accordingly the
net assets  held for  disposal  and  operating  results of Power  Products  were
segregated  and reported as  discontinued  operations.  We  recognized a loss on
disposal and all losses were


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<PAGE>

recognized as if the transaction  were completed as of February 28, 1998.  Prior
year financial  statements have been restated to reflect the  discontinuance  of
the Power Products operations.

Sale of Oryx Instruments and Materials  Corporation  (Carbon Target Assembly and
Materials  Coating  Business).  On August  18,  1999,  we sold to Oryx  Advanced
Materials,  Inc., or OAMI,  certain  specified assets associated with the carbon
target assembly  manufacturing and related materials coating business for a cash
payment of $400,000 and the assumption of  substantially  all of the liabilities
associated with such business.  We retained ownership of approximately  $280,000
in accounts receivable balances relating to the materials business subsequent to
the  disposition.  In addition,  we licensed to OAMI  certain  patents and other
technology  associated  with the  purchased  assets.  OAMI  will pay us  royalty
payments over ten years,  with a maximum royalty payment of $2.2 million for the
first three years, based on OAMI's gross profits. As of April 30, 2000, OAMI had
paid  us a total  of  $249,000  in  royalty  payments  and  was in  arrears  for
additional royalty payments owed to us.

         The  disposal  of OAMI and Oryx  Instruments  and  Materials  have been
aggregated  as they  represent  the final sale of one  business  segment and the
operating  results  of  OAMI  and  Oryx  Instruments  and  Materials  have  been
segregated  and  reported  as  discontinued  operations.  Prior  year  financial
statements  have been  restated to reflect  discontinuance  of the OAMI and Oryx
Instruments and Materials operations.

Research and Development

         In fiscal  year 2000,  we  transferred  all of our SurgX  research  and
development to Cooper Technologies, Inc., a subsidiary of Cooper Bussmann.

         Previously, our operations in the ESD and materials businesses had been
partially  funded  through  third  party  development   funding  and  government
contracts We recognize  development funding received from  non-government  third
parties to assist in the  development of certain  products,  as an offset to our
research  and  development  expenses.  In  fiscal  2000 we did not  receive  any
research  and  development  funding  from  non-government  third  parties.  This
compares to $423,000 of development funding recorded in fiscal year 1999. We had
research  government  contracts  in which  $128,000  and $412,000 of revenue and
$216,000  and  $670,000 of cost of sales were  recognized  for the years  ending
February 29, 2000 and February 28, 1999, respectively.  Research and development
net expenses  were  $954,000 and $419,000 for the years ended  February 29, 2000
and February 28, 1999,  respectively.  In fiscal year 2000 we completed  our two
remaining  government  contracts.  We now  have no open  government  development
contracts nor do we anticipate  obtaining  research and  development  government
contracts or non-government development funding in the future.

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 believe that our facility and practices for controlling
and disposing of the limited amount of waste and potentially hazardous materials
it produces comply with applicable environmental laws and regulations.  While we


                                       9

<PAGE>

have not experienced  any material  adverse effect on operations from compliance
with government regulations,  the development of any manufacturing operations by
us would require us in the future to comply with government regulations designed
to  protect  the  environment  from  wastes  and  emissions  and from  hazardous
substances,  particularly  with respect to the emission of air  pollutants,  the
discharge  of  cooling  water,  the  disposal  of  residues  and the  storage of
hazardous  substances  resulting in the expenditure of additional funds by us to
comply with those government  regulations.  The extent of government  regulation
which might result from any future  legislation or administrative  action cannot
be accurately predicted.

Intellectual Property

         Proprietary  protection  for our  products,  processes  and know-how is
important to its  business.  We currently  have numerous  patents  issued and in
process. 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 trademark SurgX was issued by the US Patent and Trademark Office on
March 17, 1998.

         The  two  foundation  patents  filed  by us 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. To date, three of these patents have been filed;
In September 1998, one of the three patents filed, method of manufacturing SurgX
overvoltage  protection devices, was issued in the U.S. In 1997, foreign filings
were initiated in 10 countries plus Europe on the two foundation patents. Except
for the grant of the two foundation  patents by Singapore,  and the issue of one
foundation  patent by Australia,  all of the foreign  patents are in process.  A
third patent on surface mount devices and connector  component designs was filed
in the U.S.  in 1996 and in Europe in 1997 are still in the review  process.  In
1998, two additional  patents on  overvoltage  protection  inside the IC package
were filed.  We believe our patent  application  disclosures  cover  significant
proprietary art in devices, processes and materials.

         We owned and  maintained  six  patents  which are  associated  with the
Intragene  process  and  own  and  maintain  three  patents  for  our  SurgX(TM)
technology. The Intragene patents were licensed to Oryx Advanced Materials, Inc.
in connection  with the sale by us of our carbon  target  assembly and materials
coating  businesses  and some  expired in 1999 and the  remaining  patents  will
expire in 2000.  We expect  that our  licensees  will  file  improvement  patent
applications  with respect to the SurgX patents,  which may effectively  broaden
proprietary  protection.   There  can  be  no  assurance,   however,  that  such
improvement patent applications will be granted.


                                       10

<PAGE>

Employees

         As of April 30,  2000,  we  employed  11 people on a  full-time  basis.
Included among full time employees are 1 executive officer, 3 managers and other
executive personnel,  1 engineering  employee, 2 administrative  personnel and 4
manufacturing  employees.  Our  employees  are  not  covered  by any  collective
bargaining agreements, and we believe our employee relations are satisfactory.


                                       11

<PAGE>

                                  RISK FACTORS

         If you purchase shares of our common stock,  you will take on financial
risk. In deciding whether to invest, you should carefully consider the following
factors, the information contained in this 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        acquisition 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 of these
offering   materials.   We  do  not  have  any   obligation  to  inform  you  if
forward-looking statements, or the circumstances they are based on, change.

                                  Company Risks

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  entity with our primary
source of income deriving from royalties from our SurgX  technology  licensed to
Cooper Bussmann and IRISO and our Intragene technology licensed to Oryx Advanced
Materials,  Inc. 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 our SurgX and Intragene  technologies  through
our licensees,  such restructuring may have 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.


                                       12

<PAGE>

         We have shifted the  strategic  focus of our business from an operating
business exploiting our own developed technologies to a licensing and investment
business where we intend to use the royalty revenues from our licensed SurgX and
Intragene  technologies to fund  investments in start-up  technology  companies.
This investment strategy involves a number of special risks, including:

         o        increased  operating expenses to support investment in our new
                  management services venture;

         o        strain on managerial and  operational  resources as management
                  tries to support multiple businesses;

         o        potential  issuance of securities  in connection  with raising
                  capital to fund  investments or using our equity in connection
                  with our investment  strategy may lessen the rights of holders
                  of our currently outstanding securities; and

         o        the need to incur additional debt.

         We may not be able to successfully  address these  problems.  Moreover,
our future  operating  results  will  depend to a  significant  degree  upon our
ability  to  invest  in early  stage  development  companies  and  insure  their
follow-on  financing,  growth and success.  In addition,  many of the investment
opportunities  we are currently  examining  are in  early-stage  companies  with
limited  operating  histories and limited or no revenues.  These investments may
have a negative impact on our financial statements.  Further, we may not be able
to  successfully  develop  these young  companies and there can be no assurances
that we will  either  recoup  our  investments  or  receive  any  return  on our
investment in any company.

We are dependent on the licensees of our SurgX and  Intragene  technologies  for
substantially all of our revenues.

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

         While the license  agreements for our SurgX technology  contain minimum
annual  royalty  payment  requirements  for  the  licensees  to  maintain  their
exclusive  rights,  there can be no assurance  that the  licensees  will pay the
minimum  royalty or that these minimum  payments will provide  enough revenue to
continue  to support our  operations.  In the case of Cooper  Bussmann,  minimum
royalty   payments   through  2001  have  already  been  satisfied  to  maintain
exclusivity,  and there can be no  assurances  that we will  receive any royalty
payments from Cooper Bussmann through this time period unless Cooper Bussmann is
successful in selling  products using SurgX  technology in excess of the minimum
royalty  payments,  and such sales have not yet been material.  To date,  Cooper
Bussmann and IRISO have shipped only limited quantities to customers of products
incorporating SurgX technology.

         Although we have  received  approximately  $250,000 in royalty  revenue
from  licensing our Intragene  technology to Oryx Advanced  Materials,  Inc., or
OAMI, there can be no assurances that we will receive any future royalty revenue
from OAMI.  There are no minimum annual royalty payment  requirements  under our
license  with  OAMI.  Our future  royalties  from


                                       13

<PAGE>

our license of the Intragene technology will be based solely upon the successful
sales,  marketing and manufacturing efforts of OAMI. Although management of OAMI
was  previously  employed  by us,  OAMI  is a new  entity  and  there  can be no
assurances  that it will be successful  in  manufacturing  and selling  products
based upon the  Intragene  technology.  OAMI is currently  in default  under its
agreement with us due to its failure to make required royalty  payments.  We are
currently  negotiating with OAMI to restructure the royalty  arrangement to take
into account a slow-down in OAMI's  business.  There can be no assurance that we
will reach a satisfactory agreement with OAMI.

We may not be  able  to  raise  sufficient  funds  to  finance  our  acquisition
strategy.

         At present, our sole sources of revenue are licensing royalties payable
by the licensees of our SurgX and Intragene technologies.  We anticipate,  based
on management's  internal forecasts and assumptions  relating to our operations,
that  our  existing  capital   resources  will  be  sufficient  to  satisfy  our
contemplated cash requirements for at least the next twelve months.

         However,  we may not have  sufficient  funds to  finance  our  proposed
strategy of seeking  investments  in or  acquisitions  of new  technologies.  In
addition,  in the  event  that our  plans  change  or our cash  projections  and
assumptions prove inaccurate,  we could be required to seek additional financing
to support  existing  operations.  Our present  business  plan may require us to
raise additional funds,  however we have no current arrangements with respect to
sources of additional financing,  and there can be no assurance that we would be
able to obtain  additional  financing if and when needed, or that, if available,
such additional financing would be on the terms acceptable to us.

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 our 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 less than 40% 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
can be attempted in a number of ways,  including the  disposition  of investment
securities and the acquisition of  non-investment  security  assets.  If we sell
investment  securities,  we may sell them sooner than we otherwise would.  These
sales may


                                       14

<PAGE>

be at depressed  prices and we may never realize  anticipated  benefits from, or
may incur losses on, these investments.  Some investments may not be sold due to
contractual or legal  restrictions  or the inability to locate a suitable buyer.
Moreover,  we may  incur tax  liabilities  when we sell  assets.  We may also be
unable to purchase additional investment securities that may be important to our
operating strategy. If we decide to acquire  non-investment  security assets, we
may not be able to identify and acquire suitable assets and businesses.

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 our
executive officers and other key employees, in particular,  Philip Micciche, our
president  and  chief  executive  officer,  and  Mitchel  Underseth,  our  chief
financial officer.  The familiarity of these individuals with the industry makes
them  especially  critical  to our  success.  In  addition,  our  success in our
investment  strategy  is  dependent  on our  ability to attract  and retain high
quality  personnel with skills  necessary to evaluate and manage  investments in
high-tech  startup  companies.  The loss of the services of any of our executive
officers or key employees may harm our business.  Competition for such personnel
is intense.

We have a history of  unprofitability;  recent  operating losses and accumulated
deficit and may not be profitable in the future.

         Since our  initial  public  offering  in April  1994,  we have not been
profitable on a quarterly or annual basis except for the quarters  ended May 31,
1996,  August 31, 1996 and November 30,  1996.  At February 29, 2000,  we had an
accumulated deficit of $20,087,000. We anticipate operating losses will continue
through  fiscal year 2001.  There can be no  assurance  that we will receive any
licensing  royalty  revenues  from the  licensees  of our  SurgX  and  Intragene
technologies  or that our licensees  will be successful in marketing and selling
products incorporating our SurgX or Intragene technologies. There can also be no
assurances that our new management  services and investment  business related to
start-up companies will be profitable in the future.

We rely on our licensees, Cooper Bussmann, IRISO and Oryx Advanced Materials, to
manufacture   and  market  products   incorporating   our  SurgX  and  Intragene
technologies 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 and Intragene  technologies.  Our SurgX  licensees have
developed  low-cost  manufacturing  processes  using  our  licensed  technology.
However,  there  can be no  assurance  that  they  will be  able to  incorporate
manufacturing  process  improvement in the future to further reduce product cost
and enhance product performance to allow them to compete in the high volume, low
price diode market.

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

         the availability of funding;

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


                                       15

<PAGE>

         o        increases in expenses associated with product development;

         o        market  acceptance  of  products  incorporating  the SurgX and
                  Intragene technologies;

         o        our licensees' ability to successfully  control their costs of
                  development, overhead and other costs; and

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

We rely  exclusively on our licensees for research and development in connection
with our SurgX and Intragene technologies.

         The  development,  design  and  manufacture  of  technology  constantly
undergo rapid and significant change. We rely on our licensees,  Cooper Bussmann
and  IRISO,  for  technological  improvements  to the SurgX  technology  and our
licensee,  Oryx  Advanced  Materials,  for  technological  improvements  to  the
Intragene technology. At present, we do not support any research and development
or  manufacturing  activities  internally.  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 operations. Our business is, to a large
degree,  dependent  upon the  enhancement  of the  SurgX and  Intragene  current
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  will not render  existing or proposed
SurgX or Intragene products uneconomical or obsolete.

We may experience  fluctuations in future operating  results which 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 Bussmann's and IRISO's continued  marketing,  sales and
                  financial support of SurgX technology;

         o        overall economic trends; and

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


                                       16

<PAGE>

         In addition,  customer orders may involve design-in requirements,  thus
making the timing of customer orders difficult to predict and uneven.

         Our expense levels are based in part on our  expectations  as to future
royalty  revenues  and, in  particular,  volume  shipments of SurgX  products by
Cooper  Bussmann  and  IRISO.  We may be unable to adjust  spending  in a timely
manner to compensate for any delay in product  development or revenue shortfall.
Any  weakening in demand for our products or delays in  acceptance  of the 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.

         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.


                                       17

<PAGE>


                                 Industry Risks

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

         The  licensees of our SurgX and Intragene  technologies  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.

                                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  which 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.

         Further, the trading prices of the stocks of many technology companies,
including  our  share  price,  are  at or  near  historical  highs  and  reflect
price/earnings  ratios  substantially  above historical levels.  There can be no
assurance that these trading prices and price/earnings ratios will be sustained.


                                       18

<PAGE>

Charter  provisions  limit the  authority  of our  stockholders,  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 April 30, 2000,  there were  convertible  securities and private warrants and
options  currently  outstanding  for  the  conversion  and  purchase  of  up  to
approximately  4,788,750  shares of common stock.  These  represent  significant
additional  potential dilution for our existing  stockholders.  These underlying
shares of common  stock are not  included in currently  outstanding  shares.  In
addition,  as a result of the  anti-dilution  provisions  included in certain of
these derivative 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 in Fremont,
California.  On August 12, 1996,  SurgX  entered  into an agreement  with E.B.J.
Partners LP to lease a 22,000 square foot facility in Fremont,  California.  The
monthly rental fee is $19,286 and the lease  terminates  August 30, 2001. We are
currently subleasing a portion of our facility at market rates.

         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 the our fiscal  year ended  February  29,
2000, no matters were submitted to a vote of security holders.


                                       19

<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,  our common stock and warrants  have traded  principally  on the NASDAQ
Small Cap Market under the symbols  "ORYX" AND "ORYXW,"  respectively.  Prior to
April 6, 1994, there was no public market for our securities. From April 6, 1994
through  June 6, 1994,  we had Units which were also traded on NASDAQ,  at which
time we requested withdrawal of such listing. The following table sets forth the
high and low bid  quotations  for the common  stock and warrants for the periods
indicated,  as reported  by NASDAQ.  These  quotations  reflect  prices  between
dealers,  do not include retail  mark-ups,  markdowns or commissions and may not
necessarily represent actual transactions.

                           Common Stock                      Warrants
                           ------------                      --------
                       High             Low            High             Low
                       ----             ---            ----             ---
1999 Fiscal year
----------------
1st Quarter            $1.3750          $0.9375        $1.0938          $0.3750
2nd Quarter            $1.3438          $0.6250        $0.6875          $0.2500
3rd Quarter            $1.4688          $0.3438        $0.4375          $0.0625
4th Quarter            $2.5625          $1.0313        $1.1563          $0.1250

2000 Fiscal year
----------------
1st Quarter            $2.4688          $1.6563        $0.9375          $0.0313
2nd Quarter            $2.3125          $1.4375        Expired
3rd Quarter            $2.0938          $1.0000        Expired
4th Quarter            $5.0625          $1.6250        Expired

         On April 30,  2000 the closing  price for our common  stock was $2.2812
per share. On April 6, 1999 our public warrants, exercisable for an aggregate of
2,549,190 shares of common stock, expired. Prior to expiration, 939,536 warrants
were exercised resulting in the issuance of 1,973,022 shares of common stock.

         Our common  stock and  warrants had also been listed for trading on the
Pacific  Exchange  under  the  symbols  "ORYX"  and  "ORYXW,"  respectively.  We
requested  that the  common  stock and  warrants  be  removed  from the  Pacific
Exchange, which occurred in May 1998.

         As of April 30, 2000 the number of record  holders of our common  stock
was approximately 88.

         We have never paid cash  dividends  on our common  stock,  but as noted
above,  we pay a $.50 annual  dividend on its  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 in the foreseeable future. Future dividend policy will depend on our


                                       20

<PAGE>

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.

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,   success  of  research  and
development  efforts by our licensees and our licensees'  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 form 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
licensees for the  commercial  success of our products,  increased  competition,
lack of acceptance of our licensees' new products,  pricing  pressures,  lack of
success in technological  advancement and other factors,  including those listed
below.

Business Segments

         Through  fiscal year 1999, we operated in two main  business  segments:
Materials  and  SurgX,  a  97%  owned  subsidiary.   These  businesses  operated
independently  and  are  supported  by a  corporate  segment  providing  for all
administrative,  accounting, and financial activities. As noted above in Part I,
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
substantially  all of the  assets  and the  entire  business  of Power  Products
Corporation.  As part of the sale of its majority  position in  Instruments  and
Materials, we retained certain assets from Instruments and Materials relating to
sputtering  targets  assembly,  or Materials.  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.  Management took these steps to reduce losses and
enable us to  concentrate on our  electrostatic  discharge  protection  business
through our SurgX subsidiary.

Consolidated Results of Continuing Operations

         For the fiscal year ended February 29, 2000,  revenues from  continuing
operations  increase  $150,000 or 25% from $605,000 for the year ended  February
28, 1999 to $755,000  for the year ended  February  29,  2000.  The  increase in
revenues was  primarily  attributed  to the royalty  revenue from OAMI and IRISO
plus an  increase  in revenue  from the sale of SurgX  liquid to our  licensees,
offset by reduced government contract revenue.  Royalty revenue in the future is
dependent  on the  success  of our  licensees.  We have no view of what level of
revenue will be achieved in the future, if any at all.

         Cost of sales for the fiscal year ended  February  29, 2000  represents
the costs  associated with  manufacturing  SurgX component  materials for Cooper
Bussmann and IRISO pursuant to


                                       21

<PAGE>

existing license agreements. We anticipate that the cost of sales in fiscal 2001
will be significantly reduced as we are in the process of transferring our SurgX
Liquid manufacturing operations, equipment and know-how to our licensee.

         Our gross loss decreased  $296,000 or 15 % from $349,000 for the fiscal
year ended  February  28, 1999 to $53,000 for the year ended  February 29, 2000.
Cost of sales as a percentage  of revenues  decreased to 107% for the year ended
February 29, 2000 from 158% for the fiscal year ended  February  28,  1999.  The
decrease  in gross  loss for the year  ended  February  29,  2000 was  primarily
attributable to an increase of $324,000 in royalty revenues in fiscal 2000.

         Funding  recognized  as  revenue  and  cost of  sales  associated  with
government  contracts for the fiscal year ended  February 29, 2000 were $128,000
and  $216,000  respectively.  This  compares  to  revenue  and  cost of sales of
$412,000 and $670,000,  respectively,  associated with government  contracts for
the fiscal year ended  February 28,  1999. We do not expect any revenue or costs
from government  contracts in fiscal 2001 and we do not have plans to pursue any
new government contracts in the future.

         General  and  administrative  expenses  increased  $256,000 or 17% from
$1,526,000  for the fiscal year ended  February 28, 1999 to  $1,782,000  for the
year ended  February  29,  2000.  The  increase  in general  and  administrative
expenses is  attributed  to increase  in  severance  cost,  legal  services  and
non-cash equity investor relation  expenses  associated with a marketing program
entered into with Continental  Capital on August 1998. We anticipate an increase
in general and  administrative  costs during fiscal year 2001 due to an increase
in head-count and other activities related to our new Oryx Ventures business.

         Research  and  development  expenses  increased  $535,000  or 128% from
$419,000  for the fiscal year ended  February  28, 1999 to $954,000 for the year
ended February 29, 2000. The increase in research and  development  expenditures
were primarily as a result of an increase of development efforts for a thin film
based technology product, non-cash expense recorded for stock options granted to
development  consultants,   and  the  absence  of  development  funding  from  a
non-government  third party. We anticipate to substantially  reduce research and
development expenses during fiscal 2001, due to the transfer of all of our SurgX
research and development activities to Cooper Electronic Technologies.

         Development funding from  non-government  third parties are recorded as
an offset to research and development  expenses.  During fiscal 2000, we did not
record any amount for development  funding,  compared to $423,000 recorded as an
offset to research and  development  expenses for fiscal year ended February 28,
1999. We do not anticipate  receiving any development funding during fiscal 2001
or thereafter.

         For fiscal year ended February 29, 2000 we recorded net interest income
of $177,000. This compares to $14,000 of net interest income for the fiscal year
ended  February  28,  1999.  This  increase is  attributable  to higher cash and
investment balances.

         For the fiscal year ended  February  29, 2000,  we recorded  $11,000 of
other  expenses  compared to $217,000 of other  income  recorded in fiscal 1999,
which is associated with receipt


                                       22

<PAGE>

of 54,455 restricted shares of Common Stock of Applied Magnetics  Corporation in
connection with consulting services provided to DAS Devices, Inc.

         During fiscal year 1999, we recorded a $15,000 loss on the write-off of
our  investment  in DAS  Devices,  Inc. In fiscal 1999,  DAS  Devices,  Inc. was
purchased by Applied Magnetics Corporation. We did not receive any consideration
for our  remaining  ownership  in  Series A  Preferred  or  common  stock due to
priority liquidation preferences held by other DAS Devices, Inc. preferred stock
holders,  and  subsequently  wrote-off our remaining  investment in DAS Devices,
Inc.

         We believe our operating  losses will continue  through  fiscal 2001 as
the anticipated royalty revenue from our SurgX and Intragene technology will not
be sufficient to cover expected operation  expenses,  including  additional cost
associated with the Oryx Ventures business for fiscal 2001.

Oryx Instruments and Materials Discontinued Operations

         On  August  18,  1999,  pursuant  to the  terms  of an  Asset  Purchase
Agreement dated as of June 1, 1999 by and among Oryx Technology  Corp., or Oryx,
and Oryx Advanced  Materials Inc., or OAMI, Oryx sold to OAMI certain  specified
assets  associated with Oryx' carbon target assembly  manufacturing  and related
materials coating  business,  or the Materials  business,  for a cash payment of
$400,000 and the assumption of substantially  all of the liabilities  associated
with such business. We retained ownership of approximately  $280,000 in accounts
receivable  balances  relating  to  the  Materials  business  subsequent  to the
disposition.  In  addition,  Oryx  licensed  to OAMI  certain  patents and other
technology  associated  with the  purchased  assets.  OAMI will pay Oryx royalty
payments over ten years,  with a maximum royalty payment of $2.2 million for the
first three years,  based on OAMI's gross  profits.  As of February 29, 2000, we
have received $249,000 in royalty payments from OAMI for the period June 1, 1999
to August 31, 1999.

         In addition,  on February 27, 1998, Corus  Investments  Ltd., a Bahamas
Company,  acquired  8,000,000  shares of the authorized  Class A common stock of
Oryx Instruments and Materials  Corporation , or Oryx Instruments and Materials,
for a purchase price of $500,000.  Prior to the sale,  Instruments  was a wholly
owned  subsidiary of Oryx. As part of the sale,  Oryx  Instruments and Materials
redeemed  8,000,000 of the 10,000,000  shares of Class A common stock held by us
for an aggregate  redemption  price of $1,500,000.  Terms of the 8,000,000 share
stock redemption  include $500,000 paid on the closing,  and $333,000 payable on
February 27, 1999 and $667,000  payable on February 27, 2000, under a promissory
note and stock  pledge  agreement.  As part of the sale,  Oryx  Instruments  and
Materials  distributed all the assets and liabilities of the materials  business
segment  and  certain  other  assets  to us. A  deferred  gain of  approximately
$646,000 was recorded by us at the time of the  transaction.  We fully  reserved
our remaining  19.9% ownership  investment in Oryx  Instruments and Materials at
February 28, 1998. On November 24, 1998, we subsequently  sold 1,000,000  shares
of our remaining Class A common stock of Oryx


                                       23

<PAGE>

Instruments   and  Materials  and  the  $1,000,000  note  receivable  from  Oryx
Instruments  and  Materials in exchange  for a cash  payment of  $500,000.  As a
result of this transaction, we recognized a profit of $146,000.

         The  disposal  of OAMI and Oryx  Instruments  and  Materials  have been
aggregated  as they  represent  the final sale of one  business  segment and the
operating  results  of  OAMI  and  Oryx  Instruments  and  Materials  have  been
segregated  and  reported  as  discontinued  operations.  Prior  year  financial
statements  have been  restated to reflect  discontinuance  of the OAMI and Oryx
Instruments  and Materials  operations.  Revenue from the segment was $1,049,000
and  $4,037,000  for  fiscal  2000  and  1999,  respectively.  Income  from  the
discontinued  operations  was $268,000 and  $1,243,000 for fiscal 2000 and 1999,
respectively.  Income taxes related to the  discontinued  operations and gain on
disposal of the Materials business were immaterial. Transaction costs related to
the Materials disposal were $55,000.

Liquidity and Capital Resources

         Our  working  capital  increased  $3,349,000  or 208% from a surplus of
$1,612,000 at February 28, 1999, to a surplus of $4,961,000 at February 29, 2000
primarily  attributed  to  proceeds  from  exercise  of our public  and  private
warrants.  Our ratio of  current  assets  to  current  liabilities  was 2.1:1 at
February 28, 1999, and 7.8:1 at February 29, 2000.

         Net cash used in  operations  for the year the ended  February 29, 2000
was $1,206,000  consisting of $1,826,000 from continuing operations primarily in
the  form  of  operating   losses  offset  by  $620,000  net  cash  provided  by
discontinued operations resulting from the sale of the Material business on June
1, 1999 and the. Net cash used in operations  for the fiscal year ended February
28, 1999, was $1,474,000  consisting of $1,575,000  from  continuing  operations
offset by $101,000 net cash provided by  discontinued  operations,  primarily in
the form of operating losses.

         Net cash used in investing  activities was $522,000 for the fiscal year
ended February 29, 2000,  primarily  attributable  to the purchase of short-term
investments  partially  offset by cash provided by proceeds from the sale of the
Material business.  Net cash provided by investing activities was $1,906,000 for
the 1999 fiscal  year,  consisting  primarily  of proceeds  from our sale of the
business  of Oryx  Power  Products  Corporation.  We do not  expect  to have any
material capital expenditures for the year ended February 28, 2001.

         Net cash provided by financing activities was $4,687,000 for the fiscal
year ended  February 29, 2000.  This  represents  an increase of  $4,271,000  or
1,027% from net cash  provided by  financing  activities  in fiscal  1999.  Cash
provided by financing  activities during fiscal 2000 was primarily attributed to
$4,246,000  provided by the exercise of public and private warrants and $471,000
provided by the exercise of stock options for common stock. Net cash provided by
financing  activities  for the fiscal year ended February 28, 1999 was $416,000,
primarily  from  the  sale  of a note  receivable,  involving  the  sale  of the
instruments business.

         In May 1997,  we  entered  into a credit  facility  which  included  an
Accounts  Receivable  Revolving  Batch  Facility and an Inventory Line of Credit
with KBK Financial, Inc. The Inventory Line of Credit provided for borrowings of
up to $1.5 million, ($750,000 of which is subject to an inventory appraisal. The
Accounts  Receivable  Revolving  Batch  Facility  allowed  us


                                       24

<PAGE>

to factor up to a maximum of $4 million,  provided  that any amount in excess of
$3.5 million was supported by an equal amount of unused  availability  under the
Inventory  Line of Credit.  Under the  facility,  we were required to sell on an
undiscounted,  non-recourse  basis all accounts  receivable.  In exchange,  cash
advances were available to us up to 85% of the face amount of eligible  accounts
receivable, as defined, to a maximum amount of $4 million. Financing costs under
the  arrangement  were equal to the greater of the lender's base rate plus 1.25%
or not less than 7.0%.  In March 1998,  the  agreement was amended to reduce the
Account  Receivable  Revolving  Batch Facility and the Inventory  Credit Line to
maximum borrowings of $500,000 each. Under the amended  agreement,  the Accounts
Receivable Revolving Batch Facility expired in March 1999 and the Inventory Line
of  Credit  expired  in May  1999.  As of  February  29,  2000,  we do not  have
outstanding any available debt or line of credit facilities.

         We believe  that we have  sufficient  capital  to meet our  anticipated
working capital  requirements through fiscal year 2001. However, in the event we
fail to meet our fiscal  year 2001  operating  plan,  we might  need  additional
funding to be obtained by raising additional equity or taking other steps. If we
require additional equity,  there can be no assurance that such transactions can
be effected in time to meet our needs,  if at all, or that any such  transaction
will be on terms acceptable to us or in the interest of its stockholders.

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.


                                       25

<PAGE>

         The  names  and ages of our  directors  and  executive  officers  as of
February 29, 2000 are as follows:

        Name                             Position                         Age
        ----                             --------                         ---

Philip J. Micciche            President, CEO and Director                 66

Mitchel Underseth             CFO and Director                            43

Andrew Intrater               Secretary, Treasurer and Director           38

Dr. John H. Abeles            Director                                    55

Jay M. Haft                   Director                                    64

Richard Hubbard               Director                                    40

Doug McBurnie                 Director                                    57

Ted. D. Morgan                Director                                    58

         PHILIP J.  MICCICHE was elected to serve as Oryx'  President  and Chief
Executive  Officer  and to serve as a director of Oryx on 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. In one of those positions,
Mr.  Micciche  brought the division from a loss to a substantial  profit in less
than 15 months.  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.

         MITCHEL  UNDERSETH has served as Chief Financial  Officer of Oryx since
November 25, 1996, with additional  responsibilities  for human  resources.  Mr.
Underseth  currently  works  part-time  for Oryx and also  serves  as the  Chief
Financial  Officer for Aptix  Corporation,  a privately held  electronic  design
automation company providing software and hardware. Mr. Underseth was elected as
a director of Oryx in October 1997. From August 1992 through  November 1996, Mr.
Underseth was Chief Financial  Officer of Triptych  CD/San Joaquin  Packaging in
Stockton,  California.  From March 1990 through  April 1992,  Mr.  Underseth was
Chief  Financial  Officer of Dysan  International/Magnetic  L.P.,  a spin-off of
Xidex's  Flexible  Disk Group.  From  September  1986  through  March 1990,  Mr.
Underseth  was Vice  President-Finance  of Xidex  Flexible  Disk Group and Rigid
Oxide Group in Santa Clara,  California.  Mr. Underseth received his M.B.A. from
the  University of Washington in Seattle and his B.S. in Business from Lewis and
Clark College in Portland, Oregon.


                                       26

<PAGE>

         ANDREW  INTRATER has been a director,  Secretary  and Treasurer of Oryx
since its  organization in July 1993. He had been employed in various  executive
capacities  with Oryx in July 1993 until March 1998 when he resigned from Oryx's
employment  following  the sale of Oryx'  majority  ownership  position  in Oryx
Instruments  &  Materials   Corporation,   since  renamed  as  Oryx  Instruments
Corporation. Mr. Intrater is currently the President and Chief Executive Officer
of Oryx Instruments Corporation.  Mr. Intrater previously held various executive
positions with ATI, the predecessor  corporation to Oryx. Between September 1988
and May 1993, Mr.  Intrater  served as President of ATI and was a director since
1983.  Mr.  Intrater  received  his B.S. in Chemical  Engineering  from  Rutgers
University and a M.S. in Materials Science from Columbia University.

         JOHN  H.  ABELES,   M.D.,  has  been  a  director  of  Oryx  since  its
organization in July 1993 and of ATI commencing October 1991 and Chairman of the
Board of Oryx from October 1993 until April 1997.  Since March 1992,  Dr. Abeles
has been a General  Partner of Northlea  Partners Ltd., Boca Raton,  Florida,  a
private  investment  partnership.  Since 1980,  Dr. Abeles has been President of
MedVest,  Inc., Boca Raton,  Florida, a business and financial  consulting firm.
Dr.  Abeles  serves on the board of  directors  of I-Flow  Corporation,  Irvine,
California,  a publicly traded company which manufactures infusion devices, DUSA
Pharmaceuticals,   Inc.,  a  publicly  traded   company,   which  is  developing
photodynamic  therapy products,  Pharma Print  Corporation,  which  manufactures
botanical products, Encore Medical Corporation,  which is an orthopedic implant,
concern and Ambersand  Medical Inc.,  which is  researching  medical  diagnostic
equipment.

         JAY M. HAFT has been a director of Oryx since  February  1995.  He is a
strategic and financial  consultant for growth stage  companies and is active in
international  corporate  finance,  mergers and acquisitions,  as well as in the
representation  of emerging growth  companies.  He has actively  participated in
strategic planning and fund raising for many high-tech  companies,  leading edge
medical  technology  companies  and  technical  product,  service and  marketing
companies.  He is a Managing  General  Partner of Gen Am "1"  Venture  Fund,  an
international  venture  capital  fund.  Mr.  Haft is also a director of numerous
public and private  corporations,  including  Robotic Vision Systems,  Inc., NCT
Group, Inc., DECAP Group, Encore Medical  Corporation,  PC Service Source, Inc.,
DUSA Pharmaceuticals, Inc., and Thrift Management, Inc. He serves as Chairman of
the Board of Noise Cancellation Technologies, Inc. He is currently of counsel to
the law  firm of  Parker  Duryee  Rosoff  & Haft,  in New  York.  Mr.  Haft  was
previously a senior corporate partner of such firm, from 1989 to1994,  and prior
to that a founding partner of Wofsey,  Certilman, Haft et al. from 1966 to 1988.
Mr.  Haft  is  a  past  member  of  the  Florida   Commission   for   Government
Accountability  to the People,  Treasurer  of the Miami  Ballet and a trustee of
Florida International  University. He is a graduate of Yale College and Yale Law
School.

         RICHARD  HUBBARD has been a director of Oryx since  October  1997.  Mr.
Hubbard is  currently a director and an analyst with the VMR High Octane Fund at
Value  Management  & Research  GmbH.  The High Octane  Fund  invests in small to
mid-cap companies worldwide.  Since 1991, Mr. Hubbard has been a founding member
of Namco,  an African marine diamond mining and  exploration  company.  He was a
director at Acomex  Ltd.  where he was  involved in the launch of Video Plus,  a
video coding and recording system, in the United Kingdom market.


                                       27

<PAGE>

Mr. Hubbard was a founding  partner in Connolly and Hubbard  Trading,  a trading
company specializing in foreign exchange and commodities.

         DOUG MCBURNIE has been a director of Oryx since July 1997. Mr. McBurnie
is retired. He was formerly Senior Vice President,  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 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,  he  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.

         TED D. MORGAN had been a director of Oryx since April 1996 and resigned
on  April  30,  2000.  He  is  Founder  and  Managing   Partner  of  Alternative
Technologies  International  ,  or  ATI,  Santa  Rosa,  California.  ATI  is  an
international  financial  advisory  firm  specializing  in services for emerging
growth companies with unique proprietary technologies. Prior to founding ATI, he
founded several  companies  including the Office Club,  which merged with Office
Depot in 1990.

         All  directors  are elected  annually by the  stockholders  of Oryx and
serve until their respective successors are duly elected and qualified.

Board Committees and Meetings

         During  the fiscal  year  ending  February  29,  2000,  there were five
meetings of our board of  directors.  Each Board member  attended 75% or more of
the  aggregate of the meetings of the board of directors and the meetings of all
committees  of the board of directors on which he served  except for John Abeles
and Richard Hubbard who each attended 60% of such meetings and Ted D. Morgan who
attended 20% of such meetings.

         The  compensation  committee  was  established  on March 28, 1995.  The
members of the  compensation  committee are Dr. John H. Abeles,  Jay M. Haft and
Richard Hubbard,  none of whom is employees 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 29, 2000.

         The audit  committee was  established on March 28, 1995. The members of
the audit committee are Jay Haft, and Ted Morgan, neither of whom is an employee
of Oryx.  The  functions of the audit  committee  are to define the scope of the
audit,  review the  auditor's  reports and  comments,  and monitor the  internal
auditing procedures of Oryx. The audit committee met once during the fiscal year
ended February 29, 2000.

         There is no nominating committee of the board of directors.


                                       28

<PAGE>

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 the  Company's  equity  securities,  to file with the
Commission  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 Commission  regulation to furnish
us with copies of all Section 16(a) forms they file.

         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 29, 2000, we believe that all Section 16(a) filing  requirements
applicable to its officers,  directors  and greater than 10%  beneficial  owners
were complied with during the fiscal year ended February 29, 2000.

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 29, 2000 and for the years ended February
28, 1999 and February 28, 1998.


                                       29

<PAGE>


                           Summary Compensation Table

   Name and           Fiscal                           Other Annual    All Other
Principal Position     Year     Salary       Bonus    Compensation  Compensation
------------------    ------   --------  -----------  ------------  ------------
Philip Micciche,      2000     $160,000               $3,817 (2)      $    -
President & Chief     1999     $158,542               $    -          $    -
Executive Officer     1998     $127,308  $     -      $4,000 (1)      $    -
Mitchel Underseth     2000     $135,750  $     -      $8,765 (4)      $    -
Chief Financial       1999     $126,377  $     -      $3,600 (5)      $    -
Officer               1998     $137,558  $44,053 (3)  $3,600 (5)      $    -
Andrew Intrater,      2000     $      -  $     -      $    -          $    -
Secretary/Treasurer   1999     $      -  $     -      $    -          $    -
                      1998     $135,000  $     -      $    -          $8,578 (6)


         (1) Other  annual  compensation  consists  of  payment  for  consulting
services provided by Mr. Micciche to Oryx.

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

         (3) Mr. Underseth  received a $44,053  performance  bonus in March 1998
attributable to fiscal year 1998.

         (4)  Consisting of $1,800 in payments to Mr.  Underseth in lieu of Oryx
supplied  health  benefits  and $6,965 for  payment in lieu of accrued  vacation
time.

         (5) Other annual compensation  consists of payments to Mr. Underseth in
lieu of Oryx supplied health benefits.

         (6)  Other  compensation  consists  of  premiums  paid on behalf of Mr.
Intrater  for term life  insurance  in the face amount of  $1,000,000,  which is
payable to Mr.  Intrater's  beneficiary  upon his death,  less the amount of the
premiums theretofore paid on his behalf which are remitted to us.

         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  29,  2000.  We did not grant any
options to officers for the fiscal year ended February 29, 2000.


                                       30

<PAGE>

<TABLE>
                   Year and Fiscal Year-End Option SAR/Values
<CAPTION>
                                                                        Value of
                                                   Number of         unexercised in-
                                                  unexercised          the-money
                      Shares                     Options/SARS at      Options/SARS
                     Acquired                      FY-end (#)         at FY-end ($)
                       on            Value        exercisable/         exercisable/
     Name           Exercise (#)  Realized ($)   unexercisable      unexercisable(1)
------------------  ------------  ------------  -----------------   ------------------
<S>                      <C>           <C>       <C>                <C>
Philip Micciche                -             -   521,705/358,295    1,365,489/934,279

Mitchel Underseth        100,000       227,049   247,845/222,155      576,931/549,654

Andrew Intrater                -             -   279,970/105,657      664,189/259,966

-------------------------------------------------------------------- -----------------
<FN>
         (1)  Calculated  on the basis of the closing price of $4.0625 per share
on February 29, 2000 minus the exercise price.
</FN>
</TABLE>
Employment Agreements

         We entered into an employment agreement dated as of March 15, 1999 with
Mr.  Philip  Micciche,  Chief  Executive  Officer,  terminable  by either party,
providing for annual compensation of $160,000 to Mr. Micciche from March 1, 1999
through the end of February 2000 and $176,000 from March 1, 2000 through the end
of February 2001. 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.

         We entered into an  employment  agreement  dated as of November 1, 1996
with Mr. Mitchel Underseth,  Chief Financial Officer,  terminable immediately by
either party,  providing for annual compensation of $120,000,  with increases in
salary based upon the recommendation of the Compensation Committee. In the event
Mr.  Underseth  is  terminated  without  cause by us, he will receive his annual
compensation  for six months.  Mr.  Underseth is currently a part-time  employee
with us and his compensation has been proportionately  adjusted to reflect hours
worked.

         We entered into an  employment  agreement  dated as of May 3, 1993 with
Mr. Andrew Intrater,  Secretary and Treasurer,  terminable immediately by either
party,  providing  for annual  compensation  of $100,000  during the term of the
agreement  and  increases  in  salary  based  upon  the  recommendation  of  the
Compensation Committee. In the event Mr. Intrater is terminated without cause by
us, he will receive his annual  compensation  for six months.  Mr. Intrater also
entered into a non-competition  agreement with us which restricts his engagement
in  competitive  activities  during the term of his employment and prohibits him
from  soliciting  customers  and employees of Oryx for a period of twelve months
following  termination  of his  employment.  This  agreement  also  requires Mr.
Intrater to maintain the  confidentiality  of information and  proprietary  data
relating to Oryx and its  activities.  On February  27, 1998,  these  agreements
terminated upon Mr. Intrater's  resignation from Oryx. Mr. Intrater continues to
serve as Director, Secretary and Treasurer of Oryx.


                                       31

<PAGE>

         We currently  offers 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.

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,  3,625,000  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 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
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 plan  terminates  on March 3,
2003.

         Options under the plan may be granted to officers, directors, employees
and consultants of Oryx,  provided that only employees may be granted  incentive
stock options.  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. The Compensation Committee
determines  the term of each option and the manner in which it may be  exercised
provided that 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
2,811,453  shares of common stock pursuant to the plan.  The following  officers
and key  employees  of Oryx  have  been  granted  options  under the plan at the
weighted-average exercise prices described below as of April 30, 2000:


                                       32

<PAGE>

                                                              Average
                                      Number                  Exercise
           Name                     of Shares                  Price
------------------------- --------------------------- --------------------------
Philip Micciche                      880,000                 $   1.449
Mitchel Underseth                    470,000                 $   1.611
Andrew Intrater                      385,627                 $   1.666


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.

         A total of  225,000  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 45,000
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 195
directors plan will initially  receive  options to purchase 45,000 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
15,000 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  250,000  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
30,000 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 30,000 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.


                                       33

<PAGE>

         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.

         On April 1, 1999,  Ted  Morgan  was  granted  options  to  purchase  an
aggregate of 15,000 shares of our common stock,  issued from the 1995  directors
plan.

Additional Grants of Options

         On February 27, 1998, in  consideration  for a bridge loan, we issued a
stock  warrant to a  financial  institution  to purchase  174,546  shares of our
common stock at an exercise price of $1.15 per share. This warrant was exercised
on February 2000.

         In fiscal 1999, as part of its sale of the Power Products business,  we
issued  non-statutory  options to former key employees of Oryx Power Products to
purchase a total of 205,000  shares of our common stock at an exercise  price of
$0.95 per share. In addition,  we issued a non-statutory  option to a former key
employee of Oryx Power Products to purchase 50,000 shares of our common stock at
an exercise price of $0.25 per share.

         On August 7, 1998,  we entered into a market access  program  marketing
agreement with Continental  Capital and Equity Corporation  pursuant to which we
agreed to issue to Continental up to 202,500 shares of our common stock, subject
to an escrow  provision  expiring on August 1, 1999,  and a two-year  warrant to
purchase  60,000 shares of our common stock,  at an exercise  price of $1.09 per
share.

         On August 15,  1998  Bernard  Hall was  granted a  non-qualified  stock
option to purchase  85,000  shares of our common  stock at an exercise  price of
$1.00 in exchange for consulting services associated with developing guidance on
testing procedures in requirements for ESD.

         On April 29, 1999 Darren Imai was granted a non-qualified  stock option
to purchase  25,000 shares of our common stock at an exercise  price of $2.25 in
exchange of consulting  services  related to the development  efforts for a thin
film based technology product.

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


                                       34

<PAGE>

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.
1,500,000  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, 2000,
there were 304,000  SurgX stock  options  granted which vest ratably over a five
year period.

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, 2000

         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.
<TABLE>
         As of April 30,  2000,  there were  issued and  outstanding  16,616,287
shares of our common stock.
<CAPTION>

                                                    Number of
                                                    Shares of
    Name and Address of Beneficial Owner           Common Stock              Percent of Class
----------------------------------------------     -------------             ----------------
<S>                                                  <C>                             <C>
Philip Micciche                                      598,362 (1)                     3.6%
1100 Auburn Street Fremont, CA
94538

Mitchel Underseth                                    297,851 (2)                     1.8%
1100 Auburn Street Fremont, CA
94538

Andrew Intrater                                      492,990 (3)                     3.0%
47341 Bayside Parkway
Fremont, CA  94538

John Abeles                                          414,132 (4)                     2.5%
2365 Northwest 41st Street Boca Raton, FL
33431

Jay M. Haft                                          127,650 (5)                        *


                                         35

<PAGE>

                                                    Number of
                                                    Shares of
    Name and Address of Beneficial Owner           Common Stock              Percent of Class
----------------------------------------------     -------------             ----------------

2 Grove Isle Dr, #1208B
Coconut Grove, FL  33122

Richard Hubbard                                       40,000 (6)                        *
130, Minories
London, EC3N 1NT U.K.

Doug McBurnie                                         40,000 (7)                     0.2%
1109 McKay Drive, MS 24 San Jose,
CA  95131

VMR High Octane Fund                                 842,105                         5.1%
c/o Meespeirson Fund Services
19-20 North Quay
Douglas, Isle of Man 1M991M

Windstar Investments N.V.                          1,084,220                         6.5%
200 East Broward Blvd.
Suite 1900
Fort Lauderdale, Florida 33302

All officers and directors                         2,010,985 (10)                   12.1%
as a group (7 persons)
<FN>
         * Represents less than 1% of the outstanding shares

         (1) Represents shares subject to stock options  exercisable as of April
30, 2000 or within 60 days thereafter.

         (2) Represents shares subject to stock options  exercisable as of April
30, 2000 or within 60 days thereafter.

         (3) Includes 182,833 shares of common stock held by Mr. Intrater.  Also
includes  310,157  shares  subject to stock options  exercisable as of April 30,
2000 or within 60 days thereafter.

         (4) Includes  227,007 shares of common stock held by Northlea  Partners
Ltd. of which Dr. Abeles is the General Partner, and 35,000 shares issuable upon
conversion of the our Series A preferred  stock also held by Northlea  Partners.
Also  includes  9,375 shares of common stock  issuable  upon exercise of certain
bridge warrants. Includes 37,750 shares of common stock issuable upon conversion
of warrants,  held by Northlea Partners. Also includes 105,000 shares subject to
stock options exercisable as of April 30, 2000 or within 60 days thereafter.


                                       36

<PAGE>

         (5) Includes 105,000 shares subject to stock options  exercisable as of
April 30, 2000 or within 60 days  thereafter.  Also  includes  22,650  shares of
common stock issuable upon conversion of warrants.

         (6) Represents shares subject to stock options  exercisable as of April
30, 2000 or within 60 days thereafter.

         (7) Represents shares subject to stock options  exercisable as of April
30, 2000 or within 60 days thereafter.

         (8) Represents shares subject to stock options  exercisable as of April
30, 2000 or within 60 days thereafter.

         (9) Includes 507,553 shares of common stock issuable upon conversion of
warrants.

         (10) Includes an aggregate of 1,611,370  shares  issuable upon exercise
of warrants  and stock  options and  conversion  of  Preferred  Stock,  included
pursuant to notes (1)-(9).
</FN>
</TABLE>

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 to the terms of a promissory  note. The note bears interest of seven
percent  (7.0%) per annum and is payable in full on the earlier of July 15, 2000
or  thirty  days  after  Mr.  Underseth's  full-time  employment  with  Oryx  is
terminated.  Principal  and interest  under the note are payable in full on such
maturity  date.  As of February 29, 2000,  there was  outstanding  principal and
interest of $12,977 under the note.  Due to Mr.  Underseth's  current  part-time
employment status, he is currently negotiating with us an amendment to the note.

         In February,  1999 we received  approximately  55,000  shares of common
stock of Applied  Magnetics Corp., or Applied  Magnetics,  assigned to us by our
Chief Executive Officer,  Philip Micciche. Mr. Micciche received shares pursuant
to a non-competition  agreement  executed by Mr. Micciche in connection with his
providing  consulting services to DAS Devices,  Inc., a magnetic read-write head
manufacturer that recently merged with Applied Magnetics.  The shares of Applied
Magnetics common stock received by us were sold on July 1, 1999.

         Oryx is paying  legal  costs  incurred  by Philip  Micciche,  our Chief
Executive  Officer,  and Mitchel  Underseth,  our 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.  As of April 30, 2000, Oryx
had paid an  aggregate  of $24,906 in legal  expenses  in  connection  with this
matter.

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


                                       37

<PAGE>

         (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 did not file any Reports on Form 8-K with the Commission  during the
fiscal quarter ended February 29, 2000.

         (c) Exhibits

Exhibit  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)
3.3A     Certificate of Amendment of Certificate of Incorporation dated February
         7, 1996 (5)
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)
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)


                                       38

<PAGE>

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


                                       39

<PAGE>

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)

10.48    Employment Agreement between Registrant and Phillip J. Micciche dated
         March 15, 1999.*
21       Subsidiaries of the Registrant (5)
23.1     Consent of Independent Accountants*
27.1     Financial Data Schedule*

*    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.


                                       40

<PAGE>

(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.

(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.


                                       41

<PAGE>

(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.


                                       42

<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 30th day of May, 2000.

                                         ORYX TECHNOLOGY CORP.


                                         By:  /s/ Philip J. Micciche
                                              ----------------------
                                              Philip J. Micciche,
                                              President and Chief
                                              Executive Officer
<TABLE>
         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.
<CAPTION>

Signature                                Title                                  Date
---------                                -----                                  ----
<S>                                      <C>                                    <C>
/s/ Philip J. Micciche                   President, Chief                       May 30, 2000
----------------------                   Executive Officer
Philip J. Micciche                       and Director
                                         (Principal Executive
                                         Officer)

/s/ Andrew Intrater                      Secretary, Treasurer                   May 30, 2000
-------------------                      and Director
Andrew Intrater

/s/ Mitchel Underseth                    Chief Financial                        May 30, 2000
---------------------                    Officer and Director
Mitchel Underseth                        (Principal Financial
                                         Officer and Principal
                                         Accounting Officer)

/s/ John H. Abeles                       Director                               May 30, 2000
------------------
John H. Abeles

/s/ Jay M. Haft                          Director                               May 30, 2000
---------------
Jay M. Haft

/s/ Thomas Guzek                         Director                               May 30, 2000
----------------
Thomas Guzek

/s/ Richard Hubbard                      Director                               May 30, 2000
-------------------
Richard Hubbard

/s/ Doug McBurnie                        Director                               May 30, 2000
-----------------
Doug McBurnie

</TABLE>

                                            43

<PAGE>

Oryx Technology Corp.
Index to Consolidated Financial Statements
February 29, 2000 and February 28, 1999
------------------------------------------------------------------------------

                                                                            Page
                                                                            ----

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

Consolidated Balance Sheet at February 29, 2000
      and February 28, 1999............................................     F-3

Consolidated Statement of Operations for the
       years ended February 29, 2000 and February 28, 1999.............     F-4

Consolidated Statement of Stockholders' Equity for the
      years ended February 29, 2000 and February 28, 1999..............     F-5

Consolidated Statement of Cash Flows for the
      years ended February 29, 2000 and February 28, 1999..............     F-6

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


                                       F-1

<PAGE>



                        Report of Independent Accountants

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


In our opinion,  the  accompanying  consolidated  balance  sheet 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  29, 2000 and February 28,
1999,  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.  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  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 the opinion expressed above.

PricewaterhouseCoopers LLP

San Jose, California
April 28, 2000


                                      F-2

<PAGE>

<TABLE>
Oryx Technology Corp.
Consolidated Balance Sheet
----------------------------------------------------------------------------------------------------------------------
<CAPTION>
                                                                                         February 29,     February 28,
                                                                                             2000             1999
             Assets
<S>                                                                                         <C>              <C>
Current assets:
  Cash and cash equivalents                                                           $     4,529,000  $     1,570,000
  Short term investments                                                                      989,000                -
  Accounts receivable, net of allowance for doubtful
    accounts of $40,000 and $118,000                                                           50,000          696,000
  Inventories                                                                                       -          384,000
  Other current assets                                                                        127,000          278,000
                                                                                      ---------------  ---------------
    Total current assets                                                                    5,695,000        2,928,000

Property and equipment, net                                                                   262,000          434,000
Other assets                                                                                   32,000          141,000
                                                                                      ---------------  ---------------
                                                                                      $     5,989,000  $     3,503,000
                                                                                      ===============  ===============

             Liabilities, Mandatorily Redeemable Preferred Stock and Stockholders' Equity

Current liabilities:
  Accounts payable                                                                    $        43,000  $       355,000
  Accrued liabilities                                                                         672,000          541,000
  Capital lease and other short term obligations                                                    -           12,000
  Deferred revenue                                                                             19,000          408,000
                                                                                      ---------------  ---------------
    Total current liabilities                                                                 734,000        1,316,000

Capital lease and other long term obligation, less current portion                                  -           16,000
                                                                                      ---------------  ---------------
    Total liabilities                                                                         734,000        1,332,000
                                                                                      ---------------  ---------------

Commitments and Contingencies (Note 13)

Series A 2% mandatorily redeemable preferred stock                                             89,000           89,000

Stockholders' equity:
  Common Stock, $0.001 par value; 25,000,000 shares
    authorized; 16,457,682 and 13,290,464 issued and outstanding                               16,000           13,000
Additional paid-in capital                                                                 25,237,000       20,144,000
Accumulated deficit                                                                       (20,087,000)     (18,075,000)
                                                                                      ---------------  ---------------
      Total stockholders' equity                                                            5,166,000        2,082,000
                                                                                      ---------------  ---------------
                                                                                      $     5,989,000  $     3,503,000
                                                                                      ===============  ===============


<FN>
                       The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
                                                           F-3

<PAGE>

<TABLE>
Oryx Technology Corp.
Consolidated Statement of Operations
---------------------------------------------------------------------------------------------------------------------
<CAPTION>
                                                                                       February 29,    February 28,
                                                                                           2000           1999
<S>                                                                                   <C>             <C>
Net revenue                                                                           $     755,000   $      605,000
Cost of sales                                                                               808,000          954,000
                                                                                      --------------  ---------------
    Gross profit (Loss)                                                                     (53,000)        (349,000)
                                                                                      --------------  ---------------

Operating expenses:
    General and administrative                                                            1,782,000        1,526,000
    Research and development                                                                954,000          419,000
                                                                                      --------------  ---------------
          Total operating expenses                                                        2,736,000        1,945,000
                                                                                      --------------  ---------------


Loss from operations                                                                     (2,789,000)      (2,294,000)
Interest income, net                                                                        177,000           14,000
Net write down on investment                                                                      -          (15,000)
Other income (expenses)                                                                     (11,000)         217,000
                                                                                      --------------  ---------------
          Loss from continuing operations                                                (2,623,000)      (2,078,000)
                                                                                      --------------  ---------------

Discontinued operations:
    Income from discontinued operations                                                     268,000        1,243,000
    Income on disposal of discontinued operations                                           345,000          146,000
                                                                                      --------------  ---------------
          Income from discontinued operations                                               613,000        1,389,000
                                                                                      --------------  ---------------

Net loss                                                                                 (2,010,000)        (689,000)
Dividends                                                                                    (2,000)          (2,000)
                                                                                      --------------  ---------------
          Net loss attributable to Common Stock                                       $  (2,012,000)  $     (691,000)
                                                                                      ==============  ===============

Basic and diluted loss per common share from continuing operations                    $       (0.17)  $        (0.16)
Basic and diluted income per common share from discontinued operations                         0.04             0.11
                                                                                      --------------  ---------------
Basic and diluted net loss per common share                                           $       (0.13)  $        (0.05)
                                                                                      ==============  ===============

Weighted average common shares used to compute basic and
          diluted net loss per share                                                     15,271,000       13,158,000
                                                                                      ==============  ===============

<FN>
                       The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
                                                          F-4

<PAGE>

<TABLE>
Oryx Technology Corp.
Consolidated Statement of Stockholders' Equity
------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>


                                                                             Common Stock
                                                                       Shares          Amount
<S>                 <C> <C>                                          <C>              <C>
Balance at February 28, 1998                                           13,124,821     $  13,000
Issuance of Common Stock upon exercise of options                          24,469             -
Issuance of Common Stock upon exercise of warrants                         10,922             -
Issuance of stock option in exchange for services                               -             -
Issuance of Common Stock in exchange
   for investor relations services                                        121,500             -
Issuance of warrants in exchange for investor relations services                -             -
Conversion of Preferred Stock to Common Stock                               8,752             -
Net Loss                                                                        -             -
Preferred Stock dividend                                                        -             -
                                                                     ------------     ---------
Balance at February 28, 1999                                           13,290,464        13,000
Issuance of Common Stock upon exercise of options                         446,906             -
Issuance of Common Stock upon exercise of warrants                      2,639,312         3,000
Issuance of stock option in exchange for services
   and employee terminations                                                    -             -
Issuance of Common Stock in exchange
   for investor relations services                                         81,000             -
Issuance of warrants in exchange for investor relations services                -             -
Net Loss                                                                        -             -
Preferred Stock dividend                                                        -             -
                                                                     ------------     ---------
Balance at February 29, 2000                                           16,457,682     $  16,000
                                                                     ============     =========


                                                                      Additional
                                                                       Paid-In           Accumulated
                                                                       Capital             Deficit            Total

Balance at February 28, 1998                                         $19,711,000        $(17,384,000)     $  2,340,000
Issuance of Common Stock upon exercise of options                         28,000                   -            28,000
Issuance of Common Stock upon exercise of warrants                        18,000                   -            18,000
Issuance of stock option in exchange for services                        209,000                   -           209,000
Issuance of Common Stock in exchange
   for investor relations services                                       143,000                   -           143,000
Issuance of warrants in exchange for investor relations services          17,000                   -            17,000
Conversion of Preferred Stock to Common Stock                             18,000                   -            18,000
Net Loss                                                                       -            (689,000)         (689,000)
Preferred Stock dividend                                                       -              (2,000)           (2,000)
                                                                     -----------        ------------      ------------
Balance at February 28, 1999                                          20,144,000         (18,075,000)        2,082,000
Issuance of Common Stock upon exercise of options                        471,000                   -           471,000
Issuance of Common Stock upon exercise of warrants                     4,243,000                   -         4,246,000
Issuance of stock option in exchange for services
   and employee terminations                                             215,000                   -           215,000
Issuance of Common Stock in exchange
   for investor relations services                                       152,000                   -           152,000
Issuance of warrants in exchange for investor relations services          12,000                   -            12,000
Net Loss                                                                       -          (2,010,000)       (2,010,000)
Preferred Stock dividend                                                       -              (2,000)           (2,000)
                                                                     -----------        ------------      ------------
Balance at February 29, 2000                                         $25,237,000        $(20,087,000)     $  5,166,000
                                                                     ===========        ============      ============


<FN>
                             The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
                                                                 F-5

<PAGE>

<TABLE>
Oryx Technology Corp.
Consolidated Statements of Cash Flows
-------------------------------------------------------------------------------------------------------------------
<CAPTION>
                                                                                     Year Ended      Year Ended
                                                                                    February 29,    February 28,
                                                                                        2000            1999
<S>                                                                                <C>             <C>
Cash flows from operating activities:
  Net loss                                                                         $ (2,010,000)   $  (689,000)
  Adjustments to reconcile net loss to net cash used in operating activities:
    Income from discontinued operations                                                (268,000)    (1,056,000)
    Gain on sale of discontinued operations                                            (345,000)      (146,000)
    Loss from asset disposition                                                           8,000              -
    Depreciation and amortization                                                       135,000        126,000
    Non-cash stock compensation                                                         392,000        173,000
      Changes in assets and liabilities
        Accounts receivable                                                              85,000          1,000
        Inventories                                                                           -         11,000
        Other current assets                                                            (20,000)       410,000
        Other assets                                                                    109,000        (21,000)
        Deferred revenue                                                                (59,000)      (121,000)
        Accounts payable                                                                (82,000)       (70,000)
        Accrued liabilities                                                             229,000       (193,000)
                                                                                   -------------   ------------
            Net cash used in continuing operations                                   (1,826,000)    (1,575,000)
            Net cash provided by discontinued operations                                620,000        101,000
                                                                                   -------------   ------------
            Net cash used in operations                                              (1,206,000)    (1,474,000)
                                                                                   -------------   ------------
Cash flows from investing activities:
  Capital expenditures                                                                 (100,000)       (94,000)
  Proceeds from assets disposition                                                       16,000              -
  Purchase of short term investment                                                    (989,000)             -
  Proceeds from sale of Applied Magnetics shares                                        151,000              -
  Proceeds from sale of discontinued operations                                         400,000      2,000,000
                                                                                   -------------   ------------
            Net cash provided (used) by investing activities                           (522,000)     1,906,000
                                                                                   -------------   ------------
Cash flows from financing activities:
  Sale of Note Receivable                                                                     -        500,000
  Repayment of bank line of credit                                                            -       (129,000)
  Payment of capital lease obligations                                                   (9,000)       (19,000)
  Payment from (repayment of) notes payable                                             (19,000)        19,000
  Proceeds from exercise of warrants for Common Stock                                 4,246,000         18,000
  Proceeds from exercise of options for Common Stock                                    471,000         28,000
  Payment of preferred stock dividend                                                    (2,000)        (2,000)
  Other                                                                                       -          1,000
                                                                                   -------------   ------------
            Net cash provided by financing activities                                 4,687,000        416,000
                                                                                   -------------   ------------
Net increase in cash and cash equivalents                                             2,959,000        848,000
Cash and cash equivalents at beginning of period                                      1,570,000        722,000
                                                                                   -------------   ------------
Cash and cash equivalents at end of period                                         $  4,529,000    $ 1,570,000
                                                                                   =============   ============

Supplemental disclosures of cash flow information:
  Interest paid during the period                                                  $          -    $    40,000
                                                                                   =============   ============

<FN>
                   The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
                                                       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.  At February 29, 2000,
     the  Company  was  primarily  involved in the  business  of  licensing  its
     proprietary  SurgX and Intragene  technology.  The Company  transferred the
     research and development of its SurgX  electrostatic  discharge  protection
     technology to its licensees  and began the process of  transferring  to its
     licensees  the  manufacturing  of its SurgX  liquid.  Additionally,  during
     fiscal 2000,  the Company sold its Material  business (see Note 4) which it
     has accounted for as a discontinued  operations and  subsequently  licensed
     its Intragene technology.

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 29, 2000 is referred to as fiscal 2000. Certain prior year amounts
     have been reclassified to conform to current year presentation.

     Principles of consolidation

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

     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. 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 29,          February 28,
                                                  2000                  1999

     Cooper Electronic Technologies               40%                   27%
     Oryx Advanced Materials, Inc                 33%                    -
     Governments Contracts                        17%                   68%
     Iriso Electronics, Co. LTD                   10%                    -


     Inventories

     Inventories  are  stated  at the  lower of cost or  market  and cost  being
     determined on a first-in, first-out basis.


                                      F-7

<PAGE>

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

     Management estimates

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

     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
     recovery of property and equipment based upon estimated cash flows.

     Investment in DAS Devices, Inc.

     The  Company  accounted  for its  investment  in DAS  Devices,  Inc.  ("DAS
     Devices")  using  the  cost  method.  See  Note  5 for  related  investment
     activity.

     Revenue recognition

     Revenues are generally recognized upon shipment of product.  However, where
     a shipment is subject to customer acceptance criteria,  revenue is deferred
     until customer  acceptance.  Revenue from research  contracts in process is
     recognized under the percentage of completion method.  Royalty revenues are
     recognized when they are earned,  contractually  payable and collectability
     is probable.

     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.

     Net loss per share

     Basic and diluted  earnings  per share for the periods presented  have been
     computed by dividing income or 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 2000 and 1999,  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 2000 or 1999.  Anti  dilutive  securities  and
     common  stock  equivalents  at February 29, 2000 which could be dilutive in
     future periods include common stock options to purchase 3,216,000 shares of
     common stock,  warrants to purchase 1,253,000 shares of common stock, 3,750
     shares of Series A  preferred  stock  which may be  converted  into  44,000
     shares of common stock and  subsidiary  stock  options to purchase  304,000
     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

     In March 1998,  the  Company  adopted  Statement  of  Financial  Accounting
     Standards (SFAS) No. 130, "Reporting  Comprehensive  Income." Comprehensive
     income,  as defined,  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.


                                      F-8

<PAGE>

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

     New accounting standard

     In June 1998, the FASB issued  Statement of Financial  Accounting  Standard
     No. 133,  "Accounting for Derivative  Instruments and Hedging  Activities,"
     (SFAS No. 133) which  establishes  accounting  and reporting  standards for
     derivative  instruments,  and for hedging  activities.  It requires that an
     entity  recognizes  all  derivatives as either assets or liabilities in the
     statement  of  financial  position and measure  those  instruments  at fair
     value.  The  Company  will adopt SFAS No.  133 as  required  for its second
     quarterly  filing in fiscal 2001.  The Company  currently does not hold any
     instruments which would be effected by SFAS No. 133.

3.   Details of Balance Sheet Components

                                                      February 29,  February 28,
                                                         2000          1999
      Inventories:
        Raw materials                                  $       -     $  75,000
        Finished goods                                         -       309,000
                                                      -------------------------
                                                       $       -     $ 384,000
                                                      =========================

      Other current assets:
        Investment in Applied Magnetics Corporation    $       -     $ 218,000
        Receivable from Todd Power                        65,000             -
        Other                                             62,000        60,000
                                                      -------------------------
                                                       $ 127,000     $ 278,000
                                                      =========================

      Property and equipment:
        Machinery and equipment                        $ 467,000     $ 501,000
        Furniture and fixtures                           231,000       250,000
        Automobiles                                            -        43,000
        Leasehold improvements                            84,000       105,000
                                                      -------------------------
                                                         782,000       899,000
      Less:  Accumulated depreciation                   (520,000)     (465,000)
                                                      -------------------------
                                                       $ 262,000     $ 434,000
                                                      =========================

      Accrued liabilities:
        Compensation                                   $ 336,000     $ 192,000
        Professional fees                                106,000       116,000
        Facilities                                        10,000        22,000
        Other                                            220,000       211,000
                                                      -------------------------
                                                       $ 672,000     $ 541,000
                                                      =========================


                                      F-9

<PAGE>

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

4.   Instruments and Materials Discontinued Operations

     On August 18, 1999,  pursuant to the terms of an Asset  Purchase  Agreement
     dated as of June 1, 1999 by and among Oryx  Technology  Corp.  ("Oryx") and
     Oryx Advanced Materials Inc. ("OAMI"),  Oryx sold to OAMI certain specified
     assets  associated  with Oryx' carbon  target  assembly  manufacturing  and
     related  materials  coating business (the "Materials"  business) for a cash
     payment  of  $400,000  and  the  assumption  of  substantially  all  of the
     liabilities  associated with such business.  The Company retained ownership
     of approximately  $280,000 in accounts  receivable balances relating to the
     Materials  business  subsequent  to  the  disposition.  In  addition,  Oryx
     licensed to OAMI certain patents and other  technology  associated with the
     purchased assets.  OAMI will pay Oryx royalty payments over ten years, with
     a maximum royalty payment of $2.2 million for the first three years,  based
     on OAMI's gross profits.  As of February 29, 2000, the Company has received
     and recognized $249,000 in royalty payments from OAMI for fiscal 2000.

     In  addition,  on February  27,  1998,  Corus  Investments  Ltd., a Bahamas
     Company,  acquired  8,000,000 shares of the authorized Class A Common Stock
     of Oryx Instruments and Materials Corporation (the "Instruments"  business)
     for a  purchase  price  of  $500,000  (the  "Sale").  Prior  to  the  Sale,
     Instruments  was a wholly owned  subsidiary of the Company.  As part of the
     Sale,  Instruments  redeemed  8,000,000 of the 10,000,000 shares of Class A
     Common  Stock held by the  Company  for an  aggregate  redemption  price of
     $1,500,000.

     The  disposal  of  OAMI  and  Oryx  Instruments  and  Materials  have  been
     aggregated as they  represent the final sale of one business  segment,  and
     the operating  results of OAMI and Oryx Instruments and Materials have been
     segregated and reported as  discontinued  operations.  Prior year financial
     statements  have been restated to include the results of operations of OAMI
     and Oryx Instruments and Materials as discontinued operations. Revenue from
     discontinued  operations  was  $1,049,000 and $4,037,000 for the year ended
     February 29, 2000 and February 28, 1999, respectively. Income taxes related
     to the discontinued  operations and the tax benefit resulting from the gain
     on disposal of the OAMI business were immaterial. Transaction costs related
     to the OAMI disposal were $55,000.  The Company has no remaining  assets or
     liabilities  relating  to the  Instruments  and  Materials  business  as of
     February 29, 2000.

5.   Investment in DAS Devices

     In fiscal  1998,  the Company  sold 42% of its  holdings in DAS Devices for
     $1.4  million and  realized a gain of  $1,383,000,  net of its prorata cost
     basis  and  expenses  of  $17,000.  At  February  28,  1998  the  Company's
     investment  in DAS Devices was $15,000.  During  fiscal year 1999,  Applied
     Magnetics  Corp.  purchased DAS Devices and the Company did not receive any
     consideration for its holding due to the priority of liquidation preference
     to other DAS  Devices  stockholders.  As a result  the  Company  recorded a
     $15,000 loss in fiscal 1999 on the write-off of its remaining investment in
     DAS Devices.

6.   Continental Capital & Equity Corporation Transaction

     During fiscal 1999, the Company  entered into a seventeen  month  marketing
     agreement to receive investor relations  services from Continental  Capital
     and Equity Corporation.  In consideration for services to be rendered,  the
     Company  agreed  to issue  162,000  shares  of common  stock  over  defined
     periods, 40,500 shares of common stock which are contingently issuable upon
     certain  milestones  and an  immediately  exercisable  warrant to  purchase
     60,000 shares of common stock at $1.09,  with a two-year  term. The Company
     issued 81,000 and 121,500 shares of common stock to  Continental  Capital &
     Equity  Corporation  in fiscal  2000 and  1999,  respectively,  under  this
     agreement.  The Company  recorded  expense of $177,000 and $147,000  during
     fiscal  2000  and  fiscal  1999,  respectively,  relating  to the  services
     received  which was based on the  Company's  stock price  during the fiscal
     years. The


                                      F-10

<PAGE>

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

     Company also issued the warrant  during fiscal 1999 and amortized the value
     of $29,000 relating to the warrant over the agreement term.

8.   Financing Arrangements

     In May 1997, the Company entered into a facility which included an Accounts
     Receivable  Revolving Batch Facility and an Inventory Line of Credit with a
     financial institution. The Inventory Line of Credit provides for borrowings
     of up to $1.5  million  ($750,000  of  which  is  subject  to an  inventory
     appraisal).  The Accounts  Receivable  Revolving  Batch Facility allows the
     Company to factor up to a maximum of $4 million,  provided  that any amount
     in  excess  of $3.5  million  is  supported  by an equal  amount  of unused
     availability  under the Inventory Line of Credit.  Under the facility,  the
     Company is  required to sell on an  undiscounted,  non  recourse  basis all
     accounts receivable. In exchange,  advances are available to the Company up
     to 85% of the face amount of eligible  accounts  receivable (as defined) up
     to a maximum  amount of $4 million.  Accounts  receivable  in the amount of
     $1,100,000 at February 28, 1998 were due from lender. Financing costs under
     the  arrangement  are equal to the greater of the  institution's  base rate
     plus 1.25% or 7.0%. In March 1998,  the agreement was amended to reduce the
     Account  Receivable  Revolving Batch Facility and the Inventory Credit Line
     to a maximum borrowings of $500,000 each. Under the amended agreement,  the
     Accounts Receivable  Revolving Batch Facility expired in March 1999 and the
     Inventory Line of Credit expired in May 1999.

     In February  1998,  the Company  entered into a bridge loan facility with a
     financial  institution  for borrowings of amounts up to $1,000,000  bearing
     interest  at the  institution's  base rate plus 4% with a minimum of 7% per
     annum.  The facility expired unused on September 15, 1998. As consideration
     upon signing the facility,  the financial  institution received warrants to
     purchase 174,546 shares of common stock  exercisable  through February 2001
     at an exercise price of $1.15.  The Company  recorded an expense of $93,000
     upon issuance of the warrants.

9.   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 11.67 shares of Common Stock. The
     Company  had  reserved  43,763  shares of Common  Stock for  issuance  upon
     conversion  of the Series A Stock as of February  29, 2000.  During  fiscal
     1999, a holder of Series A Preferred  Stock  converted 750 units into 8,752
     shares  of Common  Stock.  The  holders  of  Series A  Preferred  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.

10.  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,  which  expires in 2003,
     provides for incentive as well as nonstatutory stock options.  The Board of
     Directors may terminate the 1993 Plan at any time at its discretion.

     Options  under the 1993 Plan are 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


                                      F-11

<PAGE>

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

     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.

     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 45,000 and 30,000 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,
     10,000  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 225,000 shares  authorized under the
     1995  Directors'  Plan of which 195,000  options were  outstanding  with an
     average  exercise  price of $1.60 per share as of February  29,  2000.  The
     Company has 250,000 shares  authorized  under the 1996  Directors'  Plan of
     which 150,000 options were  outstanding  with an average  exercise price of
     $1.61 per share as of February 29, 2000.

     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 205,000
     shares of the  Company's  Common  Stock at an  exercise  price of $0.95 per
     share and 50,000 shares at an exercise price of $0.25 per share.


                                      F-12

<PAGE>

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

                                         Shares                     Weighted-
                                        Available                    Average
                                           For                    Exercise Price
                                          Grant         Shares      Per Share

Balance at February 28, 1998               217,756    2,561,926      $ 1.64

Additional shares authorized             1,130,000            -
Options granted                         (1,242,000)   1,242,000      $ 1.14
Options canceled                           272,044     (272,044)     $ 1.45
Options exercised                                -      (24,469)     $ 1.15
                                        ----------   ----------
Balance at February 28, 1999               377,800    3,507,413      $ 1.47
Additional shares authorized               215,000            -
Options granted                           (270,000)     270,000      $ 1.96
Options canceled                           114,062     (114,062)     $ 1.43
Options exercised                                -     (446,906)     $ 1.06
                                        ----------   ----------
Balance at February 29, 2000               436,862    3,216,445      $ 1.57
                                        ==========   ==========

<TABLE>
The following  table  summarizes  information  about  employee  stock options at
February 29, 2000:
<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>
$0.69 - 1.00                  177,125       4.8                    $0.86       111,500             $0.94
$1.07 - 1.58                1,777,828       7.4                     1.38     1,101,318              1.37
$1.79 - 2.25                1,261,500       7.1                     1.93       847,500              1.94
                            ---------                                        ---------
   Total                    3,216,453       7.1                    $1.57     2,060,318             $1.58
                            =========                                        =========

</TABLE>

                                      F-13

<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 29,  2000,  there were  304,000  options to purchase  shares of
     SurgX Corporation class B common stocks of which 303,437 were vested. These
     options  had an average  exercise  price of $0.80 and an average  remaining
     contractual life of 5.4 years.

     During  fiscal  1998,  the  Company  sold  333,000  Class A shares of SurgX
     Corporation for net proceeds of $485,000.  At February 28, 1999, 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.

     There was no activity under the SurgX  subsidiary  stock option plan during
     fiscal 2000 and fiscal  1999.  At February  29, 2000 and  February 28, 1999
     there  were  1,196,000  shares  available  for  grant and  304,000  options
     outstanding with an average exercise price of $0.80 per share.
<TABLE>
     The following table summarizes  information about stock options outstanding
     under the SurgX subsidiary stock option plan at February 29, 2000:
<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>
$0.80                        304,000       5.4                    $0.80         303,437            $0.80
                      ---------------                                     --------------
   Total                     304,000       5.4                    $0.80         303,437            $0.80
                      ===============                                     ==============
</TABLE>

     Fair Value Disclosures

     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  2000  would have
     been $2,687,000 and $0.18, respectively, and in fiscal 1999 would have been
     $1,366,000 and $0.10, respectively.


                                      F-14

<PAGE>

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

     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 the applicable  period:  dividend yields
     of 0% for both  periods;  expected  volatility  of 86% for fiscal  2000 and
     fiscal 1999; risk-free interest rate of 5.98% for fiscal 2000 and 5.42% for
     fiscal 1999 for options  granted;  and a weighted  average  expected option
     term of five years for both  periods.  The  weighted  average fair value of
     options  granted  during  fiscal  years  2000 and 1999 was $1.45 and $1.03,
     respectively. The weighted average fair value of options to purchase common
     shares of the Company's  subsidiaries were not material during fiscal years
     2000 and 1999.

     Warrants

     The  following  warrants at February 29, 2000,  and the number of shares of
     the  Company's  Common  Stock  which may be  purchased  at  exercise,  were
     outstanding and exercisable at February 29, 2000:

       Original       Issuable          Warrant           Warrant       Warrant
       Warrants        Common         Commencement      Expiration     Exercise
     Outstanding       Shares            Date               Date         Price

         37,500          37,500        Oct. 1994         Oct. 2004        $2.00
        379,000         572,290        Nov. 1994         Oct. 2004        $2.00
        133,145         133,145        Feb. 1996         Jan. 2001        $1.25
        400,000         400,000        Feb. 1996         Mar. 2001        $1.00
        100,000         100,000        Feb. 1996         Mar. 2001        $5.00
          9,480           9,480        Apr. 1996         Mar. 2001        $1.31
     ----------      ----------
      1,059,125       1,252,415
     ==========      ==========

     In connection  with a bridge loan  facility  described in Note 8, in fiscal
     1998 the Company issued warrants to KBK Financial, Inc. to purchase 174,546
     shares of Common Stock  exercisable  through  February  2001 at an exercise
     price of $1.15.  KBK  Financial,  Inc exercised  these warrants in February
     2000.

     During  fiscal 1999,  the Company  issued to  Continental  Capital & Equity
     Corporation a immediately  exercisable warrant to purchase 60,000 shares of
     Common  Stock at an  exercise  price of  $1.09,  with a two year  term,  in
     exchange for investor relation services (see Note 7). Continental Capital &
     Equity Corporation exercised these warrants in February 2000.

     The  terms  of  some   warrants  are  subject  to   adjustment  in  certain
     circumstances including antidilution protection.

11.  Research Contracts and Development Funding

     The  Company  has been  party  to  certain  research  contracts  which  are
     accounted  for on a percentage of  completion  basis.  Revenues and cost of
     sales recorded under such contracts  totaled  $128,000 and $216,000  during
     fiscal 2000 and  $412,000 and $670,000  during  fiscal 1999,  respectively.
     These contracts were completed during the fiscal 2000.

     During fiscal 1999,  the Company  received  development  funding from third
     parties to assist in the  commercialization  of  certain  of the  Company's
     products. Such funding is recorded as an offset to research and development
     expenses when contract specified  technical  milestones have been achieved.
     During  fiscal 1999,


                                      F-15

<PAGE>

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

     $423,000  was  credited to research and  development  expenses  under these
     arrangements. No amount was credited during fiscal 2000.

12.  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 29, 2000.

     The tax effects of temporary  differences and carryforwards  that give rise
     to significant  portions of deferred tax assets and liabilities at February
     29, 2000 and February 28, 1999 are as follows:

                                              February 29,     February 28,
                                                  2000             1999
                                            -----------------------------------

     Net operating loss carryforwards       $      4,884,000         3,904,000
     R&D credit carryforwards                        436,000           343,000
     Inventory reserves                                    -            98,000
     Deferred revenue                                  8,000           163,000
     Intangible                                       48,000           137,000
     Other                                           271,000           309,000
                                            -----------------------------------
          Gross deferred assets                    5,647,000         4,954,000
     Fixed assets                                      7,000           (12,000)
                                            -----------------------------------
          Net deferred tax assets                  5,654,000         4,942,000
     Valuation allowance                          (5,654,000)       (4,942,000)
                                            -----------------------------------
          Net deferred tax assets           $              -   $            -
                                            ===================================

<TABLE>
     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:
<CAPTION>
                                                                             February 29,  February 28,
                                                                                 2000         1999
                                                                           ----------------------------
<S>                                                                        <C>             <C>
     Statutory U.S. federal tax                                            $  (683,000)    $  (234,000)
     Valuation allowance with respect to federal deferred tax assets           727,000         226,000
     Other                                                                     (44,000)          8,000
                                                                           ----------------------------
           Effective tax                                                   $         -     $         -
                                                                           ============================
</TABLE>

     At February  29,  2000,  the Company  had  federal net  operating  loss and
     research and development credit carryforwards of approximately  $13,885,000
     and $295,000,  respectively.  Such federal net operating  loss and research
     and development credit carryforwards will expire on various dates from 2004
     through 2020,  subject to certain  limitations.  In accordance with Section
     382 of the Internal  Revenue Code, the amounts of and the


                                      F-16

<PAGE>

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

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

13.  Commitments and Contingencies

     The Company  leases its facilities and certain  equipment  under  operating
     lease agreements, which expire in various periods through 2002.

     Future minimum lease obligations are payable as follows:

                                                       Operating
       Year Ending February                             Leases

          2001                                        $ 250,000
          2002                                        $ 123,000
          2003                                            1,000
                                                     ------------
          Total minimum lease payments                $ 374,000
                                                     ============

     Rental  expense for the years ended February 29, 2000 and 1999 was $173,000
     and $260,000, respectively.

14.  Related Parties

     On February  1999,  the Company  received  54,455 shares of Common Stock of
     Applied  Magnetics  Corp.  ("Applied  Magnetics")  assigned  to it  by  the
     Company's  Chief  Executive  Officer.   The  CEO  received  the  shares  in
     connection  with  his  providing  consulting  services  to DAS  Devices,  a
     magnetic  read-write  head  manufacturer  that recently merged with Applied
     Magnetics.  The shares of Applied  Magnetics  Common Stock  received by the
     Company in this transaction were restricted until a registration  statement
     filed by Applied Magnetics with the Securities and Exchange  Commission was
     declared  effective by the Commission.  As a result,  the Company  recorded
     $218,000  as other  income  equal to the fair  market  value of the  shares
     received as of February 28, 1999.  These shares were sold by the Company in
     July 1999  recording  proceeds of $151,000 and a loss on sale of investment
     of $67,000.

     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  outstanding  balance was $12,977 as of February 29, 2000 and
     $32,927 as of February 28, 1999.

15.  Segment Information

     The Company  operates in a single industry  segment (as defined by SFAS No.
     131 "Disclosure about Segments and Enterprise and Related Information.") to
     license the SurgX and Intragene Technology.


                                      F-17

<PAGE>

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

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


                                                      Year Ended    Year Ended
                                                      February 29,  February 28,
                                                          2000         1999

Net Revenues:
  United States                                       $ 676,000     $ 601,000
  Japan                                                  79,000         4,000
                                                      ----------    ----------
  Net Revenues                                        $ 755,000     $ 605,000
                                                      ==========    ==========


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


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