FORM 10-Q. - QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


[ X ] Quarterly  Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 For the quarterly period ended September 30, 1999

                                       or

[   ] Transition  Report  Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 For the transition period from to ____ - _____.



Commission File Number :  1-11586
                         ---------


                             PTI HOLDING INC.
          -----------------------------------------------------
         (Exact name of registrant as specified in its charter)


              Delaware                                       13-3590980
  ----------------------------                         ---------------------
(State or jurisdiction                                   (I.R.S. Employer
of incorporation or organization)                        Identification No.)

c/o 15 East North Street, Dover, DE                           19901
------------------------------------                        ---------
(Address of principal executive offices)                   (Zip Code)


                                    (302) 678-0855
                  -----------------------------------------------
                  (Issuer's Telephone Number, Including Area Code)


  Indicate  by check  marker  whether the  registrant  (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the  Securities  Exchange Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.    X Yes ___ No


                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDING DURING THE PRECEDING FIVE YEARS :

  Indicate  by check mark  whether  the registrant has filed all  documents  and
reports  required  to be filed by  Sections  12,  13 or 15(d) of the  Securities
Exchange Act of 1934 subsequent to the  distribution of securities  under a plan
confirmed by a court. ___ Yes  ___ No


                     APPLICABLE ONLY TO CORPORATE ISSUERS :

  Indicate the number of shares  outstanding of each of the issuer's  classes of
common  stock,  as of the latest  practicable  date.  As of November  15,  1999,
4,956,352 shares of the issuer's common equity were outstanding.





<PAGE>



                          PART I FINANCIAL INFORMATION



ITEM 1.  Financial Statements
                                                                         Page

Consolidated Balance Sheets as of September 30, 1999 and
December 31, 1998                                                         12

Consolidated Statements of Operations for the three and nine months
ended September 30, 1999 and 1998                                         13

Consolidated Statements of Cash Flows for the nine months                 14
ended September 30, 1999 and 1998

Notes to Consolidated Financial Statements                           15 - 19



ITEM 2.  Management's Discussion and Analysis


     Statements in this Quarterly  Report on Form 10-Q  concerning the Company's
business outlook or future economic  performance,  or other financial items, and
plans and objectives related thereto, and statements concerning assumptions made
or  expectations  as to any  future  events,  conditions,  performance  or other
matters,  are  "forward-looking  statements"  as that term is defined  under the
Federal  Securities  Laws.  Forward-looking  statements  are  subject  to risks,
uncertainties  and other  factors  that  could  cause  actual  results to differ
materially from those stated in such statements.

     PTI Holding Inc. (the  "Company"),  formerly  known as Aerial Assault Inc.,
was  incorporated  under the laws of Delaware in March 1990.  Until February 28,
1994,  the Company was engaged in the  business  of  designing,  developing  and
marketing distinctive,  high-performance men's athletic footwear for basketball,
and related apparel  bearing the Company's name and logo. The Company  commenced
sales in February 1992.

     On March 1, 1994, the Company acquired  Foam-O-Rama,  Inc. ("Foam"),  a New
York  corporation  which was principally  engaged in the business of the design,
marketing and sale of bicycle helmets, by merging it with and into the company's
wholly-owned operating subsidiary, Protective Technologies International Inc., a
New  York  corporation  ("PTI"),  pursuant  to a  Merger  Agreement  and Plan of
Reorganization  dated February 14, 1994 among PTI, Foam and Foam's shareholders.
From and after March 2, 1994,  Foam had no separate  or  independent  existence,
having been  merged  into PTI.  For  purposes  of the  transfer of the  economic
benefits and risks of such  transaction  and the ongoing  business of Foam,  the
acquisition was deemed to have occurred as of the opening of business on January
1, 1994.

     On August 5, 1997,  the Company  consummated  the merger (the  "Merger") of
Flents  Products  Co.,  Inc., a New York  corporation  ("Flents-NY"),  which was
principally  engaged in the business of the  manufacture of wax earplugs and the
marketing and sale of earplugs and other safety and medical supplies, such as an
eye drop delivery system,  styptic devices,  and air-filter masks, with and into
the Company's  wholly owned  subsidiary,  Flents  Products Co., Inc., a Delaware
corporation  ("Flents"),  pursuant to an Agreement  and Plan of Merger among the
Company,  Flents and Flents-NY.  For purpose of accounting,  the acquisition was
effective as of the opening of business on June 1, 1997,  and has been accounted
for as a purchase. Flents delivered at closing an aggregate merger consideration
of  approximately  $4.8 million.  On October 5, 1998, in accordance with certain
provisions  of the  Flents  transaction,  an  additional  54,846  shares  of the
Company's common stock were issued to the original shareholders of Flents.



     On May 12, 1998,  Flents acquired certain assets of the Comfees division of
Magnivision,  a subsidiary  of American  Greetings  Corporation,  for a purchase
price  of  approximately  $1,700,000.  The  Comfees  division  manufactures  and
distributes  contact lens cases,  liquid dispensers,  medicine droppers,  finger
splints and ear protectors, among other health and beauty care items.

     On April 14, 1999,  Flents  consummated  an Asset  Purchase  Agreement with
Karlen Manufacturing, Inc. ("Karlen") and certain shareholders providing for the
acquisition of  substantially  all of the operating net assets (other than cash)
of Karlen for approximately  $17,750,000,  excluding the acquisition  costs. The
Karlen  operation,   which  is  based  in  Michigan,   is  in  the  business  of
manufacturing,  marketing  and  selling  personal  health and beauty care items,
including  some  products  similar to those sold by Flents.  It operates  from a
rented  facility in  Michigan.  In 1998,  Karlen had  revenues of  approximately
$12,000,000.

     Flents has financed the acquisition of Karlen and its working capital needs
through a variety of sources.

     Flents  has  entered  into a  Revolving  Credit,  Term  Loan  and  Security
Agreement with PNC Bank providing for a three-year  term loan of $4,000,000 with
interest  at the bank's  base rate plus .75% and a line of credit of  $6,000,000
with  interest  at the bank's  base rate plus .25%.  Flents  pledged  all of its
assets as security for this financing.

     Flents  has also  borrowed  $8,000,000  from The 1818  Mezzanine  Fund (the
"Fund"),  an affiliate of Brown Brothers Harriman and Co. The loan is due in its
entirety in six years and provides for interest at 12% per year.  Such loan from
the Fund entitles the Fund, through a warrant, to acquire shares of common stock
(for  a  nominal  amount)  that  will  constitute  after  exercise  22%  of  the
outstanding shares of common stock of Flents.

     Flents has also  issued,  for  $1,800,000,  shares of its common stock that
constitutes 18% of Flents' common stock The purchasers are two individuals, both
of whom are directors and officers of the Company.  A fairness  opinion has been
obtained to support the purchase price paid by these two directors.

     In  addition,  the Company has  contributed  $1,000,000  in cash to Flents'
capital,  lent an  additional  $1,000,000  to Flents  and  assumed a  three-year
promissory note  representing part of the purchase price to Karlen in the amount
of  $1,000,000  with interest at 12% per year.  The Company has also  guaranteed
repayment of Flents' loans from PNC Bank.

     After the sale of shares to the two  directors  and  exercise of the Fund's
warrant,  the Company will hold 60% of the outstanding shares of common stock of
Flents.

         In order to finance the Company's  contributions to Flents' acquisition
of Karlen and PTI's  working  capital  needs,  PTI has entered  into a Revolving
Credit,  Term  Loan  and  Security  Agreement  with  PNC  Bank  providing  for a
three-year  term loan of  $3,000,000  with interest at the bank's base rate plus
 .75% and a line of credit of  $22,000,000  with interest at the bank's base rate
plus .25% interest.  Upon the closing of such financing,  the Company has repaid
its previous  outstanding  bank financing in full. PTI pledged all of its assets
as security for this  financing.  The company has also  guaranteed  repayment of
PTI's loans from PNC Bank.


            Three Months ended September 30,1999 as compared to the
            -------------------------------------------------------
                      Three Months ended September 30,1998
                     --------------------------------------

         The Company's net sales were $14,517,252  during the three months ended
September  30, 1999,  an increase of 12% from net sales of  $12,917,533  for the
same  period  in  1998.  The 12%  sales  increase  from  1998  to 1999  resulted
predominantly from an increase in sales of the Flents subsidiary.  Sales for the
third quarter ended September 30, 1999 from Flents were  $5,050,803  compared to
sales of $2,610,883 for the same period in 1998. The increase  primarily results
from sales from the acquisition of Karlen in April 1999.


         The  cost of  sales  for the  quarter  ended  September  30,  1999  was
$9,900,316  (resulting  in a  gross  profit  margin  of  32%),  compared  to the
Company's  cost of sales for the quarter ended  September 30, 1998 of $9,535,984
(resulting  in a gross  profit  margin  of 26%).  Flents'  gross  profit  margin
contribution  approximated  41% in 1999  and 47% in  1998.  PTI's  gross  margin
increased due to sales of higher margined items during the quarter.

         Selling,  general and  administrative  expenses  for the quarter  ended
September   30,  1999  were   $3,871,090   compared  to  selling,   general  and
administrative  expenses of $2,784,640 for the quarter ended September 30, 1998.
SG&A expenses,  as a percentage of sales were 27% and 22% for the quarters ended
September 30, 1999 and 1998,  respectively.  The increased selling,  general and
administrative  spending was primarily due to the higher costs  associated  with
the expansion of the helmet,  bicycle and bicycle  accessory  business,  coupled
with an increased  percentage of sales of licensed products,  the acquisition of
Karlen, installation of new systems and the higher costs for human resources.

         The Company had a net income (after the minority interest deduction for
the 40% outside  ownership in Flents) of $29,740 for the quarter ended September
30, 1999 compared to the  Company's  net income for the quarter ended  September
30, 1998 of $100,689.

             Nine Months ended September 30, 1999 as compared to the
            --------------------------------------------------------
                      Nine Months ended September 30, 1998
                     --------------------------------------

         The Company's net sales were  $52,407,307  during the nine months ended
September  30, 1999,  an increase of 19% from net sales of  $44,060,744  for the
same  period  in  1998.  The 19%  sales  increase  from  1998  to 1999  resulted
predominantly from an increase in sales of the Flents subsidiary.  Sales for the
nine months ended  September 30, 1999 from Flents were  $12,179,768  compared to
sales of $6,654,788 for the same period in 1998. The increase  primarily results
from sales from the acquisition of Comfees in May 1998 and Karlen in April 1999.


         The cost of sales for the nine  months  ended  September  30,  1999 was
$37,607,359  (resulting  in a gross  profit  margin  of  28%),  compared  to the
Company's  cost of  sales  for the  nine  months  ended  September  30,  1998 of
$3,091,396  (resulting  in a gross profit  margin of 30%).  Flents' gross profit
margin contribution approximated 45% in 1999 and 48% in 1998, the 2% decrease in
the consolidated gross profit margin is primarily related to the following:

o An increase in bicycle sales in 1999, a lower margin product line.
o An increase  in the  reserves  for  discounts,  allowances,  and bad debts for
customers  who  have  recently  filed  for  bankruptcy  o  The  closing  out  of
competitors' inventory bought back to secure future sales and relationships with
future  customers  o Higher  manufacturing  costs  associated  with  new  safety
standards implemented by the Company in 1999


         Selling,  general and administrative expenses for the nine months ended
September  30,  1999  were   $11,604,232   compared  to  selling,   general  and
administrative  expenses of $8,402,243  for the nine months ended  September 30,
1998.  SG&A  expenses,  as a  percentage  of sales were 22% and 19% for the nine
months ended September 30, 1999 and 1998,  respectively.  The increased selling,
general  and  administrative  spending  in the  first  nine  months  of 1999 was
primarily due to the higher costs  associated  with the expansion of the helmet,
bicycle and bicycle accessory business,  coupled with an increased percentage of
sales of licensed  products,  the  acquisition  of Karlen,  installation  of new
systems and the higher costs for human resources.

         The Company had a net income (after the minority interest deduction for
the 40% outside  ownership  in Flents  Products) of $764,365 for the nine months
ended  September  30,  1999  compared to the  Company's  net income for the nine
months ended September 30, 1998 of $2,349,198.

Liquidity and Capital Resources

         The Company has satisfied its capital requirements through the proceeds
of its initial public offering of securities,  which resulted in net proceeds of
approximately  $3,800,000,  through  the  proceeds of a  Regulation  'S' private
placement in November 1994,  which  resulted in gross proceeds of  approximately
$751,875,  through the exercise of certain outstanding options held by employees
and consultants of the Company,  which resulted in net proceeds of approximately
$530,000,  through  internal  cash flow,  through the issuance of common  shares
representing  18% of  Flents  for  $1,800,000  in  April  1999 and  through  the
Company's credit facilities described elsewhere in "Management's  Discussion and
Analysis" and through the exercise of public warrants in 1997, which resulted in
gross proceeds of approximately $3,002,000.

         The Company's  working capital at September 30, 1999 was $10,953,923 as
compared to $10,320,370 at December 31, 1998.

         The cash flows of the Company have  fluctuated due to the impact of net
income, capital spending,  working capital requirements,  the issuance of common
stock and other financing activities. The Company expects that cash flows in the
near future will be primarily  determined  by the levels of net income,  working
capital  requirements,  and financings,  if any, undertaken by the Company.  Net
cash  (decreased)  increased by $(601,344) and $112,100 in the nine months ended
September 30, 1999 and 1998, respectively.

         Net cash provided by (used in) operating  activities was $5,464,203 and
$(10,776,445)   in  the  nine  months  ended   September   30,  1999  and  1998,
respectively.  Net income was  $764,365  and  $2,349,198  for the same  periods,
respectively.

         Net cash used in investing activities was $18,391,036 and $5,084,533 in
the nine months ended September 30, 1999 and 1998,  respectively.  Net cash used
in investing  activities  included  intangible assets acquired pertaining to the
Karlen and Comfees acquisitions of $17,408,486 and $1,703,809 respectfully, plus
capital expenditures of $323,004 and $1,916,173 in these periods,  respectively,
primarily for computer and manufacturing equipment.

         Net  cash  provided  by  financing   activities  was   $12,325,489  and
$15,973,078 in the nine months ended September 30, 1999 and 1998,  respectively.
During the nine months ended  September 30, 1999 and 1998 proceeds from the bank
and other loans were $10,521,989 and $15,848,077, respectively.

         The Company  pays its  employees  and  vendors on a weekly,  monthly or
bimonthly  basis,  while its customers pay for products on an average of 75 days
after  shipment,  and  therefore the Company has  substantial  needs for working
capital.  As of September 30, 1999,  the Company had $236,274 of cash  available
for its cash needs, compared to cash of $837,618 as of September 30, 1998.

         On May 6, 1996,  PTI opened a  revolving  line of credit at Key Bank of
New  York.  The  line of  credit  which  was  repaid  on  April  14,  1999,  was
collateralized  by the Company's  inventory,  receivables and other assets,  and
guaranteed by the Company.

         On April 14, 1999, the Company negotiated new financing agreements with
PNC  Business  Credit.  Under  the  terms of the new  financing  agreement,  PNC
Business  Credit has issued  separate  financing  agreements for PTI and Flents.
Each  company  now  has a  line  of  credit  collateralized  by  such  company's
inventory,  receivables and other assets,  and guaranteed by the Company as well
as a  separate  term  loan.  PTI  has  available  on its  line of  credit  up to
$22,000,000,  and has a term loan of $3,000,000;  Flents has the availability on
its line of credit up to  $6,000,000  and a term loan of  $4,000,000.  Each term
loan is for three  years and bears  interest  of the bank's base rate plus .75%.
The lines of credit for each bear interest at the bank's base rate plus .25%. At
the  closing  of these  financing  agreements,  the  balance  owed to Key  Bank,
pursuant  to the line of credit with Key Bank,  was fully  repaid and the Karlen
asset acquisition was completed.

       Flents also  entered  into,  with a  subordinated  lender,  a  Securities
Purchase  Agreement  by which the  lender  advanced  $8,000,000  to  Flents  and
acquired (1) detachable warrants (the "Flents warrants") exercisable to purchase
22 shares of common  stock of  Flents,  par value $.01 per  share,  which  would
constitute  upon  exercise  22% of the issued and  outstanding  common  stock of
Flents on a fully diluted basis,  and (2) an $8,000,000  promissory note with an
interest rate of 12%. The Flents warrants are exercisable for a nominal purchase
price until April 14, 2009. The promissory note is payable interest only for six
years and is due in full at maturity in six years.

         Pursuant on a fully  diluted  basis to an  Investment  Agreement by and
among the Company and two of the Company's officers/directors,  Flents issued an
aggregate of 18% of its common stock of Flents, for consideration of $1,800,000.

         Based on the Company's  business,  management  anticipates that current
cash  balances,  together  with the  Company's  line of  credit  and  cash  flow
generated  from  operations,  would be  sufficient  to continue to fund existing
production,  equipment  requirements,  marketing  activities  and  research  and
development,  as well as the remainder of the Company's cash  requirements,  for
approximately the next 18 months.

         The  Company's  research and  development  efforts are directed  toward
developing  new  products,   improving   existing   products  and  refining  its
manufacturing  processes.  Such  research  and  development  costs  amounted  to
approximately  $88,000  for  the  nine  months  ended  September  30,  1999  and
approximately  $130,000 for the nine months  ended  September  30,  1998.  It is
expected  that the Company  will spend  approximately  $200,000 on research  and
development during the 1999 year.

Introduction of the Euro
------------------------

         On January 1,  1999,  eleven of the  fifteen  member  countries  of the
European  Union  established  fixed  conversion  rates  between  their  existing
sovereign  currencies  and a new  currency  called the "Euro".  These  countries
agreed to adopt the Euro as their common legal  currency on that date.  The Euro
trades on currency exchanges and is available for non-cash  transactions.  Until
January 2, 2002, the existing  sovereign  currencies will remain legal tender in
these  countries.  On January  1, 2002,  the Euro is  scheduled  to replace  the
sovereign  legal  currencies of these  countries.  The Company will evaluate the
impact the  implementation  that the Euro will have on its business  operations,
and no assurance can be given that the  implementation of the Euro will not have
a material affect on the Company's  business,  financial position and results of
operational,  and cash flows. In addition, the Company cannot accurately predict
the  impact  the Euro  will have on  currency  exchange  rates or the  Company's
currency exchange risk.


Year 2000 Compliance
--------------------

         During 1998,  the Company  finalized  its  installation  of the SAP R/3
accounting system, which is year 2000 compliant. The company does not anticipate
any material additional costs with regard to its year 2000 compliance.

         The year 2000  issue is  expected  to affect  the  systems  of  various
entities  with which the Company  interacts,  including  suppliers  and vendors.
There can be no  assurance  that the  systems  of other  companies  on which the
Company's  systems rely will be timely  converted,  or that a failure by another
company's  systems to be year 2000 compliant  would not have a material  adverse
effect on the Company.


Recently Issued Accounting Standards
------------------------------------

         In June 1998, the FASB issued SFAS No. 133  "Accounting  for Derivative
Instruments and Hedging  Activities," which is effective for all fiscal quarters
of fiscal years  beginning  after June 15, 1999. The statement  requires that an
entity  recognize  all  derivatives  as  either  assets  or  liabilities  on the
statement of financial position and measure those instruments at fair value.


ITEM 3.  Quantitative and Qualitative Disclosures About Market Risk.

Market Risks and Sensitivity Analysis
-------------------------------------

The Company is exposed to various  market risks,  including  changes in interest
rates. This analysis presents the hypothetical loss in earnings,  cash flows and
fair  values  of the  financial  instruments  which are held by the  Company  at
September 30, 1999, and are sensitive to the above market risks. As of September
30, 1999,  the  financial  instruments  subject to this risk were the bank loans
payable  outstanding  at September  30, 1999 with  interest at market rate.  See
discussion of refinancing in the notes to the consolidated financial statements.



                            PART II OTHER INFORMATION


ITEM 1.  Legal Proceedings.

         In the first quarter of 1999,  certain  product  liability  claims were
asserted  against  the  Company.  While the  outcome  of such  claims can not be
determined,  it appears the Company's product liability insurance is adequate to
cover any losses that may arise from such claims.


ITEM 4.  Submission of Matters to a Vote of Security-Holders.

         No matter was  submitted  during the first six months of the  Company's
1999 fiscal year to a vote of security-holders.


ITEM 6.  Exhibits and Reports on Form 8-K.

         (a)      Exhibits

3.1  Registrant's  Articles  of  Incorporation,   as  amended,  incorporated  by
     reference to the like  numbered  exhibit in the  Registrant's  Registration
     Statement on Form SB-2 under the Securities  Act of 1933, as amended,  File
     No. 33-53466

3.2  Registrant's  by-laws,  incorporated  by  reference  to the  like  numbered
     exhibit in the Registrant's  Registration  Statement on Form SB-2 under the
     Securities Act of 1933, as amended, File No. 33-53466

10.2 Form of Stock Option  granted to  employees,  independent  contractors  and
     consultants,  incorporated  by  reference  to exhibit  number  10.14 in the
     Registrant's Registration Statement on Form SB-2 under the Securities
                                    Act of 1933, as amended, File No. 33-53466

10.3 Agreement  and Plan of Merger  dated  February  14,  1994 among  Protective
     Technologies  International  Inc.,  Foam-O-Rama,  Inc., Ellen Schaeffer and
     Lori Hillsberg,  as amended,  incorporated by reference to exhibit number 2
     in the  Registrant's  Current Report on Form 8-K dated March 16, 1994 under
     the Securities Exchange Act of 1934, as amended

10.4 Non-competition   Agreement   dated  March  1,  1994   between   Protective
     Technologies  International  Inc. and Ellen  Schaeffer and Lori  Hillsberg,
     incorporated  by  reference  to  exhibit  number  99.1 in the  Registrant's
     Current  Report  on Form 8-K  dated  March 16,  1994  under the  Securities
     Exchange Act of 1934, as amended

10.5 Non-competition   Agreement   dated  March  1,  1994   between   Protective
     Technologies  International  Inc. and Warren  Schaeffer and Alan Hillsberg,
     incorporated  by  reference  to  exhibit  number  99.2 in the  Registrant's
     Current  Report  on Form 8-K  dated  March 16,  1994  under the  Securities
     Exchange Act of 1934, as amended

10.6 Form of Promissory Note memorializing  loans from directors and officers as
     authorized  by the Board of Directors on March 13,  1996,  incorporated  by
     reference to exhibit number 10.21 in the Registrant's Annual Report on Form
     10-KSB  for the  period  ended  December  31,  1995,  under the  Securities
     Exchange Act of 1934, as amended

10.7 Guarantee   from  Warren   Schaeffer  and  Alan   Hillsberg  to  Protective
     Technologies  International  Inc.,  incorporated  by  reference  to exhibit
     number 10.21 in the  Registrant's  Quarterly  Report on Form 10-QSB for the
     period ended September 30, 1995, under the Securities Exchange Act of 1934,
     as amended

10.10Line of Credit  Agreement  (Asset  Based),  dated May 6, 1996,  between Key
     Bank of New York, Protective  Technologies  International Inc., PTI Holding
     Inc. and  Protective  Technologies  of America Inc.,  and  collateral  loan
     documents thereto, incorporated by reference to exhibit number 10.25 in the
     Registrant's  Quarterly  Report on Form 10-QSB dated March 31, 1996,  under
     the Securities Exchange Act of 1934, as amended

10.13Merger Agreement and plan of  Reorganization  dated July 25, 1997 among PTI
     Holding Inc. and Flents  Products Co.,  Inc., as amended,  incorporated  by
     reference to exhibit numbers 1 and 2 in the Registrant's  Current Report on
     Form 8-K date August 20, 1997 under the Securities Exchange Act of 1934, as
     amended.
`
10.14Asset  Purchase  Agreement  dated  January  8,  1999,  by and among  Flents
     Products Co., Inc.,  Karlen  Manufacturing,  Inc., and the  shareholders of
     Karlen Manufacturing,  Inc.,  incorporated by reference to exhibit number 1
     in the  Registrant's  Current Report in Form 8-K dated April 14, 1999 under
     the Securities Exchange Act of 1934, as amended.

10.15Purchase Money Promissory Note made payable to Karlen  Manufacturing,  Inc.
     dated April 14, 1999,  incorporated by reference to exhibit number 2 in the
     Registrant's  Current  Report in Form 8-K dated  April 14,  1999  under the
     Securities Exchange Act of 1934, as amended.

10.16Revolving  Credit,  Term Loan and Security  Agreement  dated April 14, 1999
     between  Flents  Products Co., Inc.,  and PNC Bank,  National  Association,
     incorporated by reference to exhibit number 3 in the  Registrant's  Current
     Report in Form 8-K dated April 14, 1999 under the  Securities  Exchange Act
     of 1934, as amended.

10.17Revolving Credit,  Term Loan and Security Agreement dated April 14, 1999 by
     and among Protective Technologies International Inc., Zacko Sports Inc. and
     PNC Bank, National Association, incorporated by reference to exhibit number
     4 in the Registrant's Current Report in Form 8-K dated April 14, 1999 under
     the Securities Exchange Act of 1934, as amended.

10.18Securities  Purchase Agreement dated April 14, 1999 between Flents Products
     Co., Inc. and The 1818  Mezzanine  Fund, LP,  incorporated  by reference to
     exhibit number 5 in the Registrant's Current Report in Form 8-K dated April
     14, 1999 under the Securities Exchange Act of 1934, as amended.

10.19Investment   Agreement   dated  April  14,  1999  by  and  among   Meredith
     Birrittella,  Warren Schaeffer,  and Flents Products Co., Inc, incorporated
     by reference to exhibit number 6 in the Registrant's Current Report in Form
     8-K dated  April 14, 1999 under the  Securities  Exchange  Act of 1934,  as
     amended.

10.20Management  Agreement  dated April 14, 1999 between  Flents  Products  Co.,
     Inc.  and  Protective  Technologies  International  Inc.,  incorporated  by
     reference to exhibit  number 7 in the  Registrant's  Current Report in Form
     8-K dated  April 14, 1999 under the  Securities  Exchange  Act of 1934,  as
     amended.

10.21Shareholder's  Agreement  dated April 14, 1999 by and among Flents Products
     Co.,  Inc.,  PTI Holding Inc.,  The 1818  Mezzanine  Fund,  L.P.,  Meredith
     Birrittella,  and Warren  Scheaffer,  incorporated  by reference to exhibit
     number 8 in the  Registrant's  Current  Report in Form 8-K dated  April 14,
     1999 under the Securities Exchange Act of 1934, as amended.

10.22Fairness  Opinion  rendered by Management  Planning,  Inc.  dated April 13,
     1999,  incorporated  by reference to exhibit  number 9 in the  Registrant's
     Current  Report  in Form 8-K  dated  April 14,  1999  under the  Securities
     Exchange Act of 1934, as amended.

10.23Consent of Management Planning,  Inc., incorporated by reference to exhibit
     number 10 in the  Registrant's  Current  Report in Form 8-K dated April 14,
     1999 under the Securities Exchange Act of 1934, as amended


(b)  Reports on Form 8-K


On April 29, 1999, the Company filed Form 8-K,  reporting the asset  acquisition
of Karlen  Manufacturing  Inc.,  and other matters  related to this  acquisition
including new  financing  arrangements  and minority  interests in the Company's
Flents Products Co.,  Inc.subsidiary.  An amendment to the 8-K was filed for the
Karlen Acquisition on June 28, 1999.





<PAGE>




                                   SIGNATURES

         In  accordance  with  Section  13 or 15(d)  of the  Exchange  Act,  the
registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.


PTI HOLDING INC.



By
    Meredith W. Birrittella,
    Chairman of the Board
    Chief Executive Officer (authorized signatory)



         In accordance with the requirements of the Securities Act of 1933, this
report has been signed by the  following  persons in the  capacities  and on the
dates stated.



________________________     Chief Executive Officer,        November 15, 1999
Meredith W. Birrittella      Chairman and Director

________________________     Chief Financial Officer         November 15, 1999
Anthony Costanzo             Chief Accounting Officer






<PAGE>




                                   SIGNATURES

         In  accordance  with  Section  13 or 15(d)  of the  Exchange  Act,  the
registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.


PTI HOLDING INC.



By/s/ Meredith W. Birrittella
    Meredith W. Birrittella,
    Chairman of the Board
    Chief Executive Officer (authorized signatory)




         In accordance with the requirements of the Securities Act of 1933, this
report has been signed by the  following  persons in the  capacities  and on the
dates stated.


/s/ Meredith W. Birrittella       Chief Executive Officer,     November 15, 1999
-----------------------------
Meredith W. Birrittella           Chairman and Director

/s/ Anthony Costanzo              Chief Financial Officer      November 15, 1999
-----------------------------
Anthony Costanzo                  Chief Accounting Officer







<PAGE>
<TABLE>

                   PTI HOLDING INC. AND SUBSIDIARIES

                      CONSOLIDATED BALANCE SHEET



<S>                                                                                           <C>                      <C>
                                                                                     September 30,1999          December 31, 1998
                                                                                     --------------------      ---------------------
ASSETS                                                                                  (unaudited)                 (audited)

Current assets:
    Cash and cash equivalents                                                                   $ 236,274                 $ 837,618
    Accounts receivable, net of allowance for returns and doubtful collections                 11,142,052                11,169,056
    Inventories                                                                                15,263,432                15,811,781
    Deferred tax asset                                                                            468,000                   266,000
    Prepaid expenses and other current assets                                                   2,194,126                 1,670,826
                                                                                   ----------------------     ----------------------
    Total current assets                                                                       29,303,884                29,755,281

Deferred tax asset                                                                                186,175                   218,400
Equipment and improvements, net                                                                 3,173,539                 3,066,426
Intangible assets, net                                                                         20,025,763                 5,346,858
Other Assets                                                                                      705,475                     -

                                                                                   -----------------------    ----------------------
                                                                                             $ 53,394,836              $ 38,386,965
                                                                                   =======================    ======================

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
    Loan payable, bank                                                                       $ 11,538,882              $ 15,217,550
    Current portion of long term debt                                                           1,800,000                     -
    Accounts payable and accrued expenses                                                       4,654,317                 4,217,361
    Income tax liability                                                                          356,762                     -
                                                                                   -----------------------    ----------------------
    Total current liabilities                                                                  18,349,961                19,434,911
                                                                                   -----------------------    ----------------------
    Long term debt, net of current portion                                                      5,299,994                     -
                                                                                   -----------------------    ----------------------
    Subordinated debt payable, net                                                              5,900,663                     -
                                                                                   -----------------------    ----------------------
Commitments and contingencies

    Minority interests in subsidiary                                                            4,124,297                     -
                                                                                   -----------------------    ----------------------
Stockholders' equity:
    Common stock, $.01 par value; authorized 10,000,000 shares, issued
         and outstanding 4,956,352 shares                                                          49,564                    49,564
    Common Stock receivable                                                                       (54,822)                  (58,322)
    Capital in excess of par                                                                   16,283,217                16,283,217
    Retained earnings                                                                           3,441,962                 2,677,595
                                                                                   -----------------------    ----------------------

    Total stockholders' equity                                                                 19,719,921                18,952,054

                                                                                   -----------------------    ----------------------
                                                                                             $ 53,394,836              $ 38,386,965
                                                                                   =======================    ======================

</TABLE>

<PAGE>




                        PTI HOLDING INC. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF INCOME

              THREE & NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
                                   (Unaudited)

<TABLE>

<S>                                                 <C>                    <C>                 <C>                 <C>

                                                 For the Three Months ended Sept. 30,       For the Nine Months ended Sept. 30,
                                                 -------------------------------------    --------------------------------------
                                                      1999                1998                 1999                  1998
                                                 -------------        -------------       ------------          -----------

Net sales                                         $ 14,517,252         $ 12,917,533       $ 52,407,307         $ 44,060,744

Cost of sales                                        9,900,316            9,535,984         37,607,359           30,901,396
                                                 -------------        -------------       -------------       -------------

Gross profit                                         4,616,936            3,381,549         14,799,948           13,159,348
                                                 -------------        -------------       -------------       -------------

Operating expenses :
  Licensing fees                                       166,560              143,752          1,290,939              569,295
  Depreciation and amortization                        447,655              461,815          1,143,899              940,123
  Other selling, general and administrative expenses 3,256,875            2,179,073          9,169,394            6,892,825
                                                  -------------       -------------       -------------       -------------

Total operating expenses                             3,871,090            2,784,640         11,604,232            8,402,243
                                                  -------------       -------------       -------------       -------------

Income from operations                                 745,846              596,909          3,195,716            4,757,105

Interest expense, net                                  694,444              423,309          1,663,540              698,349
                                                  -------------       -------------       -------------       -------------

Income before income taxes and minority interests       51,402              173,600          1,532,176            4,058,756

Income taxes                                            21,589               72,911            643,514            1,709,558
                                                  -------------       -------------       -------------       -------------

Income before minority interests                        29,813              100,689            888,662            2,349,198

Minority interests in subsidiary                           (73)                   -           (124,297)                   -
                                                  -------------       -------------       -------------       -------------

Net income                                            $ 29,740            $ 100,689          $ 764,365          $ 2,349,198
                                                 ==============       ==============      =============      ==============



Net income per share of common stock :
   Basic                                                $ 0.01               $ 0.02             $ 0.15               $ 0.49
   Diluted                                                0.01                 0.02               0.15                 0.46

Weighted  average shares outstanding :
   Basic                                             4,956,352            4,862,499          4,956,352            4,818,745
   Diluted                                           5,001,699            5,118,380          5,010,298            5,140,356


</TABLE>
<PAGE>
                   PTI HOLDING INC. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF CASH FLOWS

             NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998

<TABLE>

<S>                                                                                       <C>                      <C>
                                                                                          1999                   1998
                                                                                     -----------              ----------

Cash flows from operating activities:
      Net income                                                                       $ 764,365             $ 2,349,198
      Adjustments to reconcile net income to net cash used in operating
        activities:
      Minority interests in income of subsidiary                                         124,297                       -
      Provision for returns and doubtful accounts                                        525,000                 349,074
      Depreciation                                                                     1,286,015               1,015,053
      Amortization of intangible assets                                                  392,669                 173,974
      Deferred income tax (benefit)                                                     (169,775)               (194,507)
      (Increase) decrease in operating assets exclusive of the effects of the
         business combination:
          Accounts receivable                                                            849,150              (7,127,097)
          Inventories                                                                  2,415,381             (13,015,690)
          Prepaid expenses and other current assets                                     (570,912)             (1,208,601)
          Other assets                                                                  (705,475)                      -
      Increase in operating liabilities exclusive of the effects of the
         business combination:
         Accounts payable and accrued expenses                                           196,727               6,128,263
         Other current liabilities                                                       356,761                 753,888
                                                                                     -----------              -----------

      Net cash provided by (used in) operating activities                              5,464,203             (10,776,445)
                                                                                     -----------              -----------

Cash flows from investing activities:
      Cash payment as partial consideration for purchase of acquired assets
         and acqusition costs                                                        (17,408,486)             (1,703,809)
      Loans to stockholders, net of repayments                                            87,574                (923,048)
      Purchase of equipment and improvements                                          (1,070,124)             (2,457,676)
                                                                                     -----------              -----------

      Net cash (used in) investing activities                                        (18,391,036)             (5,084,533)
                                                                                     -----------              -----------

Cash flows from financing activities:
      Repayment of common stock receivable                                                 3,500                       -
      Proceeds from issuance of common stock                                                   -                 125,001
      Minority investment in Subsidiary                                                1,800,000                       -
      Borrowings, net                                                                 10,521,989              15,848,077
                                                                                     -----------              -----------

      Net cash provided by  financing activities                                      12,325,489              15,973,078
                                                                                     -----------              -----------

Net (decrease) increase in cash and cash equivalents                                    (601,344)                112,100

Cash and cash equivalents, beginning of period                                           837,618                 682,160
                                                                                     -----------              -----------

Cash and cash equivalents, end of period                                               $ 236,274               $ 794,260
                                                                                     ===========              ===========

Supplemental disclosure:
      Interest paid                                                                  $ 1,648,136               $ 742,860
      Income taxes paid                                                                  697,025               1,784,500
      Noncash investing and financing activities (see note 4.):
         Fair value of net assets acquired                                             3,336,912                       -
         Promissory note used as partial consideration in the business combination     1,000,000                       -
         Excess of purchase price over net assets acquired                            14,413,088                       -
         Accrued Liabilities                                                             240,231                       -


</TABLE>
<PAGE>




                        PTI HOLDING INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




1.      Basis of presentation:

        The consolidated financial statements included herein have been prepared
        by the Company,  without an audit, pursuant to the rules and regulations
        of the  Securities  and Exchange  Commission.  Certain  information  and
        disclosures  normally  included  in  financial  statements  prepared  in
        accordance  with  generally  accepted  accounting  principles  have been
        condensed  or  omitted  pursuant  to such rules and  regulations.  These
        unaudited   consolidated   financial   statements   should  be  read  in
        conjunction with the consolidated financial statements and notes thereto
        included  in the  Company's  Annual  Report on Form  10-KSB for the year
        ended  December  31,  1998 and filed with the  Securities  and  Exchange
        Commission.

        In the opinion of the Company's management, these unaudited consolidated
        financial  statements  include  all  adjustments,  consisting  solely of
        normal recurring  adjustments,  necessary in order to present fairly the
        Company's  consolidated  financial position as of September 30, 1999 and
        the  results  of its  operations  for the  three and nine  months  ended
        September  30,  1999  and its  cash  flows  for the  nine  months  ended
        September 30, 1999.  The results of operations for an interim period are
        not  necessarily  indicative  of the results to be attained in any other
        fiscal period.

      Reclassification:

      For  comparability,  certain  1998 amounts  have been  reclassified  where
      appropriate  to conform to the financial  statement  presentation  used in
      1999.

2.      Contingent liabilities:

        Certain claims,  suits and complaints  arising in the ordinary course of
        business  have been filed or are  pending  against the  Company.  In the
        opinion of  management,  all such  matters are without  merit or of such
        kind,  or involve such amounts,  as would not have a material  effect on
        the  financial  position  and  results of  operations  of the Company if
        concluded unfavorably.

        In 1998,  certain  product  liability  claims were asserted  against the
        Company.  While the  outcome of such  claims  cannot be  determined,  it
        appears the Company's product  liability  insurance is adequate to cover
        any losses that may arise from such claims.


3.      Segment Information:

        In June 1997, the FASB issued SFAS No. 131,  "Disclosures about segments
        of an Enterprise and Related  Information",  which establishes standards
        for  the  way  public  business  enterprises  report  information  about
        operating segments in interim and annual financial  statements.  It also
        establishes   standards  for  related  disclosures  about  products  and
        services, geographic areas and major customers. The Company adopted SFAS
        No. 131 for the year ended December 31, 1998.

        The  information  for 1998  has been  restated  from  the  prior  year's
        presentation in order to conform to the 1999 presentation.

        The  Company has two  reportable  segments:  PTI Sports and Flents.  PTI
        Sports and Flents have  separate  management  teams and  infrastructures
        that offer different products.

        The PTI Sports segment  designs,  manufactures  and distributes  bicycle
        helmets, bicycles and bicycle accessories for sale, principally to major
        retailers in the United States and Canada.

        The Flents segment  designs,  manufactures and markets health and beauty
        products.  Customers  include major department  stores,  drug chains and
        supermarket retailers in the United States.

        The accounting  policies of the segments are the same as those described
        in the  summary of the  significant  accounting  policies.  The  Company
        evaluates  performance  based on  operating  earnings of the  respective
        segments. Inter-segment sales are not significant. Inter-segment charges
        for  production,  SG&A,  and interest costs are determined on a pro rata
        basis.

        Two major retail chains accounted for  approximately  44% and 27% of net
        sales in 1999 and 46% and 27% of net sales in 1998.  As of September 30,
        1999,  accounts  receivable   included   approximately   $2,597,000  and
        $4,609,000  respectively,  due from these two customers.  The PTI Sports
        segment reports the sales of the larger of the two major customers,  and
        both segments  report the sales of the second major  customer.  Although
        other major retailers are customers,  a loss of one or both of these two
        established  major customers would cause a significant loss of sales and
        affect operating results adversely.


        The following  table presents  segment  information  for the nine months
ended September 30, 1999 and 1998.

<TABLE>

                    <S>                                     <C>                   <C>                 <C>                 <C>

                   1999                                  PTI Sports              Flents             Other                Total
               -----------                             -------------         ------------      ------------          -------------

              Net sales                            $        40,227,000   $       12,180,000  $       -          $        52,407,000
              Gross profit                                   9,345,000            5,455,000          -                   14,800,000
              Operating earnings                             1,625,000            1,628,000          (57,000)             3,196,000
              Depreciation and amortization                  1,046,000              633,000          -                    1,679,000
              Interest revenue                                  72,000                9,000            2,000                 83,000
              Interest expense                                 732,000            1,015,000          -                    1,747,000
              Income tax expense (benefit)                     406,000              261,000          (23,000)               644,000
              Total assets                                  25,508,000           29,897,000       (2,010,000)            53,395,000
              Capital expenditures                             764,652              305,472          -                    1,070,124


                   1998                                  PTI Sports              Flents             Other                Total
               -------------                            -------------         -------------     ------------        ---------------

              Net sales                            $        37,406,000   $        6,655,000  $       -          $        44,061,000
              Gross profit                                  10,024,000            3,135,000          -                   13,159,000
              Operating earnings                             3,500,000            1,331,000          (74,000)             4,757,000
              Depreciation and amortization                    940,000              249,000          -                    1,189,000
              Interest revenue                                  22,000                5,000            4,000                 31,000
              Interest expense                                 521,000              208,000          -                      729,000
              Income tax expense (benefit)                   1,177,000              562,000          (29,000)             1,710,000
              Total assets                                  36,955,000            7,876,000        1,500,000             46,331,000
              Capital expenditures                           2,398,968               58,708          -                    2,457,676



</TABLE>



     Financial  information  relating to the Company's  operations by geographic
area is presented below.
<TABLE>
                <S>                                                                     <C>                            <C>
                                                                                       Nine Months ended September 30,
             Net sales                                                                1999                            1998
                                                                                  -------------                   -------------

             United States                                              $         50,729,000            $           41,857,000
             Canada                                                                1,628,000                         2,164,000
             Other                                                                    50,000                            40,000
                                                                                 -------------                    -------------

                                                                         $        52,407,000            $           44,061,000
                                                                                 =============                    =============

</TABLE>


        Significantly all of the Company's  long-lived assets are located in the
United States.


4.       Business Combination:

       On April 14, 1999, Flents Products Co., Inc.,  ("Flents"),  prior to that
       date a wholly  owned  subsidiary  of the  Company,  consummated  an asset
       acquisition   (the   "Acquisition")   of  Karlen   Manufacturing,   Inc.,
       ("Karlen").  The  Company  acquired  substantially  all of the  operating
       assets of Karlen,  other than one  product  line and cash.  The  purchase
       price was  $17,750,000  subject to  adjustment.  The assets were acquired
       subject to substantially  all existing  operating  liabilities of Karlen,
       other  than  liabilities  related  to  the  excluded  product  line.  The
       Acquisition was consummated pursuant to an Asset Purchase Agreement dated
       January 8, 1999,  as amended by  amendment  dated April 14,  1999,  among
       Flents, Karlen and the shareholders of Karlen.

       The  purchase  price  consisted  of a  $16,750,000  cash  payment  and  a
       $1,000,000  promissory  note  bearing  interest  at 12%  per  annum.  The
       operating  assets  which were not  acquired  in the  Acquisition  include
       Karlen's Blue Devil product line, which constituted approximately 1% - 2%
       of Karlen's net sales in 1998.

       Karlen had revenues in the amount of  approximately  $12,345,000 in 1998.
       The  assets  acquired  include   approximately   $1,585,000  in  accounts
       receivables,  $1,800,000  in  inventory  and  $372,000  in  property  and
       equipment. Flents assumed current liabilities of approximately $373,000.

       All agreements  entered into and described  below are dated April 14,1999
       unless noted otherwise

       In connection  with the  Acquisition,  Flents  entered into an Employment
       Agreement  with the chief  operating  officer of Karlen,  to serve as the
       President of Flents. The Employment Agreement has a term of five years.

       Flents also  entered into a Lease  Agreement.  The lease is for a term of
       three years and is at specified  rental  payments,  which Flents believes
       are fair market rates. The lessor is a shareholder of Karlen.

       In addition,  Flents has entered into a  Requirements  Agreement by which
       Flents  has  agreed  to  buy  all  of  its   requirements   of  non-latex
       polyurethane  cosmetic grade foam, subject to the terms of the Agreement,
       from an entity related to a Karlen shareholder. This raw material is used
       in the  manufacture  of foam  wedges  which are used in various  cosmetic
       products.  The term of this  agreement  is for three years with  purchase
       prices  under  the  Requirements  Agreement  approximately  equal  to the
       historic  purchase  prices  charged  to  Karlen  for  this  critical  raw
       material.

       To  finance  the  Acquisition,  at the  Closing,  Flents  entered  into a
       $10,000,000  financing facility pursuant to a Revolving Credit, Term Loan
       and Security  Agreement with a bank. The facility includes a Term loan of
       $4,000,000,  fully funded at closing,  and a line of credit of $6,000,000
       of which at closing approximately  $2,900,000 was drawn and approximately
       $1,000,000 was available under the facility's  various  borrowing limits.
       Flents pledged all of its assets as security for this financing. The term
       loan is for three  years and bears  interest at the bank's base rate plus
       .75%.  The line of credit  bears  interest  at the bank's  base rate plus
       .25%.

       Flents also  entered  into,  with a  subordinated  lender,  a  Securities
       Purchase Agreement by which the lender advanced  $8,000,000 to Flents and
       acquired (1) detachable  warrants (the "Flents warrants")  exercisable to
       purchase 22 shares of common  stock of Flents,  par value $.01 per share,
       which would  constitute  upon exercise 22% of the issued and  outstanding
       common  stock  of  Flents  on a  diluted  basis,  and  (2) an  $8,000,000
       promissory  note with an interest  rate of 12%. At September 30, 1999 the
       $8,000,000  promissory note had a stated value of $5,900,663 after giving
       consideration that the note has an effective interest rate of 19.88%. The
       Flents warrants are exercisable for a nominal  purchase price until April
       14, 2009. The promissory note is payable  interest only for six years and
       is due in full at maturity in six years.

       Pursuant to an  Investment  Agreement by and among the Company and two of
       the  Company's  officers/directors,  Flents issued an aggregate of 18% of
       its common stock of Flents, for consideration of $1,800,000.

       Upon the  exercise of the  warrants,  the Company will own 60% of Flents.
       Because  Flents is no longer a wholly  owned  subsidiary  of the Company,
       Flents  also  entered  into  a  Management   Agreement  with   Protective
       Technologies   International   Inc.,  ("PTI  Sports"),   a  wholly  owned
       subsidiary of the Company.  Under the  Management  Agreement,  PTI Sports
       will  provide  various  services to Flents,  including  senior  executive
       services of the Chief Executive Officer and the Chief Financial  Officer,
       information  and  data  processing  functions  and  services,  management
       systems and services,  and senior human resource management functions and
       services, such as payroll, benefits, pension and related functions.

       Flents also entered into a  Shareholders'  Agreement by and among Flents,
       the  Company,  the  Subordinated  lender  and the two  officers/directors
       owning  18%  of  Flents.  The  Shareholders'   Agreement  places  various
       restrictions on the shareholders,  including restrictions on the transfer
       of shares of Flents common stock.

       Also at Closing,  PTI Sports and Zacko  Sports Inc.,  ("Zacko"),  both of
       which are  wholly  owned  subsidiaries  of the  Company,  entered  into a
       $25,000,000  financing facility pursuant to a Revolving Credit, Term Loan
       and Security  Agreement by and among PTI Sports,  Zacko and the Bank. The
       facility includes a term loan of $3,000,000, fully funded at closing, and
       a line of  credit  of  $22,000,000  of  which  at  closing  approximately
       $11,100,000  was drawn and  approximately  $4,400,000 was available under
       the facility's various borrowing limits. PTI Sports and Zacko pledged all
       of their assets as security for this financing.

       The  proceeds  of the  loans  from the Bank  were  also used to repay all
       existing bank financing of Flents, PTI Sports and Zacko, outstanding.

       The aggregate maturities of long-term debt are as follows:

       Twelve months ending September 30,
       ---------------------------------

       2000                             $       1,800,000
       2001                                     1,800,000
       2002                                     3,949,997
       2003                                          -
       2004                                          -
       Thereafter                               5,450,660
                                        -----------------
                                        $      13,000,657
                                        =================


Supplemental pro forma information as though the enterprises had combined at the
beginning of the periods is presented below:

<TABLE>

<S>                                                    <C>                 <C>                 <C>                 <C>
                                                       For the Three Months ended                For the Nine Months ended
                                                             Sept. 30,                                   Sept. 30,
                                                 -------------------------------------    --------------------------------------
                                                      1999                1998                 1999                  1998
                                                 -------------        -------------       ------------          -----------

Revenues                                         $ 14,517,000         $ 16,003,000       $ 52,821,000         $ 53,265,000

Income before income taxes                             52,000              595,000          1,711,000            4,925,000

Gross profit                                           30,000              250,000            954,000            2,698,000

Net income per share of common stock
  Basic                                          $       0.01         $       0.05       $       0.19         $       0.55
  Diluted                                                0.01                 0.05               0.19                 0.53

</TABLE>