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 March 31, 2000

                                       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 mark  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 May  16,  2000,
4,956,352 shares of the issuer's common equity were outstanding.

         This is the  registrant's  initial  form 10-Q  report,  form 10-QSB was
filed in all applicable preceding quarters.



                          PART I FINANCIAL INFORMATION



ITEM 1.
Financial Statements.
                                                                          Page

Consolidated Balance Sheets as of March 31, 2000 and December 31, 1999      11

Consolidated Statements of Operations for the quarters
ended March 31, 2000, 1999 and 1998                                         12

Consolidated Statements of Cash Flows for the quarters
ended March 31, 2000, 1999 and 1998                                         13

Notes to Consolidated Financial Statements                             14 - 17



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")  was  incorporated  under  the laws of
Delaware in March 1990.

         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 accounting,
the acquisition has been accounted for as a purchase.

         On August 5, 1997, the Company consummated the merger (the "Merger") of
Flents Products Co., Inc., a New York corporation ("FPC"), 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 FPC.  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 acquisition  ("Karlen") of
Karlen  Manufacturing,  Inc. The Company acquired  substantially  all of the net
operating  assets of  Karlen.  The  purchase  price was  $17,750,000,  excluding
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.

       The  purchase  price  consisted  of a  $16,750,000  cash  payment  and  a
$1,000,000 promissory note bearing interest at 12% per annum.

     Karlen  Manufacturing  Inc.  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 Karlen  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.  The
Agreement  provides for  compensation at an annual rate of $165,000 per year. On
the first anniversary of the Agreement and on each subsequent  anniversary,  the
annual rate of salary  shall be  increased  by 5% of the amount of the  previous
annual rate.  The  Agreement  also entitles the Employee to a bonus based on the
Subsidiary's  increase in earnings  before  interest,  taxes,  depreciation  and
amortization.  Additionally,  the  Agreement  grants the  Employee  an option to
purchase an aggregate of 2.0408  shares of common stock of the  Subsidiary.  The
exercise price shall be the value of the Subsidiary on April 14, 1999 multiplied
by 2.0408%.  The option  vests on the fifth  anniversary  of the  Agreement  and
expires nine months after vesting.

       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 Karlen 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 December 31, 1999 the $8,000,000  promissory note had a
stated  value of  $5,954,841  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  PTI.  Under  the  Management
Agreement,  PTI provides 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, 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.

                        Three  Months  ended  March 31,  2000 as compared to the
Three Months ended March 31, 1999

         The Company's net sales were $15,743,723  during the three months ended
March 31,  2000,  a decrease  of 2% from net sales of  $16,120,849  for the same
period in 1999.  Sales for PTI were $10,420,247 for the three months ended March
31, 2000 and  $13,846,232 for the same period in 1999. The decrease in sales for
PTI  was  attributed  to a  change  in the  purchasing  patterns  by  our  major
customers,  whereby  customer  orders and shipments  are  currently  spread more
evenly throughout the year. Sales which were  historically  shipped in the first
quarter,  now are set to ship in the  second  quarter.  Sales  for  Flents  were
$5,323,476 for the three months ended March 31, 2000 and $2,274,617 for the same
period in 1999. The increase in sales for Flents resulted predominantly from the
acquisition  by Flents of Karlen in 1999.  Karlen was acquired in April 1999 and
therefore not included in the first quarter ended March 31, 1999.

         The cost of  sales  for the  three  months  ended  March  31,  2000 was
$11,006,533  (resulting  in a gross  profit  margin  of  30%),  compared  to the
Company's cost of sales for the three months ended March 31, 1999 of $11,511,592
(resulting  in a  gross  profit  margin  of  29%).  PTI's  gross  profit  margin
contribution  approximated 23% for the three months ended March 31, 2000 and 29%
for the  three  months  ended  March  31,  1999.  Flents'  gross  profit  margin
contribution  approximated 44% for the three months ended March 31, 2000 and 45%
for the three months ended March 31, 1999. The  fluctuation in gross margins for
PTI and Flents was due  primarily  to changes in product mix sales.  PTI's gross
margins  for the three  months  ended  March 31,  2000  were  also  affected  by
increased credit  allowances to major customers,  which were not included in the
three months ended March 31, 1999

         Selling, general and administrative expenses for the three months ended
March 31, 2000 were $4,907,969  compared to selling,  general and administrative
expenses of $3,508,369  and for the three months ended March 31, 1999.  Selling,
general & administrative expenses, as a percentage of sales were 31% and 22% for
the quarters ended March 31, 2000 and 1999, respectively. The increased selling,
general and  administrative  spending in 2000 and 1999 was  primarily due to the
addition of the operating expenses of Karlen,  which was acquired in April 1999,
higher costs  associated  with the expansion of the  businesses,  licensing fees
associated  with the sales of licensed  products,  the  amortization of goodwill
associated with the acquisitions of Karlen and Comfees,  the depreciation of the
installation of new systems and the higher costs for human resources.

         Interest expense, net of interest income, for the Company for the three
months ended March 31, 2000 was  $704,202,  compared to net interest  expense of
$264,572 for the three months ended March 31, 1999. The increase in net interest
expense from 1999 to 2000 was due  primarily to increased  inventory  levels for
the  Company and to the  financing  costs  associated  with the  acquisition  of
Karlen.  Net interest expense for Flents was $494,223 for the three months ended
March 31, 2000 and $93,488 for the three months ended March 31, 1999.

         The Company had a net loss of  ($553,941)  for the three  months  ended
March 31, 2000  compared to the  Company's net income for the three months ended
March 31, 1999 of $485,063.  The reduction in earnings  resulted  primarily from
increased SG&A spending and the financing costs  associated with the acquisition
of  Karlen  and  from  increased  Goodwill   amortization   resulting  from  the
acquisitions.


Liquidity and Capital Resources

         The  Company's  working  capital at March 31,  2000 was  $9,025,413  as
compared to $9,733,611 at December 31, 1999.

         The cash flows of the Company have  fluctuated due to the impact of net
income and losses, 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 by ($297,663) and $616,362 in the three months ended
March 31, 2000 and 1999, respectively.

         Net cash provided by (used in) operating  activities  was  $(4,244,732)
and $1,955,203 in the three months ended March 31, 2000 and 1999,  respectively.
Net  income   (loss)  was   ($553,941)   and  $485,063  for  the  same  periods,
respectively.

         Net cash provided by (used in) investing  activities was ($523,637) and
$120,961 in the three  months ended March 31, 2000 and 1999,  respectively.  Net
cash used in investing  activities included payments for acquired businesses and
assets,  payments  primarily for  computers,  manufacturing  equipment and other
capital  expenditures  of $416,675 and $271,500 in these periods,  respectively.
The  increases  in capital  expenditures  were due  primarily  to the  increased
development of new production tooling and new computer equipment purchases.

     Net cash  provided by (used in) financing  activities  was  $4,470,706  and
($1,459,802)  in the three months  ended March 31, 2000 and 1999,  respectively.
During  the  three  months  ended  March  31,  2000  and  1999  net   borrowings
(repayments) were $4,920,709 and ($1,459,802), respectively. The increase in net
borrowings was due primarily to increased  inventory  levels in  anticipation of
the upcoming spring sales season.

         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 March 31, 2000,  the Company had $435,867 of cash  available for
its cash needs, compared to cash of $733,530 as of December 31, 1999.

         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 available 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.  At March 31,  2000,  the  balances  of the lines of credit were
$12,430,512  (PTI)  and  $3,057,215  (Flents),  and the term  loan  balance  was
$5,199,988.  The  availability  on  the  lines  of  credit,  based  on  accounts
receivable  and  inventory   balances  at  March  31,  2000  were  approximately
$16,000,000 and $4,000,000 for PTI and Flents, respectively.

       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%. 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.

         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  $233,000,  $54,000 and $47,000 for the  quarters  ended March 31,
2000,  1999 and 1998,  respectively.  It is expected that the Company will spend
approximately $400,000 on research and development during the 2000 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 operations,  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.



Recently Issued Accounting Standards

         In June 1999, the Financial  Accounting Standards Board ("FASB") issued
SFAS  No.137,  Accounting  for  Derivative  Instruments  and Hedging  Activities
Deferral of the Effective Date of FASB  Statement No. 133. The Statement  defers
for one  year  the  effective  date  of  SFAS  No.  133,  Accounting  Derivative
Instruments  and  Hedging  Activities,   which  was  issued  in  June  1998  and
established  accounting and reporting  standards requiring that every derivative
instrument,   including  certain  derivative   instruments   embedded  in  other
contracts,  be  recorded in the  balance  sheet as either an asset or  liability
measured  at its fair  value.  SFAS No. 133 also  requires  that  changes in the
derivative's  fair value be  recognized  currently in earnings  unless  specific
hedge  accounting  criteria  are met.  SFAS No. 133 will now apply to all fiscal
quarters of all fiscal years beginning after June 2000. Management believes that
the  implementation  of SFAS No. 133 during the third  quarter of year 2000 will
not have a material impact on the Company's results of operations.

     In December  1999,  the  Securities  and Exchange  Commission  issued Staff
Accounting Bulletin (SAB) No. 101, Revenue Recognition in Financial  Statements.
SAB No. 101 provides guidance on the recognition, presentation and disclosure of
revenue in  financial  statements.  The Company has  reviewed  the  bulletin and
believes that its current  revenue  recognition  policy is  consistent  with the
guidance provided in SAB No. 101.


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. The following  analysis presents the hypothetical loss in earnings,  cash
flows  and fair  values  of the  financial  instruments  which  were held by the
Company at March 31, 2000, and are sensitive to the above market risks.

Interest Rate Risks

At March 31, 2000, the Company had financial  assets  totaling $15.8 million and
financial   liabilities   totaling  $35.6  million.  For  fixed  rate  financial
instruments,  interest  rate  changes  affect the fair  market  value but do not
impact  earnings  or  cash  flows.  Conversely,   for  variable  rate  financial
instruments, interest rate changes generally do not affect the fair market value
but do impact future  earnings and cash flows,  assuming  other factors are held
constant.

At March 31, 2000, the Company had fixed rate financial assets of $15.8 million.
Holding other variables constant, a ten percent increase in interest rates would
increase  the  unrealized   fair  value  of  the  fixed   financial   assets  by
approximately $1.2 million.

At March 31, 2000, the Company had fixed rate debt of $14.9 million and variable
rate debt of $20.7  million.  A ten percent  decrease  in  interest  rates would
increase the unrealized fair value of the fixed rate debt by approximately  $2.3
million.

The net  decrease in  earnings  for the next year  resulting  from a ten percent
interest  rate  increase  would be  approximately  $1.6  million,  holding other
variables constant.


                            PART II OTHER INFORMATION


ITEM 1.  Legal Proceedings.

         Certain  product  liability  claims and actions are pending 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.


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

         No matter was submitted  during the first quarter of the Company's 2000
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

                  10.10             Line  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

                  10.13             Merger 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.
`
                  10.14             Asset Purchase  Agreement  dated  January 8,
                                    1999, by and among Flents Products Co.,Inc.,
                                    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.

                  10.15             Purchase 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.

                  10.16             Revolving  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.

                  10.17             Revolving  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.

                  10.18             Securities  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.

                  10.19             Investment 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.

                  10.20             Management  Agreement  dated  April 14, 1999
                                    between   Flents   Products  Co.,  Inc.  and
                                    Protective  Technologies  International Inc.
                                    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.

                  10.21             Shareholder'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.

                  10.22             Fairness   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.

                  10.23             Consent   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

The Company did not file any Current Report on Form 8-K during the quarter ended
March 31, 2000.





<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,               May 15, 2000
Meredith W. Birrittella      Chairman and Director

                             Chief Financial Officer                May 15, 2000
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,           May 15, 2000
----------------------------
Meredith W. Birrittella          Chairman and Director



/s/ Anthony Costanzo             Chief Financial Officer            May 15, 2000
-----------------------------
Anthony Costanzo                 Chief Accounting Officer







<PAGE>


                        PTI HOLDING INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

<TABLE>


<S>                                                                                  <C>                      <C>
ASSETS
                                                                                  March 31, 2000       December 31, 1999
                                                                                -----------------     ------------------
                                                                                 (unaudited)            (audited)

Current assets:
    Cash and cash equivalents                                                          $ 435,867           $ 733,530
    Accounts receivable, net of allowance for returns and doubtful
      collections of $863,609 (March 31, 2000) and $515,881 (December 31, 1999)       14,472,315          10,599,417
    Inventories                                                                       17,373,608          12,959,906
    Deferred tax asset                                                                   322,000             322,000
    Prepaid expenses and other current assets                                          1,607,703           2,270,274
                                                                                -----------------     ---------------
    Total current assets                                                              34,211,493          26,885,127

Deferred tax asset                                                                        90,000              90,000
Equipment and improvements, net                                                        3,259,966           3,226,447
Intangible assets, net                                                                19,702,359          19,871,196
Other Assets                                                                             605,210             662,265
                                                                                ------------------  -----------------
                                                                                    $ 57,869,028        $ 50,735,035
                                                                                ==================  =================

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
    Loan payable, bank                                                              $ 15,487,727      $ 10,567,018
    Current portion of Long term debt                                                  1,800,000         1,800,000
    Accounts payable and accrued expenses                                              7,898,353         4,784,498
                                                                                ------------------  ----------------
    Total current liabilities                                                         25,186,080        17,151,516

Long Term debt, net of current portion                                                 4,399,988         4,849,991

Subordinated note payable                                                              6,011,757         5,954,841

Commitments and contingencies

Minority interest in Subsidiary                                                        4,076,214         4,029,761

Stockholders' equity:
    Common stock, $.01 par value; authorized 10,000,000 shares, issued
         and outstanding 4,956,352 shares                                                 49,564            49,564
    Note receivable                                                                      (54,822)          (54,822)
    Capital in excess of par                                                          16,283,217        16,283,217
    Retained earnings                                                                  1,917,030         2,470,967
                                                                                -----------------  ---------------

    Total stockholders' equity                                                        18,194,989       18,748,926
                                                                                -----------------  ---------------

                                                                                   $ 57,869,028      $ 50,735,035
                                                                                =================  ===============
</TABLE>

<TABLE>

           PTI HOLDING INC. AND SUBSIDIARIES

         CONSOLIDATED STATEMENTS OF OPERATIONS
                      (Unaudited)

<S>                                                                   <C>                      <C>
                                                                    THREE MONTHS ENDED MARCH 31,

                                                                 2000                       1999
                                                            -----------------         ------------------

Net sales                                                       $ 15,743,723               $ 16,120,849

Cost of sales                                                     11,006,533                 11,511,592
                                                            ------------------        ------------------

Gross profit                                                       4,737,190                  4,609,257
                                                            ------------------        ------------------
Operating expenses :
     Licensing fees                                                  560,647                    478,701
     Depreciation and amortization                                   454,964                    431,025
     Other selling, general and administrative expenses            3,892,358                  2,598,643
                                                            ------------------        ------------------

Total operating expenses                                           4,907,969                  3,508,369
                                                            ------------------        ------------------

Income (loss) from operations                                       (170,779)                 1,100,888

Interest expense, net                                                704,202                    264,572
                                                           ------------------        -------------------

Income (loss) before income taxes                                   (874,981)                   836,316

Income taxes (benefit)                                              (367,493)                   351,253
                                                           ------------------        -------------------

Income (loss) before minority interest                              (507,488)                   485,063
                                                           ------------------        -------------------

Minority interest                                                    (46,453)                         -
                                                           ------------------        -------------------

Net income (loss)                                                 $ (553,941)                 $ 485,063
                                                           ==================        ===================
</TABLE>


<TABLE>

                        PTI HOLDING INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                   THREE MONTHS ENDED MARCH 31, 2000 AND 1999
<S>                                                                                         <C>                    <C>


                                                                                              2000                1999
                                                                                     ----------------    ----------------

Cash flows from operating activities:

    Net income (loss)                                                                     $ (553,941)         $ 485,063
    Adjustments to reconcile net income (loss) to net cash used in operating
      activities:
    Minority interest in income of subsidiary                                                 46,453
    Provision for returns and doubtful accounts                                              347,728                  -
    Depreciation                                                                             393,915            390,135
    Amortization of intangible assets                                                        232,944             40,889
    Amortization of OID on Subordinated note payable                                          56,916                  -
    Deferred income tax (benefit)                                                                  -             10,300
    (Increase) decrease in operating assets:
        Accounts receivable                                                               (4,220,626)        (3,506,919)
        Inventories                                                                       (4,413,702)         2,619,909
        Prepaid expenses and other current assets                                                  -                  -
        Other assets                                                                         762,481           (362,497)
    Increase (decrease) in operating liabilities:
       Accounts payable and accrued expenses                                               3,113,859          2,278,323
       Other current liabilities                                                                   -                  -
                                                                                    ----------------    ----------------
    Net cash (used in) provided by operating activities                                   (4,233,974)         1,955,203
                                                                                    ----------------    ----------------


Cash flows from investing activities:

    Cash payments as consideration for purchase of acquired product line                      (7,052)                 -
    Loan to stockholders                                                                     (99,910)           392,461
    Purchase of equipment and improvements                                                  (427,434)          (271,500)
                                                                                    ----------------    ----------------

    Net cash (used in) provided by investing activities                                     (534,395)           120,961
                                                                                    ----------------    ----------------
Cash flows from financing activities:
    Payments of other current liabilities                                                          -                  -
    Repayment of long term Financing                                                        (450,003)                 -
    Borrowings, net                                                                        4,920,709         (1,459,802)
                                                                                    ----------------    ----------------

    Net cash provided by (used in) financing activities                                    4,470,706         (1,459,802)
                                                                                    ----------------    ----------------

Net increase (decrease) in cash and cash equivalents                                        (297,663)           616,362

Cash and cash equivalents, beginning of period                                               733,530            837,618
                                                                                    ----------------    ----------------

Cash and cash equivalents, end of period                                                   $ 435,867        $ 1,453,980
                                                                                    ================    ================


Supplemental disclosures:
       Interest paid                                                                       $ 734,414          $ 292,614


</TABLE>








                        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-K for the year ended
        December 31, 1999 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 March 31, 2000 and the
        results of its  operations and its cash flows for the three months ended
        March 31, 2000.  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  1999 amounts  have been  reclassified  where
      appropriate  to conform to the financial  statement  presentation  used in
      2000.

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 1999,  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:

        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 earplugs and other
        safety and medical supplies such as an eye drop delivery system, styptic
        devices,  and air  filter  masks.  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  37% and 19% of net
        sales for the three months  ended March 31, 2000.  The same two retailer
        accounted for approximately 43% and 27% of net sales for the same period
        in 1999 and 35% and 30% for the same  period  in 1998.  As of March  31,
        2000,  accounts  receivable   included   approximately   $5,846,000  and
        $3,165,000  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 three months
ended March 31, 2000, 1999 and 1998.


<TABLE>

               <S>                                          <C>                    <C>              <C>                 <C>
                  2000                                    PTI Sports              Flents             Other                Total
               --------                                 ---------------          ----------        ----------          -------------
              Net sales                                     10,421,000            5,323,000          -                   15,744,000
              Gross profit                                   2,409,000            2,328,000          -                    4,737,000
              Operating earnings (loss)                      (858,000)              694,000           (7,000)             (171,000)
              Depreciation and amortization                    165,000              290,000          -                      455,000
              Interest revenue                                  18,000                5,000             1,000                24,000
              Interest expense                                 229,000              499,000          -                      728,000
              Income tax expense (benefit)                   (448,000)               84,000           (3,000)             (367,000)
              Total assets                                  29,716,000           27,068,000         1,085,000            57,869,000
              Capital expenditures                             357,000               70,000          -                      427,000


                   1999                                    PTI Sports              Flents             Other                Total
               ------------                            ---------------          -----------         --------            -----------
              Net sales                                     13,846,000            2,275,000          -                   16,121,000
              Gross profit                                   3,583,000            1,026,000          -                    4,609,000
              Operating earnings                               907,000              220,000          (26,000)             1,101,000
              Depreciation and amortization                    325,000              106,000          -                      431,000
              Interest revenue                                  24,000                2,000             1,000                27,000
              Interest expense                                 198,000               94,000          -                      292,000
              Income tax expense (benefit)                     308,000               54,000          (11,000)               351,000
              Total assets                                  30,979,000            8,160,000           562,000            39,701,000
              Capital expenditures                             254,000               17,000          -                      271,000

</TABLE>

        First quarter financial information relating to the Company's operations
by geographic area is presented below.

              Net sales                  2000                     1999
              ------------             -----------              ------------

              United States      $       15,174,000      $         15,448,000
              Canada                        520,000                   623,000
              Other                          50,000                    50,000
                                  -----------------            --------------
                                 $       15,744,000      $         16,121,000
                                  =================            ==============




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



4. Subsequent events:


In April 2000, the Company  entered into a 65 month lease for a warehousing  and
distribution  facility.  The lease calls for minimum  monthly rentals of $16,000
per month for the fist 5 months and $72,054 per month thereafter  through August
31, 2005.