FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[ X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 1998
______________
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: 0-14617
RHEOMETRIC SCIENTIFIC, INC.
______________________________________________________
(Exact name of registrant as specified in its charter)
New Jersey 61-0708419
___________________________ _______________________
(State or other jurisdiction of (I.R.S. Employer Identi-
incorporation or organization) fication Number)
One Possumtown Road, Piscataway, NJ 08854-2103
___________________________________ ____________
(Address of principal executive offices) (Zip Code)
(732) 560-8550
____________________________________________________
(Registrant's telephone number, including area code)
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 No X
______ ______
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Class Outstanding at May 15, 1998
__________________________ ___________________________
Common Stock, no par value 13,161,739
<PAGE>
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RHEOMETRIC SCIENTIFIC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands) (Unaudited)
<CAPTION>
March December
31, 1998 31, 1997
_________ _________
<S> <C> <C>
ASSETS
Current Assets
Cash $ 506 $ 297
Accounts receivable, net 10,788 14,916
Inventories, net
Finished goods 4,992 5,659
Work in process 2,015 2,650
Assembled components, materials, and parts 6,152 3,550
_______ _______
13,159 11,859
Prepaid expenses and other assets 546 813
_______ _______
Total current assets 24,999 27,885
_______ _______
Property, plant, and equipment 15,968 15,904
Less accumulated depreciation and
amortization 9,613 9,475
_______ _______
Property, plant, and equipment, net 6,355 6,429
Other assets 1,370 1,120
_______ _______
Total Assets $32,724 $35,434
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short-term bank borrowings $ 7,275 $ 8,769
Current maturities of long-term debt 229 227
Accounts payable 3,711 3,931
Borrowings against accounts receivable 592 958
Payable to affiliate 1,256 1,064
Accrued liabilities 5,150 5,360
_______ _______
Total current liabilities 18,213 20,309
_______ _______
Long-term note payable 59 79
Long-term debt lease obligation 4,773 4,718
Long-term debt - affiliate 6,258 6,258
Other long-term liabilities 1,267 1,240
_______ _______
Total liabilities 30,570 32,604
_______ _______
Commitments and Contingencies
Shareholders' Equity
Common stock, stated value of $.001,
authorized 20,000 shares; issued and
outstanding 13,162 shares 13 13
Additional paid-in capital 25,492 25,492
Accumulated deficit (23,169) (22,547)
Cumulative translation adjustment (182) (128)
_______ _______
Total shareholders' equity 2,154 2,830
_______ _______
Total Liabilities & Shareholders' Equity $32,724 $35,434
======= =======
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
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RHEOMETRIC SCIENTIFIC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
<CAPTION>
Three Months Ended
March 31,
1998 1997
______ ______
<S> <C> <C>
Sales $ 6,794 $ 8,317
Cost of sales 3,519 4,759
______ _______
Gross profit 3,275 3,558
_______ _______
General and administrative expenses 286 705
Marketing and selling expenses 2,339 2,179
Research and development expenses 519 747
Goodwill and intangible amortization 59 80
Total Operating Expenses 3,203 3,711
______ ______
Operating income/(loss) 72 (153)
Interest expense (382) (411)
Interest expense - Affiliate (214) (203)
Interest income -- 17
Foreign currency loss (94) (289)
______ ______
Loss before income taxes (618) (1,039)
Income tax expense (4) (3)
______ ______
Net loss $ (622) $(1,042)
Net loss per share
Basic $ (0.05) $ (0.08)
Diluted $ (0.05) $ (0.08)
Average number of shares
Outstanding
Basic 13,162 13,162
====== ======
Diluted 13,162 13,162
====== ======
See Notes to Consolidated Financial Statements.
</TABLE>
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<TABLE>
RHEOMETRIC SCIENTIFIC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited)
<CAPTION>
Three Months Ended
March 31,
1998 1997
_____ _____
<S> <C> <C>
Cash Flows from Operating Activities:
Net loss $ ( 622) $ (1,042)
Adjustments to reconcile net loss to net cash
(used in)/provided by operating activities:
Depreciation and amortization of plant and
Equipment 173 198
Amortization of goodwill and intangibles 59 80
Provision for inventory reserves 175 170
Unrealized currency loss 175 139
Changes in assets and liabilities:
Accounts receivable 3,983 406
Inventories (1,503) (1,642)
Prepaid expenses and other current
Assets 187 99
Accounts payable and accrued
Liabilities (225) (95)
Other assets (318) 39
Other non-current liabilities 28 2
______ ______
Net cash provided by/(used in) operating
activities 2,112 (1,646)
______ ______
Cash Flows from Investing Activities:
Purchases of property, plant, and equipment (11) (11)
______ ______
Net cash used in investing activities (11) (11)
______ ______
Cash Flows from Financing Activities:
Net (repayments)/borrowings under line of
credit agreements (1,460) (839)
Net (repayments)/borrowings against
accounts receivables (355) 1,414
Repayment of long-term debt/lease obligation (54) (37)
Mortgage participation -- 861
_____ ______
Net cash (used in)/provided by financing
activities (1,869) 1,399
______ ______
Effect of exchange rate changes on cash (23) 76
______ ______
Net increase/(decrease) in cash 209 (182)
Cash at beginning of period 297 486
______ ______
Cash at end of period $ 506 $ 304
====== ======
Cash payments for interest $ 417 $ 672
====== ======
Cash payments for income taxes $ 108 $ 32
====== ======
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
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<TABLE>
RHEOMETRIC SCIENTIFIC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(In thousands, except per share data)
(Unaudited)
<CAPTION>
Three Months Ended
March 31,
1998 1997
______ ______
<S> <C> <C>
Net loss $ (622) $(1,042)
Other comprehensive income
Foreign currency translation
adjustments (54) (227)
______ ______
Other comprehensive loss (54) (227)
______ ______
Comprehensive loss $ (676) $(1,269)
====== ======
</TABLE>
RHEOMETRIC SCIENTIFIC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Accounting Policies
The information included in the foregoing interim
financial statements is unaudited. In the opinion of
management, all adjustments, consisting of normal
recurring accruals, necessary for a fair presentation of
financial position and results of operations for the
interim periods presented have been reflected herein.
The results of operations for the interim periods are not
necessarily indicative of the results to be expected for
the entire year.
In June 1997, the Financial Accounting Standards Board
(FASB) issued Statement of Financial Accounting Standards
(SFAS) No. 131, "Disclosures about Segments of an
Enterprise and Related Information," for fiscal years
beginning after December 15, 1997. The provisions of SFAS
No. 131 establish standards for the way that enterprises
report information about operating segments in annual
financial statements and require that selected
information about operating segments in interim financial
statements be reported. It also establishes standards
for related disclosure about products and services,
geographic areas, and major customers. The Company is
reviewing these standards of disclosure for adoption in
1998.
Effective January 1, 1998, the Company adopted Statement of
Financial Accounting Standards (SFAS) No. 130, "Reporting
Comprehensive Income." The provisions of SFAS No. 130
establish standards for reporting and display of comprehensive
income and its
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components in the financial statements. This statement
requires all items that are required to be recognized under
accounting standards as components of comprehensive income be
reported in the financial statements and displayed with the
same prominence as other financial statements.
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," for fiscal years beginning after
June 15, 1999. The provisions of SFAS No. 133 require
all derivatives to 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 133. At
present time the Company is reviewing the potential
impact of this standard.
2. Loss Per Share
In February 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" ("SFAS No. 128"). SFAS 128 establishes
standards for computing and presenting earnings per share
("EPS") and supersedes APB Opinion No. 15. "Earnings per
Share" ("Opinion 15"). SFAS 128 replaces the presentation of
primary EPS with a presentation of basic EPS which excludes
dilution and is computed by dividing income available to
common stockholders by the weighted-average number of common
shares outstanding during the period. Diluted reflects the
potential dilution that could occur if outstanding options and
warrants were exercised. This statement has no effect on the
Company's prior period EPS data.
2. Long-term Debt and Short-term Borrowings
Long-term debt consists of the following:
<TABLE>
<CAPTION>
March 31, 1998 December 31, 1997
_______________ _______________
<S> <C> <C>
Obligation under sale/leaseback
payable through February 2011,
with interest imputed at a
weighted-average rate of
13.9% for 1998 and 1997,
respectively $4,914,000 $4,857,000
Note payable through November
1999 with interest at 9.54% 147,000 167,000
__________ __________
5,061,000 5,024,000
Less current maturities 229,000 227,000
__________ __________
$4,832,000 $4,797,000
========== ==========
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The Company has working capital lines of credit with
certain domestic and foreign banks. The foreign working
capital lines of credit are supported by letters of
credit issued under the Company's Loan and Security
Agreement, as amended (the "Loan Agreement"). Total
borrowings were $7,275,000 with remaining availability of
approximately $1,775,000 at March 31, 1998. Interest on
the domestic line of credit at March 31, 1998 was 10% and
10% at December 31, 1997. The interest rate on the
foreign lines of credit ranged between 1.9% and 8.3% as
of March 31, 1998 and between 1.9% and 6.8% at December
31, 1997.
The Loan Agreement requires the Company to maintain a
minimum tangible net worth and working capital, generate
minimum consolidated and domestic cash flows, and achieve
a minimum adjusted funded debt to adjusted tangible net
worth ratio. In addition, the Loan Agreement prohibits
the payment of cash dividends or cash distributions to
shareholders.
During 1997 and the first half of 1998, the Company had
been in violation of certain debt covenants associated
with its obligation under a sale/leaseback arrangement
and its short-term loan agreement. The Company has
obtained waivers covering these violations and believes
that they will be in compliance with applicable debt
covenants for periods subsequent to June 30, 1998.
Financial covenants under the sale/leaseback arrangement
have been waived through December 31, 1998.
The Company's lines and letters of credit are subject to
acceleration in the event that there is a material and
adverse change in the condition or affairs, financial or
otherwise, of the Company which in the reasonable opinion
of the lender impairs the lender's collateral or
increases its risk so as to jeopardize the repayment of
the obligations.
The Loan Agreement expires on February 23, 1999, and the
lender notified the Company in August 1998 that the Loan
Agreement will not be extended beyond the expiration
date. Following that notification, the Company has
commenced discussions with other prospective lenders to
replace the credit facility provided by the Loan
Agreement with a credit facility with a maximum available
credit of $10,000,000. The ability to proceed with a
lesser maximum credit than available under the current
Loan Agreement is based on existing improvements in the
management of the Company's working capital. While the
Company believes it will be able to secure a new credit
facility on or prior to the expiration date of the Loan
Agreement, it has not yet received a commitment for such
a facility and there can be no assurance that it will do
so.
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3. 1997 Restructuring
During the third quarter 1997, the Company undertook
several strategic initiatives designed to improve
operational efficiencies and cash management, as well as
to enhance its market position and customer support.
These initiatives included a restructuring of
manufacturing operations, a restructuring of international
sales and marketing activities, and an introduction of new
products targeted to broaden markets for rheology and
process control instrumentation. The restructuring and
consolidation efforts resulted in a one-time write-off of
$2,224,000, $600,000 related to inventory obsolescence and
a restructuring charge of $1,624,000. These charges are
reflected in the Company's third quarter 1997 financial
results. At December 31, 1997 the restructuring reserve of
$1,624,000 was reduced by $684,000 as the result of the
assignment of the UK lease to a third party at more
favorable terms than initially anticipated. The
restructuring reserve of $890,000 as of March 31, 1998 is
a component of accrued liabilities in the Consolidated
Balance Sheet. Approximately $50,000 was charged to the
restructuring reserve in the first quarter of 1998.
The Company's restructuring plan centers on its European
operations. The Company will change the focus of Europe
to be centralized in Germany, while maintaining a strong
presence in both the U.K. and France. It expects this
plan to be in full effect in the second half of 1998.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
Results of Operations
Sales for the three-month period ended March 31, 1998
decreased $1,523,000 (or 18.3%) compared to the
corresponding period in 1997. This includes a negative
impact of $186,000 on sales due to unfavorable currency
rates in effect for the first quarter of 1998 compared to
the first quarter of 1997. Domestic sales increased by
$222,000 while Japanese, German, French, and U.K. sales
decreased $368,000, $99,000, $442,000, and $836,000,
respectively. International and export sales decreased to
55.2% of consolidated sales from 66.2% for the same period
in 1997. Gross profit for the quarter ended March 31, 1998
was 48.2% compared to 42.8% in 1997.
Operating expenses of $3,203,000 decreased by $508,000 from
the same period in 1997. Domestic, U.K., and German
expenses decreased by $211,000, $190,000 and $47,000,
respectively, offset by an increase in France and Japan of
$5,000 and $3,000,
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respectively. An additional decrease of $68,000 was due to
the currency rates in effect in Germany, France, and Japan
in the first quarter of 1998 compared to the first quarter
of 1997.
Net interest expense for the three months ended March 31,
1998 was $596,000 compared to $597,000 for the corresponding
period in the prior year.
The Company is exposed to foreign currency gains and losses
related to its intercompany payables and another payable to
Mettler Toledo AG, pursuant to the exclusive world-wide
property rights agreement between the Company and Mettler,
which is due in Swiss Francs. The Company's foreign
currency exposure policy is to not enter into foreign
currency derivative instruments.
The foreign currency adjustments for the three months ended
March 31, 1998 were a loss of $94,000, compared to $289,000
for the same period in 1997. The year-to-date adjustment
was primarily due to transaction losses of $165,000
resulting from the German Mark, French Franc, and Japanese
Yen against the U.S. Dollar, which were offset by an
unrealized gain of $71,000 resulting from the British Pound
against the U.S. Dollar.
Inherent in the Company's business is the potential for
inventory obsolescence for older products as the Company
develops new products. Obsolescence has historically
related to parts inventory. The Company continuously
monitors its exposure relating to excess and obsolete
inventory and establishes what in management's judgment at
the time are appropriate valuation reserves.
Liquidity and Capital Resources
Management believes that cash generated from operations and
funds available under lines of credit should be sufficient
to meet the Company's working capital needs until February
23, 1999 and thereafter depending on the Company's success
in obtaining a new credit facility. Adequacy of cash flows
beyond that period will depend upon the Company's ability to
achieve expected sales volumes to support profitable
operations.
The Company has working capital lines of credit with certain
domestic and foreign banks. The foreign working capital
lines of credit are supported by letters of credit issued
under the Company's Loan and Security Agreement, as amended
(the "Loan Agreement"). Total borrowings were $7,275,000
with remaining availability of approximately $1,775,000 at
March 31, 1998. Interest on the domestic line of credit at
March 31, 1998 was 10% and 10% at December 31, 1997. The
interest rate on the foreign lines of credit ranged between
1.9% and 8.3% as of March 31, 1998 and between 1.9% and 6.8%
at December 31, 1997.
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The Loan Agreement expires on February 23, 1999, and the
lender notified the Company in August 1998 that the Loan
Agreement will not be extended beyond the expiration date.
Following that notification, the Company has commenced
discussions with other prospective lenders to replace the
credit facility provided by the Loan Agreement with a credit
facility with a maximum available credit of $10,000,000.
The ability to proceed with a lesser maximum credit than
available under the current Loan Agreement is based on
existing improvements in the management of the Company's
working capital. While the Company believes it will be able
to secure a new credit facility on or prior to the
expiration date of the Loan Agreement, it has not yet
received a commitment for such a facility and there can be
no assurance that it will do so.
Cash Flows from Operations. Net cash provided by operating
activities during the three months ended March 31, 1998 was
2,112,000, an increase of $3,758,000 over the same period
last year. Net loss for the three months ended March 31,
1998 was $622,000 compared to $1,042,000 during the same
period last year. During the three months ended March 31,
1998, accounts receivable decreased by $3,983,000 reflecting
lower first quarter 1998 sales as compared to the last
quarter 1997 sales. Inventories increased by $1,503,000
partially due to lower than anticipated first quarter 1998
sales. Management continuously monitors inventory levels on
a worldwide basis in order to ensure that excess inventory
is kept to a minimum. Accounts payable and accrued
liabilities decreased $225,000 while other assets increased
$318,000.
Cash Flows From Investing. Net cash used in investing
activities during the three months ended March 31, 1998 was
$11,000 as compared to $11,000 during the same period in
1997.
Cash Flows From Financing. Net cash used in financing
activities during the three-month period ended March 31,
1998 was $1,869,000. The Company's borrowing against its
accounts receivable during the three-month period ended
March 31, 1998 decreased $355,000 while its borrowing under
line of credit agreements decreased $1,460,000.
Year 2000 Compliance. The Company has consulted with its
main software provider regarding potential year 2000
problems. The majority of this potential problem has been
addressed and the remaining problem area will be addressed
via upgrades, which will be available prior to the year
2000. In addition, the Company has proactively identified
program modifications that may require a change in
programming code. Such code modifications are being
actively made and the Company anticipates that all program
modifications will be completed well before the year 2000.
The Company plans to initiate in 1998 communication with its
significant suppliers to determine the effect that it may be
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impacted by third parties failure to address this issue.
The Company will continue to monitor and evaluate the impact
of year 2000 on its operations.
PART II. OTHER INFORMATION
Item 5. Other Information
On February 5, 1998, Alan R. Eschbach resigned as
president and chief executive officer of the company.
At that time, Alexander F. Giacco, chairman of the
board, became president and chief executive officer.
At a meeting of the board of directors on February 19,
1998, the Board of Directors granted to Alan R.
Eschbach and Walter M. Bromm options for 25,000 shares
of common stock to become exercisable once the plan
amendment is approved by shareholders at the next
annual shareholders' meeting.
The Company's common stock was moved to the OTC-
Bulletin Board Market, effective with the close of
trading on April 14, 1998, due to the expiration of an
exception from the minimum bid price of the NASDAQ
SmallCap Market.
In August 1998 the Company assigned the lease of its
Epsom facility in the United Kingdom to a third party
and moved its sales and service personnel to offices
located in Leatherhead.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits (numbered in accordance with Item
601 of Regulation S-K).
3.1 Certificate of Incorporation of the Registrant,
as Amended, incorporated by reference to Exhibit
3.1 to the Company's Quarterly Report on Form 10-
Q for the period ended March 31, 1995 (File No.
0-14617).
3.2 By-Laws of the Registrant, as Amended,
incorporated by reference to Exhibit 3.2 to the
Company's Annual Report on Form 10-K for the
year ended December 31, 1993 (File No. 0-14617).
4.1 Specimen Certificate representing Common Stock
of the Registrant, incorporated by reference to
the exhibits to the Company's Registration
Statement on Form S-1, File No. 33-807 filed on
October 10, 1985.
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Item 6. - continued
4.2 Warrant to Purchase 132,617 shares Common Stock of
Rheometric Scientific, Inc. issued to RSI (NJ) QRS 12-13,
Inc., incorporated by reference to Exhibit 1 to the
Company's Current Report on Form 8-K dated February 23, 1996
(File No. 0-14617).
4.3 Warrant to Purchase 331,543 shares of Common Stock of
Rheometric Scientific, Inc. issued to RSI (NJ) QRS 12-13,
Inc., incorporated by reference to Exhibit 2 to the
Company's Current Report on Form 8-K dated February 23, 1996
(File No. 0-14617).
*4.4 Rheometric Scientific, Inc. 1996 Stock
Option Plan, incorporated by reference to
Exhibit 4.3 to the Company's Quarterly Report on
Form 10-Q for the period ended June 30, 1996
(File No. 0-14617).
*10.1 Amended and Restated Employment Agreement
between Ronald F. Garritano and the Company
incorporated by reference to Exhibit 10.3 to the
Company's Annual Report on Form 10-K dated
December 31, 1997 (File No. 0-14617).
*10.2 Employment Agreement between Matthew Bilt
and the Company, incorporated by reference to
Exhibit 10.4 to the Company's Quarterly Report
on Form 10-Q for the period ended September 30,
1996 (File No. 0-14617).
*10.3 Employment Agreement between Joseph Musanti and
the Company incorporated by reference to Exhibit
10.4 to the Company's Annual Report on Form 10-K
dated December 31, 1997 (File No. 0-14617).
10.4 Loan and Security Agreement with Fleet Capital
Corporation dated February 23, 1996,
incorporated by reference to Exhibit 1 to the
Company's Current Report on Form 8-K dated
February 23, 1996 (File No. 0-14617).
10.5 Lease Agreement by and between RSI (NJ) QRS 12-
13, Inc., and Rheometric Scientific, Inc. dated as of
February 23, 1996, incorporated by reference to Exhibit 5 to
the Company's Current Report on Form 8-K dated February 23,
1996 (File No. 0-14617).
10.6 Revolving Credit Facility Note - Fleet Capital
Corporation, incorporated by reference to Exhibit 6 to the
Company's Current Report on Form 8-K dated February 23, 1996
(File No. 0-14617).
10.7 Subordination Agreement between Axess
Corporation and Fleet Capital Corporation, incorporated by
reference to Exhibit 10.26 to the Company's Annual Report on
Form 10-K dated December 31, 1995 (File No. 0-14617).
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Item 6. - continued
10.8 Subordination Agreement between Axess Corporation
and RSI (NJ) QRS 12-13, Inc., incorporated by reference to
Exhibit 10.27 to the Company's Annual Report on Form 10-K
dated December 31, 1995 (File No. 0-14617).
10.9 Amended and Restated Subordinated Unsecured
Working Capital Note - Axess Corporation, incorporated by
reference to Exhibit 10.28 to the Company's Annual Report on
Form 10-K dated December 31, 1995 (File No. 0-14617).
10.10 First Amendment to Lease Agreement dated June 10,
1996 between RSI (NJ) QRS 12-13, Inc. and Rheometric
Scientific, Inc. incorporated by reference to Exhibit 10.12
to the Company's Annual Report on Form 10-K dated December
31, 1996 (File No. 0-14617).
10.11 Second Amendment to Lease Agreement dated February
20, 1997 between RSI (NJ) QRS 12-13, Inc. and Rheometric
Scientific, Inc. incorporated by reference to Exhibit 10.13
to the Company's Annual Report on Form 10-K dated December
31, 1996 (File No. 0-14617).
10.12 Amendment Letter dated May 2, 1997 by Fleet
Capital Corporation, amending Sections 9.1(J) and 9.3(D) of
the Loan and Security Agreement dated February 23, 1996,
incorporated by reference to Exhibit 10.14 to the Company's
Annual Report on Form 10-K dated December 31, 1996 (File No.
0-14617).
10.13 Amendment Letter dated May 6, 1997 by RSI (NJ) QRS-
12-13, Inc., amending paragraphs 7 and 8 of Exhibit D to the
Lease Agreement dated as of February 23, 1996, incorporated
by reference to Exhibit 10.15 to the Company's Annual Report
on Form 10-K dated December 31, 1996 (File No. 0-14617).
10.14 Amendment to Loan and Security Agreement with
Fleet Capital Corporation dated March 31, 1998 incorporated
by reference to Exhibit 10.16 to the Company's Annual Report
on Form 10-K dated December 31, 1997 (File No. 0-14617).
24 Consent of Independent Auditors incorporated by
reference to Exhibit 24 to the Company's Annual
Report on Form 10-K dated December 31, 1997
(File No. 0-14617).
27 Financial Data Schedule
(b) Reports on Form 8-K:
A report on Form 8-K was filed with the
Securities and Exchange Commission on February 17, 1998
with regard to the company's move to The Nasdaq SmallCap
Market via an exception from the bid price, net tangible
assets and market value of public float initial inclusion
requirements.
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SIGNATURES
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.
RHEOMETRIC SCIENTIFIC, INC.
(Registrant)
October 2, 1998 By /s/ Joseph Musanti
Joseph Musanti, Vice President,
Finance & Materials and
Chief Financial Officer
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</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000779164
<NAME> RHEOMETRIC SCIENTIFIC
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 506
<SECURITIES> 0
<RECEIVABLES> 10,788
<ALLOWANCES> 0
<INVENTORY> 13,159
<CURRENT-ASSETS> 24,999
<PP&E> 15,968
<DEPRECIATION> 9,613
<TOTAL-ASSETS> 32,724
<CURRENT-LIABILITIES> 18,213
<BONDS> 4,832
0
0
<COMMON> 13
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</TABLE>
