================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  -------------
                                  FORM 10-QSB/A
                                  -------------

                                 AMENDMENT NO. 1


{X} Quarterly Report Pursuant to Section 13 or 15(d) of the Securities  Exchange
Act of 1934 for the quarterly period ended July 25, 1999

                                       or

{ } Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the Transition Period from ________to_________


                          Commission File Number 0-8567


                             Datametrics Corporation
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)



                Delaware                                        95-3545701
                --------                                        ----------
     (State or other jurisdiction of                         (I.R.S. Employer
     incorporation or organization)                       Identification Number)

            25B Hanover Road
        Florham Park, New Jersey                                   07932
     -------------------------------                      ----------------------
(Address of principal executive offices)                        (Zip Code)


                                 (973) 377-3900
                                 --------------
              (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  X       No
                                            ---         ---

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

Common Stock, $.01 Par Value -- 19,007,227 shares as of September 8, 1999

================================================================================
<PAGE>

                            DATAMETRICS CORPORATION
                              Index to Form 10-QSB

                                                                        Page No.

Part I - FINANCIAL INFORMATION
         Item 1.      Financial Statements:
                      Consolidated Balance Sheet
                      as of July 25, 1999                                     3

                      Consolidated Statements of
                      Operations for the Nine Months
                      Ended July 25, 1999 and
                      July 26, 1998                                           4

                      Consolidated Statements of
                      Cash Flows for the Nine Months
                      Ended July 25, 1999 and
                      July 26, 1998                                           5

                      Notes to Consolidated
                      Financial Statements                                    6

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


Part II - OTHER INFORMATION
         Item 1.      Legal Proceedings                                       11
         Item 2.      Changes in securities and uses of funds.                11
         Item 3.      Defaults upon Senior Securities                         12
         Item 4.      Submission of matters to a vote
                      of security holders.                                    12
         Item 5.      Other Information                                       12
         Item 6.      Exhibits and Reports on Form 8-K                        12

Signatures                                                                    14


                                  Page 2 of 14

<PAGE>

                             DATAMETRICS CORPORATION
                           CONSOLIDATED BALANCE SHEET
                                   (unaudited)

    (in thousands, except for share date)                          July 25, 1999
    -------------------------------------                          -------------

ASSETS
CURRENT ASSETS:
         Cash and cash equivalents                                          $776
         Accounts receivable, net                                          2,780
         Inventory, net                                                    4,579
         Prepaid expenses and other current assets                             3
                                                                          ------
         Total Current Assets                                              8,138

Property and Equipment, at Cost:
         Land                                                                420
         Building                                                          1,042
         Machinery and equipment                                           3,312
         Furniture, fixtures & computer equipment                          2,773
         Leasehold improvements                                               96
                                                                          ------
                                                                           7,643
         Accumulated depreciation and amortization                       (5,441)
                                                                          ------
         Net property and equipment                                        2,202
         Inventoried Parts                                                 3,200
         Other Assets                                                        807
                                                                          ------
                                                                         $14,347
                                                                          ======

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
         Current maturities of long-term debt                              1,950
         Accounts Payable                                                    712
         Accrued commissions and payroll                                      90
         Accrued warranty                                                     30
         Other accrued expenses                                              356
         Other accrued liabilities                                           225
         Bridge Notes                                                        250

                  Total Current Liabilities                                3,613
                                                                          ------
         Long-Term Debt, less current maturities
         Loan Payable                                                      4,396
         Other Long-Term Liabilities                                         766
                                                                          ------
                  Total Liabilities                                        8,775
                                                                          ------
         Commitments and Contingencies
         Stockholders' Equity
         Common stock, $.01 par value - 40,000,000 shares
                  authorized; 19,007,227 shares issued and
                  outstanding in 1999 (15,557,630 in 1998)                   190
         Additional paid-in capital                                       41,091
         Accumulated deficit                                            (35,709)
                                                                         -------
                  Total Stockholders' Equity                               5,572
                                                                         -------
                                                                         $14,347
                                                                         =======
See accompanying notes.

                                  Page 3 of 14

<PAGE>

                             DATAMETRICS CORPORATION
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)
<TABLE>
<CAPTION>



                                                              Three Months Ended         Nine Months Ended
                                                            July 25,     July 26,      July 25,     July 26,
                                                              1999         1998          1999         1998
                                                              _________________          _________________
                                                             (In thousands, except for per share data)
<S>                                                         <C>           <C>          <C>          <C>

Sales                                                        $2,385        $2,667       $6,273       $6,196

     Cost of sales                                            1,277         1,513        3,543        4,137
     Research & development                                      59           150          284          498
     Selling, general & administrative                          893           943        2,511        2,935
                                                             ----------------------------------------------

Income (loss) from operations                                   156            61         (65)      (1,374)
Interest expense, net                                           113           156          356          388
Lease settlement expense                                        ---           ---        1,225          ---
                                                             ----------------------------------------------

Income (loss) before provision                                    43         (95)      (1,646)      (1,762)
     for income taxes
Provision for income taxes                                      ---             3          ---            6
                                                             ----------------------------------------------

Net income (loss)                                               $43         ($98)     ($1,646)     ($1,768)
                                                             ==============================================

Earnings (loss) per share of common stock
     Basic and Diluted                                        $0.00       ($0.01)      ($0.09)      ($0.12)
                                                             ==============================================

Weighted average number of shares outstanding
     Basic and Diluted                                      $18,447        15,566       17,386       15,102
                                                             ==============================================

</TABLE>

                                  Page 4 of 14

<PAGE>

                             DATAMETRICS CORPORATION
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                        For the Nine Months Ended
                                                                 July 25, 1999             July 26, 1998
                                                                 ---------------------------------------
<S>                                                                 <C>                      <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net Loss                                                        (1,646)                    (1,768)
     Adjustments:
         Depreciation and amortization                                   341                        392
         Bad debt expense                                                ---                         25

     Changes in assets and liabilities
         Accounts receivable                                           (801)                      (362)
         Inventory                                                     (439)                    (1,318)
         Prepaid expenses and other current assets                        52                         77
         Other assets                                                      3                        271
         Accounts payable                                              (322)                      (792)
         Accrued commission and payroll                                (135)                      (479)
         Other accrued expenses                                          141                    (1,101)
         Advance and progress payments from customers                    ---                      (133)
         Other long-term liabilities                                     ---                      (264)
                                                                 ---------------------------------------

Net cash used in operating activities                                (2,806)                    (5,452)
                                                                 ---------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Capital expenditures for property and equipment                   (236)                    (1,556)
                                                                 ---------------------------------------

Net cash used in investing activities                                  (236)                    (1,556)
                                                                 ---------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Borrowings on revolving line of credit                              426                      7,456
     Payments on revolving line of credit                            (2,095)                    (5,638)
     Payment on capitalized lease obligations                            ---                        (6)
     Borrowings on long-term debt                                      1,800                      1,899
     Payments on long-terms debt                                         ---                      (133)
     Proceeds from the issuance of common stock and warrants           3,209                      3,850
     Proceeds from bridge notes                                          250                        ---

Net cash provided by financing activities                              3,590                      7,428
                                                                 ---------------------------------------

Net increase in cash and cash equivalents                                548                        420
Cash and cash equivalents at the beginning of the period                 228                        200
                                                                 ---------------------------------------

CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD                      $776                       $620
                                                                 =======================================
Cash paid during the period for:
     Interest                                                           $172                       $437
     Income taxes                                                        ---                          6
Non-cash transactions
     Exchange of 7% Convertible Debentures for 10%
         Senior Subordinated Notes Due 2000                          (1,750)                        ---
     Exchange of Senior Subordinated Debentures for
         10% Senior Subordinated Notes Due 2000                        (500)                        ---
</TABLE>
See accompanying notes.

                                  Page 5 of 14

<PAGE>


                             DATAMETRICS CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                  July 25, 1999
                                   (Unaudited)

1. The  consolidated  financial  statements  include the accounts of Datametrics
Corporation and its wholly-owned subsidiaries (collectively, the "Company").

The consolidated  financial statements included herein have been prepared by the
Company,  without audit, pursuant to the rules and regulations of the Securities
and Exchange  Commission for the  requirements  of the Quarterly  Report on Form
10-QSB.  Certain  information  and  footnote  disclosure  normally  included  in
financial  statements  prepared in accordance with generally accepted accounting
principles   have  been  condensed  or  omitted   pursuant  to  such  rules  and
regulations,  although the Company believes that the disclosures are adequate to
make the  information  presented  not  misleading.  It is  suggested  that these
consolidated financial statements be read in conjunction with the statements and
notes thereto  included in the  Company's  latest Annual Report on Form 10-K for
the fiscal year ended October 25, 1998 as filed with the Securities and Exchange
Commission.

The  information  reflects  all  adjustments  (consisting  of  normal  recurring
adjustments)  which are, in the opinion of  management,  necessary  to present a
fair statement of the results of operations for the interim periods. Much of the
Company's business is longer term and involves varying development,  production,
and  delivery  schedules.  Accordingly,  results  of  a  particular  quarter  or
quarter-to-quarter  comparisons  of  recorded  sales  and  profits  may  not  be
indicative of future operating  results,  including  results for the fiscal year
ending October 31, 1999.

2. INVENTORIES. Stockroom inventories consist primarily of materials used by the
Company for  existing  and  anticipated  contracts  and  materials  and finished
assemblies  which are held to satisfy spare parts  requirements of the Company's
customers. Those parts not expected to be sold within one year are classified as
a non-current  asset.  The Company does not amortize its non-current  inventory,
but the Company evaluates all inventory for obsolescence on a periodic basis and
records  estimated  reserves.  Inventories  as of July 25,  1999  consist of the
following:


   Inventories of parts and sub-assemblies                   $      11,662,929
   Contracts in progress                                               741,552
   Finished goods                                                      202,500
                                                             -----------------
                                                                    12,606,981

                  Less non current inventories                       3,200,000
                  Less reserve for obsolescence                      4,828,000
                                                             $       4,578,981





                                  Page 6 of 14

<PAGE>



3.  SUBSEQUENT  EVENTS.  In  August  1999  the  Company  completed  the  sale of
$2,300,000 of Subordinated  Convertible Secured Notes Due August 2000 ("Notes").
A portion of the  purchase  price for the Notes  included the tender back to the
Company and  retirement  of $600,000 of the  Company's  10% Senior  Subordinated
Secured  Debentures  then in default,  and $150,000 of the  Company's 10% Bridge
Notes which were  required by their terms to be repaid in May 1999 and  extended
by agreement of the holders.  The remaining  $1,550,000 was received in cash. In
connection  with the sale of the Notes,  the Company issued warrants to purchase
up to 1,150,000 shares of its Common Stock, $.01 par value, for a purchase price
of $1.10 per share.  The  Company  also  issued  Warrants  to  purchase up to an
aggregate  250,000  shares of its Common stock for a purchase price of $1.00 per
share to the  holders of the  Company's  10% Bridge  Notes then  outstanding  in
consideration  of interest due on the Bridge Notes and the extension of the date
of maturity of the Bridge Notes.  See the Company's  Current  Report on Form 8-K
filed with the Securities and Exchange Commission on August 24, 1999.

On August 20, 1999,  the Company made a payment of $100,000 in  satisfaction  of
the remaining  $100,000 of the Company's 10% Bridge Notes which were required by
their terms to be repaid in May 1999 and extended by agreement with the holder.

In  September,  the Company  completed  negotiations  and closed on a $1,500,000
revolving line of credit with Branch Banking and Trust Company  ("Branch Bank").
The Line of Credit  accrues  interest at a variable  rate equal to Branch Bank's
Prime Rate plus 0.5%. The Line of Credit is secured by the assets of the Company
and  guarantees  by  two  guarantors  in  the  aggregate  amount  of  $1,500,000
("Guarantees")  that are secured by letters of credit  issued on the accounts of
each of the  guarantors.  In  consideration  of the  Guarantees,  the guarantors
received Warrants to purchase up to an aggregate  1,500,000 shares of the Common
Stock of the Company,  $.01 par value,  for a purchase price of $1.00 per share,
pursuant to an arrangement  made in July 1999. The Company also issued  Warrants
to  purchase  up to  75,000  shares of the  Common  Stock of the  Company  for a
purchase price of $1.10 per share to a third party as compensation for arranging
the Guarantees. The Line of Credit expires on August 25, 2000.

On September 6, 1999, the Company  applied a portion of the proceeds of its line
of  credit to fund the  payment  of the  remaining  $750,000  of its 10%  Senior
Subordinated Secured Debentures then in default, plus accrued interest thereon.

ITEM 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                  CONDITION AND RESULTS OF OPERATIONS

                              RESULTS OF OPERATIONS

                 Nine Month Period Ended July 25, 1999 Compared
                    To Nine Month Period Ended July 26, 1998

Sales for the nine month period ended July 25, 1999 were $6,273,000, an increase
of $77,000 or 1%,  compared  with sales of  $6,196,000 in the same period in the
prior fiscal year. The increase in sales




                                  Page 7 of 14

<PAGE>



for the nine months ended July 25, 1999 is attributable to higher production and
order levels.  During the same period in the prior fiscal year,  the Company was
completing the start up of its new  manufacturing  facility in Orlando,  Florida
and during this  transition  period  experienced  material  shortages  and labor
inefficiencies.

Cost of sales for the first nine  months of fiscal 1999 was  $3,543,000  (57% of
sales),  a decrease of $594,000 or 14%,  compared with $4,137,000 (67% of sales)
for the same period in the prior fiscal year. Cost of sales  decreased  compared
to the same period in the prior  fiscal year  because the Company has  completed
its transition to its new Florida manufacturing  facility and is now starting to
experience labor and material efficiencies.

Research and development  expenses were $284,000 for the nine-month period ended
July 25, 1999,  a decrease of $214,000 or 43%,  compared  with  $498,000 for the
same  period in the prior year.  The  decrease  in  expenditures  is due to less
research and  development  required for the  Company's  new family of industrial
color printers.

Selling,  general and administrative ("SG&A") expenses for the nine month period
ended July 25, 1999 were  $2,511,000  (40% of sales) a decrease of $424,000,  or
14%,  compared with  $2,935,000  (47% of sales) for the same period in the prior
fiscal  year.  The  decrease is due to fewer  administrative  and support  staff
required by the Company.

Net interest  expense  amounted to $356,000 for the nine month period ended July
25, 1999, a decrease of $32,000,  or 9%,  compared with net interest  expense of
$388,000  for the same period in the prior year.  This  decrease is due to lower
outstanding borrowings.

The net  loss  for the  nine-month  period  ended  July  25,  1999  amounted  to
$1,646,000  a  reduction  in  losses  of  $122,000  compared  with a net loss of
$1,768,000  for the same  period in the  prior  year.  The loss for the  current
nine-month period is primarily attributable to the non-recurring settlement with
the Company's former  California  landlord in which the Company agreed to pay to
the landlord $1,225,000 in cash and stock.

                 Three Month Period Ended July 25, 1999 Compared
                    To Three Month Period Ended July 26, 1998

Sales for the three-month period ended July 25, 1999 were $2,385,000, a decrease
of $282,000 or 11%,  compared with sales of $2,667,000 in the same period in the
prior fiscal year.  The decrease in sales for the third  quarter  ended July 25,
1999 is  attributable  to lower than  anticipated  orders from the Department of
Defense and prime contractors for the Department of Defense.

Cost of Sales  for the  third  quarter  of fiscal  1999 was  $1,227,000  (51% of
sales),  a decrease of $236,000 or 15%,  compared with $1,513,000 (57% of sales)
for the same  period in the prior  fiscal  year.  Cost of sales  improved as the
Company continues to be more efficient in the use of direct labor.






                                  Page 8 of 14

<PAGE>



Research and development  expenses were $59,000 for the three-month period ended
July 25, 1999, a decrease of $91,000, compared with $150,000 for the same period
in the prior year. All of the expenditures were for the Company's DmC Model 1200
dot matrix  printer and DmC Model 4080 thermal  printer as well as the Company's
new family of industrial  color  printer.  The decrease is due to less resources
required for the Company's family of industrial color printer.

Selling, general and administrative ("SG&A") expenses for the three month period
ended July 25, 1999 were $893,000  (37% of sales) a decrease of $50,000,  or 5%,
compared  with  $943,000  (35% of sales) for the same period in the prior fiscal
year.  The decrease is due to lower  administrative  and support staff  expenses
throughout the Company.

Net interest  expense amounted to $113,000 for the three month period ended July
25, 1999 compared  with net interest  expense of $156,000 for the same period in
the prior year. The decrease is due to lower outstanding borrowings.

The net income  for the  three-month  period  ended July 25,  1999  amounted  to
$43,000, an increase of $141,000, compared with net loss of $98,000 for the same
period in the prior year.

Management has determined  that, based on the Company's  historical  losses from
recurring operations, the Company will not recognize its net deferred tax assets
at July 25, 1999. Ultimate recognition of these tax assets is dependent, to some
extent, on future revenue levels and margins.  It is the intention of management
to assess the appropriate level for the valuation allowance each quarter.

The contract  process in which  products  are offered for sale is generally  set
before costs are incurred, and prices are based on estimates of the costs, which
include the anticipated impact of inflation.

The Company's backlog of funded orders not yet recognized as revenue at July 25,
1999 was  approximately  $4,245,022.  At  September  2, 1999,  the  backlog  was
approximately $4,047,761.  Approximately 75% of the September 2, 1999 backlog is
expected to be delivered during the next twelve months.

                         LIQUIDITY AND CAPITAL RESOURCES

In August,  the Company completed a private financing of $2,300,000  through the
sale of 12% Subordinated Convertible Secured Notes Due August 2000. A portion of
the  purchase  price for the Notes  included  the tender back to the Company and
retirement  of  $600,000  of  the  Company's  10%  Senior  Subordinated  Secured
Debentures then in default, and $150,000 of the Company's 10% Bridge Notes which
were  required by their terms to be repaid in May 1999 and extended by agreement
of the holders.  The remaining  $1,550,000  was received in cash. The Company is
using the cash proceeds from the sale of the Notes to fund working capital.

Subsequent  to the end of the  quarter,  the Company  established  a  $1,500,000
revolving line of credit with Branch Bank,  which accrues interest at a variable
rate equal to the Branch Bank's Prime Rate




                                  Page 9 of 14

<PAGE>



plus  0.5%.  The Line of Credit is  secured  by the  assets of the  Company  and
guarantees  by two  guarantors in the  aggregate  amount of $1,500,000  that are
secured by letters of credit  issued on the  account of each of the  guarantors.
The Company  recently applied a portion of the proceeds of its line of credit to
fund the payment of the remaining  $750,000 in principal  amount  outstanding of
its 10% Senior Subordinated Secured Debentures in default, plus accrued interest
thereon,  and  expects to  continue  to use the  proceeds  of the line of credit
hereinafter to fund working capital.

The Company's  working  capital and current  ratios at July 25, 1999, and at the
end of  fiscal  year  1998,  were  $4,523,000  and  $3,570,000,  and 2.2 and 1.6
respectively.

Management believes that the Company must make approximately $100,000 of capital
expenditures (including capitalized leases) during the remainder of fiscal 1999.
The Company's other principal commitments for fiscal year 1999 include principal
and interest  payments on loans and  subordinated  debt.  Management  expects to
finance the  capital  expenditure  requirements  and other  commitments  using a
portion of the proceeds of its revolving line of credit.

The Company utilizes various computer  software packages as tools in running its
accounting  operations.  Management plans to replace the current software with a
new version  which is better  suited to support its current and future  business
needs. The approach includes:  an assessment of internal programs and equipment;
communication  with major  customers  and vendors  with  respect to the state of
readiness of their  systems;  an evaluation of facility  related  issues and the
development  of a  contingency  plan.  This  approach is designed to maintain an
uninterrupted  supply of goods and services to/from the Company.  The Company is
incorporating Year 2000 ("Y2K") compliant computer programming language into its
software package.  The Company does not believe the investment  required for its
mainframe  and  critical  hardware   equipment  to  be  Y2K  compliant  will  be
significant.

The Company is in a continuous process of communicating with its major customers
and suppliers to determine Y2K systems compatibility and compliance. The Company
has been assured by its major  suppliers that there will be no disruption in the
delivery of goods and services. The Company believes that adequate resources are
available  for the supply of its raw materials  and facility  related  equipment
will be operational.

The Company continues to assess the risks of Y2K associated program failures and
will develop a formal contingency plan with its business partners to address the
specific risks. The failure to correct a material Y2K problem could result in an
interruption  in normal  business  activity.  The Company's  plan is expected to
significantly reduce the risk associated with the Y2K issue. However, due to the
inherent uncertainty of the Y2K issue and dependence on third-party  compliance,
no assurance can be given that potential Y2K failures will not adversely  effect
the Company's operations, liquidity and financial position.




                                  Page 10 of 14

<PAGE>


                  FORWARD LOOKING STATEMENTS-CAUTIONARY FACTORS

Except for the historical  information and statements  contained in this report,
the matters  set forth in this  report are  "forward  looking  statements"  that
involve  uncertainties  and risks,  some of which are  discussed at  appropriate
points in this report and the  Company's  other SEC filings,  including the fact
that the  Company  is  engaged  in  supplying  equipment  and  services  to U.S.
government  defense  programs  which are  subject  to special  risks,  including
dependence on government  appropriations,  contract  termination  without cause,
contract  renegotiation  and  the  intense  competition  for  available  defense
business.

PART II.          OTHER INFORMATION

ITEM 1.           LEGAL PROCEEDINGS.

The Company is, from time to time, the subject of legal  litigation,  claims and
assessments  arising out of matters occurring during the normal operation of the
Company's business. In the opinion of management,  the liability,  if any, under
such current litigation,  claims and assessments would not materially affect the
financial  position  or the  results  of  operations  of the  Company  except as
disclosed herein.

On May 5, 1999,  pursuant to an agreement with the Company's  former landlord in
settlement  of all claims  arising out of a judgment  against the  Company,  the
Company paid $900,000 in cash and issued  150,000  shares of Common Stock to the
landlord.  The Company has agreed to register  the shares of Common  Stock,  and
under certain circumstances,  the Company will issue additional shares of Common
Stock to the  extent  that the  market  price of its Common  Stock  falls  below
certain  levels.  The Company also has the right to repurchase  the shares under
certain circumstances.

ITEM 2.           CHANGES IN SECURITIES AND USES OF PROCEEDS.

During  the  three-month  period  ended  July 25,  1999,  the  Company  sold the
following  securities  without  registration  and pursuant to the  exemption set
forth in Section 4(2) under the Securities Act of 1933, as amended:

         1. In May 1999, the Company sold an aggregate  1,500,000  shares of its
Common Stock to 3 investors for an aggregate  purchase price of  $1,500,000.  In
connection  therewith,  the  Company  also  issued  Warrants  to  purchase up to
1,500,000  shares of its Common Stock at a purchase price equal to the lesser of
$1.35 per share or the volume-weighted average price of the Common Stock for the
20 trading days  immediately  preceding the notice of exercise.  The Company has
agreed to register  the shares of Common  Stock  issued and the shares of Common
Stock  underlying  the Warrants.  See the Company's  Current  Report on Form 8-K
filed with the Securities and Exchange Commission on May 17, 1999.




                                  Page 11 of 14

<PAGE>



         2. In May 1999,  the Company  issued 150,000 shares of its Common Stock
to the owner of the  premises  the Company  formerly  leased in Woodland  Hills,
California,  in  settlement  of a claim brought by the owner against the Company
for unpaid rent due plus damages.

         3. In May, 1999, in consideration of marketing  services to be rendered
pursuant to a Market Access  Program  Marketing  Agreement,  the Company  issued
104,348  shares  of its  Common  Stock to  Continental  Capital  & Equity  Corp.
("CCEC"),  Warrants  to purchase up to 100,000  shares of the  Company's  Common
Stock for a purchase  price of $1.00 per share and  Warrants  to  purchase up to
100,000  shares of the Company's  Common Stock for a purchase price of $2.00 per
share.  Subsequent to such issuance an issue arose between the Company and CCEC,
and the entitlement of CECC to such shares and Warrants is currently in dispute.

ITEM 3.           DEFAULTS UPON SENIOR SECURITIES.

In May 1999, the holders of $250,000 of the Company's 10% Bridge Notes agreed to
extend the date of maturity of the Bridge  Notes,  which were  required by their
terms to be repaid during May 1999. The holders of $150,000 of such Bridge Notes
exchanged the Bridge Notes for the Company's  Convertible  Subordinated  Secured
Notes Due August 2000.  On August 20,  1999,  the Company  repaid the  remaining
$100,000 of the outstanding principal balance of the Bridge Notes.

As of July 25, 1999, the Company was in default of  approximately  $1,350,000 in
principal amount of its 10% Senior Subordinated  Secured Debentures,  which were
required to be repaid by their terms on May 25, 1998.  The Company has satisfied
approximately  $600,000 of the outstanding  amount by exchange for the Company's
12%  Subordinated  Convertible  Secured  Notes due August 2000.  The Company has
funded repayment of the remaining $750,000 of the outstanding  principal amount,
plus accrued  interest,  with a portion of the proceeds of the Company's line of
credit  with Branch  Banking  and Trust  Company,  thereby  retiring  all of the
Company's outstanding debt to its security holders currently in default.

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

                  None.

ITEM 5.           OTHER INFORMATION.

                  None.

ITEM 6.           EXHIBITS AND REPORTS ON FORM 8-K.

          (a)     List of Exhibits:

                  Exhibit 27 - Financial Data Schedule.





                                  Page 12 of 14

<PAGE>


         (b)      Reports on Form 8-K.

                  The  Company  filed a  Current  Report  on Form  8-K  with the
Securities and Exchange Commission on May 17, 1999, which reported as Item 5 the
Company's sale of Common Stock and Warrants on May 7, 1999.










                                  Page 13 of 14


<PAGE>

                                   SIGNATURES

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


                                               DATAMETRICS CORPORATION
                                               (Registrant)



Dated:   September 13, 1999                    /s/   Daniel P. Ginns
         ------------------                    ---------------------------------
                                               Daniel P. Ginns
                                               Chief Executive Officer






Dated:   September 13, 1999                    /s/ William B. Pandos
         ------------------                    ---------------------------------
                                               William B. Pandos
                                               Chief Financial Officer




                                  Page 14 of 14