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

--------------------------------------------------------------------------------

                                    FORM 10-Q

             [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                   For the quarterly period ended July 4, 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 0-21232

                           RECOVERY ENGINEERING, INC.
             (Exact name of registrant as specified in its charter)

            Minnesota                                 41-1557115
-------------------------------            ------------------------------------
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
 incorporation organization)
                             9300 North 75th Avenue
                              Minneapolis, MN 55428
                    (Address of principal executive offices)
       Registrant's telephone number, including area code: (612) 315-5500
                                       N/A
--------------------------------------------------------------------------------
 (Former name, former address and former fiscal year, if changed since
                                 last report.)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.      Yes _X_   No ___

                      APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date.

       Common Stock, $.01 Par Value - 6,042,484 shares as of July 30, 1999
       -------------------------------------------------------------------

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

                                     1 of 15
<PAGE>


                           RECOVERY ENGINEERING, INC.

                                      INDEX


         PART I. FINANCIAL INFORMATION                                  Page No.
                                                                        --------
Item 1.  Financial Statements (Unaudited):

         Balance Sheets
         July 4, 1999 and January 3, 1999....................................  3

         Statements of Operations
         Three- and Sixth-month periods ended July 4, 1999 and July 5, 1998..  4

         Statements of Cash Flows
         Six-month periods ended July 4, 1999 and July 5, 1998...............  5

         Notes to Financial Statements.......................................  6

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

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.......... 10

         PART II. OTHER INFORMATION

Item 1.  Legal Proceedings................................................... 11

Item 2.  Changes in Securities and Use of Proceeds........................... 11

Item 3.  Defaults upon Senior Securities..................................... 11

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.................................... 13

         Signatures.......................................................... 14

         Exhibit Index to Form 10-Q.......................................... 15


                                     2 of 15
<PAGE>


                           RECOVERY ENGINEERING, INC.
                                 BALANCE SHEETS
                        (In thousands, except share data)
<TABLE>
<CAPTION>
                                                              July 4,    January 3,
                                                               1999         1999
                                                             --------     --------
                                   ASSETS                   (Unaudited)
<S>                                                          <C>          <C>
Current assets:
   Cash and cash equivalents ............................    $ 16,866     $ 14,000
   Accounts receivable (net of allowance of
   $281 for fiscal 1999 and $308 for fiscal 1998) .......      14,819       15,389
   Inventory ............................................      12,454       10,661
   Other current assets .................................         550          620
                                                             --------     --------
      Total Current Assets ..............................      44,689       40,670
Property and equipment:
   Tooling ..............................................      10,229        9,547
   Equipment and fixtures ...............................      14,774       14,109
                                                             --------     --------
                                                               25,003       23,656
   Less accumulated depreciation ........................       8,818        7,004
                                                             --------     --------
                                                               16,185       16,652

Deferred income taxes ...................................       1,512        1,512
Patents (net of accumulated amortization) ...............         731          729
Other assets ............................................         415          313
                                                             --------     --------
      Total assets ......................................    $ 63,532     $ 59,876
                                                             ========     ========

      LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Accounts payable .....................................    $  2,366     $  5,740
   Accrued marketing expenses ...........................       4,367        1,003
   Accrued co-op advertising ............................       4,128        2,994
   Other accrued expenses ...............................       3,342        2,868
                                                             --------     --------
      Total current liabilities .........................      14,203       12,605

Long-term debt ..........................................      15,000       15,000

Shareholders' equity:
   Common stock, $.01 par value:
      Authorized shares -- 100,000,000
      Issued and outstanding shares:
      Fiscal 1999 - 6,039,223 and fiscal 1998 - 6,012,281          60           60
   Additional paid-in capital ...........................      60,242       59,977
   Note receivable from sale of stock ...................        (498)        (498)
   Retained earnings (deficit) ..........................     (25,475)     (27,268)
                                                             --------     --------
      Total shareholders' equity ........................      34,329       32,271
                                                             --------     --------
   Total liabilities and shareholders' equity ...........    $ 63,532     $ 59,876
                                                             ========     ========
</TABLE>
                             See accompanying notes.

                                     3 of 15
<PAGE>


                           RECOVERY ENGINEERING, INC.

                            STATEMENTS OF OPERATIONS

                (Unaudited - in thousands, except per share data)


<TABLE>
<CAPTION>
                                               Three months ended              Six months ended
                                           July 4, 1999   July 5, 1998   July 4, 1999   July 5, 1998
                                           ------------   ------------   ------------   ------------
<S>                                          <C>            <C>            <C>            <C>
Net sales .............................      $ 24,592       $ 21,724       $ 45,158       $ 38,949
Cost of products sold .................        10,974         10,626         21,239         19,659
                                             --------       --------       --------       --------
Gross profit ..........................        13,618         11,098         23,919         19,290

Operating expenses:
    Selling, general and administrative        11,077          8,857         19,832         16,722
    Research and development ..........           962          1,089          1,923          2,100
                                             --------       --------       --------       --------
                                               12,039          9,946         21,755         18,822

Income from operations ................         1,579          1,152          2,164            468

Other income (expense):
    Interest income and other .........           226            207            453            207
    Interest expense and other ........          (248)          (394)          (507)          (934)
                                             --------       --------       --------       --------
                                                  (22)          (187)           (54)          (727)

Income (loss) before income taxes .....         1,557            965          2,110           (259)
Income tax benefit (expense) ..........          (234)          (145)          (317)            40
                                             --------       --------       --------       --------
Net income (loss) .....................      $  1,323       $    820       $  1,793       $   (219)
                                             ========       ========       ========       ========

Net income (loss) per share - basic ...      $   0.22       $   0.15       $   0.30       $  (0.04)
                                             ========       ========       ========       ========

Weighted average shares - basic .......         6,030          5,557          6,023          5,044

Net income (loss) per share - diluted .      $   0.20       $   0.14       $   0.29       $  (0.04)
                                             ========       ========       ========       ========

Weighted average shares - diluted .....         7,444          7,200          7,234          5,044
</TABLE>


                             See accompanying notes.

                                    4 of 15
<PAGE>


                           RECOVERY ENGINEERING, INC.

                            STATEMENTS OF CASH FLOWS

                           (Unaudited - in thousands)

<TABLE>
<CAPTION>
                                                                   Six months     Six months
                                                                      ended          ended
                                                                  July 4, 1999   July 5, 1998
                                                                  ------------   ------------
<S>                                                                 <C>            <C>
Operating activities
     Net income (loss) .......................................      $  1,793       $   (219)
     Adjustments to reconcile net income (loss)
       to net cash provided by (used in) operating activities:
         Depreciation and amortization .......................         1,885          1,308
         Changes in operating assets and liabilities:
              Accounts receivable ............................           570         (1,516)
              Inventory ......................................        (1,793)        (1,060)
              Other assets ...................................           (32)           816
              Accounts payable ...............................        (3,374)        (3,652)
              Accrued expenses ...............................         4,972         (1,749)
                                                                    --------       --------
     Net cash provided by (used in) operating activities .....         4,021         (6,072)

Investing activities
     Purchase of property and equipment ......................        (1,347)        (3,829)
     Purchase of patents .....................................           (73)           (71)
     Purchase of marketable securities .......................            --         (2,000)
                                                                    --------       --------

     Net cash used in investing activities ...................        (1,420)        (5,900)

Financing activities
     Net repayments - bank line of credit ....................            --         (7,161)
     Issuance of common stock ................................           265         38,439
                                                                    --------       --------

     Net cash provided by financing activities ...............           265         31,278
                                                                    --------       --------

Increase (decrease) in cash and cash equivalents .............         2,866         19,306

Cash and cash equivalents at beginning of period .............        14,000            261
                                                                    --------       --------

Cash and cash equivalents at end of period ...................      $ 16,866       $ 19,567
                                                                    ========       ========
</TABLE>

                            See accompanying notes.

                                    5 of 15
<PAGE>


                           RECOVERY ENGINEERING, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)
                                  July 4, 1999
Note A -- Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and the instructions to Form 10-Q. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the ninety-one day period
ended July 4, 1999 are not necessarily indicative of the results that may be
expected for the year ending January 2, 2000, or any other period. For further
information, refer to the financial statements and footnotes thereto for the
year ended January 3, 1999 included in the Company's latest annual report on
Form 10-K.

Commencing with fiscal 1998, the Company's fiscal year ends on the Sunday
closest to December 31 (fiscal year 1999 ends January 2, 2000) and each quarter
ends on the last Sunday of a thirteen-week period. As a result, the six months
ended July 4, 1999 and July 5, 1998 included 182 and 186 days, respectively. In
the Company's opinion, this difference in days does not materially affect the
comparability of the financial results of the periods presented.

Note B -- Inventory

The components of inventory consist of the following:

                               July 4,           January 3,
                                1999               1999
                             -----------        -----------
    Finished products        $ 8,076,000        $ 4,378,000
    Work in process              213,000            258,000
    Raw materials              4,165,000          6,025,000
                             -----------        -----------
                             $12,454,000        $10,661,000
                             ===========        ===========

Note C -- Accounting Statements

In 1997, the FASB issued Statements No. 130, REPORTING COMPREHENSIVE INCOME, and
No. 131, DISCLOSURES ABOUT SEGMENTS OF AN ENTERPRISE AND RELATED INFORMATION,
effective for fiscal years beginning after December 15, 1997. The adoption by
the Company of these Statements in January 1998 did not have a material impact
on the Company's financial statements. In 1998, the FASB issued Statements No.
132 EMPLOYERS' DISCLOSURES ABOUT PENSIONS AND OTHER POSTRETIREMENT BENEFITS, and
No. 133 ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES. Statement
No. 132 is effective for fiscal years beginning after December 15, 1997, and
Statement No. 133 is effective for fiscal years beginning after June 15, 1999.
The adoption by the Company of these statements in January 1998 and January
1999, respectively, did not and is not expected to have a material impact on the
Company's financial statements.

                                    6 of 15
<PAGE>


Item 2.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                   (Ninety-one Day Period ended July 4, 1999)
RESULTS OF OPERATIONS:

Net sales for the three-month period ended July 4, 1999 increased 13.2% to
$24,592,000 from $21,724,000 for the same period in 1998. Net sales for the
six-month period ended July 4, 1999 increased 15.9% to $45,158,000 from
$38,949,000 for the same period in 1998. The increase in sales for the quarter
was driven by a 33% increase in sell-through at retail versus the same period
in 1998, according to data collected by the Company. As previously reported, a
higher percentage of the Company's sales in the first half of 1998 were to stock
retailers' shelves with new products than has been the case in 1999.

Gross profit margins increased to 55.4% and 53.0% for the three- and six-month
periods ended July 4, 1999, respectively, compared to 51.1% and 49.5% for the
same periods in the prior year. These increases were driven largely by increased
replacement filter sales as a percentage of total sales, by a reduction in
product direct costs, and by reductions in manufacturing overhead expenses. The
Company continues to benefit from the maturation of the new manufacturing
processes launched in 1998.

Selling, general and administrative expenses increased to $11,077,000 (45.0% of
net sales) and $19,832,000 (43.9% of net sales) for the three- and six-month
periods ended July 4, 1999 from $8,857,000 (40.8% of net sales) and $16,722,000
(42.9% of net sales) for the same periods in 1998. The increase in selling,
general and administrative expenses was attributable primarily to advertising
and promotional expenses related to the continued rollout and expansion of the
Company's line of household water filters. Selling, general and administrative
expenses increased as a percentage of sales for the three- and six-month periods
ended July 4, 1999 compared to the same periods in 1998. Although the Company
expects to continue its investment in marketing and advertising expenditures,
the Company believes that selling, general and administrative expenses will, as
a percentage of net sales, decrease for the year in 1999 compared to 1998.

Research and development expense decreased to $962,000 and $1,923,000 for the
three- and six-month periods ended July 4, 1999, compared to $1,089,000 and
$2,100,000 for the same periods in 1998. The Company continues to be committed
towards developing new products and technology. Development of product line
extensions and other new technology will require continued emphasis and may
require increased spending on research and development.

Other expenses decreased to $22,000 and $54,000 for the three- and six-month
periods ended July 4, 1999 compared to $187,000 and $727,000 for the same
periods in 1998. Interest income and other income increased to $226,000 and
$453,000 for the three- and six-month periods ended July 4, 1999 compared to
$207,000 and $207,000 for the same periods in 1998.

                                    7 of 15
<PAGE>


This increase was mainly due to increased balances of cash and cash equivalents
as a result of the Company's public offering which was completed April 28, 1998,
as well as the proceeds from the overallotment option completed May 18, 1998.
Interest expense and other expense decreased to $248,000 and $507,000 for the
three- and six-month periods ended July 4, 1999 compared to $394,000 and
$934,000 for the same periods in 1998. The decrease was due mainly to lower
interest expense on the Company's bank line of credit, which was established in
March 1997 and repaid by the Company subsequent to its public offering in the
second quarter of 1998.

The Company's effective income tax rate was 15% for the three- and six-month
periods ended July 4, 1999 and July 5, 1998, respectively. The Company has a
$1,512,000 net deferred tax asset primarily related to net operating loss
carryforwards. The Company has recorded a valuation allowance for the majority
of its deferred tax asset due to the uncertainty of future realization.


LIQUIDITY AND CAPITAL RESOURCES:

During the six-month period ended July 4, 1999, operations provided cash of
$4,021,000, compared to $6,072,000 of cash used in operations in the same period
the prior year. In the first half of 1999, cash was provided by net income and a
decrease in accounts receivable and an increase in accrued expenses, while cash
was used to increase inventories and decrease accounts payable. In the first
half of 1998, cash was used to fund the net loss and increase inventories and
accounts receivable, as well as decrease accounts payable and accrued expenses.

Capital expenditures were $1,347,000 for the six-month period ended July 4,
1999, compared to $3,829,000 for the same period in 1998. Capital expenditures
in both periods were primarily to purchase tooling and manufacturing equipment.
The Company anticipates continued expenditures for tooling and manufacturing
equipment purchases associated with product development and an increase in
overall production capacity.

In July 1996, the Company issued $15.0 million of Convertible Notes to certain
investment partnerships affiliated with The Goldman Sachs Group, L.P. ("GS
Group") which bear interest at 5% per annum and expire in 2003. Interest on the
loan is paid quarterly. GS Group may convert the outstanding balance of the loan
into shares of Common Stock at a conversion price of $14.85 per share at any
time during the life of the loan, subject to adjustment in certain
circumstances. If not converted, the loan is payable in annual installments
starting August 2001. The estimated fair value of the convertible loan based on
the Company's incremental borrowing rate for similar liabilities, approximates
its carrying value.

The Company had no borrowings outstanding under its bank credit facility at July
4, 1999 and January 3, 1999. This credit facility, established in March 1997 and
amended in March 1998, provides for total borrowings up to $15,000,000 secured
by equipment, inventory, receivables, and intangibles. The credit facility is a
discretionary working capital line of credit, limited to eligible receivables
and inventory, which bears interest at the bank's reference rate plus 0.75

                                    8 of 15
<PAGE>


percent. Borrowings are due on demand. Pursuant to the Company's agreement with
GS Group, borrowings are limited to $12,500,000 in 1999.

The Company completed a public offering of Common Stock in the second quarter of
1998 netting approximately $38,200,000 from the sale of 1,368,500 shares. The
Common Stock was priced at $30.00 per share. All of the shares were sold by the
Company.

Management believes that anticipated cash flows from operations, funds available
through its bank credit facility and the net proceeds from the sale of
securities will provide sufficient capital resources for current operations,
expansion of plant capacity and product development. The Board of Directors
currently intends to retain all earnings for expansion of the Company's
business.

YEAR 2000 ISSUES

The Company understands the Year 2000 ("Y2K") issue to be the result of computer
programs using a two-digit format, as opposed to four digits, to indicate the
year. Such computer systems would be unable to interpret dates beyond the year
1999, which could cause a system failure or other computer errors, leading to
disruptions in operations either through internal failures or through the effect
of failures which might happen externally, and which could have a material
adverse effect on the Company's financial position.

In 1998, the Company developed a three-phase program for Y2K information systems
readiness. The intent of Phase I was to identify those systems with which the
Company has exposure to Y2K issues and assess the ability to make them Y2K
ready. The intent of Phase II was to implement corrective actions to remedy
issues discovered in Phase I. The intent of Phase III is to test all remedial
corrective actions taken and, if necessary, complete a contingency plan.

The Company has identified three major areas determined to be critical for
successful Y2K readiness: (1) financial and manufacturing information system
applications, (2) manufacturing automation and (3) third-party relationships.

The Company, in accordance with Phase I of the program, has completed an
internal review of all systems and contacted all software suppliers to determine
major areas of exposure to Y2K issues. In the financial and information system
area, a number of applications have been identified as Y2K ready due to their
recent implementation, and no material issues were discovered. These include the
Company's core financial and reporting systems. In the manufacturing area, the
Company has completed its review and did not find any material issues. In the
third-party area, the Company continues its assessment of its major third-party
relationships. Many of these parties state that they intend to be Y2K ready by
2000. The Company has completed Phase II of the program, as well as the testing
component of Phase III. The Company has developed contingency plans in
conjunction with Phase III and is in the process of finalizing them.

                                    9 of 15
<PAGE>


The Company is in the process of determining what total costs will be incurred
in connection with its Y2K readiness initiatives. Expenses incurred to date are
not material and future expenses estimated by the Company are not expected to be
material. The Company will fund all Y2K readiness expenses through operating
cash flows.

Management of the Company believes it has an effective program in place to
resolve Y2K issues in a timely manner. As noted above, the Company has not yet
completed all necessary phases of its Y2K readiness program. In the event that
the Company does not complete any additional phases or is exposed to Y2K
problems beyond its reasonable control, the Company may be unable to take
customer orders, manufacture and ship products, invoice customers or collect
payments, and may be generally subject to litigation or disruptions in the
economy which could materially adversely affect the Company. The amount of
potential liability or lost revenue that might result from such events cannot be
reasonably estimated at this time.

FORWARD-LOOKING STATEMENTS

This report (as well as press releases, other public documents, other written
statements and oral statements made or to be made by the Company) contains
statements relating to future events or the future financial performance of the
Company which are forward-looking statements within the meaning of the safe
harbor provisions of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking
statements involve risks and uncertainties that could significantly affect
anticipated results in the future and, accordingly, actual results may differ
materially from those described in the forward-looking statements. These risks
and uncertainties include, but are not limited to, the effects of economic
conditions, continued customer acceptance of products, the Company's reliance on
proprietary technology, pending patent litigation, product obsolescence, the
Company's ability to manage growth, risks associated with international
operations, competition, product liability, and other factors described from
time to time in the Company's filings with the Securities and Exchange
Commission, including the Company's Annual Report on Form 10-K.


Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company's operations are not currently subject to market risks for interest
rates, foreign currency rates, commodity prices or other market price risks of a
material nature.

                                    10 of 15
<PAGE>


PART        II OTHER INFORMATION

Item 1.     Legal Proceedings

            The Company and several other water filtration companies were named
            as defendants in a civil proceeding initiated in January 1997 by
            Brita U.S.A., a subsidiary of Clorox Company, which asserted that
            the defendants infringed one of Brita's patents relating to pitcher
            products. On March 3, 1999, summary judgment was entered in the
            United States District Court for the Northern District of Illinois,
            dismissing all claims against the Company and the other defendants.
            Brita has filed a Notice of Appeal regarding the Court's decision.
            The Company will continue to vigorously defend this case. The
            Company was aware of Brita's patent prior to developing the PUR
            pitcher design and believes that it does not infringe Brita's
            patent. The design of the PUR Plus pitcher, dispenser and related
            filter cartridge differs in material respects from the design of the
            pitcher products that are the subject of this litigation.

            The Company has been named as the defendant in a civil proceeding
            initiated in May 1999 by KX Industries, L.P., a former supplier to
            the Company, which asserts that the Company is infringing a KX
            patent relating to processes for manufacturing carbon blocks. The
            Company intends to vigorously defend this case. The Company was
            aware of the KX patent prior to developing its manufacturing
            processes and believes that it does not infringe KX's patent.

            The Company from time to time is involved in various other legal
            proceedings arising in the normal course of business, none of which
            is expected to result in any material loss to the Company.

Item 2.     Changes in Securities and Use of Proceeds

            On April 29, 1999, the Board of Directors of the Company adopted
            Amendment No. 2 to the Rights Agreement, dated January 30, 1996,
            between the Company and Norwest Bank, N.A., as Rights Agent. The
            Rights Agreement previously required that a majority of the
            "Continuing Directors," as defined in the Rights Agreement, approve
            the redemption of the Rights, the exchange of the Rights after any
            person becomes an Acquiring Person, and certain other actions under
            the Rights Agreement. Pursuant to Amendment No. 2, these actions now
            require the approval of a majority of the Board of Directors.

Item 3.     Defaults upon Senior Securities

            Not applicable

                                    11 of 15
<PAGE>


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

            The Company's Annual Meeting of Shareholders was held on April 29,
            1999. The following matters were submitted to a vote of the
            shareholders at the Annual Meeting:

            Approval of Amendment to the Company's Articles of Incorporation to
            authorize a classified board and to implement certain related
            matters. (2,512,146 votes FOR, 1,226,219 votes AGAINST, and 7,499
            votes ABSTAINED, and 1,228,262 shares held by brokers were not voted
            on the resolution)

            Election of Directors. The following persons were elected to serve
            as directors, for the following terms:

            Terms expiring in 2000             Terms expiring in 2001
            Robert R. Gheewalla                John E. Gherty
            William D. Thompson                Sanjay H. Patel
                                               Richard J. Zeckhauser

            Terms expiring in 2002
            Brian F. Sullivan
            William F. Wanner, Jr.

            Approval of Amendment to 1994 Stock Option and Incentive Plan to
            increase the number of shares reserved for issuance thereunder.
            (3,412,243 votes FOR, 308,472 votes AGAINST, and 25,150 votes
            ABSTAINED, and 1,228,262 shares held by brokers were not voted on
            the resolution)

            Approval of Amendment to 1993 Director Stock Option Plan to increase
            the number of shares reserved for issuance thereunder. (3,567,201
            votes FOR, 199,246 votes AGAINST, and 36,009 votes ABSTAINED, and
            1,171,670 shares held by brokers were not voted on the resolution)

            Ratification of Appointment of Ernst & Young, LLP as Independent
            Auditors. (4,951,398 votes FOR, 13,140 votes AGAINST, and 9,589
            votes ABSTAINED)

Item 5.     Other Information

            Not applicable

                                    12 of 15
<PAGE>


Item 6.     Exhibits and Reports on Form 8-K

            (a)         Exhibits

                        Exhibit
                        No.         Description
                        ---         -----------
                        10.1        Change-in-Control Severance Pay Agreement
                                    dated November 2, 1998 between Recovery
                                    Engineering, Inc. and Brian F. Sullivan
                        10.2        Change-in-Control Severance Pay Agreement
                                    dated November 2, 1998 between Recovery
                                    Engineering, Inc. and Richard D. Hembree
                        10.3        Change-in-Control Severance Pay Agreement
                                    dated November 2, 1998 between Recovery
                                    Engineering, Inc. and Charles F. Karpinske
                        10.4        Change-in-Control Severance Pay Agreement
                                    dated November 2, 1998 between Recovery
                                    Engineering, Inc. and Jeffrey T. Dekko
                        10.5        Change-in-Control Severance Pay Agreement
                                    dated November 2, 1998 between Recovery
                                    Engineering, Inc. and Barry B. Van Lerberghe
                        10.6        Change-in-Control Severance Pay Agreement
                                    dated November 2, 1998 between Recovery
                                    Engineering, Inc. and Daniel B. Seebart
                        10.7        Change-in-Control Severance Pay Agreement
                                    dated February 17, 1999 between Recovery
                                    Engineering, Inc. and Reed A. Watson
                        27          Financial Data Schedule

            (b)         Reports on Form 8-K

                        No reports on Form 8-K were filed during the quarter
                        covered by this Form 10-Q.

                                    13 of 15
<PAGE>


                                   SIGNATURES


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



                                  Recovery Engineering, Inc.
                                  ----------------------------------------------
                                  (Registrant)




Dated:  August 16, 1999           /s/Brian F. Sullivan
       ----------------           ----------------------------------------------
                                  Brian F. Sullivan
                                  Chairman and Chief Executive Officer
                                  (principal executive officer)




Dated:  August 16, 1999           /s/Charles F. Karpinske
       ----------------           ----------------------------------------------
                                  Charles F. Karpinske
                                  Chief Financial Officer
                                  (principal financial and accounting officer)

                                    14 of 15
<PAGE>


                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                           EXHIBIT INDEX TO FORM 10-Q


For the quarter ended                               Commission File No.: 0-21232
July 4, 1999


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                           RECOVERY ENGINEERING, INC.
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<TABLE>
<CAPTION>
       Exhibit
           No.  Description                                     Method of Filing
           ---  -----------                                     ----------------
<S>                                                             <C>
        10.1 *  Change-in-Control Severance Pay Agreement       Filed electronically herewith
                dated November 2, 1998 between Recovery
                Engineering, Inc. and Brian F. Sullivan

        10.2 *  Change-in-Control Severance Pay Agreement       Filed electronically herewith
                dated November 2, 1998 between Recovery
                Engineering, Inc. and Richard D. Hembree

        10.3 *  Change-in-Control Severance Pay Agreement       Filed electronically herewith
                dated November 2, 1998 between Recovery
                Engineering, Inc. and Charles F. Karpinske

        10.4 *  Change-in-Control Severance Pay Agreement       Filed electronically herewith
                dated November 2, 1998 between Recovery
                Engineering, Inc. and Jeffrey T. Dekko

        10.5 *  Change-in-Control Severance Pay Agreement       Filed electronically herewith
                dated November 2, 1998 between Recovery
                Engineering, Inc. and Barry B. Van Lerberghe

        10.6 *  Change-in-Control Severance Pay Agreement       Filed electronically herewith
                dated November 2, 1998 between Recovery
                Engineering, Inc. and Daniel B. Seebart

        10.7 *  Change-in-Control Severance Pay Agreement       Filed electronically herewith
                dated February 17, 1999 between Recovery
                Engineering, Inc. and Reed A. Watson

            27  Financial Data Schedule                         Filed electronically herewith
</TABLE>

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* Management Contracts


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