<PAGE>

                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                   Quarterly Report Under Section 13 or 15 (d)
                   Of the Securities and Exchange act of 1934


For Quarter Ended             June  30, 1997
                 --------------------------------------------------------------

Commission file number              0-14119-NY
                      ---------------------------------------------------------
                        Polymer Research Corp. of America
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

            New York                                 11-2023495      
--------------------------------------------------------------------------------
(State or other jurisdiction of                   (I.R.S Employer 
 incorporation or organization)                 Identification No.)

                   2186 Mill Avenue, Brooklyn, New York 11234
--------------------------------------------------------------------------------
                    (Address of principal executive offices)
                                   (Zip code)

                                 (718) 444-4300
--------------------------------------------------------------------------------
               (Registrants telephone number, including area code)

                                 Not Applicable
--------------------------------------------------------------------------------
            (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 practicable date.

                July 31, 1997                    1,488,711
--------------------------------------------------------------------------------


<PAGE>

                        POLYMER RESEARCH CORP. OF AMERICA

                                      INDEX


                                                       Page
                                                      Number
                                                      ------
Part I - FINANCIAL INFORMATION:

          ITEM I - FINANCIAL STATEMENTS

          Balance Sheets:
          June 30, 1997 (Unaudited) and
             December 31, 1996                          1

          Statements of Operations:
          Three months and six months ended
          June 30, 1997 and 1996 (Unaudited)            3

          Statements of Cash Flows:
          Three months and six months ended
          June 30, 1997 and 1996 (Unaudited)            4

          Notes to Financial Statements                5-8

          ITEM 2 - MANAGEMENT`S DISCUSSION AND ANALYSIS
                   OF FINANCIAL CONDITION AND RESULTS
                   OF OPERATIONS                      9-10


PART II - OTHER INFORMATION                             11









<PAGE>


PART I - FINANCIAL INFORMATION 
POLYMER RESEARCH CORP. OF AMERICA
BALANCE SHEETS
JUNE 30, 1997 AND DECEMBER 31, 1996
--------------------------------------------------------------------------------

                                              June 30,      December 31,
ASSETS                                          1997            1996
------                                       ----------      ----------
                                             (Unaudited)      (Note 1)
CURRENT ASSETS:
Cash                                         $  541,289      $  709,170
Certificates of deposit                         570,291         554,338
Investment securities available
  for sale                                      472,115         473,283
Accounts receivable,less allowances
  of $0 and $0                                   98,487          91,850
Inventories                                      82,564          85,822
Prepaid expenses and other                      119,861         195,086
                                             ----------      ----------
Total current assets                          1,884,607       2,109,549
                                             ----------      ----------

Land, Property, and Equipment-net             2,890,536       2,939,514
                                             ----------      ----------

Deferred financing costs and other               11,600          11,814
                                             ----------      ----------
Total other assets                               11,600          11,814
                                             ----------      ----------

TOTAL                                        $4,786,743      $5,060,877
                                             ==========      ==========




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

PART I - FINANCIAL INFORMATION POLYMER
RESEARCH CORP. OF AMERICA
BALANCE SHEETS
JUNE 30, 1997 AND DECEMBER 31, 1996
--------------------------------------------------------------------------------

                                            June 30,        December 31,
                                              1997              1996
                                          -----------       -----------
                                          (Unaudited)         (Note 1)

LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------

CURRENT LIABILITIES:
Current portion of long-term debt         $    28,031       $    28,143
Accounts payable                               48,113            56,907
Accrued expenses and other
 current liabilities                          303,313           417,714
Deferred revenue                               25,000           393,300
                                          -----------       -----------
Total current liabilities                     404,457           896,064
                                          -----------       -----------
LONG-TERM DEBT  (NOTE 2)                    1,469,422         1,483,080
                                          -----------       -----------

STOCKHOLDERS' EQUITY:
Common stock, par value $.01 per
 share, authorized 4,000,000 shares,
 issued 1,585,140 and 1,585,140
 shares respectively                           15,851            14,896
Capital in excess of par value              2,863,189         2,632,037
Retained earnings                              97,250           103,654
Unrealized holding losses                      (6,689)          (12,117)
Less: Treasury stock, at cost
 91,837 shares in 1996 and
 91,837 shares in 1995                        (56,737)          (56,737)
                                          -----------       -----------
Total Stockholders' Equity                  2,912,864         2,681,733
                                          -----------       -----------

TOTAL                                     $ 4,786,743       $ 5,060,877
                                          ===========       ===========


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

POLYMER RESEARCH CORP. OF AMERICA
STATEMENTS OF OPERATIONS FOR THE
THREE MONTHS ENDED JUNE 30, 1997 AND 1996 (UNAUDITED) AND
THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996 (UNAUDITED)
--------------------------------------------------------------------------------


<TABLE>
<CAPTION>
                                              Three Months Ended                   Six Months Ended
                                                    June 30,                           June 30,
                                            1997              1996              1997              1996
                                         ---------         ---------         ---------         ---------  
<S>                                    <C>               <C>               <C>               <C>        
Net revenues:
  Product sales                        $   320,399       $   223,353       $   553,079       $   451,086
  Research                               1,129,601         1,135,900         2,277,901         2,223,724
                                         ---------         ---------         ---------         ---------  
  Total                                  1,450,000         1,359,253         2,830,980         2,674,810
                                         ---------         ---------         ---------         ---------  
Cost of Revenues
  Product sales                            258,758           195,961           489,889           380,467
  Research                                 233,608           275,372           495,260           570,374
                                         ---------         ---------         ---------         ---------  
  Total                                    492,366           471,333           985,149           950,841
                                         ---------         ---------         ---------         ---------  
Gross Profit on Revenues                   957,634           887,920         1,845,831         1,723,969

Selling, General, and
 Administrative Expenses                   746,822           682,227         1,407,179         1,317,094
                                         ---------         ---------         ---------         ---------  
Income from Operations                     210,812           205,693           438,652           406,875
                                         ---------         ---------         ---------         ---------  
Other Revenues (Expenses):
  Interest income                           16,952            12,800            34,068            28,687
  Interest expense (See note 2)            (39,518)          (61,160)          (79,017)         (122,664)
                                         ---------         ---------         ---------         ---------  
  Total                                    (22,566)          (48,360)          (44,949)          (93,977)
                                         ---------         ---------         ---------         ---------  
Income before income taxes                 188,246           157,333           393,703           312,898
Provision for income taxes                 (89,499)          (78,000)         (188,000)         (153,500)
                                         ---------         ---------         ---------         ---------  
Net Income                             $    98,747       $    79,333       $   205,703       $   159,398
                                         =========         =========         =========         =========  
Income per Share                       $      0.06       $      0.05 *     $      0.13       $      0.10 *
                                         =========         =========         =========         =========  
Weighted average number of shares
  outstanding during the period          1,585,140         1,585,140 *       1,585,140         1,585,140 *
                                         =========         =========         =========         =========  
</TABLE>

* Restated for 1997 5% stock dividend




The accompanying notes are an integral part of these financial statements.
------------------------------------------------------------------------------3


<PAGE>

POLYMER RESEARCH CORP. OF AMERICA
STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996
(UNAUDITED)
--------------------------------------------------------------------------------




OPERATIONS:                             1997            1996
                                     ---------       ---------


Net Income                           $ 205,703       $ 159,398
Charge not affecting funds -
 Unrealized holding losses               5,428
 Issuance of stock                      20,000
 Depreciation and amortization          48,978          50,350
                                     ---------       ---------
Funds Provided by operations           280,109         209,748
                                     ---------       ---------

Asset and liability management:
 Accounts receivable                    (6,637)        (27,596)
 Inventories                             3,258         (12,413)
 Other current assets                   75,225         (63,284)
 Other assets                              214             300
 Accounts payable                       (8,794)         19,588
 Accrued expenses and other           (114,401)        (71,294)
 Income taxes payable                                  (33,400)
 Deferred revenue                     (368,300)       (170,837)
 Other current liabilities
                                     ---------       ---------    
Increase (Decrease) in net
    operating assets                  (419,435)       (358,936)
                                     ---------       ---------
Total                                 (139,326)       (149,188)
                                     ---------       ---------

FUNDS USED BY
 FINANCING
Certificates of deposit                (15,953)         (3,733)
Investment securities                    1,168          52,927
Payments on long term debt             (13,770)        (19,072)
                                     ---------       ---------
 Total                                 (28,555)         30,122
                                     ---------       ---------

INVESTMENT IN LAND, PROPERTY,
 AND EQUIPMENT                                          (4,860)
                                                     ---------
INCREASE (DECREASE) IN CASH          $(167,881)      $(123,926)
                                     =========       =========



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

                       POLYMER RESEARCH CORP. OF AMERICA
                         NOTES TO FINANCIAL STATEMENTS
                                  (UNAUDITED)

NOTE 1 - Financial statements

In the opinion of the management of Polymer Research Corp. of America (the
Company), the accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-Q and do not include all of the
information and footnotes required by generally accepted accounting principles.
Management believes that the results herein reflect all adjustments which are in
the opinion of management necessary to fairly state the results and current
financial condition of the Company for the respective periods. These statements
should be read in conjunction with the financial statements and notes thereto
included in the Company's report filed under cover of Form 10-K.

The results of operations for the six month period is not necessarily indicative
of the results for an entire year.

The balance sheet at December 31, 1996 has been taken from the audited financial
statements as of that date.

NOTE 2 - Summary of Significant Accounting Policies

Business Activity

The Company is engaged in the research and development of the applications of
chemical grafting and sells products resulting from such research.

Credit Risk

Financial Instruments that potentially subject the company to credit risk
include investments in United States Treasury bills notes and other certificates
of deposit, government agencies' securities and U.S. Government and New York
State mutual bond funds. Future Changes in economic conditions may make the
investment less valuable.

In addition, financial instruments that potentially subject the Company to
credit risk also include accounts receivable. Accounts receivable resulting from
research or product sales are not collateralized.

The Company maintains deposits with financial institutions in excess of amounts
insured by the FDIC.
------------------------------------------------------------------------------5

<PAGE>

Pervasiveness of Estimates

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates

Revenue Recognition

Revenue from research contracts is recognized upon two criteria: first, client
approval of performance of a specific stage of the contract and, second,
collection of the resulting revenue is assured. Revenue from production is
recognized when products are shipped for sale to customers.

Inventories

Inventories are valued at the lower of cost or market, with cost determined
using the first-in, first-out method and with market defined as the lower of
replacement cost or realizable value.

Investment Securities

The Company determines the appropriate classification of securities at the time
of purchase. If the Company has the intent and the ability at the time of
purchase to hold securities until maturity or on a long-term basis, they are
classified as investments and carried at amortized historical cost. Securities
to be held for indefinite periods of time and not intended to be held to
maturity or on a long-term basis are classified as available for sale and
carried at face value. Securities held for indefinite periods of time include
securities that management intends to use as part of its asset and liability
management strategy and that may be sold in response to changes in interest
rates, resultant prepayment risk and other factors related to interest rate and
resultant prepayment risk changes.

Realized gains and losses on dispositions are based on the net proceeds and the
adjusted book value of the securities sold, using the specific identification
method. Unrealized gains and losses on investment securities available for sale
are based on the difference between book value and fair value of each security.
These gains and losses are credited or charged to shareholders' equity, whereas
realized gains and losses flow through the Company's operations.
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<PAGE>

Property and Equipment

Property and equipment is stated at cost. The costs of additions and betterments
are capitalized and expenditures for repairs and maintenance are expensed in the
period incurred. When items of property and equipment are sold or retired, the
related costs and accumulated depreciation are removed from the accounts and any
gain or loss is included in income.

The company capitalizes leased equipment where the terms of the lease result in
the transfer to the Company of substantially all of the benefits and risks of
ownership of the equipment.

Depreciation and amortization of property and equipment is provided utilizing
the straight-line method over the estimated useful lives of the respective
assets as follows: 

Transportation equipment                3 to 5 years 
Machinery and equipment                      5 years 
Furniture and fixtures                 5 to 10 years 
Building and improvements                   40 years
Office equipment under capital
 leases                                      5 years

Deferred Financing Costs

Costs incurred in obtaining the mortgage discussed below have been capitalized
and are being amortized over the term of the related obligation utilizing the
straight-line method.

Income Taxes

The Company accounts for its income taxes utilizing Statement of Financial
Accounting Standards ("SFAS") No. 109 "Accounting for Income Taxes" which
requires that the Company follow the liability method of accounting for income
taxes. 

The liability method provides that deferred tax assets and liabilities are 
recorded based on the difference between the tax bases of assets and 
liabilities and their carrying amounts for financial reporting purposes,
referred to as "temporary differences." The adoption of the new statement did
not have a material impact on the Company's financial position or results of
operations.

Net Earnings Per Share

Earnings per share are computed based upon the weighted average number of common
shares outstanding during each year.
------------------------------------------------------------------------------7

<PAGE>

Profit Sharing Plan

Effective January 1, 1990, the Company adopted a qualified non-contributory
profit sharing plan. The plan provides its eligible employees with a source of
retirement income, as well as provide assistance in other circumstances such as
death or disability. Eligible employees must meet two requirements to become
participants; attainment of age 21 and completion of one year of service with
the Company. Employer contributions are determined, if any, at the Board of
director's discretion. A percentage of the benefits vest after three years of
qualifying service.

NOTE 3 - Provision for Income Taxes  (First six months)

                      1997                1996
                     -----                ----
Federal           $ 112,000             $ 91,000
State and local      76,000               62,500
                  ---------             --------
Total             $ 188,000             $153,500
                  =========             ========

NOTE 4 - Mortgage Liability

In September of 1996 the Company prepaid $800,000 due under the mortgage on the
Company's building and modified its payment schedule. In connection with the
modification, the company paid the Mortgagee $45,000. As modified, the Company
is obligated to pay a mortgage note payable in equal monthly instalments of
$15,457 including interest at 10.5% per annum through June, 2000. Such mortgage
is being amortized using a 25 year amortization. The entire unpaid principal
balance is due in a balloon payment of $1,398,330 on June 1, 2000. 

NOTE - 5 - Stock Dividend

On April 1, 1997 the Company declared a 5% stock dividend to shareholders, paid
April 9, 1997. The transaction was valued based upon the closing market price of
the Company's stock on April 1, 1997, which was $2.81 per share. Retained
earnings was charged for $ 212,107 as a result of the issuance of 75,483 shares.









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<PAGE>

            POLYMER RESEARCH CORP. OF AMERICA

 ITEM 2 - MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
            CONDITION AND RESULTS OF OPERATIONS

CAPITAL RESOURCES AND LIQUIDITY

Cash, Investments, and Investment Securities have decreased collectively by
$153,096 since December 31, 1996. The decrease is principally due to the 1997
use of cash received in late 1996 to perform services on research contracts and
thereby reduce deferred revenues which was partially offset by earnings during
the first six months of this fiscal year.

Cash is generated by and used by the Company through its operations. Neither the
issuance of stock nor debt was in 1996, or expected to be in 1997, sources of
cash for use in operations.

The rate of current assets to current liabilities at June 30, 1997 increased to
4.66 to 1.0 as compared to 2.35 to 1.0 at December 31, 1996. The increase is a
result of net earnings in 1997 and the decrease in deferred revenue.
 
Based on the above, the Company's cash, investment, and investment securities 
position at June 30, 1997 is deemed sufficient to cover any unforeseen sales 
downturn in the short term as it is equal to approximately seven months 
selling, general, and administrative expenses. 

Over both the long and short term, liquidity will be a direct result of sales 
and related net earnings.

B.  RESULTS OF OPERATIONS

Three months ended June 30, 1997 v. 1996

Net revenues for the second quarter of 1997 were $ 1,450,000, an increase of $
90,747 (7%) over the second quarter of 1996. Research sales increased $6,299
(1%) in the second quarter of 1997 over 1996. Product sales increased $97,046
(40%) in the second quarter of 1997 over 1996 due to increased demand resulting
from research findings.

The cost of revenues in research decreased from 24% in the second quarter of
1996 to 21% in the same quarter of 1997 due to reductions in staff and in
repairs and maintenance expenses.

Costs of product sales decreased from 88% in the second quarter of 1996 to 81%
in the same quarter of 1997 principally

------------------------------------------------------------------------------9

<PAGE>

as a result of increased volume while utilizing the same staff in spite of
higher material costs. 

Selling, general, and administrative expenses remained consistent as a 
percentage of sales at 52% for the second quarter of 1997 and 50% for the 
comparable quarter of 1996.

Interest expense decreased due to the principal pre-payment of $800,000 on the
mortgage in September 1996. (See Note 4.)

Net income increased from $ 78,333 (6% of sales) in 1996 to $ 98,747 (7% of
sales) in 1997, principally as the result of increased revenues, improved gross
margins, and the reduced interest expense.

Six months ended June 30, 1997 v. 1996

Net revenues for the first six months of 1997 were $ 2,830,980 an increase of $
156,170 (6%) over the first six months of 1996. Research sales increased $54,177
(2%) in the first six months of 1997 over 1996. Product sales increased $101,993
(23%) in the first six months of 1997 over 1996 due to increased demand
resulting from research findings. 

The cost of revenues in research decreased from 26% in the first six months of 
1996 to 22% in the same period of 1997 due to reductions in staff and in 
repairs and maintenance expenses. 

Costs of product sales increased from 84% in the first six months of 1996 to 
89% in the same period of 1997 principally as a result of increased material 
prices. 

Selling, general, and administrative expenses remained consistent as a 
percentage of sales at 50% for the first six months of 1997 and 49% for the 
comparable period of 1996.

Interest expense decreased due to the principal pre-payment of $800,000 on the
mortgage in September 1996. (See Note 4.)

Net income increased from $ 159,398 (6% of sales) in 1996 to $205,703 (7% of
sales) in 1997, principally as the result of increased revenues, improved gross
margins, and the reduced interest expense.






-----------------------------------------------------------------------------10

<PAGE>

PART II - OTHER INFORMATION

ITEM 1 - Legal Proceedings:

The Company is party to various lawsuits arising in the ordinary course of
business. The Company's financial statements include reserves for legal expenses
and any unfavorable outcomes in amounts management believes to be reasonable. In
the opinion of management, such lawsuits should not have a material adverse
effect on the Company's financial condition.

ITEM 2 - Changes in Securities:

On April 1, 1997 the Company declared a 5% stock dividend to shareholders, paid
April 9, 1997. The transaction was valued based upon the closing market price of
the Company's stock on April 1, 1997, which was $2.81 per share. Retained
earnings was charged for $ 212,107 as a result of the issuance of 75,483 shares.

On April 1, 1997 prior to the declaration of a stock dividend, the Company
issued 20,000 shares of stock to an Executive Vice President as a bonus for past
and future services. These shares have not been registered under the Securities
Act of 1933 and sales of the shares are subject to restrictions and limitations.
The Company has valued the shares at $1 per share and will recognize
compensation expense for 1997 totaling $ 20,000 related to this bonus rateably
throughout the year.

ITEM 3 - Defaults Upon Senior Securities: None

ITEM 4 - Submission of Matters to a Vote of Security Holders:

The Company held its annual meeting on May 22, 1997. At such meeting the
following persons were elected directors:

Director and votes for:
    Carl Horowitz          1,251,274
    Irene Horowitz         1,251,274
    John Ryan              1,251,274
    Alice Horowitz         1,251,274
    Boris Jody             1,251,274
    Mohan Sanduja          1,251,274
    Terry J. Wolfgang      1,251,274

ITEM 5 - Other Information: None

ITEM 6 - Exhibits and Reports on Form 8-k: None
-----------------------------------------------------------------------------11

<PAGE>

                                   FORM 10-Q

                                   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.


                         POLYMER RESEARCH CORP. OF AMERICA,
                         ----------------------------------------------------
                                    (REGISTRANT)


Date  July 31, 97         /s/ Carl Horowitz
    --------------       ----------------------------------------------------
                         Carl Horowitz, President and Chief
                          Accounting Officer






























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