Indicate by check mark 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________________

     APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of the issuer's common stock, as of the latest practicable date  13,266,131 at July 28, 2000.

7.   LEASE AGREEMENT

8. FINANCING AGREEMENTS    

    There was no material change in segment identifiable assets during the period.

    On April 24, 2000, the Company's shareholders approved changing the Company's name to
Minolta-QMS, Inc.

Net loss for the three months ended June 30, 2000 was $.7 million ($0.06 per share) on net sales of $82.8 million compared to a net loss of $1.4 million ($0.12 per share) for the three months ended July 2, 1999, on net sales of $50.9 million.

Net sales for the three months ended June 30, 2000, increased by $31.9 million or 62.7% from net sales for the three months ended July 2, 1999. The sales increase was due primarily to the reacquisition of the Company's former European and Australian subsidiaries in June 1999.

During the three months ended June 30, 2000, total U.S. and Canadian sales decreased by 17.0% as compared to net sales for the three months ended July 2, 1999. This decrease was primarily due to the transition of maintenance services to IBM, which in effect led to lower service and spares revenue.

Europe/Australia sales for the three months ended June 30, 2000, as compared to the three months ended July 2, 1999, increased by $33.6 million or 196.3%. This increase was due to the reacquisition of the Company's former European and Australian subsidiaries, increased sales volumes to Minolta Europe (a relatively new sales channel), sales of lower priced entry-level laser printers, and a marked increase in consumables sales volumes.

Japanese sales for the three months ended June 30, 2000, as compared to the three months ended July 2, 1999, increased by $3.5 million or 72.5%. This increase was primarily due to increased sales in the Korean channel where a large account contributed to virtually the entire increase.

The Company's gross profit for the three-month comparisons increased $8.9 million (from $11.9 million to $20.8 million), primarily as a result of higher sales. Gross profit as a percentage of sales increased from 23.3% to 25.1%. This was the result of increased sales of higher margin hardware and consumables.

Operating expenses including goodwill amortization increased by $7.6 million for the three-month comparisons. As a percentage of net sales, operating expenses including goodwill amortization decreased from 25.6% to 24.8% for the three-month comparisons. The increase in operating expenses including goodwill amortization was due primarily to the addition of the European and Australian subsidiaries, increased marketing and advertising activities, and increased research and development spending. The decrease in operating expenses, as a percentage of sales, reflects the Company's continuing strategy to align operating expenses with revenues.

Total other income and expense for the three months ended June 30, 2000, was a net expense of $1.6 million. This was an increase of approximately $1.6 million from the three months ended July 2, 1999. The increase was primarily due to the increase in interest expense and reflects the new short-term debt and long-term debt incurred in connection with the Minolta convergence and the reacquisition of the Company's former European subsidiary.

Income taxes reflect estimated foreign income taxes or benefits of Minolta - QMS, Inc.'s foreign subsidiaries and U.S. tax liabilities for foreign commissions earned.

Accounts receivable grew by $11.9 million during the three-month period ended June 30, 2000, due to the increased sales volume.

Net inventories and accounts payable increased by $6.6 million and $14.4 million, respectively, for the three-month period. The increase in inventory was primarily due to increased sales volume and the anticipated introduction of the Company's next generation of color laser products. The increase in accounts payable followed the increase in the Company's net sales and inventory.

The Company expects its assets and liabilities to remain at higher levels due to higher sales and production volumes from acquisitions.

The Company's net working capital as of June 30, 2000 was $21.0 million as compared to $17.5 million at March 31, 2000 and $18.6 million at July 2, 1999

At June 30, 2000, the Company had cash on hand of $4.0 million and borrowings of $11.5 million and $29.1 million under the revolving credit facilities with Harris Trust and Savings Bank ("Harris") and Heller National Bank ("HNB"), respectively. Total borrowing capacity under the facilities is a function of eligible accounts receivable and inventory. At June 30, 2000, total availability was $57.9 million, consisting of $20.0 million with Harris and $37.9 million with HNB. The Company believes its current working capital availability, including the effect of the acquisition, is adequate for its operating needs.

The Company was not in compliance with certain of the Harris financial covenants at June 30, 2000. A waiver of non-compliance was received from the lender.

On June 30, 2000, the term loans payable to Minolta Co., Ltd. were modified to defer principal payments by one year to the second anniversary date of each loan.

At March 31, 2000, the Company was in violation of several financial covenants contained in an operating lease agreement. Among the remedies available to the landlord was the acceleration of all remaining base rent on a discounted basis for the initial lease term (approximately $13.0 million), cancellation of the lease, or all other remedies available by law.

On June 14, 2000, Minolta Investments Company acquired the property being leased under this operating lease agreement and became the lessor of the Company under the operating lease agreement. At that time the operating lease agreement was amended to reflect a change in the basic rent payments to $375,000 per quarter through the period ending June 30, 2001. Thereafter, rent will be adjusted annually based on the change in the London Interbank Offered Rate ("LIBOR"). In addition, all financial covenants in both the operating lease agreement and the waiver and lease amendment were deleted. Warrants under this agreement remain with the former landlord, however the exercise price was amended to reflect the average of the previous 10 days closing price of the Company's stock at June 14, 2000. This amendment had no material effect on the Company's consolidated financial statements. The warrants to purchase 100,000 shares are exercisable through December 31, 2001.

The Company purchases print engine mechanisms and memory components from several Japanese suppliers. Fluctuations in Japanese yen currency exchange rates will affect the prices of these products. The Company is attempting to mitigate negative impacts through yen-sharing arrangements with suppliers; however, material price increases resulting from unfavorable exchange rate fluctuations could adversely affect operating results.

The effect of yen fluctuations on material prices are also offset in part by yen-based Japanese sales. Approximately 10.0% of all Company sales are in Japanese yen, which causes sales and profit margins to increase when yen values increase.

In June 1998, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging Activities," which will be effective (as amended) for the Company in fiscal 2002. This Statement requires that all derivatives be recognized in the statement of financial position as either assets or liabilities and measured at fair value. In addition, all hedging relationships must be designated, reassessed and documented pursuant to the provisions of SFAS No. 133. The Company's management has not yet determined the effect SFAS No. 133 will have on its consolidated financial statements.

In December 1999, the SEC issued Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial Statement." The Company's management does not believe this bulletin will have a material effect on its consolidated financial statements .

The Company is exposed to market risk primarily from changes in foreign currency exchange rates and to a lesser extent interest rates. The following describes the nature of these risks.

At June 30, 2000, the Company had sales in over 90 countries worldwide. These sales outside the United States accounted for approximately 70 percent of worldwide sales. Virtually all of these sales were denominated in currencies of the local country. As such, the Company's reported profits and cash flows are exposed to changing exchange rates.

To date, management has not deemed it cost-effective to engage in a formula-based program of hedging the profits and cash flows of foreign operations using derivative financial instruments. The Company's U.S. operations purchase significant quantities of inventory from Japanese suppliers. Payments are made to these suppliers in U.S. dollars linked to the yen. In the OEM agreements with these suppliers, a currency payment model is negotiated that describes how fluctuations in exchange rates will be shared over the term of the agreement. In June 1999, the Company reacquired its former European subsidiary, which also purchases significant quantities of inventory from Japanese suppliers in yen. The Company is currently negotiating with its European subsidiary's suppliers to adjust for fluctuations in exchange rates.

In addition, at any point in time the Company's foreign subsidiaries hold financial assets and liabilities that are denominated in currencies other than U.S. dollars. These financial assets and liabilities consist primarily of short-term, third-party receivables and payables. Changes in exchange rates affect these financial assets and liabilities.

Prior to 2000, the Company on occasion has used derivatives to hedge specific risk situations involving foreign currency exposures. No such derivatives were held at June 30, 2000.

The financial liabilities of the Company that are exposed to changes in interest rates include short-term borrowings and long-term debt. The stated rate of interest for borrowings under the Harris revolving credit agreement is one-quarter of one percent (0.25) over prime or LIBOR plus three percent, and the stated rate of interest for borrowings under the Heller revolving credit agreement is one and one-quarter percent (1.25) over AIBOR. Long-term borrowings with Minolta Co., Ltd. and Alto Imaging Group N.V. have stated interest rates of LIBOR plus 2.5% payable monthly in arrears and LIBOR plus 0.5% (but not to be less than 6.50%), respectively. Long-term borrowings of the Company's European subsidiary bear interest at 6% and 10%. A one percent annual increase in the stated interest rates would have resulted in approximately $222,000 of additional interest expense for the three months ended June 30, 2000.

__________________________________________________________________________________________

ITEM 1 - LEGAL PROCEEDINGS

The Company is a defendant in various litigation and claims in the normal course of business. Based on consultation with various counsel in these matters, management is of the opinion that the ultimate resolution of such litigation and claims will not materially affect the Company's financial position, results of operations, or cash flows.

ITEM 2 - CHANGES IN SECURITIES - None.

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES - None.

ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS -

The Company's annual meeting of stockholders (the "Meeting") was held on April 24, 2000. The results of the voting on the election of directors were as follows:

Accordingly, all nominees for the Board of Directors were elected.

The results of the voting on the amendment of the Company's Certificate of Incorporation described in the Proxy Statement delivered in connection with the meeting were as follows:

Accordingly, the amendment of the Company's Certificate of Incorporation was adopted.

The results of the voting on the approval of an amendment to the Company's 1997 Stock Incentive Plan described in the Proxy Statement delivered in connection with the meeting were as follows:

Accordingly, the amendment to the Company's 1997 Stock Incentive Plan was adopted.

The results of the voting on the approval of an amendment to the Company's Stock Option Plan for Directors described in the Proxy Statement delivered in connection with the meeting were as follows:

Accordingly, the amendment to the Company's Stock Option Plan for Directors was adopted.

ITEM 5 - OTHER INFORMATION - None.

(a)  Exhibits:

 (b)  Reports:  None.

    Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.