U.S. Securities and Exchange Commission

                      Washington, D.C. 20549

                           Form 10-KSB



[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934

     For the Fiscal Year Ended December 31, 1996.

                   Commission File No. 2-69336

                           CRAMER, INC.

KANSAS                I.R.S. EMPLOYER IDENTIFICATION
                           NUMBER 48-0638707
625 ADAMS STREET, KANSAS CITY, KS 66105
TELEPHONE: (913) 621-6700

Securities registered under Section 12(g) of the Exchange Act:
Common Stock

Check whether the issuer: (1) has filed all reports required to
be filed by Sections 13 or 15(d) of the Exchange Act during the
past 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 __

Check if no disclosure of delinquent filers in response to Item
405 of Regulation S-B is contained in this form, and no
disclosure will be contained, to the best of registrant's
knowledge, in definitive proxy or other information statements
incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB.  [X]

The issuer's revenues for the 1996 fiscal year were $11,872,000.

As of December 31, 1996 the aggregate market value of the common
shares of Cramer, Inc. held by non-affiliates was approximately
$247,000.  (Calculated assuming a $0.14 book value per share on
December 31, 1996.)

State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date:
3,840,650 shares of common stock.

Transitional Small Business Disclosure Format (check one): Yes__
No  X 


<PAGE>


                              INDEX

                                                         PAGE NO.

PART I

  Item 1.   Description of Business                                     1
  Item 2.   Description of Property                                     6
  Item 3.   Legal Proceedings                                           6
  Item 4.   Submission of Matters to a Vote of Security 
            Holders                                                     6

PART II

  Item 5.   Market for Common Equity and Related 
            Stockholder Matters                                         7
  Item 6.   Management's Discussion and Analysis of 
            Financial Condition and Results of Operations               7
  Item 7.   Financial Statements                                       11
  Item 8.   Changes in and Disagreements with Accountants on 
            Accounting and Financial Disclosure                        24

PART III

  Item 9.   Directors, Executive Officers, Promoters and 
            Control Persons; Compliance with Section 16(a) 
            of the Exchange Act                                        25
  Item 10.  Executive Compensation                                     26
  Item 11.  Security Ownership of Certain Beneficial Owners 
            and Management                                             27
  Item 12.  Certain Relationships and Related Transactions             28
  Item 13.  Exhibits and Reports on Form 8-K                           28



<PAGE>







                              PART I

ITEM 1. DESCRIPTION OF BUSINESS

Cramer, Inc. is a Kansas corporation engaged in the manufacture
and sale of seating and utility products for office, industrial
and home use.  The Company was established in 1886 as a
manufacturer of safes and office products.  The Company was owned
by descendants of the Cramer family until 1961 when it was sold
to OLIX Industries, a public company located in Austin, Texas. 
In January 1981, OLIX made a public distribution of its Cramer
common stock.



Business of Issuer

The Company's seating products compete in the $10 billion
domestic market for office furniture, which includes seating,
desks, files, and panel systems.  Major companies serving this
market are Steelcase, Herman Miller, Knoll, Haworth, Kimball, and
HON Industries.  These six companies supply products in all major
categories of this market.  Together they account for an
estimated 60% of sales in this market.  The remaining 40% of the
market is served by smaller companies (typically sales of less
than $75 million) that primarily compete only in selected
segments.  These segments are delineated either by product type,
such as seating or casegoods, or by customer category, for
example high-style, or wood-finish, or budget-price.

Cramer's seating products are non-wood characterized by painted
metal finish and upholstered seats and backs.  The product line
includes standard height chairs and a wide range of raised height
models and stools.  All offer ergonomic design with varying
degrees of adjustability to accommodate individual users.  Cramer
manufactures and sells chairs for a variety of demanding
commercial applications, including intensive (24-hour) use,
production facilities, laboratories, hospitals, schools as well
as conference, secretarial and management seating for the general
office.  The Company also manufactures Cleanroom and Electro-Static
Discharge seating which meets the needs of certain
specialized manufacturing and research environments.  The
Company's seating products are recognized for quality
construction and lasting durability.

The Company's utility products include the Kik-Step[Registered
Trademark], a round, all-steel, 2-step stool that rolls on
retractable casters and is frequently used in libraries, file
rooms, and warehouses.  This product was designed by Cramer in
1957 and continues to be an important part of the Company's
product line.  In addition to the Kik-Step[Registered Trademark],
Cramer manufactures a range of steel and light-weight aluminum
ladders featuring the same retractable caster concept.  The
Company's utility product line also includes step stools and foot
rests manufactured by the Company, a variety of other products
such as step ladders purchased from other manufacturers, a line
of durable, self-skinned urethane chairs and stools, and steel or
aluminum framed industrial grade seating products.

<PAGE>





Marketing and Competition

The domestic office furniture market is highly competitive. 
Cramer competes by focusing on the non-wood task seating market
niche with products that have high-quality and a reputation for
long-term reliability.  The Company also differentiates itself by
a commitment to customer service and on-time delivery.  The
Company's 110+ year history and the proven reliability of its
products support a strong reputation and product awareness in the
marketplace.  Cramer frequently competes in its narrow market
area against similar-sized niche manufacturers.  In addition, the
Company has been able to effectively compete against the major
companies in the industry when Cramer's special product features,
reputation for quality, and Cramer's quality of customer service
offer the customer a better price-value relationship than the
large competitors.

Cramer's products are sold throughout the United States. 
International sales are not significant.

The majority of the Company's office products are sold to
independent office furniture dealers who resell the products to
end users.  Cramer has approximately 1,500 of these accounts. 
For the past several years, sales to independent office furniture
dealers have accounted for approximately 75% of the Company's
revenue.  These sales efforts are focused through approximately
20 independent sales representative organizations located in
major markets throughout the United States.  These sale
organizations typically employ from 1 to 6 people, and represent
3 to 6 complimentary product lines such as desks, panel systems,
and lighting.  Average tenure for the Company's sales
representatives is more than four years.  These representatives
initiate and develop business directly with end users, designers
and architects for specification projects and coordinate and
manage the Company's business relationships with the independent
office furniture dealers in their territories.

The Company's industrial products are sold primarily to
approximately 100 wholesale and catalog distributors.  These
distributors include major office supply and industrial
suppliers, and specialty distributors serving end-users' health-
care, scientific, and safety needs.  While other manufacturers
produce competing products, as a result of the Company's
favorable price/value relationship, the variety of applicable
products Cramer has to offer the specific wholesale or catalog
distributor, and its attention to customer service, these
competitors have, thus far, not been successful in reducing the
Company's market share of these products.  However, there is no
guarantee that competitors will not be successful in the future. 
While eight wholesale and catalog distributors accounted for 72%
of the Company's 1996 industrial product sales, no single
customer accounted for more than 10% of the Company's total sales
in 1995 or 1996.

An emerging area for the Company is home products.  These include
Kik-Steps[Registered Trademark] which are sold primarily through
specialty catalog distributors serving domestic kitchen and
workroom needs.  In addition, seating products are sold by office
furniture dealers for home office use.

Cramer regularly participates in national office and industrial
products trade shows and conferences.  Sales representatives
display product samples and provide demonstration chairs for
dealers and end-users.  The Company maintains permanent product
displays in showrooms in Los Angeles, Chicago, and New York.


<PAGE>



Sales in the contract furnishing industry, where Cramer's office
products compete, follow a seasonal pattern of lower volume in
the winter and summer and higher volume in the spring and fall. 
Industrial product sales are generally equal through each quarter
of the year.


Products

The Company's flagship seating product is the Triton[Registered
Trademark] chair, which was introduced in 1992.  The Company
believes this chair is unique in the industry because it combines
steel structural components with full ergonomic adjustability. 
This design significantly upgrades the user's ability to meet
emerging ergonomic adjustability requirements, yet have a chair
that exceeds industry durability specifications.  The
Triton[Registered Trademark] is designed to meet or exceed all
current standards of adjustability for prevention of repetitive
stress trauma including the San Francisco VDT work-station
standards; meet or exceed all flame-retarding specifications,
including Boston Fire Marshal, California TB 117, and California
TB 133; and meet or exceed industry testing for strength and
component failure (ANSI/BIFMA specifications).

In addition, during 1995, with only minor modifications, a
version of the Triton[Registered Trademark] was independently
certified to pass the more rigorous U.S. Federal General Services
Administration Intensive Use Seating specifications.  This
product began delivery in the first half of 1996.

Typical purchasers of the Triton[Registered Trademark] are
health-care facilities, professional offices, production lines,
airline reservation centers, police and emergency dispatch
stations and similar 24-hour use applications.  During 1996, the
Company introduced a larger version of the Triton[Registered
Trademark] called the Triton Max.  This version was specifically
designed to accommodate larger-sized users.

Other significant seating products include the Fusion[Registered
Trademark], Rhino, and Cirrus/Nimbus.  The Fusion[Registered
Trademark] chair provides full ergonomic task seating at a
moderate price.  This chair's design and function follow the
strict standards found in all of the Company's active ergonomic
seating lines.  The product is designed to function within
office, light assembly and laboratory settings.  The chair line
is designed to complement the Triton[Registered Trademark] line
with its unique steel seat pan.

The Rhino product line, introduced in 1994, is distinguished by
its seat and back which are made from "tough-skinned" urethane
foam.  This technology offers industrial-strength reliability for
factory seating, including the ability to wash the chair without
damaging the upholstery.  The product-line includes a large
"task" chair and a smaller "operational" chair.  The third
product in the Rhino line is a small sit-stand designed to
relieve weight from an individual's feet in industrial situations
which do not allow a fully seated position.

The Cirrus and Nimbus chairs are conference chairs with passive
ergonomic mechanisms.  While introduced in the 1980's, these
products continue to have good market acceptance, particularly by
government purchasers.

The Company believes that systematic development and introduction
of new products is important for the Company's growth and
continued profitability. In 1997, the <PAGE>  Company intends to
introduce new stacking guest chairs as well as other seating
products.

The Company's step stool and aluminum ladders have been in use in
the United States since the 1950s.  The design of these products
and the retractable caster concept are well recognized and
accepted in the marketplace.  In 1996, the Company began
providing steel versions of its popular retractable caster
ladders.



Production, Trademarks and Government Regulation

The Company's products are fabricated from raw materials such as
steel sheet and tubing, aluminum tubing, foam, and fabric
purchased from sources locally and throughout the United States. 
Specialized components and subassemblies are likewise purchased
from vendors throughout the United States.  Cramer understands
the importance of developing partnerships with its vendors, and
has undertaken a program to work closely with suppliers to
improve quality, delivery, and price, while offering technical
assistance and production planning forecasts.  Although this
approach includes focusing greater purchases with fewer vendors,
the Company believes it retains the ability to change to
alternative suppliers in most cases.

Certain components of the Company's products are sourced from a
single vendor.  Any disruption in such supply arrangements could
result in temporary shipment delays or increased costs.  However,
the Company believes it has the ability to substitute suppliers
for any component in less than a three month period of time.

Production machinery and equipment used in the manufacture of the
Company's products are owned and maintained by the Company, and
primarily located in the Company's factory in Kansas City,
Kansas.  Certain tooling for the fabrication of specialized
components is owned by the Company, but located at vendors who
manufacture the components.  The production equipment ranges from
older-model metalworking machinery to a modern powder coat
painting system.  The Company systematically maintains its
equipment at high levels of operation.  Cramer has sufficient
production capacity for substantially increased sales
requirements.

The Company manufactures approximately 60% of all of its orders
specifically to customer requirements.  Cramer is able to
customize product specifications for particular needs.  The
Company's delivery schedule typically is four weeks for seating
products and two weeks for utility products.  This schedule is
typical for the business areas where the Company competes.  The
Company has sufficient manufacturing flexibility to provide
shorter lead times when necessary for special customer needs. 
This ability, plus a small inventory of finished chairs in stock
for immediate delivery, can be a competitive advantage in certain
situations.  At December 31, 1996, the Company's backlog of
unfilled orders was $972,000, the majority of which are scheduled
to be shipped in the first quarter of 1997.

While approximately 40% of the Company's sales are shipped from
stock, the Company maintains a finished goods inventory of only
$185,000.  This inventory consists of a small inventory of Kik-
Step[Registered Trademark] stools and ladders and the Quick Ship
seating inventory described above.  The Company believes its
ability to maintain its high inventory turnover ratio in this
area (26 times in 1996) is a competitive advantage.


<PAGE>


The Company's Kik-Step[Registered Trademark], Aeros[Registered
Trademark], Triton[Registered Trademark], and Fusion[Registered
Trademark] product names are registered trademarks.  The
Company's other major contract seating products are marketed
under the Cirrus, Nimbus, and Rhino trademarks.

No government approval is required for Cramer's products.  The
Company designs its products to meet voluntary industry standards
for strength and reliability (ANSI/BIFMA).  The Company maintains
ANSI/BIFMA test equipment at its factory and has implemented a
program of systematically testing its products for reliability. 
Certain products are designed to meet the more rigorous
requirements of the General Services Administration.  This
provides the Company with competitive advantages in certain
situations.

The Company's production processes use no known hazardous or
polluting substances.  The Company is subject to various federal,
state, and local laws and regulations governing the protection of
its employees and the environment.  The Company believes that it
is in substantial compliance with such laws, and that continued
compliance will not have a material adverse effect on its
business.

Employees

As of December 31, 1996, the Company employed 94 full time
people; 36 office, supervisory, managerial, and executive
personnel, and 58 factory workers.  Cramer management considers
the ability to attract, train, and retain skilled professional
employees and production workers to be an important aspect of the
Company's competitive advantage.  Management believes that it
enjoys a good, interdependent relationship with its employees,
and has instituted personnel policies intended to maintain this
relationship.  The Company is an equal opportunity employer and
an active non-discrimination policy is integral to this concept.

The factory workers are covered by a collective bargaining
agreement with the United Steelworkers of America which expires
on September 30, 1998.  The Company believes that strong labor
relations are important to its ability to achieve product
quality, on-time delivery, and continuous improvement in the
workplace.  No work stoppages have occurred over the past ten
years.  The State of Kansas is a right-to work state, so not all
factory workers belong to the Union.  At year end, 24 of the 58
factory workers were not dues-paying members.  The Company
considers its labor relations to be good.

Research and Development

New products are developed internally by a technical staff who
have an average of 5 years experience with seating and industrial
products.  New designs are developed on state-of-the-art CAD
equipment to shorten development time, improve documentation, and
facilitate sourcing of high-quality components from outside
vendors.  The Company spent approximately $80,000 and $70,000 on
engineering, research and development in 1996 and 1995,
respectively.

Cramer employees are committed to continuous improvement of
products and processes.  The Company believes that this
philosophy is working to develop products with higher
reliability, lower cost, and improved product features.



<PAGE>




Item 2.  DESCRIPTION OF PROPERTY

The Company's corporate headquarters and manufacturing facility
are located on a 5-acre tract at 625 Adams Street, Kansas City,
KS  in a building owned and occupied by the Company since 1957. 
This facility comprises 165,000 square feet, including 20,000
office, 2,000 showroom, and 143,000 manufacturing space.

The Company considers the facility appropriate for its type of
manufacturing, with sufficient expansion potential for
foreseeable growth.  The facility is in good condition.  No
expansions, renovations, or significant changes are necessary or
planned.  The location is in proximity to a large labor pool and
has good access to transportation, including rail service.

The Company believes that its facilities are adequately insured. 

Sales showrooms located in furniture design centers in Los
Angeles, Chicago, and New York are subleased by Cramer for
permanent display of the Company's products.  None of these
subleases have terms longer than one year.



ITEM 3. LEGAL PROCEEDINGS

The Company is a defendant in several lawsuits relating to
product liability claims arising from accidents allegedly
occurring in connection with the use of its products.  The claims
are covered by insurance and are being defended by the Company's
independent counsel or by counsel assigned by the Company's
insurance carriers, but are subject to deductibles ranging from
$0 to $100,000.  A number of the claimants allege substantial
damages.  While management believes the Company has substantial
defenses with respect to the claims, the ultimate outcome of such
litigation cannot be predicted with certainty.  The Company has
reasonably estimated and accrued in its financial statements its
portion of the deductible as a product liability contingency. 
Such claims are an ordinary aspect of the Company's business.

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

None



<PAGE>








                             PART II

ITEM 5.   MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
          MATTERS

Cramer stock is not listed on NASDAQ or any exchange and there is
no public trading market for the Company's stock.

The Company is aware of a limited number of privately negotiated
transactions in the Company's stock.  In such cases, the Company
has been informed that the price per share approximated the net
book value of the Company's stock.

As of December 31, 1996, there were 701 shareholders of record.

Since being publicly held, the Company has never paid cash
dividends and does not anticipate paying any cash dividends in
the foreseeable future.  The Company's ability to pay cash
dividends on its common stock will depend upon its capital
surplus and cash requirements.

ITEM 6.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
            CONDITION AND RESULTS OF OPERATIONS

Except for the historical information contained herein, the
following discussion and other sections of this report on Form
10-KSB contain forward-looking statements that involve risks and
uncertainties.  The Company's actual results could differ
materially.  Factors that could cause or contribute to such
differences include, but are not limited to, those discussed in
the section entitled "Factors That May Affect Future Results of
Operations," as well as those discussed elsewhere in the
Company's reports filed with the Securities and Exchange
Commission.



RESULTS OF OPERATIONS

Cramer's net order income increased by 1% in 1996 to $12,074,000
as compared to a decline of 10% during 1995.  The increase in
order income levels was the result of improved sales
representative performance, new products and programs.  At
December 31, 1996, Cramer's backlog of unfilled orders was
$972,000 as compared to $973,000 at December 31, 1995. 
Substantially all of the December 31, 1996 backlog was scheduled
to ship within the first quarter of 1997.

At $11,872,000, 1996's net sales were 7% less than in 1995. 
However, net sales in 1995 included approximately $750,000
generated by a reduction in the abnormally high backlog that had
built up in the latter portions of 1994 when the Company was
experiencing operating difficulties.  Excluding this one-time
event, sales results for 1996 were almost equal to 1995.



<PAGE>


The Company's total gross margin in 1996, $3,310,000, was $87,000
higher than in 1995.  As a percentage of net sales, margins
improved from 25% in 1995 to 28% in 1996.  The increase in
margins is due to higher average selling prices in 1996 and to
material cost reductions achieved from improved purchasing
practices and improvements in product design.

Selling expenses increased by $381,000 in 1996 as compared to
1995.  The increase was primarily due to the costs of recruiting
a new and expanded executive sales management team.  The Company
also incurred increased advertising and promotional activities
related to an increase in new product introductions in 1996 as
compared to 1995.  Additionally, in 1996, the Company incurred
increased costs to negotiate and sign multi-year direct sales
contracts with the General Services Administration and other
federal agencies.  Finally, the Company's commission expenses
were higher as a percentage of sales in 1996 as compared to 1995
due to the success of its programs to increase direct sales to
government agencies and other end users.  These programs require
commission payments to a participating furniture dealer.

General and administrative expenses decreased by $146,000 between
1995 and 1996.  The decrease was due in part to the transfer of
certain administrative personnel into sales related positions and
to an approximately $70,000 reduction in costs associated with
product liability claims. 

Interest expense was $47,000 lower in 1996 as compared to 1995. 
The 31% reduction in expense was due to lower average borrowings,
$1,299,000 in 1996 as compared to $1,444,000 in 1995.  In
addition, the Company benefited from a significant reduction in
interest rates as a result of the consolidated Rotherwood (the
Company's parent) borrowing arrangements instituted during the
year (see Note 3 to the Financial Statements).

As a result of a significant tax net operating loss carryforwards
originating in the 1980s, the Company paid only $3,000 in income
taxes for 1995 and expects to pay none for 1996.  Deferred tax
assets arising from these tax loss carryforwards and other
temporary differences have not been recorded due to the
uncertainty of future operating success.

While the total gross margin increased in 1996 as compared to
1995, higher selling expenses resulted in an $80,000 decrease in
net income.  As a result of option exercises in mid-1995,
weighted average shares outstanding increased by 481,000 during
1996.  Net income per share in 1996 was $0.08 as compared to
$0.12 in 1995.

FINANCIAL CONDITION AND LIQUIDITY

The Company's December 31, 1996 accounts receivable balance
decreased by $68,000 as compared to the balance at December 31,
1995.  The decrease is consistent with the lower sales level in
December 1996 as compared to December 1995 and management's
continued emphasis on reducing the days sales in receivables,
which decreased from 31 days at December 31, 1995 to 30 days at
December 31, 1996.



<PAGE>


The Company's December 31, 1996 inventory decreased by $202,000
(or 14%) from the 1995 year-end balance.  The reduction was due
to tighter inventory controls and continued management emphasis
on improving inventory turnover, which increased from 8.2 times
per year in 1995 to 8.6 times per year in 1996. 

Capital expenditures in 1996 aggregated $227,000 and consisted of
investments in factory tooling and office equipment.  Purchases
of capital equipment increased significantly in 1996 over the
1995 level as the Company returned to normal operating practices
concerning equipment replacement and improvement.  Purchases of
such assets had been curtailed in 1995 due to the Company's
financial constraints.

The Company's short-term notes payable increased and long-term
notes decreased at December 31, 1996 as compared to December 31,
1995 due to the Company's participation in a new consolidated
Rotherwood credit facility.  The consolidated credit facility
matures in August 1997 and all borrowings are classified as
current liabilities at December 31, 1996.  The Company used its
borrowings under the new facility to retire all outstanding long-
term notes payable to banks and its previous working capital line
with United Missouri Bank.  Total borrowings at December 31 1996
under the new credit facility, $1,059,000, are substantially
equivalent to total borrowings from banks, $1,064,000, at
December 31, 1995.

In order to improve relations with the Company's vendors, trade
accounts payable were decreased by $352,000 during 1996.  The
reduction was achieved by applying a portion of the cash
generated from operations to these liabilities.

Long-term notes from parties other than banks were reduced by
$82,000 during 1996 in accordance with established payment
schedules.  All remaining payments on such debts are due within
the succeeding twelve months and therefore are shown entirely as
current liabilities.

During 1996, Rotherwood negotiated a new credit facility with
Mark Twain Bank (the Bank).  The new credit facility provides
Rotherwood, and each of its four participating subsidiaries
(including Cramer), with access to a $3,750,000 credit line with
interest charged on outstanding borrowings at one-eighth less
than the Bank's prime interest rate.  This is a reduction in
interest rates as compared to the Company's prior borrowing
arrangements with banks.  The Company may borrow up to the
maximum amount of the credit line less any amounts already
borrowed by the other participating Rotherwood companies.

The combined credit facility is secured by the inventory,
accounts receivable, and equipment of all of the Rotherwood
subsidiaries.  In addition, each participating Rotherwood
subsidiary has guaranteed repayment of the total amount borrowed
under the credit facility.  However, the current assets pledged
by the other Rotherwood subsidiaries in support of the credit
facility exceeded $4 million at December 31, 1996.  In addition,
Rotherwood's founder has pledged publicly traded equity
securities with a market value in excess of $4 million as
additional collateral for the loan.  Management believes that the
reduction in interest rates and the access to a larger credit
facility more than offset the risk that it would suffer losses
under the guarantee provisions of the credit facility in the
event that one or more of the other Rotherwood subsidiaries would
default under their portion of the credit line.


<PAGE>



There is a risk that Cramer will not have access to sufficient
funds for its operations if the other participating Rotherwood
subsidiaries have borrowed more of the funds under the credit
line than anticipated.  However, the $3,750,000 credit line is
substantially in excess of the total aggregate prospective
borrowing needs of Cramer and the other Rotherwood subsidiaries
over the next 12 months.  Furthermore, Cramer management
participates in regular assessments of the borrowing needs of all
Rotherwood subsidiaries and believes it would be aware of
anticipated credit shortages in time to arrange new or additional
sources of capital.  Therefore, the Company believes that the
current consolidated credit line, coupled with anticipated cash
flow from operations, will be sufficient to meet current
operating requirements over the next 12 months.

Management believes that 1997's results will improve on those in
1996.  Intake of orders and sales are expected to increase as the
Company realizes the benefits of the new products introduced and
of the marketing and distribution enhancements made in 1996. 
Overall profitability should be enhanced as a result of realizing
a full year's benefit of cost reductions made in 1996. 
Profitability on individual orders should be further enhanced as
the increased production volume will allow lower allocation of
fixed costs to individual orders.  Due to these factors,
profitability is anticipated to increase at a faster rate than
sales volume.


FACTORS THAT MAY AFFECT FUTURE RESULTS OF OPERATIONS

In connection with the "Safe Harbor Provisions of the Private
Securities Litigation Reform Act of 1995," Cramer, Inc. is hereby
filing cautionary statements identifying important factors that
could cause the Company's actual results to differ materially
from those projected in forward-looking statements of the Company
made by, or on behalf of, the Company.  When used in this Form
10-KSB and in future filings by the Company with the Securities
and Exchange Commission, in the Company's press releases and in
oral statements made with the approval of an authorized executive
officer, words or phrases such as "believes", "will likely
result", "are expected to", "will continue", "is anticipated",
"estimate", "project" or similar expressions are intended to
identify forward-looking statements.  The Company wishes to
caution readers not to place undue reliance on such forward-
looking statements.

There are a number of reasons why investors should not place
undue reliance on forward-looking statements.  Among the risks
and uncertainties that could cause the Company's actual results
for future periods to differ materially from any forward-looking
statements made are the following:

  .    Fluctuations or reductions in product demand and market
       acceptance
  .    The level of product development by the Company
  .    Capacity and supply constraints or difficulties
  .    The results of financing efforts
  .    The effect of new laws and regulations
  .    Unexpected additional expenses or operating losses
  .    Competition
  .    The Company's reliance on certain vendors for key
       components

The foregoing list of risks and uncertainties is not meant to be
complete.


<PAGE>


ITEM 7.     FINANCIAL STATEMENTS

The following financial statements of Cramer, Inc., are included
herewith:
                                                       Page No.
Independent Auditor's Report                             F-1
Balance Sheet - December 31, 1996                        F-2
Statements of Income for the Years Ended
December 31, 1995 and 1996                               F-3

Statements of Stockholders' Equity (Deficit) for
the Years Ended December 31, 1995 and 1996               F-4

Statements of Cash Flows for the Years Ended
December 31, 1995 and 1996                               F-5

Notes to Financial Statements                            F-6


<PAGE>



                  Report of Independent Auditors            F-1



The Board of Directors and Stockholders
Cramer, Inc.

We have audited the accompanying balance sheet of Cramer, Inc. as
of December 31, 1996, and the related statements of income,
shareholders' equity (deficit), and cash flows for each of the
two years in the period then ended.  These financial statements
are the responsibility of the Company's management.  Our
responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted
auditing standards.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation.  We believe that
our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position
of Cramer, Inc. at December 31, 1996, and the results of its
operations and its cash flows for each of the two years in the
period then ended, in conformity with generally accepted
accounting principles.



                                          /s/ Ernst & Young LLP
Kansas City, Missouri
February 17, 1997



<PAGE>



                           CRAMER INC.                        F-2
                          BALANCE SHEET
            (Amounts in Thousands, Except Share Data)


ASSETS                                                     December 31, 1996
  Current Assets:
     Cash                                                      $      117
     Accounts receivable, net of allowance of $21                   1,034
     Inventories                                                    1,286
     Prepaid expenses                                                 284
       Total Current Assets                                         2,721

  Property, Plant and Equipment, net                                  658

  Other Assets:
     Intangible pension asset                                         264

       Total Assets                                            $    3,643

LIABILITIES AND STOCKHOLDERS' EQUITY
  Current Liabilities:
     Note payable                                              $    1,059
     Current portion of long-term notes                                76
     Accounts payable                                                 672
     Accrued liabilities                                              573

       Total Current Liabilities                                    2,380

  Noncurrent Liabilities:
     Pension benefits payable                                         552
     Other                                                            159

       Total Noncurrent Liabilities                                   711

  Stockholders' Equity:
     Common stock, no par value; authorized, 6,000,000
       shares; issued and outstanding 3,840,650 shares              3,508
     Accumulated deficit                                          (2,914)

                                                                      594

     Minimum pension liability adjustment                            (42)

       Net Stockholders' Equity                                       552

     Total Liabilities and Stockholders' Equity                  $  3,643

The accompanying notes are an integral part of these financial
statements.


<PAGE>





                           CRAMER INC.                        F-3
                       STATEMENTS OF INCOME
          (Amounts in Thousands, Except Per Share Data)


                                                   Year Ended December 31,
                                                      1996           1995

Net Sales                                            $11,872      $12,785
Cost of Sales                                          8,562        9,562

      Gross Profit                                     3,310        3,223

Operating Expenses:
  Selling                                              1,933        1,552
  General and administration                             921        1,067

      Total Operating Expenses                         2,854        2,619

      Income from Operations                             456          604

Other Income (Expense):
  Interest expense                                     (105)        (152)
  Other                                                 (26)         (44)

      Income Before Income Taxes                         325          408

Income Taxes                                               0            3

Net Income                                           $   325      $   405

Net Income Per Common and Common 
  Equivalent Share                                   $  0.08      $  0.12

Weighted Average Number of Common and 
  Common Equivalent Shares Outstanding                 3,841        3,360



The accompanying notes are an integral part of these financial
statements.



<PAGE>



                           CRAMER, INC.                       F-4
           STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
                      (Amounts in Thousands)


                                                                        Total 
                                                             Minimum    Stock- 
                                                             Pension   holders'
                    Number of  Common  Accumulated Treasury Liability  Equity
                     Shares    Stock     Deficit    Stock  Adjustment (Deficit)

Balance at 
 December 31, 1994   2,707     $3,425   $(3,644)    $(147)    $(76)    $(442)

Issuances of Common 
 Stock Upon 
 Option Exercise     1,150        230                                    230

Adjustment to 
 Additional Minimum 
 Pension Liability                                              17        17

Retirement of 
 Treasury Stock        (16)      (147)               147

Net Income                                  405                          405

Balance at 
 December 31, 1995   3,841       3,508   (3,239)       0       (59)      210

Adjustment to 
 Additional Minimum 
 Pension Liability                                              17        17

Net Income                                  325                          325

Balance at 
 December 31, 1996   3,841      $3,508  $(2,914)       $0     $(42)     $552


The accompanying notes are an integral part of these financial statements.



<PAGE>




                           CRAMER, INC.                       F-5
                     STATEMENTS OF CASH FLOWS
                      (Amounts in Thousands)


                                                    Year Ended December 31,
                                                        1996         1995  

Cash flows from operating activities:
  Net income                                         $     325   $    405
  Income from settlement of property 
     taxes                                                   0      (137)
  Adjustments to reconcile net income 
     to net cash provided by operating 
     activities:
     Depreciation and amortization                         177        162
     Changes in operating assets and 
       liabilities:
       Accounts receivable                                  68        156
       Inventories                                         202        133
       Prepaid expenses                                   (38)        110
       Other assets                                         52         52
       Accounts payable and accrued 
         liabilities                                     (437)      (498)
       Noncurrent pension benefits payable                (26)       (24)
       Other noncurrent liabilities                         24        135

       Net cash provided by operating 
         activities                                        347        494

Cash flows from investing activities:
  Capital expenditures                                   (227)       (57)

Cash flows from financing activities:
  Principal payments on notes payable 
     and long-term notes                               (6,840)   (13,212)
  Proceeds from issuance of notes payable 
     and long-term notes                                 6,753     12,628
  Proceeds from exercise of stock options                    0        230
       Net cash used in financing activities              (87)      (354)

Net increase in cash                                        33         83
Cash at beginning of year                                   84          1

Cash at end of year                                  $     117   $     84

Supplemental disclosures of cash 
flow information:
  Cash paid during the year for:
     Interest                                        $     102   $    162
     Income tax                                      $       0   $      2



The accompanying notes are an integral part of these financial
statements.


<PAGE>



                           Cramer, Inc.                       F-6
                  Notes to Financial Statements
                        December 31, 1996



1.   SUMMARY OF ACCOUNTING POLICIES

ORGANIZATION

Cramer is a manufacturer of seating and utility products for
office and industrial use.  The Company sells its products
throughout the United States.  International sales are limited. 
The Company's principal customers are office furniture dealers
(seating products) and wholesale catalog distributors (utility
and seating products).  Cramer is a 54% owned subsidiary of
Rotherwood Corporation (Rotherwood), a Minneapolis, Minnesota
based holding company.



INVENTORIES

Inventories are valued at the lower of cost (determined by the
first-in, first-out method) or market.  The closing inventory is
comprised of raw material $804,000, work in progress $297,000,
and finished goods $185,000.



PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are carried at cost.  Depreciation
is provided for in amounts sufficient to charge the cost of
depreciable assets to operations over their estimated service
lives, principally on a straight-line basis.

                                                        Estimated
                                                          Useful 
                                           Cost            Life  
                                      (In Thousands)    (In Years)

     Land                               $    29            ------               
     Buildings                              715            20-40 
     Machinery and Equipment              3,330             3-10 
     Furniture and Office Equipment       1,245             5-10 
                                          5,319      
     Less Accumulated Depreciation        4,661
     Net Property, Plant and Equipment  $   658



INCOME TAXES

Income taxes have been provided using the liability method in
accordance with FASB Statement No. 109, Accounting for Income
Taxes.



<PAGE>



USE OF ESTIMATES

The preparation of the financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the amounts reported
in the financial statements and accompanying notes.  Actual
results could differ from those estimates.



WARRANTIES

Depending on the model, the Company warranties its products for
periods up to 15 years.  The Company's reserve for anticipated
warranty costs of $180,000 is included in accrued liabilities. 
The warranty reserve is estimated based on durability testing,
engineering studies, and actual costs in prior years.



2.   BENEFIT PLANS

DEFINED BENEFIT PLAN

The Company has a defined benefit pension plan covering all of
its bargaining unit employees working as of September 30, 1988. 
Effective September 30, 1988, the plan was amended to freeze
future benefit accruals.  As a result of freezing the benefits,
no further benefits accrue to plan participants.  The amount of
pension a participant will receive was frozen at $9.00 multiplied
by the number of years of service from the later of the date of
hire or January 1, 1942, through September 30, 1988.  Effective
September 30, 1988, new employees have not accrued benefits under
the defined benefit plan.  The Company's funding of the plan is
equal to, or exceeds, the minimum contribution required by ERISA
and totaled $181,400 and $80,500 in 1996 and 1995, respectively.

Net pension costs included the following components (in
thousands):

                                          Year Ended December 31,
                                             1996        1995 

Service cost - benefits earned during 
     the period                         $         0    $       0 
Interest cost on projected benefit 
     obligation                                  79           92 
Expected return on plan assets                  (33)         (42)
Net amortization and deferral                    52           52
     Net regular periodic pension cost           98          102
Settlement costs                                 68            0

          Total pension costs           $       166    $     102



<PAGE>


     Net regular periodic pension cost was calculated using the
following assumptions:

                                          Year Ended December 31,
                                               1996     1995  

     Weighted Average Discount Rate             8.0%     8.0%
     Expected Long-Term Rate of Return          8.9%     8.9%


The plan's funded status as of December 31, 1996 is summarized
below (in thousands):

     Actuarial present value of projected benefit 
          obligation                              $    875
     Plan assets at fair value                         291
     Projected benefit obligation in excess of 
          plan assets                                 (584)
     Remaining unrecognized net transition 
          obligation                                   244
     Unrecognized prior service cost                    20
     Unrecognized net loss                              42
     Adjustment required to recognize minimum 
          liability                                   (306)

     Net pension liability recognized             $   (584)

Of the net pension liability, $32,000 is reflected as the current
portion and included in accrued liabilities.  An intangible asset
of $264,000 equal to the unrecognized prior service cost and
transition obligation has been included in the balance sheet. 
The remaining additional minimum liability of $42,000 related to
the unrecognized net loss has been recorded as a decrease in
stockholders' equity at December 31, 1996.

In order to reduce administrative costs, in 1996 the Company
settled its pension obligation with retirees that had a vested
benefit of less than $3,500.  The Company also transferred its
pension obligation for certain retirees to an insurance company
in exchange for the portion of the Plan assets for which the
insurance company had previously served as trustee.  These
transactions reduced the accumulated plan benefit obligation by
approximately $159,000 and was accounted for as a settlement
under Statement of Financial Accounting Standards No. 88,
Employers Accounting for Settlements and Curtailments of Defined
Benefit Pension Plans and for Termination Benefits.  Settlement
costs of $68,000 are included as a portion of 1996's other non-
operating income and expense.

Plan assets are held by trust funds devoted to servicing pension
benefits and are invested in a diversified portfolio of fixed
income and equity securities.



DEFINED CONTRIBUTION PLAN

The Company sponsors a 401(k) plan covering substantially all
employees.  Participants may contribute from one percent (1%) to
fifteen percent (15%) of compensation, subject to annual
limitations.  Company contributions are at the <PAGE> discretion of the
Board of Directors.  There were no Company contributions in 1996
or 1995.


3.   SHORT-TERM BORROWINGS

The Company, Rotherwood, and certain other subsidiaries of
Rotherwood participate in a combined credit facility with Mark
Twain Bank.  The credit facility provides Rotherwood and its
participating subsidiaries with access to a credit line of
$3,750,000 with interest charged at a rate of one-eighth of a
percent less than the Bank's prime rate (8.125% at December 31,
1996).  The Company's share of these borrowings at December 31,
1996 was $1,059,000.  The total amount borrowed by all Rotherwood
companies at December 31, 1996 was $1,128,000.

The combined credit facility, which matures in August 1997, is
secured by the inventory, accounts receivable and equipment of
all of the participating Rotherwood subsidiaries.

The Company, and each of the other Rotherwood subsidiaries, has
guaranteed repayment of the total debt to Mark Twain Bank.  The
current assets pledged by the other Rotherwood subsidiaries
exceeded $4 million at December 31, 1996.  In addition,
Rotherwood's founder has pledged publicly traded equity
securities with a market value in excess of $4 million as
additional collateral for the loan.  The Company's management
believes that there is minimal risk associated with the guarantee
provisions of the credit facility.



4. LONG-TERM NOTES

                                                  December 31,
                                                       1996
                                                   (Amounts in
                                                    Thousands)

Note payable to Wyandotte County on real estate 
taxes - unsecured, payable in seven monthly 
installments of $10,340 through July 1997.  
The note is non-interest bearing and is net 
of unamortized discount of $2,811 calculated 
using an imputed interest rate of 12%.                  $70

Note payable in settlement of a mediated agreement 
in an age discrimination suit, payable in monthly 
installments of $2,000 through March 1997.                6

     Total Long-Term Notes, All Current                 $76


<PAGE>



5.   STOCKHOLDERS' EQUITY

The Company has a stock option plan (the Plan) which provides for
the grant of incentive awards to directors, officers and other
key employees.  Under the Plan, stock options are granted at the
fair market value of the Company's common stock at the date of
the grant.  Because the stock is not actively traded, the Company
uses book value to approximate fair market value.  All option
grants were made prior to December 31, 1994 and, in accordance
with APB opinion No. 25, Accounting for Stock Issued to
Employees, no compensation expense was recognized.  There were no
stock option grants in 1995 or 1996.

In 1989, a principal shareholder was granted an option to
purchase 1,100,000 shares of the Company's stock at $0.20 per
share in recognition of his assistance in obtaining new debt
financing for the Company.  The shareholder subsequently
transferred this option to Rotherwood Corporation, an affiliate
of the stockholder.  During 1995, Rotherwood exercised these
options and the stock was issued by the Company.

During 1995, 50,000 shares of stock were issued by the Company to
a former employee of the Company upon exercise of his options. 
These options had an exercise price of $0.20 per share.

During 1995, 245,500 options that were previously vested canceled
in conjunction with the termination of employment of certain
former members of the Company's management.  All currently
outstanding stock options expire in November 1998.  At December
31, 1996, the Company had the following stock options
outstanding:

                   Number      Number      Number
                  of Shares   of Shares   of Shares     Exercise
  Name           Authorized    Granted     Vested         Price  
Management        829,900       20,000      20,000     $    0.40

During 1995, the Company's Board of Directors approved the
retirement of the Company's treasury stock.  The cost of the
treasury stock, approximately $147,000, was charged to the common
stock account.



6. NET INCOME PER SHARE

Net income per share has been calculated by dividing the net
income by the weighted average of common and common equivalent
shares outstanding during 1996 and 1995, 3,840,650 and 3,359,690,
respectively.  Common equivalent shares, which consist of
outstanding shares and options authorized under the stock option
plans, are determined using the treasury stock method based on
the Company's net book per share during the period, which the
Company believes to approximate the fair market value per share
of the Company stock.  As the option exercise price exceeds the
net book value per share, options are not considered in the 1996
and 1995 calculations as their effect would be antidulitive.



<PAGE>



7.   INCOME TAXES

Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used
for income tax purposes.  Significant components of the Company's
deferred tax assets and liabilities as of December 31, 1996 are
as follows (in thousands):

     Deferred tax Assets:
          Net operating loss carryforwards        $    3,541
          Tax credit carryforwards                       317
          Pension costs                                  218
          Warranty accrual                                70
          Product liability accrual                       65
          Vacation accrual                                19
          Inventory                                        8
          Other - net                                     26
     Total deferred tax assets                         4,264
     Deferred tax liabilities:
          Depreciation                                   (12)
     Net deferred tax assets                           4,252
     Valuation allowance                              (4,252)
                                                  $        0

A reconciliation of the income tax provision to the amounts
computed at the federal statutory rate is as follows (in
thousands):

                                          Year Ended December 31,
                                            1996        1995

     Tax provision at statutory rate    $    110  $    139
     State income taxes, net of 
          federal taxes                       15        19
     Changes in valuation reserve 
          related to utilization of 
          net operating loss carryforward   (130)     (158)
     Other                                     5         3
                                        $      0  $      3

At December 31, 1996, the Company has available the following net
operating loss and credit carryfowards to reduce future income
taxes.  These amounts are subject to applicable limitations. 
(Amounts in thousands.)

                                   Amount            Expiration
                                 Available               Dates 

     Net operating losses          $    9,078       2001 - 2009
     Targeted jobs tax credit      $      261       1999 - 2001
     Investment tax credit         $       56       1999 - 2000
     Contributions                 $        4       1996 - 1999


<PAGE>



8.   FINANCIAL INSTRUMENTS

The Company grants credit to customers who meet the Company's
pre-established credit requirements.  Credit losses are provided
for in the Company's financial statements based on factors
surrounding the credit risk of specific customers, historical
trends and other information and have consistently been within
management's expectations.

The Company's concentrations of credit risk with respect to trade
receivables arising from the sale to office furniture dealers are
minor due to the large number of entities comprising the
Company's customer base.  However, as of December 31, 1996, the
Company had approximately $171,000 of receivables from eight
companies, all of whom are wholesale catalogers of office or
industrial products and who are the principal purchasers of the
Company's utility products.

At December 31, 1996, the carrying value of the Company's cash,
accounts receivable, and accounts payable approximate fair value. 
Based on borrowing rates currently available to the Company for
bank loans with similar terms and collateral, the fair value of
the Company's short-term notes payable and long-term notes
approximate their carrying value.



9. COMMITMENTS AND CONTINGENCIES

The Company is a defendant in several lawsuits relating to
product liability claims arising from accidents allegedly
occurring in connection with the use of its products.  The claims
are covered by insurance and are being defended by the Company's
counsel or by counsel assigned by the Company's insurance
carriers, but are subject to deductibles ranging from $0 to
$100,000.  A number of the claimants allege substantial damages. 
The ultimate outcome of such litigation cannot be predicted at
this time.  However, management believes the Company has
substantial defenses with respect to the claims and that the
ultimate outcome of these claims will not have a material adverse
effect on the Company's financial position.  The company has
accrued and included with other noncurrent liabilities the
estimated amount of losses not covered by insurance which may be
incurred from presently known and anticipated product liability
claims.



10.  NON-OPERATING INCOME

During 1995, the Company negotiated a reduction in previously
assessed and unpaid real estate and personal property taxes due
Wyandotte County, Kansas, the site of the Company's manufacturing
facilities.  Wyandotte County also agreed to allow payment of the
remaining amounts due over a 24-month period.  Income of $137,000
was recorded from this settlement and is included as a component
of 1995's other nonoperating income and expense.



<PAGE>


11. RELATED PARTY TRANSACTIONS

Rotherwood, the Company's majority owner, provides management
services to the Company.  Certain employees of the Company
provide management service to other subsidiaries of Rotherwood. 
In 1996 and 1995, the net cost to the Company for these services
was approximately $46,000 and $21,000, respectively.  (See Note 5
for discussion of Rotherwood's 1995 stock option exercise.)



ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
          ACCOUNTING AND FINANCIAL DISCLOSURE

          None.





<PAGE>


                             PART III



ITEM 9.   DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
          PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
          ACT

A.   IDENTIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS:

The Company's Board of Directors is composed of three (3) members
elected to serve for terms as indicated.  The officers and
directors of the Company are as follows:

                                                        Officer or 
                                                       Director of
                                                       the Company  Term to
      Name         Age          Office                   Since      Expire

James R. Zicarelli 45     Chairman of the Board & CEO       1992     1997 
David E. Crandall  53     Director                          1992     1997 
James E. Workman   47     Director                          1994     1997 
James Lockley      46     Vice President,          
                          Sales & Marketing                 1996
David C. Mettlach  44     Vice President, 
                          Business Development              1992
Gary A. Rubin      39     Vice President, Finance
                          Secretary & Treasurer             1995
George Kruse       53     Vice President, Operations        1996


Past Business Experience

James R. Zicarelli  President of Rotherwood Corporation, a
                    holding company and majority stockholder of
                    the Company.  In addition, Mr. Zicarelli
                    serves as a board member or officer of The
                    American Company, Inc., Pacer Corporation,
                    and Sagebrush Technology Inc.  Prior to 1992,
                    Mr. Zicarelli was the President of DRC, a
                    data services company.

David E. Crandall   Chairman and CEO of PPA Industries, a
                    manufacturing Company located in Dallas,
                    Texas.  In addition, Mr. Crandall serves as
                    board member of PPA Industries, Inc., and
                    Information Retrieval Methods.

James E. Workman    President, Workman Consulting International
                    and General Manager, Pacer Trading Company, a
                    subsidiary of Rotherwood Corporation. 
                    Formerly Director of Purchasing, IAMS
                    Company.  IAMS is a premium pet food
                    manufacturer.  Prior to 1990, Mr. Workman was
                    a materials manager for Cramer, Inc.





<PAGE>


James Lockley       Vice President, Sales and Marketing of Cramer
                    since April 1996.  Twenty-three years of
                    sales and sales management experience in the
                    office products and contract furniture
                    industries.  Most recently, Director of Sales
                    & Marketing for Johnson Industries.

David C. Mettlach   Vice President of Cramer since October 1992. 
                    Prior background in developing, marketing and
                    manufacturing contract furniture products for
                    Haworth and Universal Woods, inc.  These
                    products included seating lines, casegoods
                    (wood and metal) and panel systems.

Gary A. Rubin       Vice President, Finance of Cramer since April
                    1995.  Formerly Vice President, Finance and
                    Administration for a capital equipment
                    manufacturer and Senior Audit Manager for
                    Deloitte & Touche.  Certified Public
                    Accountant.

George Kruse        Vice President, Operations of Cramer since
                    March 1996.  Formerly Director of Operations
                    for Cramer, Inc. since January 1995.  Prior
                    background in manufacturing and operations
                    management with Johnson & Johnson and
                    Honeywell, Inc.  Most recently West Coast
                    General Manager for PPA Industries, Inc.

No director or officer has any family relationship with any other
director or officer.



ITEM 10.  EXECUTIVE COMPENSATION

Board member James Zicarelli serves as the Company's CEO.  Mr.
Zicarelli is an employee of Rotherwood Corporation and does not
receive any compensation from the Company for serving as CEO. 
Mr. Zicarelli's compensation from Rotherwood is not specifically
related to Cramer's performance or the time spent by him in
Cramer management.  However, the Company paid certain management
fees to Rotherwood in 1995 and 1996.  See Section 12 of this
report for further discussion of Cramer's transactions with
Rotherwood.  None of the Company's other executive officers'
compensation exceeded $100,000 in 1996.


<PAGE>



ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT

The following table sets forth the ownership of the Company's
common stock by each person known to the Company to be the
beneficial owner of more than 5% of its outstanding common stock,
by individual directors of the Company, and by the officers and
directors of the Company as a group:

                                         Amount and 
                                         Nature of 
                    Name and Address     Beneficial    Percent of
Title of Class     of Beneficial Owner   Ownership /a/  Class /h/


Common stock   Rotherwood Corporation /b/  2,081,236        53.9%
               1400 Northland Plaza
               3800 W. 80th Street
               Bloomington, MN  55431
     
Common stock     James L. Marvin /c/         300,000         7.8%
            155 W. Lake Avenue 
            Suite 203
            Colorado Springs, CO  80906

Common stock     David E. Crandall /d/       125,341         3.2%
            5415 Edlen Drive
            Dallas, TX  75220

Common stock     James R. Zicarelli /e/            0           0%
            1400 Northland Plaza
            3800 W. 80th Street
            Minneapolis, MN  55431

Common stock     James E. Workman /f/         30,000         0.8%
            2245 Rockingham Drive
            Troy, OH  45373

All Officers and Directors as a Group 
  (7 persons)                                 175,341 /g/    4.5%

/a/    Represents shares over which the designated party has sole
       investment and voting power.
/b/    Rotherwood Corporation may be deemed a "parent" of the
       Company by virtue of its percentage of stock ownership.
/c/    Consists of 300,000 shares of common stock which are held by
       Foothills Company, an affiliate of Mr. Marvin.
/d/    Mr. Crandall is a Director of the Company.
/e/    Mr. Zicarelli is a Director, Chairman and CEO of the Company
       and an Officer of Rotherwood Corporation.
/f/    Mr. Workman is a Director of the Company and an employee of
       Rotherwood Corporation.
/g/    Includes options to purchase 20,000 shares of common stock,
       which can be immediately exercised.
/h/    Percentage based on common and common equivalent shares.



<PAGE>


ITEM 12.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

By virtue of its 54% ownership of the Company's common stock,
Rotherwood Corporation (Rotherwood) is a "parent" of the Company. 
In order to provide needed capital during 1995, the Company
issued 1,100,000 shares of common stock to Rotherwood upon
exercise of stock options.  The option exercise price was $0.20
per share.  See discussion at Note 5 to the Financial Statements.

Mr. James Zicarelli, Chairman of the Company's Board of
Directors, has served as the Company's CEO since February 1995. 
Mr. Zicarelli is an employee of Rotherwood.  Mr. Workman, a
member of the Company's Board of Directors, is also an employee
of Rotherwood.  In 1995, Cramer began paying fees to Rotherwood
for management services including those provided by Mr.
Zicarelli.  In 1995 and 1996, the Company also paid fees to other
affiliates of Rotherwood for consultation and assistance provided
in the area of Human Resources and Labor Relations.  In 1995 and
1996, certain employees of Cramer provided operating and
financial consulting services to other subsidiaries of Rotherwood
in return for fees paid to the Company.  Total amounts charged
for the foregoing services were:

                                       1996          1995
Paid by the Company to Rotherwood 
  and its affiliates                 $102,000       $41,000
Paid to the Company by Rotherwood 
  and its affiliates                 $ 56,000       $20,000

The Company believes that the amounts charged for services
provided or received were not less favorable than those charged
by third parties.

The Company participates in a combined Rotherwood credit facility
with Mark Twain Bank (see Management's Discussion and Analysis
and Note 3 to Financial Statements).



ITEM 13.    EXHIBITS AND REPORTS ON FORM 8-K

Exhibit 10.1     1989 Incentive Stock Option Plan
Exhibit 10.2     1996 Loan Documents - Mark Twain Bank
                 10.2a  Corporate Resolution of Rotherwood Corporation
                 10.2b  Commercial Security Agreement of Rotherwood
                        Corporation
                 10.2c  Commercial/Agricultural Revolving or Draw Note -
                        Variable Rate
                 10.2d  Loan Agreement, dated August 27, 1996
                 10.2e  Revised Facility Description Rider to the Loan
                        Agreement, dated August 27, 1996
                 10.2f  Continuing Contract of Guaranty
                 10.2g  Commercial Security Agreement of Cramer, Inc.
Exhibit 23a      Consent of Ernst & Young

There were no current reports filed by the Company in 1996.



<PAGE>


                            SIGNATURES



Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, as
duly authorized.

                           CRAMER, INC.



March 14, 1997             /s/ James R. Zicarelli
                           James R. Zicarelli
                           President & CEO
                           (Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the date
indicated.



March 14, 1997             /s/ James R. Zicarelli
                           James R. Zicarelli
                           Director



March 14, 1997             /s/ David E. Crandall
                           David E. Crandall
                           Director



March 14, 1997             /s/ James E. Workman
                           James E. Workman
                           Director



March 14, 1997             /s/ Gary A. Rubin
                           Gary A. Rubin
                           Vice President, Finance
                           (Principal Financial and Accounting
                           Officer)


<PAGE>



                          EXHIBIT INDEX


Number

10.1   1989 Incentive Stock Option Plan (previously filed)
10.2   1996 Loan Documents - Mark Twain Bank
       10.2a  Corporate Resolution of Rotherwood Corporation
       10.2b  Commercial Security Agreement of Rotherwood Corporation
       10.2c  Commercial/Agricultural Revolving or Draw Note - Variable Rate
       10.2d  Loan Agreement, dated August 27, 1996
       10.2e  Revised Facility Description Rider to the Loan Agreement, dated
              August 27, 1996
       10.2f  Continuing Contract of Guaranty
       10.2g  Commercial Security Agreement of Cramer, Inc.
23a    Consent of Ernst & Young