FORM 10-QSB

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                 QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                    FOR THE QUARTER ENDED SEPTEMBER 30, 1997
                        COMMISSION FILE NUMBER 33-19598-D

                             SUNLlGHT SYSTEMS, LTD.
             (Exact Name of Registrant as specified in its charter)


             COLORADO                                   84-0992908
-------------------------------            -------------------------------------
(State or other jurisdiction of            ( I.R.S. Employer Identification No.)
incorporation or organization)

5222 South Holly
Greenwood Village, Colorado                              80111
---------------------------------------                ----------
(Address of principal executive office)                (Zip code)

Registrant's telephone number, including area code   303-779-1900
                                                     ------------

Indicate by check whether the registrant  (1) has filed all reports  required to
be filed by section 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.


                          Yes  X                    No
                             ----                     ----

The  number  of  shares  of the  registrant's  $.0001  par  value  common  stock
outstanding as of September 30, 1997, was 11,500,064.

<PAGE>
                             SUNLIGHT SYSTEMS, LTD.

                                    INDEX                                  PAGE

Part I.      Financial Information
             ---------------------

Item 1.      Balance Sheets
             September 30, 1997 and 1996                                   1-2
 
             Statements of Operations:
             Quarters ended September 30, 1997 and 1996                      3

             Statements of Changes in Cash Flows
             Quarters ended September 30, 1997 and 1996                      4

             Notes to Financial Statements                                 5-6

Item 2.      Management's Discussion and Analysis of
             Financial Condition and Results of Operation                    7

Part II      Other Information
             -----------------

Item 1.      Legal Proceedings                                               8

Item 2.      Changes in Securities                                           8

Item 3.      Defaults Upon Senior Securities                                 8

Item 4.      Submission of Matter to a Vote of Security  Holders             8

Item 5.      Other Information                                               8

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


<PAGE>

PART 1.     FINANCIAL INFORMATION
            ---------------------

Item 1      Financial Statements
<TABLE>
<CAPTION>
                             Sunlight Systems, Ltd.
                                 Balance Sheets
                           September 30, 1997 and 1996


                                     ASSETS


                                                                          1997            1996
                                                                          ----            ----
<S>                                                                   <C>             <C> 
Current assets
--------------

      Cash                                                            $   2,080       $   6,880
      Current portion of note receivable                                 12,536          87,233
      Inventory                                                                         103,001
      Prepaid expenses                                                                    4,352
                                                                      ---------       ---------
      Total current assets                                               14,616         201,646
                                                                      ---------       ---------


Property and equipment, net of
accumulated depreciation of $3,244                                                       66,578
                                                                      ---------       ---------


Other assets
      Investment in oil and gas properties                              171,970         171,970
      Available for sale securities of
          Energy Corporation common stock,
              Restricted                                                     --              --
              Unrestricted, including allowance for
                 increase in market value of $25,927                     25,927         222,224
               Intercell Corporation common stock
                  Unrestricted, including allowance for
                   increase in market value of $5,600                     5,600
      Start-up costs, net of accumulated
            amortization of $1,531                                                       29,096
      Dealer and distributor costs, net of
           accumulated amortization of $2,500                                            27,500
      Deposits                                                            4,090           4,590

      Note Receivable, discounted for imputed interest                   34,983
            at 10%, net of current portion                            ---------       ---------

                                                                        242,570         455,380
                                                                      ---------       ---------

                                                                      $ 257,186       $ 723,604
                                                                      =========       =========
</TABLE>

                                                       -1-
<PAGE>
<TABLE>
<CAPTION>

                             Sunlight Systems, Ltd.
                           Balance Sheets (continued)
                           September 30, 1997 and 1996





                      Liabilities and Stockholders' Equity


                                                                         1997             1996
                                                                         ----             ----
<S>                                                                  <C>              <C> 
Current liabilities
-------------------

       Accounts payable-related party                                $  57,000
       Accounts payable                                                  1,174        $  46,252
       Loan payable                                                                      35,129
       Payroll and sales taxes                                                            6,494
                                                                     ---------        ---------

       Total current liabilities                                        58,174           87,875
                                                                     ---------        ---------










Stockholders' equity
      Preferred stock, $.0001 par value
            5,000,000 shares authorized, none issued
       Common stock, $.0001 par value
          45,000,000 shares authorized, 11,500,064
          issued and outstanding                                         1,150              900
       Additional paid in capital                                      686,229          561,479
       Unrealized gain on securities available for sale                 31,527          222,224
       Accumulated deficit                                            (519,894)        (148,874)

                                                                     ---------        ---------
                                                                       199,012          635,729
                                                                     ---------        ---------



                                                                     $ 257,186        $ 723,064
                                                                     =========        =========
</TABLE>

                        See Notes to Financial Statements

                                       -2-
<PAGE>
<TABLE>
<CAPTION>
                             Sunlight Systems, Ltd.
                            Statements of Operations
                   Quarters Ended September 30, 1997 and 1996




                                                                           1997            1996
                                                                           ----            ----

<S>                                                                   <C>              <C> 
Revenues                                                              $    1,169

General and administrative expenses                                       33,971       $   27,940
                                                                      ----------       ----------
Loss from continuing operations                                          (32,802)         (27,940)

Discontinued Operations
Loss from operations of
     Discontinued segment                                                                 120,934)
                                                                                       ----------
Net income (loss)                                                     $  (32,802)      $ (148,874)
                                                                      ==========       ==========

Net income (loss) per common shares                                      $(.0029)         $(.0417)
                                                                        ========         ========
Weighted average number of common
      shares outstanding                                              11,500,064        9,000,064
                                                                      ==========        =========
</TABLE>
























                        See Notes To Financial Statements

                                       -3-
<PAGE>
<TABLE>
<CAPTION>
                             Sunlight Systems, Ltd.
                            Statements of Cash Flows
                    Quarter Ended September 30, 1997 and 1996


                                                                          1997             1996
                                                                          ----             ----
<S>                                                                    <C>              <C>
Cash flows from operating activities
Net income (loss)                                                      $ (32,802)       $(148,874)
Adjustments to reconcile net loss
     to net cash from operating activities
         Depreciation and amortization                                                      7,275
         Amortized discount on notes recievable                           (1,169)
Change in assets and liabilities:
     (Increase) decrease in:
         Inventory                                                                       (103,000)
         Prepaid expenses                                                                  (4,531)
         Deposits                                                                          (4,590)
     Increase (decrease) in:
         Accounts payable                                                 22,174           46,252
         Payroll and sales taxes                                                            6,494
                                                                       ---------        ---------
Net cash used by operating activities                                    (11,797)        (200,974)
                                                                       ---------        ---------
Cash flows from investing activities
     Purchase of property and equipment                                                   (69,822)
     Purchase of distribution and dealerships                                             (30,000)
     Increase in start-up costs                                                           (30,627)
     Payments received on notes receivable                                 1,250
                                                                       ---------        ---------
Net cash used by investing activities                                      1,250         (130,449)
                                                                       ---------        ---------
Cash flows from financing activities
     Proceeds from sale of common stock                                                   302,767
     Increase in loan payable                                              4,500           35,129
                                                                       ---------        ---------
Net cash flows from financing activities                                   4,500          337,896
                                                                       ---------        ---------
Net increase decrease in cash flows                                       (6,047)           6,473

Cash, beginning                                                            8,127              407
                                                                       ---------        ---------
Cash, ending                                                           $   2,080        $   6,880
                                                                       =========        =========

Noncash  investing  and  financing  activities:
   Assets acquired by issuance of common stock:
     Stock subscription note receivable                                                 $ 87,233
     Investment in oil and gas property                                                 $171,970
     Marketable equity securities of
        Energy Corporation                                                              $     --

</TABLE>


                        See Note to Financial Statements

                                       -4-
<PAGE>

                             Sunlight Systems, Ltd.
                          Notes to Financial Statements

1.   Organization,  Business  and  Merger of  Mendell-Denver  Corporation  with 
     Sunlight Systems, Ltd.

     Mendell-Denver  Corporation  (Mendell)  was formed on July 22, 1985 for the
     purpose of acquiring,  exploring and developing oil and gas properties.  On
     May 1, 1992,  Mendell sold all of its  interests in oil and gas  properties
     and has since had no business operations.

     Sunlight Systems,  Ltd. (Sunlight) was formed on June 22, 1996. On July 17,
     1996 it became a  wholly-owned  subsidiary  of Mendell.  Mendell was merged
     with and into  Sunlight  with  Sunlight  being the  surviving  corporation.
     Shareholders  of Mendell  received  one common  share of Sunlight  for five
     shares of Mendell.

     Sunlight was a dealer in Colorado and Nevada and a distributor in Illinois,
     Ohio,  Michigan  and Indiana of skylights  manufactured  or imported by Sun
     Tunnel  Systems,  Inc.  As  discussed  in Note 4, on  November  1, 1997 the
     Company sold its dealerships and distributorships.  The Company is actively
     seeking business opportunities for potential acquisition or merger.


2.   Presentation of Interim Information

     In the opinion of the management of Sunlight  Systems,  Ltd. (the Company),
     the  accompanying   unaudited  financial   statements  include  all  normal
     adjustments  considered  necessary to present fairly the financial position
     as of September 30, 1997 and 1996,  and the results of  operations  for the
     quarters ended September 30, 1997 and 1996, and cash flows for the quarters
     ended  September  30, 1997 and 1996.  Interim  results are not  necessarily
     indicative of results for a full year.

     The  financial  statements  and notes are  presented  as  permitted by Form
     10-QSB,  and do not contain certain  information  included in the Company's
     audited  financial  statements and notes for the fiscal year ended June 30,
     1997.

3.   Investment in Energy Corporation

     The company owns One Hundred and Sixty-Six Thousand,  Six Hundred and Sixty
     Seven (166,667) restricted shares of Energy Corporation. Energy Corporation
     is a public company whose stock,  as a result of it's decision to implement
     a voluntary Plan of Liquidation Dissolution, is not currently trading. As a
     result of sale of all it's assets to Intercell Corporation (NASDAQ;INCE) on
     July 7, 1996, Energy  Corporation  received Five Million,  Four Hundred and
     Twelve Thousand, Three Hundred and Fifty Five (5,412,355) restricted shares
     of Intercell  Corporation in exchange for such assets.  Energy  Corporation
     and  Intercell  Corporation  have agreed to register and  distribute to the
     shareholders  of Energy  Corporation  the Five  Million,  Four  Hundred and
     Twelve Thousand,  Three Hundred and Fifty-Five  (5,412,355)  shares held by
     Energy  Corporation.  All  beneficial  owners  of  common  stock of  Energy
     Corporation,  as of July 8,  1996 will be  entitled,  over a three (3) year
     period, in six (6) equal installments, payable in January and April of each
     year  commencing  1997 through 1999, to receive for each share of Intercell
     Corporation,  such  holder  own,  one (1)  registered  share  of  Intercell
     Corporation.  Intercell Corporation is currently preparing the Registration
     Statement for filing with the Securities and Exchange Commission.

                                       -5-

<PAGE>

                             Sunlight Systems, Ltd.
                    Notes to Financial Statements (continued)

3.   Investment An Energy Corporation (continued)

     The shares of Energy Corporation were acquired in a noncash  transaction in
     exchange  for shares of the  Company.  The shares have been  recorded at no
     cost  because  the  Company  is  unable  to  determine  the cost of  Energy
     Corporation shares of its predecessor owners.

     Unrealized gains and losses of marketable  securities available for sale as
     of March 31, 1997 are as follows:

                                                               Gross 
                                       Shares       Cost    Unrealized     Fair
     Energy Corporation:                                       Gains       Value
     Shares with restrictions
        lasting more than one year     46,298     $  --     $ 12,963     $12,963
     Shares with restrictions
        lasting less than one year     92,596     $  --     $  25,927    $25,927

     Intercell Corporation             20,000     $  --     $  5,600     $ 5,600


     The unrealized gain on shares with  restrictions  lasting for more than one
     year is not being recognized in the financial statements.


4.   Discontinued operations

     On November 1, 1997, the Company sold its dealerships and  distributorships
     in skylights manufactured or imported by Sun Tunnel Systems, Inc. including
     all of its assets. In separate transactions, the Company received 1)$18,700
     in cash 2) a note  receivable  for  $60,000  and 3) a note  receivable  for
     $30,000.  The notes receivable are  collaterialized  by the assets sold and
     require payments of $1,250 and $1,000,  respectively.  The notes receivable
     are discounted to recognize an interest rate of 10%. The Company recognized
     a loss on the sale of $134,947.
















                                       -6-
<PAGE>

Item 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
           -----------------------------------------------------------
           AND RESULTS OF OPERATION
           ------------------------

LIQUIDITY:
----------

     At  September  30,  1997 the Company  had a negative  working  capital of $
(45,896).  This position is due to an increase in accounts payable. At September
30, 1996, the Company had positive  working  capital of $113,771.  This positive
position  is from the  receipt  of cash  proceeds  for the  sale of  stock  less
operating losses.


CAPITAL RESOURCES
-----------------

     Total assets of the Company as of September  30, 1997 were  $257,186  which
consisted   principally  of  $203,497  in  investments   and  $47,519  in  notes
receivable.  Total assets of the Company as of September  30, 1996 were $723,604
which consisted  principally of $394,194 in  investments,  $103,001 in inventory
and $87,233  stock  subscriptions  receivable  acquired  for common  stock.  The
Company also had trade obligations of $52,246.

     Stockholders'  equity decreased during the quarter ended September 30, 1997
due to general and  administrative  expenses  which were  principally  and costs
incurred in evaluating potential acquisitions.

     Stockholders'  equity increased during the quarter ended September 30, 1996
due to the issuance of common stock for cash $302,767; investments $171,970; and
subscription receivable $87,233 net of a net loss of $148,874.

RESULTS OF OPERATION
--------------------

     Revenues  for the  quarter  ended  September  30,1997  were  entirely  from
amortizing  the  discount  of the notes  receivable.  The  Company  had sales of
$13,118  and a gross  profit of $9,433  from the sale of  skylights  during  the
quarter  ended  September  30,  1996,  the initial  quarter of its business as a
dealer and distributor of skylights.


     General and  administrative  expenses for the quarter  ended  September 30,
1997 were due to seeing other  requisition or meager  opportunities  General and
administrative  expenses for the quarter ended  September 30, 1996.  General and
administrative expenses for the quarter ended September 30, 1996 of $27,940 were
due to initiating the Company's business  activities as a dealer and distributor
of skylights.














                                       -7-
<PAGE>

PART II - OTHER INFORMATION
---------------------------

Item 1.       Legal Proceedings
------        -----------------

              None

Item 2.       Change in Securities
-------       --------------------

              None

Item 3.       Defaults Upon Senior Securities
-------       -------------------------------

              None

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

              There  were no  meetings  of  security  holders  during the period
              covered by this report.


Item 5.       Other Information
-------       -----------------

              None

Item 6        Exhibits and Other Reports On Form 8-K
------        --------------------------------------

              Exhibit 27.1 - Financial Data Schedule































                                       -8-
<PAGE>

                                   SIGNATURES



        Pursuant  to the  requirement  of  Section  13 or  Section  15(D) of the
Securities  Exchange Act of 1934, the Registrant  duly has caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.



Dated:    November 13, 1997             Sunlight Systems, Ltd.
                                        (Registrant)




                                        By:  /s/ Patricia E. Johnson
                                           -----------------------------------
                                            Patricia E. Johnston
                                            Chief Executive Officer, President,
                                            Chief Financial Officer, Treasurer,
                                            And Director












                                       -9-