U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

Annual Report Pursuant to Section 13 or 15(d) of the Securities  Exchange Act of
1934.

                   For the fiscal year ended December 31, 1998

                         Commission File Number: 0-3207

                           Barringer Technologies Inc.
                 (Name of small business issuer in its charter)

           Delaware                                         84-0720473
(State or Other Jurisdiction of             (I.R.S. Employer Identification No.)
Incorporation or Organization)               

                      30 Technology Drive, Warren, NJ 07059
          (Address, Including Zip Code, of Principal Executive Offices)

                                (908) 222 - 9100
                           (Issuer's Telephone Number)

Securities registered pursuant to Section 12(b) of the Exchange Act: NONE

Securities registered pursuant to Section 12(g) of the Exchange Act:

     Common Stock, par value $.01 per share 
     Common Stock Purchase Warrants

     Check whether the issuer (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

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

     The aggregate market value of voting stock held by  nonaffiliates  computed
by  reference  to the price at which the stock was sold,  or the average bid and
asked price of such stock, is $31,291,000 as of March 26, 1999.

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


                                                Outstanding as of March 26, 1999
     Common Stock, $.01 par value                    7,394,072

<PAGE>

                                   TABLE OF CONTENTS


Page

                                     PART I

Item   1.  Business................................................     3
Item   2.  Properties..............................................     8
Item   3.  Legal Proceedings.......................................     8
Item   4.  Submission of Matters to a Vote of Security Holders.....     9

                                     PART II

Item   5. Market for Common Equity and Related Stockholder Matters..    9
Item   6. Selected Financial Data...................................    10
tem    7. Management's Discussion and Analysis......................    11
Item   7A.Quantitative and Qualitative Disclosures About Market Risk.   17
Item   8. Financial Statements and Supplemental Data.................   17
Item   9. Changes in and Disagreements with Accountants on 
          Accounting and Financial Disclosures.......................   17

                                    PART III

Item  10. Directors and Executive Officers of the Registrant.........   18
Item  11. Executive Compensation.....................................   20
Item  12. Security Ownership of Certain Beneficial 
          Owners and Management......................................   25
Item  13. Certain Relationships and Related Transactions.............   27


                                     PART IV

Item  14. Exhibits, Financial Statement Schedules, and
          Reports on Form 8-K........................................   27

Signatures...........................................................   31


<PAGE>
                                     PART I

Item 1.  Business.
 
Disclosure Regarding Forward Looking Statements
 
     This Annual Report on Form 10-K contains forward-looking  statements within
the meaning of  Section 27A  of the  Securities  Act of 1933,  as  amended,  and
Section 21E of the Securities  Exchange Act of 1934, as amended,  that are based
on the beliefs of the Company's  management as well as  assumptions  made by and
information currently available to the Company's  management.  When used in this
Annual  Report,  the  words  "estimate,"  "project,"  "believe,"   "anticipate,"
"intend,"  "expect,"  "plan,"  predict," "may,"  "should,"  "will," the negative
thereof  and  similar  expressions  are  intended  to  identify  forward-looking
statements.

     Forward-looking   statements   are   inherently   subject   to  risks   and
uncertainties, many of which cannot be predicted with accuracy and some of which
might not even be anticipated.  Future events and actual results,  financial and
otherwise,  could differ  materially  from those set forth in or contemplated by
the forward-looking  statements  contained herein.  Important factors that could
contribute to such differences  include, but are not limited to, the development
and growth of markets for the Company's  products,  the Company's  dependence on
and the effect of governmental regulations on demand for the Company's products,
the impact of both foreign and domestic governmental budgeting decisions and the
timing  of  governmental  expenditures,  the  reliance  of  the  Company  on its
IONSCAN(R)  products,  and the  dependency  of the  Company  on its  ability  to
successfully  develop  and  market new  products  applications,  the  effects of
competition,  and the effect of general economic and market conditions,  as well
as conditions  prevailing in the markets for the Company's products.  Certain of
the factors  summarized  above are  described  in more  detail in the  Company's
Registration Statement on Form SB-2 (File no. 333-33129) and reference is hereby
made thereto for additional  information with respect to the matters  referenced
above.  Other factors may be described from time to time in the Company's  other
filings with the  Securities  and Exchange  Commission,  news releases and other
communications.  Readers  are  cautioned  not to place  undue  reliance on these
forward-looking statements,  which speak only as of the date hereof. The Company
does not  undertake any  obligation  to release  publicly any revisions to these
forward-looking  statements to reflect  events or  circumstances  after the date
hereof or to reflect the occurrence of unanticipated events.

     Subsequent written and oral forward-looking  statements attributable to the
Company  or  persons  acting on its  behalf  are  expressly  qualified  in their
entirety by the cautionary statements set forth above and contained elsewhere in
this Form 10-K.

General

     The  Company  was  incorporated  under the laws of the State of Delaware on
September 7, 1967.

     The Company is the world's  leading  manufacturer  (based on units sold) of
high sensitivity  equipment used for detecting and identifying  trace amounts of
plastic and other explosives and illegal drugs. The Company designs and produces
products  that employ a  proprietary  application  of ion mobility  spectrometry
("IMS")  technology that can detect and identify  targeted  compounds in amounts
smaller than one-billionth of a gram in approximately six seconds. The Company's
current principal product, the IONSCAN(R),  is a portable desktop system used in
explosives  detection  and drug  interdiction  applications.  As of December 31,
1998, the Company had sold over 1,000 units in 53 countries.

     The  markets  for  the  Company's  IONSCAN(R)  currently  include  aviation
security, other transport security, facilities protection,  forensics, military,
corrections,  customs and law enforcement.  The Company's  customers include the


<PAGE>

Federal Aviation  Administration (the "FAA"), the U.S. Air Force, the U.S. Coast
Guard,  the U.S. Drug  Enforcement  Agency (the "DEA") and the Federal Bureau of
Investigation  (the  "FBI"),  as well as customs  agencies  in  France,  Canada,
Australia and Japan and various prison facilities in the U.S. and elsewhere. The
IONSCAN(R) is also installed at over 40 airports and  transportation  centers in
countries  throughout the world,  including Gatwick Airport and Heathrow Airport
in the United  Kingdom  and Kuala  Lumpur  Airport in  Malaysia,  as well as the
Eurotunnel. In the United States alone, there are over 250 IONSCAN(R)s installed
in 30 airports such as John F. Kennedy  International Airport and Chicago O'Hare
International  Airport in the  United  States.  The  Company  believes  that its
principal  competitive  advantages  are the detection  capability,  reliability,
versatility,  cost  effectiveness,  ease of use,  portability  and  after-market
service of the  IONSCAN(R).  These  advantages  enable the IONSCAN(R) to be used
both in lieu of and in  conjunction  with  bulk  imaging  technologies,  such as
enhanced x-ray and computer aided tomography ("CATSCAN").

     The Company  believes  that many of the markets it serves are  experiencing
substantial growth, principally in reaction to heightened safety concerns caused
by the threat of terrorism and growing public awareness of drug-related criminal
activity.  The  Company  believes  that the  deployment  of  advanced  detection
equipment,  such as the IONSCAN(R),  will continue to increase as the acceptance
of using such  equipment to combat these  concerns  increases.  During 1998, the
Company  received orders totaling $9.4 million from the FAA as part of the FAA's
publicly announced intention to further deploy advanced detection  technology at
the nation's  larger  airports.  In addition,  during 1997 and 1998, the Company
sold a number of IONSCAN(R)s  to the U.S. Air Force for use in securing  certain
U.S. Air Force bases in the U.S. and abroad.

     The Company believes that there are numerous potential applications for its
trace detection technology. Currently, the principal applications are explosives
detection and drug interdiction.
 
Market Overview

     Explosives Detection

     In the past several years, a number of events have contributed to increased
public  concern  regarding the threat of terrorism  and have focused  government
attention on the limited  effectiveness  of currently  deployed  x-ray and metal
detection  equipment  and  on  the  need  for  advanced   explosives   detection
technology. As a result, several advanced technologies have been adapted for use
in explosives  detection  applications.  These technologies include bulk imaging
techniques,  such as  enhanced  x-ray and  CATSCAN,  as well as trace  detection
techniques, such as IMS, gas chromatography and chemoluminescence.  Bulk imaging
techniques offer certain advantages over conventional x-ray technology,  but are
generally  expensive to deploy (as much as $1.0 million per  installation),  are
non-portable  and  generally  reject a large  number of  objects  as a result of
perceived  anomalies  that  are  later  determined  not  to  be  explosives.  By
comparison,  trace  detection  equipment is capable of detecting and identifying
minute  amounts of chemical  substances  and is generally more portable and less
expensive than bulk imaging equipment.

     While   implementation   of  advanced   detection   strategies  has  varied
significantly around the world, the Company believes that aviation  authorities,
including the FAA, have generally  recognized  that no one detection  technology
provides a complete  solution to the  problem of  enhancing  existing  detection
capabilities. Consequently, trace detection technology is frequently deployed as
a complement to bulk imaging equipment to resolve  anomalies  identified by bulk
detectors and in  applications  where it is impractical to use the larger,  less
mobile  bulk  imaging  detectors,  such  as  checking  carry-on  baggage.  Trace
detection  technology  is also  deployed in lieu of bulk  imaging  equipment  in
certain  installations  because  of its  relatively  low cost,  particularly  in
smaller airports and in less developed countries.


<PAGE>

     The development and deployment of advanced explosives  detection technology
is being  driven by recent  government  initiatives  in the  United  States  and
elsewhere in the world. For example,  in response to the  recommendations of the
White House Commission on Aviation Safety and Security (the "Gore  Commission"),
in October 1996, the U.S. Congress appropriated $144 million for the procurement
of advanced explosives  detection  technology and an additional $100 million for
fiscal year 1999,  which the FAA is using to deploy such technology in a limited
number of the 400  busiest  U.S.  airports.  Also,  since the  enactment  of the
Aviation Security Act of 1990, the FAA has funded over $200 million for research
and development of advanced explosives detection technologies.

     Trace detection  technology has a broad range of other explosives detection
uses,  including other transport  security,  facilities  protection,  forensics,
military and law enforcement.  Government agencies,  military forces and private
businesses  have deployed trace detection  equipment at facilities,  such as the
World Trade Center,  military  bases,  embassies and public  utilities,  such as
nuclear  power  plants,  that are  perceived as  potential  targets of terrorist
attacks. Law enforcement agencies,  such as the FBI and the New York City Police
Department, and military forces also use trace detection technology for forensic
purposes.   For  example,  the  IONSCAN(R)  was  used  in  connection  with  the
investigations  of the  crash  of TWA  Flight  800 and the  1995  Oklahoma  City
bombing.

     Drug Interdiction

     As a result of increased drug usage,  particularly  amongst  children under
18, a heightened public awareness of drug-related  criminal activity  generally,
and the use of more  sophisticated  techniques by drug  traffickers,  government
agencies have increased their spending on drug interdiction  efforts. The use of
conventional x-ray scanning, random searches and canines has had limited success
in  suppressing   illegal  drug  trafficking.   Accordingly,   customs  and  law
enforcement  agencies have increasingly turned to advanced detection  technology
to assist in their drug detection and  interdiction  efforts.  For example,  the
U.S. Coast Guard has deployed  trace  detection  equipment  onboard its ships to
search  vessels at sea for illegal  drugs.  Similarly,  prisons in the U.S.  and
elsewhere are employing trace detection equipment to reduce drug use.

Other Products

     On April 30, 1998, the Company acquired DigiVision, Inc. ("DigiVision"),  a
San Diego-based  developer of video enhancement  products for use in medical and
various industrial applications.

     The  Company  has  developed  and  introduced  into the market  place a Gas
Chromatography-IONSCAN(R)  ("GC-IMS"). The GC-IMS is a fully transportable field
screening  instrument  that  combines  the  technology  of the Ionscan  with the
separation capabilities of a gas chromatograph.  This product will now allow for
dual analysis capability providing improved resolution and quantitative results.

Sales and Marketing

     The  Company  sells  its  products  through  a  direct  sales  organization
comprised  of 27 sales and service  people  located at its  headquarters  in New
Jersey and at offices in San Diego, Toronto,  London, Paris and Kuala Lumpur. In
addition,  the Company  utilizes a network of 63  independent  sales and service
representatives  located in the United States,  Europe, the Middle East, Africa,
Asia,  South America and Australia.  The Company's  sales and marketing  efforts
typically involve extensive  customer visits,  demonstrations and field testing.
Sales prospects  generally are targeted by the Company or its independent  sales
representatives, although the Company also responds to requests for proposals.

     Selling prices for the IONSCAN(R)  typically  range from $40,000 to $55,000
per  unit,  depending  principally  on the  configuration  of the  unit  and the


<PAGE>

purchaser's location. Once a sale is consummated,  the Company provides training
at a customer's location to teach operators how to use the IONSCAN(R), including
proper sampling techniques.  The Company generally provides a one-year parts and
labor  warranty on its  IONSCAN(R)  instruments,  although from time to time the
Company has provided extended warranties. To date, the Company's warranty claims
experience has not been significant.

     The Company  does not  actively  market its  specialty  instruments  or its
contract  research and  development  services.  However,  from time to time, the
Company responds to appropriate  requests for proposals for such instruments and
services.  As a result of increased sales of the IONSCAN(R),  sales of specialty
instruments and contract research and development services is no longer material
to the Company's consolidated results of operations.

     For the year ended December 31, 1998,  the FAA accounted for  approximately
46.3% of consolidated  revenues of the Company.  For the year ended December 31,
1997,  two  customers  accounted  for  approximately  27.8%  (14.8%  and 13%) of
consolidated  revenues of the Company. For the year ended December 31, 1996, one
customer  accounted  for  approximately  11%  of  consolidated  revenues  of the
Company.
 
Backlog

     The Company measures its backlog of instrument revenues as orders for which
contracts  or  purchase  orders  have  been  signed,  but that have not yet been
shipped  and for  which  revenues  have not yet  been  recognized.  The  Company
includes in its  backlog  only those  customer  orders  that are  scheduled  for
delivery  within the next 18 months.  The Company  typically  ships its products
within three weeks of receiving  an order.  The Company  follows the practice of
manufacturing  to a sales forecast in order to have inventory  available to meet
anticipated  demand  promptly.  As a result,  the Company  has not  historically
maintained a material backlog of orders for its instruments and, in the ordinary
course of business,  intends to have sufficient inventory of IONSCAN(R)s on hand
to allow shipment upon receipt of an order.  However,  depending on the size and
timing of customer orders, the Company may, from time to time, have a backlog of
orders. At December 31, 1998, the Company had a backlog of $750,000. The Company
had no backlog at December 31, 1997. It is expected  that the Company's  backlog
will ship by March 31, 1999.

Manufacturing and Assembly

     The Company assembles IONSCAN(R)s from components supplied to it by various
suppliers and parts manufactured  internally.  Once the IONSCAN(R) is assembled,
it is "burned in" for a period of time to identify  weak  electrical  components
and to assure that it is functioning  properly.  After successful  completion of
this procedure, the IONSCAN(R) is ready for shipment to a customer.

     Although many of the basic components of the IONSCAN(R), such as integrated
circuits,  resistors,  capacitors,  liquid  crystal  displays and other  similar
components,  are  readily  available  from a  number  of  sources,  the  Company
typically  purchases such components from single suppliers.  A limited number of
components and sub-assemblies are manufactured for the Company,  pursuant to the
Company's  proprietary  specifications,  but the Company  does not believe it is
dependent  on any single  source for these items.  To date,  the Company has not
experienced   any  material   difficulty   in  obtaining   any   components   or
sub-assemblies.

Competition

     The Company competes with other entities,  including  Intelligent Detection
Systems,  Inc.,  Ion Track  Instruments  Inc. and Thermedics  Detection  Inc., a
number of which may have significantly  greater  financial,  marketing and other
resources than the Company.  Principal  competitive  factors include selectivity
(the  ability  of  an  instrument  to  identify  the  presence  of a  particular
substance), sensitivity (the ability of an instrument to detect small amounts of


<PAGE>

a particular  substance),  false alarm rate, price,  marketing,  ease of use and
speed of  analysis.  The  Company  believes  that it competes  effectively  with
respect to each of these factors.

     The  Company   competes  for   government   expenditures   with   equipment
manufacturers, such as InVision Technologies, Inc. and Vivid Technologies, Inc.,
which utilize other types of detection technologies,  such as enhanced x-ray and
CATSCAN,  as well as with manufacturers of other IMS equipment and manufacturers
using other trace particle  detection  technologies,  such as gas chromatography
and  chemiluminescence.  Because trace particle  detection  equipment is used in
certain  instances to verify detection results obtained by bulk imaging systems,
the  IONSCAN(R) and other trace  particle  detection  products are often used in
conjunction  with bulk imaging  technologies.  As a result of recent  government
initiatives,  the Company  anticipates that additional  technologies,  including
improved IMS technologies, will be developed and that new competitors will enter
the Company's markets.

     The Company also competes with the use of canines to locate the presence of
explosives or drugs. Although canines have a highly developed sense of smell and
are able to follow a trail, the Company believes that its IONSCAN(R) instruments
are more effective and cost-efficient than canines in most applications, because
they can operate 24 hours a day, have greater  selectivity  than canines and can
identify the composition of the substance detected.

Government Regulation

     Although the Company's  business is not subject to  significant  government
regulation,  government  regulation plays a large role in determining the demand
for the  IONSCAN(R).  In the  U.S.  and most  foreign  countries,  the  aviation
industry is highly regulated and authorities,  such as the FAA in the U.S., have
the  ability  to  recommend  or mandate  use of  enhanced  explosives  detection
equipment.
 
Product Development

     The Company spent $2.4  million,  $1.6 million and $780,000 on research and
development  activities  for the years ended  December 31, 1998,  1997 and 1996,
respectively,  of which  $386,000,  $849,000 and  $551,000,  respectively,  were
funded  under   various   research  and   development   grants  and   contracts.
Substantially  all of the Company's  research and  development  activities  have
related  to  the  development  and  enhancement  of  the  Company's   IONSCAN(R)
technology and the development of new IONSCAN(R) products.

     During  the  second  half  of  1998,  the  Company  introduced  its  latest
generation of IONSCAN(R).  It is a one module unit that has enhanced ergonomics,
increased ease of use, decreased size and weight and lower manufacturing costs.

Patents, Trademarks and Proprietary Rights

     Certain of the technology used in the IONSCAN(R) is licensed by the Company
from the Canadian government as described below. While the Company holds patents
relating to certain  components,  systems and techniques  used in the IONSCAN(R)
and while  certain  other  elements of the  IONSCAN(R)  are  protected  by other
intellectual property rights, the Company has no comprehensive patent or similar
exclusive  intellectual  property right covering the IONSCAN(R) in its entirety.
In addition,  the basic IMS technology used in the IONSCAN(R) is not proprietary
and is  available  in the public  domain.  Accordingly,  present  and  potential
competitors  could use such basic technology to duplicate the performance of the
IONSCAN(R).

     The initial  development  of the IONSCAN(R) was funded in part by Transport
Canada  and  Revenue  Canada.   Pursuant  to  an  agreement  with  the  Canadian
government,  the  Company  has a  worldwide  license to use  certain  unpatented
technology  developed  from such work and pays Revenue Canada a royalty equal to
1.0% of IONSCAN(R)  sales. The initial term of this license agreement expires on


<PAGE>

March 31, 1999. However,  the Company has entered into an agreement with Revenue
Canada,  pursuant  to which the  Company  has  obtained  the right to renew such
licensing  arrangement on a year-by-year  basis for up to ten additional  years.
Revenue  Canada  has  retained  the right to use the  technology  and to produce
products incorporating such technology although, to date, Revenue Canada has not
attempted to do so.
 
Employees

     As of December 31, 1998, the Company had 135 full-time  employees,  of whom
51 were  engaged  in  manufacturing,  29 were  engaged  in  product  development
activities  and 55 were  engaged in sales,  service and general  administration.
Twenty-two employees have advanced degrees (including thirteen doctorates). None
of the  Company's  employees  is  represented  by any  union,  and  the  Company
considers its relationships with its employees to be satisfactory.

Financial Information about Segment and Geographic Data and Export Sales

     For  information  with respect to financial  information  about segment and
geographic data and export sales, reference is made to the information set forth
in Note 10 to the  Consolidated  Financial  Statements  of the Company  included
herein.

Item 2.  Properties.

         The Company does not own any real property and currently  conducts its 
operations at the following  leased premises:

<TABLE>
<CAPTION>

                                                                        Approx-
                                                                         imate
                                                                         Square          Annual                Lease
          Location                  Description of Facility              Footage       Lease Cost           Expiration

<S>                                 <C>                                   <C>           <C>             <C>  
30 Technology Drive                 Corporate headquarters,               17,128         $226,000         June 2008 (1)
Warren, New Jersey                  research, sales, customer
07059                               support, assembly and
                                    warehousing

1730 Aimco Boulevard                Research, manufacturing               28,380         $ 76,000         September 2005 (2) 
Mississauga, Ontario,               customer support and
and assembly, sales,                administrative
Canada L4W 1V1                      
                                    

Village Fret BAT-3453               Sales and customer                     2,500         $ 43,000         February 2000
BP 10614-4                          support
Rue du Te
95724, Roissy C.D.G.
France

Unit 3 at Manor Royal               Sales and customer                     1,560         $ 22,000         July 2001
Crawley, West Sussex                support
England RH10 2QU

No. 21-1 Jalan 3176 D               Sales and customer                     1,200          $14,000         November 2000
Desa Pandah                         support
55100 Kuala Lumpur
Malaysia

</TABLE>

(1) On January 1, 2000, the approximate  square footage  increases to 28,128 and
the annual lease cost  increases to $387,000.  On July 1, 2003, the annual lease
cost will increase  based upon the increase in the Revised  Consumer Price Index
during  the  first 5 years of the  lease,  with a minimum  increase  of 2% and a
maximum increase of 5% per year. 
(2) Increases to $115,000 on September 1, 2000.


<PAGE>

Item 3.  Legal Proceedings.

     Ion Track Instruments, Inc. ("ITI")filed a civil action No. 98-11521-JLT in
August  1998  in  the  United  States   District   Court  for  the  District  of
Massachusetts  against the Company and one of its  employees  ("salesman").  The
action  alleges  that the Company  and the  salesman  made false and  misleading
statements  about ITI's  products in  violation of the Lanham Act. ITI has moved
the court for, among other things, a preliminary  injunction barring the Company
and the salesman from continuing to make any of the alleged  statements at issue
in the  lawsuit.  ITI also  seeks  preliminary  injunctive  relief  barring  the
salesman from continuing his employment with the Company or, in the alternative,
limiting the  salesman's  communication  with other  employees of the Company to
avoid any disclosures of trade secrets ITI alleges the salesman possesses.  That
motion is currently pending before the court.

     The Company has denied the  substantive  allegations  of this complaint and
has filed a  counterclaim  seeking  damages from ITI. The Company  believes that
ITI's claims are without merit and intends to vigorously defend the action.  The
Company does not expect that this action will  materially  adversely  affect its
consolidated financial position, results of operations or liquidity.

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

     No matters  were  submitted  to a vote of the  Company's  security  holders
during the fourth quarter of the year ended December 31, 1998.

                                     PART II

Item 5.  Market for Common Equity and Related Stockholder Matters

     The  Company's  Common  Stock has been  included in the Nasdaq Stock Market
under the symbol  "BARR."  The  following  table  sets  forth,  for the  periods
indicated,  the high and low sales  price  information  for the Common  Stock as
reported on the Nasdaq Stock Market.

                                                     High                Low

Fiscal 1997
  First quarter                                  $   10 3/4          $   8 1/8
  Second quarter                                     15                  9 3/8
  Third quarter                                      16                 10 3/8
  Fourth quarter                                     14 3/8              8 3/4

Fiscal 1998
  First quarter                                  $   15 1/4          $  11 5/8
  Second quarter                                     13 1/2              8 1/2
  Third quarter                                       9 7/8              6
  Fourth quarter                                      9 1/8              5

Fiscal 1999
  First quarter (through March 26, 1999)         $    7 23/32        $   5 13/16

     On March 26,  1999, the last reported sale price of the Common Stock on the
Nasdaq Stock Market was $6.563 per share.  As of March 26, 1999, the Company had
approximately 650 stockholders of record.

<PAGE>

                                 DIVIDEND POLICY

     The Company has never  declared or paid cash dividends on its Common Stock.
The Board of Directors  currently  intends to retain future  earnings to support
its growth strategy and does not anticipate  paying dividends in the foreseeable


<PAGE>

future.  Payment of future  dividends,  if any, will be at the discretion of the
Board of Directors  after taking into account  various  factors,  including  the
Company's financial  condition,  results of operations,  current and anticipated
cash needs and plans for expansion.  The Company is prohibited  from paying cash
dividends on the Common Stock unless full cumulative dividends have been paid or
set aside for  payment on its Class A  Convertible  Preferred  Stock and Class B
Convertible  Preferred  Stock  at an  annual  rate of  $0.16  per  share,  which
dividends, at the option of the Company, are payable in cash or shares of Common
Stock.

                     RECENT SALES OF UNREGISTERED SECURITIES

     In December 1998, the Company sold an aggregate of 153,000 shares of Common
Stock held in the  treasury to the senior  executive  offiers of the Company and
certain of the Company's independent directors at a purchase price of $8.375 per
share,  the  closing  pric  of the  Common  Stock  on  the  date  of  the  sale.
Substantially  all of the purchase price for the shares of Common Stock sold was
paid  in  the  form  of  five-year  non-recourse  promissory  notes  aggregating
approximately  $1.3 million  secured by pledges of the underlying  Common Stock.
The notes bear  interest  at a rate of 4.52% per annum.  In  January  1999,  the
Company  sold an  additional  10,000  shares of Common  Stock to Ms.  Lavet at a
purchase price of $9.75 per share,  the closing price of the Common Stock on the
date of sale. The consideration  paid by Ms. Lavet was substantially the same as
described above,  except that Ms. Lavet's note bears interest at a rate of 4.64%
per annum.

Item 6. Selected Financial Data

<TABLE>
<CAPTION>


                                        Summary Consolidated Financial Data
                                       (In thousands, except per share data)
                                                    (Unaudited)

                                                                          Year Ended December 31,
                                                  1994            1995             1996            1997           1998


<S>                                              <C>              <C>            <C>             <C>             <C>   
Consolidated Statements of
  Operations Data(1 and 2):
  Revenues                                        $5,514          $6,374         $10,923         $22,689         $20,458
  Gross profit                                     1,414           2,773           5,560          13,681          12,504
  Operating income (loss)                         (2,469)           (886)          1,596           4,995           1,438
  Income tax (provision)
    benefit                                          (75)             --             391             371           1,309
  Income (loss) from
    continuing operations                         (2,633)         (1,178)          2,059           5,754           4,431
  Net income (loss)                               (2,565)           (827)          2,059           5,754           4,431
  Preferred stock dividends                         (108)            (82)            (39)            (12)            (10)
  Net income (loss)
    attributable to common
    stockholders                                  (2,673)           (909)          2,020           5,742           4,421
  Income (loss) per common
    share from continuing
    operations (diluted)                         $ (0.97)        $ (0.39)        $  0.46         $  0.92         $  0.58
  Net income (loss) per
    common share (diluted)                       $ (0.95)        $ (0.28)        $  0.46         $  0.92         $  0.58
  Weighted average common
    shares outstanding (diluted)                   2,827           3,283           4,440           6,257           7,612


Consolidated Balance Sheet Data:
  Working capital                                 $  652          $  370         $14,271         $19,664         $45,697
  Current assets                                   5,067           3,672          16,624          24,037          49,056
  Total assets                                     6,792           4,735          17,323          25,608          52,644
  Current liabilities                              4,415           3,302           2,353           4,373           3,359
  Long-term liabilities                              451             108             117             121             145
  Stockholders' equity                             1,186           1,325          14,853          21,114          49,140
</TABLE>


<PAGE>

_____________ 

(1)  Amounts for all periods ending prior to December 31, 1995 reflect Barringer
     Laboratories Inc. ("Labco") as a discontinued operation. The Company sold a
     portion of its equity  interest in Labco in 1995 and the  remainder  of its
     interest in 1996.

(2)  The amounts for the fiscal  period ending  December 31, 1998,  includes the
     results of  operations of  DigiVision  Inc.  from May 1, 1998,  the date of
     acquisition.  Included  in  this  period  is the  write-off  of  in-process
     research and development expenses in the amount of $435,000.

<PAGE>

     Unless  otherwise  indicated,  all information  herein has been adjusted to
give effect to the  one-for-four  reverse split of the Common Stock  effected on
September 25, 1995.

Item 7.  Management's Discussion and Analysis

Results of Operations

     The following  table sets forth  certain  income and expense items from the
Company's  consolidated  statements of  operations  expressed as a percentage of
revenues for the periods indicated.
<TABLE>
<CAPTION>

                                                      Year Ended December 31,

                                              1996             1997             1998


Consolidated Statements of 
     Operations Data:
<S>                                           <C>              <C>               <C>   
Revenues                                      100.0%           100.0%            100.0%
Cost of revenues                               49.1             39.7              38.9
                                               -----------------------------------------
Gross profit                                   50.9             60.3              61.1
                                               -----------------------------------------
Operating expenses:
Selling, general and administrative            34.2             35.1              41.8
Write-off of acquired technology                --               --                2.1
Amortization of goodwill                        --               --                0.5
Product development                             2.1              3.2               9.7
                                               -----------------------------------------
Total operating expenses                       36.3             38.3              54.1
                                               -----------------------------------------
Operating income                               14.6             22.0               7.0
Other (expense) income, net                     0.7              1.7               8.3
Income tax benefit                              3.6              1.6               6.4
                                               -----------------------------------------
Net income                                     18.9             25.3              21.7
Preferred stock dividends                      (0.4)             --*               --*
                                               -----------------------------------------
Net income available to common stockholders    18.5%            25.3%             21.7%
                                               =========================================
*  Less than 0.1%.

</TABLE>


Comparison  of the Fiscal Year Ended  December 31, 1998 to the Fiscal Year Ended
December 31, 1997

          Revenues.  For the  fiscal  year ended  December  31,  1998,  revenues
decreased by $2.2 million,  or 9.8%, to $20.5 million from $22.7 million for the
fiscal year ended December 31, 1997.  Sales of IONSCAN(R)s and related  products
decreased by $2.5 million,  or 11.8%,  due to a decrease of 15.4% in the average
unit  selling  price of an  IONSCAN(R),  offset in part by a slight  increase in
units sold and  $769,000  of sales by  DigiVision,  acquired  May 1,  1998.  The
increase in unit sales was due to significant  IONSCAN(R)  sales to the aviation
security  market,  primarily  to the FAA.  The  decrease in average unit selling
prices  resulted  primarily  from  increased  competitive  activity.   Sales  of
specialty  instruments was  insignificant in both 1998 and 1997. As sales of its
IONSCAN(R)s  have  increased,  the Company has placed less emphasis on marketing
its  specialty  instruments  and  anticipates  that  revenues from sales of such
instruments will continue to be insignificant to the Company's  overall results.
Revenues derived from funded research and development decreased by 

<PAGE>

approximately $465,000, or 54.8%, in 1998 as compared to 1997 as a result of the
nearing of  completion  on the first phase of a $950,000 FAA project  awarded to
the Company to design an automated luggage explosives detection system utilizing
the Company's trace  detection  technology.  Because of the increasing  sales of
IONSCAN(R)s,  the  Company  believes  that  revenues  from funded  research  and
development  activities  will continue to be less  significant  to the Company's
overall results of operations.

     Gross  Profit.  For the fiscal year ended  December 31, 1998,  gross profit
decreased by $1.2 million, or 8.6%, to $12.5 million from $13.7 million in 1997.
As a percentage of revenues,  gross profit  increased to 61.1% in the year ended
December 31, 1998 from 60.3% in 1997. The improvement in gross profit percentage
was primarily  attributable  to larger,  more efficient  production  runs of the
IONSCAN(R)  and a related  reduction in cost of materials  due to higher  volume
purchases, offset in part by lower margins as a result of declining average unit
selling  prices  and  lower  margins  attributable  to  DigiVision.   DigiVision
contributed gross profit of $135,000, or 17.6% of the related revenue.

     Selling, General and Administrative. For the fiscal year ended December 31,
1998,  selling,  general and administrative  expenses increased by approximately
$581,000, or 7.3%, to $8.6 million from $8.0 million in 1997. As a percentage of
revenues,  selling,  general and  administrative  expenses increased to 41.8% in
1998  from  35.1%  in  1997.   Selling  and  marketing   expenses  decreased  by
approximately $210,000,  primarily the result of fewer commissioned sales offset
by  $318,000  of  selling  expenses  attributable  to  DigiVision.  General  and
administrative  expenses increased by $791,000 primarily as a result of expenses
attributable  to the  Company's  newly formed  business  development  group,  an
increase in the  provision  for  doubtful  accounts  and sales  allowances,  and
expenses  attributable  to  DigiVision,  all of which were  partially  offset by
reimbursement of certain expenses.

     Product Development.  For the fiscal year ended December 31,  1998, product
development  expenses  increased by $1.3 million,  or 176%, to $2.0 million from
$715,000 in 1997.  As a percentage  of revenues,  product  development  expenses
increased to 9.7% (11.5% when combined with funded research and development) for
the fiscal  year ended  December  31,  1998 from 3.2% (6.9% when  combined  with
funded  research  and  development)  in 1997 as a result  of a  higher  level of
internally funded new product development activity.  Management expects to incur
increased product development  expenses in future periods in connection with the
enhancement  of  existing  products  and the  development  of new  products  and
applications.

     Write-off of Acquired Technology.  On April 30, 1998, the Company completed
the acquisition of DigiVision.  In connection  therewith,  the Company  acquired
approximately  $435,000  of  certain  technology  that was in the  research  and
development  stage.  The costs related to such technology costs were expensed at
the time of the acquisition.

     Amortization of Goodwill. In connection with the acquisition of DigiVision,
the  Company  recorded  goodwill  of $778,000  which is being  amortized  over a
five-year period.

     Operating  Income.  For the fiscal year ended December 31, 1998,  operating
income decreased by $3.6 million, or 71.2%, to $1.4 million from $5.0 million in
1997. As a percentage of revenues, operating income decreased to 7.0% from 22.0%
in 1997. The decrease is due to the combination of factors noted above.

     Other  Income and  expense.  For the fiscal year ended  December 31,  1998,
other income  increased by $1.3 million,  or 335%, to $1.7 million from $388,000
in 1997. The increase was  attributable  to an increase in investment  income of
$1.2  million,  or 265%,  to $1.6  million  as  compared  to  $450,000  in 1997,
primarily as a result of the  investment  of a portion of the net proceeds  from
the Company's  April 1998 public  offering,  and  licensing  fees of $100,000 in
1998.

<PAGE>

     Income Taxes. For the fiscal year ended December 31,  1998, the Company had
a net tax benefit of $1.3  million,  composed of foreign  taxes of $130,000  and
state taxes of  $146,000,  offset by a $1.6 million  deferred tax benefit.  Such
deferred tax benefit was due to an  elimination  of the  deferred tax  valuation
allowance as a result of changes in management's estimates of the utilization of
U.S. tax loss carryforwards  caused primarily by improved operating results over
the last three fiscal years.

     As of December 31, 1998, the Company had net operating  loss  carryforwards
of  approximately  $7.3 million and $3.2 million which will carry over to future
years to  offset  U.S.  federal  and state  taxable  income,  respectively.  The
substantial  portion of the net operating loss  carryforward  will expire in the
year 2010. At December 31, 1998, the Company has recorded a valuation reserve of
$214,000  related  to certain  limitations  applied  to the net  operating  loss
carryforward  of  DigiVision,  its  recently  acquired  subsidiary.   Management
believes  that  there  is a  risk  that  certain  of  this  net  operating  loss
carryforward  may expire unused and,  accordingly,  has  established a valuation
allowance.

Comparison  of the Fiscal Year Ended  December 31, 1997 to the Fiscal Year Ended
December 31, 1996

     Revenues.  For the fiscal year ended December 31, 1997,  revenues increased
by $11.8  million,  or 108%,  to $22.7 million from $10.9 million for the fiscal
year  ended  December  31,  1996.  Sales of  IONSCAN(R)s  and  related  products
increased by $12.3  million,  or 131%, due to an increase in the number of units
sold, offset in part by a decline in average unit selling price. The increase in
unit sales was due to significant  IONSCAN(R)  sales to drug detection  markets,
primarily to law enforcement agencies,  and to a lesser extent,  increased sales
to the aviation  security market,  primarily to the FAA. The decrease in average
selling prices resulted  primarily from an increase in the number of IONSCAN(R)s
sold to U.S. government agencies,  which typically are at lower unit prices than
sales  to  other  customers.   Sales  of  specialty   instruments  decreased  by
approximately  $697,000, or 85.2%, in 1997 as compared to 1996,  principally due
to the  completion in 1996 of a heavy water analyzer  contract.  As sales of its
IONSCAN(R)s  have  increased,  the Company has placed less emphasis on marketing
its  specialty  instruments  and  anticipates  that  revenues from sales of such
instruments will continue to be insignificant to the Company's  overall results.
Revenues derived from funded research and development increased by approximately
$146,000, or 20.8%, in 1997 as compared to 1996. Funded research and development
revenues  increased  as a result  of the  award  by the FAA in  March  1997 of a
$700,000  contract to design an automated  luggage  explosives  detection system
utilizing  the Company's  trace  detection  technology.  The first phase of this
project,  which involves a proof of concept,  is expected to be completed during
1998. Because of the increasing sales of IONSCAN(R)s,  the Company believes that
revenues from funded  research and  development  activities  will continue to be
insignificant to the Company's overall results of operations.

     Gross  Profit.  For the fiscal year ended  December 31, 1997,  gross profit
increased by $8.1 million,  or 146%, to $13.7 million from $5.6 million in 1996.
As a  percentage  of  revenues,  gross  profit  increased to 60.3% in the fiscal
period ended December 31, 1997 from 50.9% in 1996. The improvement was primarily
attributable to larger,  more efficient  production runs of the IONSCAN(R) and a
related reduction in cost of materials due to higher volume purchases, coupled
with higher margins on international  sales,  offset in part by lower margins on
sales to U.S.  government  agencies.  In addition,  the Company has been able to
reduce its cost of materials as a result of higher volume purchases.

     Selling, General and Administrative. For the fiscal year ended December 31,
1997,  selling,  general and administrative  expenses increased by approximately
$4.2  million,  or  114%,  to $7.9  million  from  $3.7 million  in  1996.  As a
percentage of revenues,  selling,  general and administrative expenses increased
to 35.1% in 1997 from 34.2% in 1996. Selling and marketing expenses increased by
approximately  $2.5

<PAGE>

million,   of  which  $1.6  million  was  due  to  increased  sales  commissions
attributable to a larger  percentage of sales  originating  through  independent
sales agents and  distributors.  The remaining  increase was attributable to the
addition of sales and service  personnel and related  costs to handle  increased
business volume.  General and administrative  expenses increased by $1.7 million
primarily  as a result of  increased  payroll  and related  costs and  increased
professional  and consulting  costs.  Product  Development.  For the fiscal year
ended December 31, 1997, product development expenses increased by $485,000,  or
211%, to $715,000  from  $230,000 in 1996. As a percentage of revenues,  product
development  expenses increased to 3.2% (6.9% when combined with funded research
and  development)  for the fiscal year ended  December  31, 1997 from 2.1% (8.5%
when combined  with funded  research and  development)  in 1996 as a result of a
higher level of internally funded new product development activity.

     Operating  Income.  For the fiscal year ended December 31, 1997,  operating
income increased by $3.4 million,  or 213%, to $5.0 million from $1.6 million in
1996.  As a percentage  of revenues,  operating  income  increased to 22.0% from
14.6% in 1996. The increase is due to the greater  operating  leverage on higher
levels of revenue.

     Other  Income and  Expense.  For the fiscal year ended  December 31,  1997,
interest  expense  decreased by $219,000,  or 96.1%,  to $9,000 from $228,000 in
1996 as a result of the repayment of indebtedness out of the net proceeds of the
Company's  November 1996 public offering.  Investment income for the fiscal year
ended December 31,  1997 was $450,000 as compared to $72,000 in 1996,  primarily
as a  result  of the  investment  of a  portion  of the net  proceeds  from  the
Company's November 1996 public offering.

     Income Taxes. For the fiscal year ended December 31,  1997, the Company had
a net tax benefit of $371,000,  composed of foreign taxes of $404,000, offset by
a $775,000 net deferred tax benefit.  Such  deferred tax benefit was due in part
to a reduction in the deferred tax valuation allowance as a result of changes in
management's  estimates of the utilization of U.S. tax loss carryforwards caused
primarily by improved operating results.

Liquidity and Capital Resources

     Cash  provided by  operations  was $2.8 million in 1998 and $2.0 million in
1997 and cash used in  operations  was $1.4  million in 1996.  Cash  provided by
operations in 1998 resulted primarily from net income of $4.4 million, partially
offset by an increase in inventories  and other current assets and a decrease in
accounts payable and accrued liabilities.  Inventories  increased as the Company
acquired the materials necessary to support increased IONSCAN(R)  production for
its new Model 400B and other current assets increased as a result of an increase
in prepaid insurance.  The decrease in accounts payable and accrued  liabilities
was the result of reduced purchases in the latter part of year. Cash provided by
operations in 1997 resulted primarily from net income of $5.8 million, partially
offset by increases in accounts receivable and inventories.  Accounts receivable
increased as a result of higher sales, particularly during the month of December
1997.  Inventories  also  increased  as the Company  acquired  the  materials to
support  increased  IONSCAN(R)  production.  Cash used in  operating  activities
during  1996  resulted  primarily  from  increases  in accounts  receivable  and
inventory, which more than offset net income of $2.1 million for the year.

     Cash used in investing activities was $15.4 million during 1998 compared to
net cash provided by investing  activities of $639,000 during 1997 and cash used
in  investing  activities  of $3.9 million  during 1996.  Cash used in investing
activities during 1998 resulted primarily from the purchase of investments,  the
purchase of  equipment  and the  acquisition  of  DigiVision.  Cash  provided by
investing   activities   during  1997  resulted   primarily  from  the  sale  of
investments,  partially offset by

<PAGE>

capital  expenditures.  Cash used in investing  activities  during 1996 resulted
primarily  from the  purchase of  investments,  offset in part by the receipt of
$574,000 in  connection  with the Company's  sale of its  remaining  interest in
Labco.

     Cash  provided by  financing  activities  was $23.3  million  during  1998,
$315,000  during 1997 and $10.6  million in 1996.  Cash  provided  by  financing
activities during 1998 resulted primarily from the net proceeds of the Company's
April 1998 public  offering of common  stock  offset in part by the  purchase of
treasury  stock.  Cash  provided by financing  activities  during 1997  resulted
primarily from the net proceeds of certain option and warrant exercises,  offset
in part by the repayment of indebtedness.  Cash provided by financing activities
in 1996 resulted primarily from the net proceeds of the sale of common stock and
common stock purchase warrants in a public offering and the sale of $1.0 million
of  convertible  subordinated  debentures,  offset in part by the  repayment  of
indebtedness.

     The Company's capital  expenditures in 1998 aggregated  approximately  $1.5
million.  Such  expenditures  consisted  primarily of fixed assets  purchased to
support product development projects,  leasehold  improvements and furniture and
fixtures  relating  to the new  corporate  headquarters  and  computer  hardware
relating to the  modernization of the Company's  computer  network.  The Company
believes that it will require  approximately  $750,000 in capital  investment in
additional tooling,  equipment and facility improvements to meet its anticipated
production levels for 1999.

     In March 1998,  the Company  established  a $5.0 million  unsecured  credit
facility  with Fleet Bank,  N.A.  (the  "Bank") to be used for  general  working
capital  purposes,  including  the  issuance  of standby  letters of credit (the
"Facility").  Drawings  under the Facility may not be used to fund  acquisitions
unless  approved in advance by the Bank.  Amounts  drawn under the Facility bear
interest  at a variable  rate per annum  selected  by the  Company  and equal to
either the Bank's prime rate less 0.75% or LIBOR  (determined  on the basis of a
30-, 60- or 90-day  interest  period,  as  applicable)  plus 2.0%.  The Facility
expires on June 30,  1999, subject to renewal. The Facility is guaranteed by the
Company's primary U.S. subsidiary,  Barringer Instruments Inc. ("BII"). Pursuant
to the  Facility,  the  Company  and BII are  required  to comply  with  certain
customary covenants, including certain financial tests. In addition, BII and the
Company's Canadian subsidiary,  Barringer Research Limited ("BRL"),  have agreed
not to pledge  their  assets to any other  creditor  without  the  Bank's  prior
written consent.

     The Company has  approximately  $7.3 million of tax loss  carryforwards  to
offset future taxable  income in the U.S and $2.1 million of expenses  available
to offset future taxable income in Canada.

     As of December 31, 1998, the Company had cash and cash equivalents of $18.8
million and marketable  securities of $15.6 million.  The Company  believes that
its existing cash balances,  marketable securities and income from operations in
future periods will be sufficient to fund its working capital  requirements  for
at least the next twelve months.

     On July 7,  1998 the  Company  announced  that its Board of  Directors  had
authorized the repurchase of up to 1,000,000  shares or  approximately  12.7% of
the Company's outstanding Common Stock. As of December 31, 1998, the Company had
repurchased  212,500  shares  at an  aggregate  cost of  $1,540,000.  Additional
repurchases  will be made  from  time to  time in open  market  transactions  in
amounts as determined by the Company's  management and will be funded out of the
Company's working capital.

Inflation

     Inflation  was not a material  factor in either the sales or the  operating
expenses of the Company during the periods presented herein.

<PAGE>

Year 2000 Issue

     The year 2000 issue is the result of computer  programs being written using
two digits  rather than four to define the  applicable  year.  Certain  computer
programs  may  recognize a date using "00" as the year 1900 rather than the year
2000.  This  could  result  in  a  system  failure  or  miscalculations  causing
disruptions of operations,  including, among other things, a temporary inability
to process  transactions,  send  invoices or engage in similar  normal  business
activity.

     The Company has recently  established  a team to assess risk,  identify and
correct  exposures when possible,  and develop  contingency  plans for Year 2000
compliance  issues.  The Company has developed an assessment  plan and timetable
and  anticipates  completion of its  assessment  by June 30, 1999. To date,  the
committee has identified several areas of potential concern to the Company, most
particularly  the  software  and  hardware  used as part of its own  information
systems, the impact of Year 2000 problems on the operation of its products, both
current and  discontinued,  the impact of Year 2000 issues on its  vendors,  the
impact of Year 2000 issues as it affects the  physical  working  environment  in
which the Company  operates,  the potential  impact of Year 2000 problems on the
markets that the Company sells into and finally, crisis planning.

     The Company is currently completing its review of the software and hardware
systems used by the Company's  information  systems.  The Company  believes that
with  modifications  to existing  software and hardware and  conversions  to new
software, its internal systems and hardware will be Year 2000 compliant .

     The  Company  has  substantially  completed  a  preliminary  review  of its
IONSCAN(R)  products and  believes  that Year 2000 issues will have no impact on
the performance of its IONSCAN(R) product line as the IONSCAN(R)'s functionality
is not dependent on date or time  references.  The Company has sold many custom,
one of a kind  products  other  than  the  IONSCAN(R)  over the  years.  It will
investigate  Year 2000 issues related to such products only when requested to do
so by the end  user.  However,  based  upon a  preliminary  review  the  Company
believes that the  functionality  of those  products is not dependent on date or
time references.

     The  Company  has  initiated  formal  communications  with its  significant
suppliers,  customers, and critical business partners to determine the extent to
which the  Company may be  vulnerable  in the event that those  parties  fail to
properly remediate their own Year 2000 issues. The Company intends to take steps
to monitor the progress  made by those  parties,  and intends to monitor  others
with whom it does business as the Year 2000 approaches.

     The  Company  has  reviewed  the  operating  environment  within  which  it
functions to assess the Year 2000 risks  relating to,  among other  things,  its
heating and air conditioning  systems,  security systems,  communication systems
and related hardware. The Company has determined that such systems are Year 2000
compliant.  To the extent possible,  it will also assess certain market risks to
try and  determine,  the  effects,  if any,  Year 2000 issues  could have on its
customers  that would affect their ability to purchase and pay for the Company's
products.  Based on initial assessments,  the Company does not believe that Year
2000 issues will significantly alter demand for the Company's products.

     The Company intends to develop a crisis plan to deal with certain  critical
Year 2000 "what if" situations  should they arise. The Company currently expects
that it will either shift supply orders to suppliers that can  demonstrate  Year
2000  compliance or will attempt to stockpile  significant  supplies of critical
components as January 1, 2000 approaches.  The Company believes,  however,  that
due to the  widespread  nature of potential  Year 2000 issues,  the  contingency
planning  process is an ongoing one which will require further  modifications as
the Company  obtains  

<PAGE>

additional  information  regarding the Company's state of  preparedness  and the
status of third party Year 2000 readiness.

     The  Company  believes  that the  actions it has taken to date and steps it
intends  to take in the  future  will  allow it to be Year 2000  compliant  in a
timely manner. There can be no assurances,  however, that the Company's internal
systems and products or those of third parties on which the Company  relies will
be Year  2000  compliant  in a  timely  manner  or that the  Company's  or third
parties'  contingency plans will mitigate the effects of any noncompliance.  The
failure to achieve Year 2000 compliance or to have appropriate contingency plans
in place to deal with any noncompliance could result in a significant disruption
of the  Company's  operations  and could have a material  adverse  effect on the
Company's financial condition or results of operations.

     Because  the  Company is still in the  process of  assessing  its Year 2000
issues,  the Company cannot  estimate the cost of achieving Year 2000 compliance
at this time. However,  based on the preliminary  assessments conducted to date,
the Company does not believe that the costs of achieving such compliance will be
material to its results of operations or financial condition.

     The costs of compliance and the dates on which the Company believes it will
complete  its  Year  2000  modifications  and  risk  assessments,  are  based on
managements  best  estimates,  based upon many  different  assumptions of future
events and other factors. However, there can be no assurances that the Company's
estimates   will  be  achieved  and  actual  results  could  differ  from  those
anticipated.

Recent Pronouncements of the Financial Accounting Standards Board

     In June 1998, the Financial  Accounting Standards Board issued Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and Hedging  Activities"  ("SFAS No. 133"),  which  establishes  accounting  and
reporting  standards  for derivative  instruments  and hedging  activities.  The
Company is currently reviewing the effects of  SFAS No. 133  but does not expect
the  new   guidelines  to  have  a   material impact on the Company's  financial
position and results of operations. This standard will be adopted by the Company
no later than its year ending December 31, 2000.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

         Not applicable.
 
Item 8.  Financial Statements and Supplemental Data.

     Financial statements are contained on pages F-1 through F-22.

Quarterly Results of Operations

     The  following  table  sets  forth  certain   consolidated   statements  of
operations  data for each of the quarters in the two-year period ended  December
31, 1998. This data is unaudited but, in the opinion of management, reflects all
adjustments, consisting only of normal recurring adjustments, necessary for fair
presentation  of  this   information  in  accordance  with  generally   accepted
accounting   principles.   See  Note 12  of  Notes  to  Consolidated   Financial
Statements.

<PAGE>

<TABLE>
<CAPTION>
                                                                       Quarter Ended
                                  Mar 31,     Jun 30,    Sep 30,    Dec 31,     Mar 31,     Jun 30,    Sep 30,    Dec 31,
                                   1997        1997       1997       1997        1998        1998       1998       1998
                                                                       (In thousands, except per share data)
<S>      <C>                      <C>         <C>        <C>        <C>          <C>        <C>        <C>        <C> 
Revenues                          $3,622      $5,816     $5,905     $7,346       $5,948     $5,188     $3,412     $5,910
Cost of revenues                   1,461       2,494      2,729      2,324        2,435      1,978      1,283      2,258
                                   -----       -----      -----      -----        -----      -----      -----      ----
  Gross profit                     2,161       3,322      3,176      5,022        3,513      3,210      2,129      3,652
                                   -----       -----      -----      -----        -----      -----      -----      ----

<PAGE>

Operating expenses:
  Selling, general and
    administrative                 1,295       1,905      1,668      3,103        1,696      2,095      1,909      2,956
  Write-off of acquired
    technology                        --          --         --         --           --        435         --         --
  Product development                175         163        164        213          362        423        546        644
                                   -----       -----      -----      -----        -----      -----      -----      -----
Total operating expenses           1,470       2,068      1,832      3,316        2,058      2,953      2,445      3,600
                                   -----       -----      -----      -----        -----      -----      -----      -----
Operating income (loss)              691       1,254      1,344      1,706        1,455        257      (326)         52
Other (expense) income, net           79         105         88        116          136        423        556        569
Income tax benefit                    75          56        125        115          200        150        195        764
                                   -----       -----      -----      -----        -----      -----      -----      -----
Net income                         $ 845      $1,415     $1,557     $1,937       $1,791     $  830     $  425     $1,385
Net income per common share*:
  Basic                            $0.16      $ 0.26     $ 0.28     $ 0.35       $ 0.32     $ 0.11     $ 0.05     $ 0.18
                                   =====      ======     ======     ======       ======     ======     ======      =====
  Diluted                          $0.14      $ 0.22     $ 0.24     $ 0.31       $ 0.28     $ 0.10     $ 0.05     $ 0.17
                                   =====      ======     ======     ======       ======     ======     ======     ======
</TABLE>

* The total of each year's quarterly  results may not equal the reported results
for the respective years.

Item  9.  Changes  in and  Disagreements  with  Accountants  on  Accounting  and
          Financial Disclosures.

          Not applicable.

                                    PART III

Item 10.  Directors and  Executive Officers of the Registrant

Directors and Executive Officers

     The following table sets forth certain information  regarding the Company's
executive officers and directors as of March 1, 1999.

    Name                          Age                   Position

Stanley S. Binder                 57       Chairman  of the  Board, Chief
                                           Executive Officer

John H. Davies                     62      Vice Chairman and Director, President
                                           and  Chief Executive Officer of BRL

Kenneth S. Wood                    47      Director, President and Chief 
                                           Operating Officer

Richard S. Rosenfeld               52      Vice   President-Finance,   Chief 
                                           Financial   Officer, Treasurer and 
                                           Secretary

John D. Abernathy                  61      Director

Richard D. Condon                  64      Director

John J. Harte                      57      Director

James C. McGrath                   56      Director

Lorraine M. Lavet                  38      Director

     Mr. Stanley  S. Binder,  Director since 1991. Mr. Binder joined the Company
in July 1989 and has served as  Chairman of the Board  since  February  1991 and
Chief Executive  Officer since July 1990. Mr. Binder also served as President of
the Company from July 1989 until May 1998, Chief Operating  Officer from 1989 to
June 1990 and Chief Financial Officer from 1989 until July 1993. Mr. Binder also
is an independent general partner in the Special Situations Fund III, L.P. ("SSF
III"), a substantial  investor in the Company.  Mr. Binder is a past director of
the  American  Electronics  Association  and  past  chairman  of its New  Jersey
Council. Mr. Binder is a member of the Executive,  Nominating and Technology and
Strategic Planning Committees of the Board.

<PAGE>

     Mr. John H. Davies,  Director  since 1992. Mr. Davies joined the Company in
October  1967 and has been Vice  Chairman  of the Company  since May 1998.  From
January 1992 to May 1998 he served as Executive  Vice  President of the Company.
He has been  President and Chief  Executive  Officer of Barringer  Research Ltd.
since August 1989. He is a member of the  Executive,  Nominating  and Technology
and Strategic Planning Committees of the Board.

     Mr. Kenneth  S. Wood,  Director  since 1999. Mr. Wood joined the Company in
1990 and has been President and Chief Operating Officer of the Company since May
1998.  From  January  1992  until May  1998,  he  served  as Vice  President  of
Operations of Barringer  Instruments  Inc. He served as Secretary of the Company
from March 1993 until May 1998.

     Mr. Richard S. Rosenfeld.  Mr. Rosenfeld is a certified public  accountant.
He joined  the  Company  in January  1992 and has  served as Vice  President  of
Finance,  Chief  Financial  Officer and Treasurer of the Company since July 1993
and as Secretary of the Company since May 1998.
 
     Mr. John D.  Abernathy,  Director since 1993. Mr.  Abernathy is a certified
public accountant.  Since January 1995, he has been Executive Director of Patton
Boggs,  LLP, a Washington, D.C. law firm.  From March 1994  to  January 1995, he
was  an  independent financial  and  management  consultant.  From March 1991 to
March 1994, he was the Managing  Director of Summit,  Solomon & Feldesman, a law
firm  in  dissolution  since  March 1993. From  July 1983  until  June 1990, Mr.
Abernathy was Chairman and  Chief  Executive  Partner of  BDO Seidman,  a public
accounting firm. Mr. Abernathy is also a  director of  Oakhurst  Company,  Inc.,
a  distributor  of  automotive  parts and  accessories.  He  is  a member of the
Executive, Audit and Finance and Executive Compensation Committees of the Board.

     Mr. Richard  D. Condon,  Director  since 1992.  Mr. Condon  is currently an
independent  consultant.  From January 1996 to October  1998,  Mr.  Condon was a
consultant to and director of Amherst  Process  Instruments,  Inc., a scientific
instrumentation   company.   Prior  thereto,  from  1989  until  December  1995,
Mr. Condon  was a consultant  to and director of  Analytical  Technology,  Inc.,
Boston,  Massachusetts,  a scientific instrumentation company. He is a member of
the Executive  Compensation and Technology and Strategic Planning  Committees of
the Board.

     Mr. John J. Harte,  Director  since 1986.  Mr. Harte is a certified  public
accountant  and, since 1978,  has been Vice President of Mid-Lakes  Distributing
Inc., a manufacturer and distributor of heating and air  conditioning  parts and
equipment located in Chicago,  Illinois. From 1991 until January 1997, Mr. Harte
also was Vice President, Special Projects, of the Company. Mr. Harte is a member
of the Audit and Finance,  Executive  Compensation and Nominating  Committees of
the Board.

     Mr. James C. McGrath,  Director since 1994. Mr. McGrath is an international
security  consultant.  Since  July  1989,  he  has  been  President  of  McGrath
International,  Inc., a management  consulting firm specializing in the security
field.  He is a member of the  Audit  and  Finance  and  Executive  Compensation
Committees of the Board.

     Ms.  Lorraine  M. Lavet,  Director  since  1999.  Ms.  Lavet has been Chief
Operating Officer of the American Electronics  Association since September 1996.
Prior  thereto,  from September 1994 to August 1996, Ms. Lavet was President and
Chief Executive Officer of the Fairfax County Chamber of Commerce.

     All directors hold office until the next annual meeting of stockholders and
until their  successors  have been duly  elected and  qualified.  The  Company's
Directors  are elected by the holders of the  Company's  Common  Stock,  Class A
Convertible  Preferred Stock and Class B Convertible Preferred Stock voting as a
single class.  There are no family  relationships  among any of the directors or
executive officers.

<PAGE>

Item 11.  Executive Compensation

     The following table sets forth a summary of all  compensation  paid for the
last three fiscal  years to  the Chief Executive Officer of the Company and each
of  the other executive officers of  the Company  whose  total annual salary and
bonus are $100,000 or more (collectively, the "Named Executive Officers"):

<TABLE>
<CAPTION>

                                            Summary Compensation Table

                                                 Annual Compensation          Long-Term Compensation
                                                                                     Securities
                                                                        Restricted   Underlying                All Other
         Name and         Fiscal    Salary     Bonus(1)   Other Annual     Stock      Options/        LTIP   Compensation
    Principal Position     Year       ($)         ($)   Compensation ($) Award(s)     SARs (#)     Payouts ($) ($)(1)

<S>                         <C>     <C>        <C>            <C>        <C>           <C>            <C>     <C>
Stanley S. Binder           1998    $250,000   $182,000         --             --       87,500 (2)       --     $65,865 (3)(4)
   Chairman and Chief       1997     200,000    350,000         --             --       87,500           --       9,500
   Executive Officer        1996     171,491     63,000         --             --       55,000           --       2,925

John H. Davies*             1998    $149,782   $ 46,000         --             --       34,000 (2)       --     $36,615 (4)
   Vice Chairman            1997     136,440    160,000         --             --       34,000           --       6,811
                            1996     125,775     43,200         --             --       38,250           --       6,317

Kenneth S. Wood             1998    $164,063   $ 65,000         --             --       31,500 (2)       --     $23,840 (4)
   President and Chief      1997     130,000    170,000         --             --       31,500           --       8,480
   Operating Officer        1996     111,815     39,600         --             --       33,750           --       2,199

Richard S. Rosenfeld        1998    $125,000   $ 34,000         --             --       27,300 (2)       --     $20,000 (4)
   Vice President-Finance,  1997     107,500    115,000         --             --       27,300           --       7,085
   Chief Financial Officer  1996      96,000     34,200         --             --       27,500           --       1,872

</TABLE>

*    Amounts  converted  to U.S.  dollars at the average  exchange  rate for the
     respective year.

(1)  Includes  amounts  contributed  by the Company  pursuant  to the  Company's
     tax-qualified  401(k) deferred  compensation  plan ("401(k) Plan"). In 1998
     and 1997,  the 401(k) Plan  provided  that the Company  would make matching
     contributions  to the  participants in the 401(k) Plan equal to 100% of the
     first 5.0% of a participant's salary contributed. In 1996 , the 401(k) Plan
     provided  that  the  Company  would  make  matching  contributions  to  the
     participants  in the  401(k)  Plan  equal  to 100% of the  first  2.0% of a
     participant's   salary  contributed  and  50.0%  of  the  next  5.0%  of  a
     participant's salary contributed.  Company contributions to the 401(k) Plan
     vest proportionately over a five-year period,  commencing at the end of the
     participant's  first year with the  Company.  Amounts  paid  during 1998 on
     behalf of the Named Executive  Officers were $10,000,  $7,215,  $10,000 and
     $10,000 for Messrs. Binder, Davies, Wood and Rosenfeld, respectively.

(2)  Represents repricing of options previously granted. See "Option Repricing."

(3)  Includes  premiums  paid by the  Company  for term life  insurance  for Mr.
     Binder during 1998 in the amount of $5,865.

(4)  Includes  amounts  accrued  pursuant  to the  Barringer  Technologies  Inc.
     Supplemental  Executive Retirement Plan (the "SERP Plan").  Amounts accrued
     during  1998  for the  Named  Executive  Officers  were  $50,000,  $29,400,
     $13,840,  and $10,000  for  Messrs.  Binder,  Davies,  Wood and  Rosenfeld,
     respectively.

     Effective January 1, 1998, the Company adopted the SERP Plan. The SERP Plan
provides eligible  participants with certain retirement benefits supplemental to
the  Company's  401(k)  Plan.  Pursuant to the SERP Plan,  the Company will make
annual  contributions  to the  account of each  participant  equal to a variable
percentage of the  participant's  base salary and annual cash bonus depending on
the Company's  achievement of certain performance targets. The actual percentage
contribution will be determined by the Executive Compensation Committee, subject
to certain  parameters.  A  participant  will become  vested under the SERP Plan
after five years of  participation  therein.  A participant may elect to receive
benefits  under the SERP Plan  commencing  at age 60 and is  entitled to receive
either a lump-sum  payment of his or her account  balances upon retirement or to
use the account balance to purchase an annuity.  In the event of the termination
of a participant's  employment under certain circumstances set forth in the SERP
Plan,  the  participant  will be entitled to receive his or her account  balance
whether or not the participant has become vested under the SERP Plan. Currently,
each of the Named Executive Officers participates in the SERP Plan.

Option Grants

     The following table summarizes certain information relating to the grant of
options to purchase Common Stock to each of the Named Executive Officers:

<PAGE>

<TABLE>
<CAPTION>

                                     Option/SAR Grants in Last Fiscal Year(1)

                               Number of      Percent of Total
                              Securities        Options/SARs                                  Potential realizable value
                              Underlying         Granted to       Exercise or                 of assumed annual rates of
                             Options/SARs       Employees ins     Base Price    Expiration     stock price appreciation
Name                        Granted(#)(2,3)      Fiscal Year        ($/sh)         Date             For option term     
                                                                                                   5%           10%  
<S>                              <C>                <C>           <C>            <C>   <C>     <C>             <C>      
Stanley S. Binder                87,500             19.1%         $ 6.19         10/21/08      $ 340,625       $ 863,211
 
John H. Davies                   34,000              7.4            6.19         10/21/08        132,357         335,419
 
Kenneth S. Wood                  31,500              6.9            6.19         10/21/08        122,625         310,756
 
Richard S. Rosenfeld             27,300              6.0            6.19         10/21/08        106,275         269,322
</TABLE>

(1)  The Company did not grant any stock appreciation rights in 1998.

(2)  Twenty-five  percent of each option  grant is  exercisable  after the first
     anniversary  of the date of grant,  50% is  exercisable  after  the  second
     anniversary,  75% is exercisable  after the third  anniversary  and 100% is
     exercisable after the fourth anniversary.

(3) Represents repricing of options previously granted.  See "Option Repricing."

Options Exercised in Last Fiscal Year and Fiscal Year-End Option Values

     The  following  table  sets  forth  information  with  respect to the Named
Executive  Officers  concerning  the exercise of stock  options  during 1998 and
unexercised  options held by such Named  Executive  Officers as of  December 31,
1998.
<TABLE>
<CAPTION>

                                      Aggregated Option Exercises in 1998 and
                                           Fiscal Year-End Option Values

                                                                Number of Unexercised
                                                                Securities Underlying             Value of Unexercised
                             Shares                                Options/SARs                   in-the-money Options
                           Acquired On        Value               at Year-End(#)                    at Year-End($)(1)
         Name              Exercise(#)     Realized($)     Exercisable     Unexercisable     Exercisable    Unexercisable

<S>                                                           <C>              <C>            <C>               <C>     
Stanley S. Binder                  --              --         77,250           110,250        $553,031          $377,531
John H. Davies                     --              --         53,688            49,813         384,367           197,110
Kenneth S. Wood                    --              --         46,313            45,188         197,110           332,820
Richard S. Rosenfeld               --              --         38,625            38,675         276,516           148,710

</TABLE>


(1)  Based on a closing  price of $8.625  per share for the  Common  Stock as of
     December 31, 1998.

Option Repricing

     On  October  21,  1998,  the  Company's  Board  of  Directors  approved the
repricing of options exercisable for  an aggregate of  287,700 shares of  Common
Stock previously granted to key  employees of the  Company (including  the Named
Executive Officers) and the Company's  non-employee  diresctors pursuant to  the
Company's  1997 Stock  Compensation Program  (the "Repricing").  Pursuant to the
Repricing,  option  holders exchanged  options, certain of which were vested and
presently  exercisable,  with  exercise  prices ranging from $9.38 to $13.88 per
share  for new stock  options covering  the same  number of shares and having an
exercise price of $6.19 per share, the closing  price of the Common Stock on the
NASDAQ  National  Market on October 21, 1998.   Options  granted pursuant to the
Repricing  vest over  a  four-year period,  with  25%  of  the  options becoming
exercisable  in each year commencing one  year after  the date of  the Repricing
and will expire ten years after the Repricing.

1997 Stock Compensation Program

     In May 1997,  the Company  adopted the  Barringer  1997 Stock  Compensation
Program (the "Stock Compensation  Program") in order to promote the interests of
the Company,  its direct and indirect  present and future  subsidiaries  and its
stockholders  by providing  eligible  persons with the opportunity to acquire an
ownership interest,  or to increase their ownership interest,  in the Company as
an  incentive to remain in the service of the  Company.  The Stock  Compensation
Program authorizes the granting of incentive stock options,  non-qualified stock
options, stock appreciation rights, performance shares and stock bonus awards to
employees and consultants of the Company and its  subsidiaries,  including those
employees  serving as  officers  or  directors  of the  Company  (the  "Employee
Plans").  The Stock Compensation Program also authorizes automatic option grants
to directors  who are not  otherwise  employed by the Company (the  "Independent
Director  Plan").  In connection with the Stock 

<PAGE>

Compensation Program,  600,000 shares of Common Stock are reserved for issuance,
of which up to 500,000  shares may be issued under the Employee  Plans and up to
100,000  shares may be issued under the  Independent  Director  Plan.  The Stock
Compensation Program is administered by the Executive Compensation Committee.

     Options and awards granted under the Stock Compensation Program may have an
exercise  or  payment  price  as  established  by  the  Executive   Compensation
Committee;  provided that the exercise price of incentive  stock options granted
under  the  Employee  Plans may not be less  than the fair  market  value of the
underlying  shares on the date of grant.  Options  granted under the Independent
Director Plan must have an exercise  price equal to the fair market value of the
underlying shares on the date of grant.

     Unless otherwise provided at the date of grant, no option or award may vest
within  one year of the date of grant and no  option  or award may be  exercised
more than 10 years from the date of grant. Options granted under the Independent
Director  Plan  vest one year  following  the date of grant  and  expire  if not
exercised on or before the fifth anniversary thereof. Unless otherwise specified
by the Executive Compensation Committee, options and awards (other than pursuant
to the Independent  Director Plan) vest in four equal installments on the first,
second,  third and  fourth  anniversaries  of the date of grant.  Vesting of any
option or award granted under the Stock Compensation  Program may be accelerated
in certain circumstances,  including upon the occurrence of a "Change in Control
Event" (as defined in the Stock Compensation Program).

     Options  and  awards  granted  under the  Stock  Compensation  Program  are
nontransferable,  except  by will or by the laws of  descent  and  distribution.
However,  the  Executive  Compensation  Committee  may permit the recipient of a
non-incentive  stock option granted under the Employee Plans and options granted
under the Independent Director Plan to transfer the option to a family member or
a trust  created for the  benefit of family  members.  During the  lifetime of a
participant,  an option may be exercised only by the  participant or a permitted
transferee.  In the event that a participant's  employment or service terminates
as a result of death, all vested awards are paid to the participant's  estate by
the Company and the  participant's  estate or any permitted  transferee  has the
right to  exercise  vested  options  for a period  ending on the  earlier of the
expiration  dates of such  options  or one year from the date of  death.  If the
participant's  employment  or service  terminates as a result of retirement or a
"disability" (as set forth in the Stock Compensation Program), all vested awards
are paid to the  participant by the Company and the participant or any permitted
transferee  has the right to exercise  vested options for a period ending on the
earlier  of the  expiration  dates of such  options or one year from the date of
termination.  If the participant's  employment or service  terminates for cause,
all options  and awards  will  automatically  expire  upon  termination.  If the
participant's  employment or service terminates other than as a result of death,
disability,  retirement or termination for cause,  the participant has the right
to collect all vested awards  immediately  and the  participant or any permitted
transferee  has the right to exercise  vested options for a period ending on the
earlier of the  expiration  dates of such  options or awards or 30 days from the
date  of   termination,   subject  to  extension  at  the   discretion   of  the
Administrator,  or three  months  from the  date of  termination  in the case of
options  granted  pursuant to the Independent  Director Plan. In all cases,  any
unvested options or awards terminate as of the date of termination of employment
or service.

     The Stock Compensation Program will terminate on February 28,  2007, unless
earlier  terminated  by the Board of  Directors.  No  options  or awards  may be
granted under the Stock  Compensation  Program after its  termination;  however,
termination of the Stock Compensation  Program will not affect the status of any
option or award outstanding on the date of termination.

     Prior  to  the  Repricing,  stock  options  exercisable  for  an  aggregate
of  403,700  shares of Common Stock  were outstanding  under the Employee Plans.
These  options  expire  10  years after  the  date of grant  and  had a weighted
average  exercise  price of $10.57  per share.  Such  options  were  exercisable
annually in 25% increments  beginning with the first  anniversary of the date of
grant. In connection  with  the Repricing,  263,700 of  such options, certain of
which  were  vested  and  presently  exercisable,  

<PAGE>

were canceled and new options  exercisable for an aggregate of 263,700 shares of
Common  Stock were  granted.  The new options  expire 10 years after the date of
grant and have an exercise  price of $6.19 per share.  Such  options vest over a
four-year period and are exercisable  annually in 25% increments  beginning with
the first anniversary of the date of grant. In addition, prior to the Repricing,
options  exercisable  for an  aggregate  of 24,000  shares of Common  Stock were
outstanding under the Independent Director Plan. These were exercisable one year
from the date of grant, were to expire five years from the date of grant and had
a weighted  average  exercise price of $12.83 per share.  In connection with the
Repricing,  all of such  options,  certain  of which were  vested and  presently
exercisable,  were  canceled  and new options  exercisable  for an  aggregate of
24,000 shares of Common Stock were granted  outside the 1997 Stock  Compensation
Program.  The new  options  expire 10 years  after the date of grant and have an
exercise price of $6.19 per share. Such options vest over a four-year period and
are exercisable  annually in 25% increments beginning with the first anniversary
of the date of grant.

Exercise Program

     In connection with the options granted by the Company to its employees, the
Board of Directors has approved a stock option  exercise  program (the "Exercise
Program").  The Exercise  Program  permits all  employees of the Company and its
subsidiaries  who are granted  stock  options  (pursuant to either  qualified or
non-qualified  plans) to finance  the  exercise  of such  options by causing the
Company to issue the shares  underlying such options upon receipt by the Company
from the employee of a full-recourse demand note evidencing  indebtedness to the
Company in an amount equal to the exercise price. Such loans,  which are secured
by the underlying  shares of Common Stock, are  interest-free  for one year from
the date on which the employee exercises his or her option, after which interest
accrues at the prime rate, which rate is changed  monthly.  The loans are repaid
with a portion of the proceeds  from the sale of the Common Stock to be received
by the  employees  upon the  exercise  of their  options.  As of March 1,  1999,
Messrs.  Binder and Wood were indebted to the Company in the approximate amounts
of $277,000 and $13,050,  respectively, for loans made pursuant to the  Exercise
Program. During 1998,  the  largest  aggregate amount of indebtedness of Messrs.
Binder and Wood pursuant  to such loans were $272,525 and $13,050, respectively.
The  rate  of interest  charged  on  each such loan  during  1998 was the  prime
lending  rate charged by Summit Bank.

Stock Purchase Program

     In December 1998, the Company sold an aggregate of 153,000 shares of Common
Stock held in the treasury to the senior  executive  officers of the Company and
certain of the Company's independent directors at a purchase price of $8.375 per
share,  the  closing  price  of the  Common  Stock  on  the  date  of the  sale.
Substantially  all of the purchase price for the shares of Common Stock sold was
paid  in  the  form  of  five-year  non-recourse  promissory  notes  aggregating
approximately  $1.3 million  secured by pledges of the underlying  Common Stock.
The notes bear  interest  at a rate of 4.52% per annum.  In  January  1999,  the
Company  sold an  additional  10,000  shares of Common  Stock to Ms.  Lavet at a
purchase price of $9.75 per share,  the closing price of the Common Stock on the
date of sale. The consideration  paid by Ms. Lavet was substantially the same as
described above,  except that Ms. Lavet's note bears interest at a rate of 4.64%
per  annum.  The  number  of shares of  Common  Stock  purchased  by each of the
individuals  and  the  principal  amount  of the  notes  due  from  each  of the
individuals is set forth below.

<TABLE>
<CAPTION>

                                        Number of               Principal amount
         Name                        shares purchased              of notes

<S>                                       <C>                      <C>     
 Stanley S. Binder                        50,000                   $418,250
 John H. Davies                           20,000                    167,300
 Kenneth S. Wood                          23,000                    192,395
 Richard S. Rosenfeld                     20,000                    167,300
 John D. Abernathy                        10,000                     83,650
 Richard D. Condon                        10,000                     83,650
 James C. McGrath                         10,000                     83,650

<PAGE>

 John J. Harte                            10,000                     83,650
 Lorraine M. Lavet                        10,000                     97,400
 
</TABLE>

Employment Agreements

     The Company has entered  into a  five-year  employment  agreement  with Mr.
Binder,   the  President  and  Chief  Executive  Officer  of  the  Company  (the
"Employment  Agreement"),  effective  January  1,  1998.  Under  the  Employment
Agreement Mr. Binder  received a base salary of $250,000 for 1998. Mr.  Binder's
salary is subject to certain adjustments and to periodic increases as determined
by the Board of Directors.  In addition, Mr. Binder is entitled to receive up to
a total of three special bonuses during the term of the Employment Agreement, in
the amount of $65,000, $65,000 and $70,000,  respectively, in the event that the
Company's  EBITDA (as  defined in the  Employment  Agreement),  exceeds  certain
targeted  amounts  for  any  fiscal  year  during  the  term  of the  Employment
Agreement.  Mr.  Binder  received  the first of these  special  bonuses in 1998.
Pursuant to the Employment Agreement, Mr. Binder is also entitled to participate
in the  Company's  cash bonus plan and to  participate  in the SERP Plan.  Also,
under the terms of the Employment Agreement,  in 1997, Mr. Binder received stock
options  covering  50,000  shares of Common  Stock  having an exercise  price of
$11.78 per share (equal to the fair market  value on the date of grant).  In the
Employment  Agreement,  the Company has agreed to maintain a $1.0  million  term
life  insurance  policy for Mr.  Binder's  benefit.  Mr.  Binder is  entitled to
several perquisites, including a car allowance and reimbursement for the cost of
certain financial planning services.

     In the event that  Mr. Binder's  employment  is  terminated  pursuant  to a
Without Cause  Termination,  or Mr. Binder  terminates  his  employment for Good
Reason (as such terms are defined in the Employment Agreement),  Mr. Binder will
be entitled to a severance  payment  equal to 2.99 times his  then-current  base
salary and to certain other severance benefits. In addition, upon the occurrence
of a  Change  in  Control  Event  (as such  term is  defined  in the  Employment
Agreement),  Mr. Binder  has the right to terminate  his  employment  within 180
days, in which event the  termination  will be treated as a termination for Good
Reason with the effects specified above. In addition,  the Company has agreed to
pay  Mr. Binder  additional  amounts,  if  necessary,  to  pay  any  excise  tax
Mr. Binder may become subject to in the event that any payment made to him under
the Employment  Agreement  constitutes an "excess parachute  payment" within the
meaning of Section 280G of the Internal Revenue Code of 1986, as amended.

     Pursuant  to the  Employment  Agreement,  Mr. Binder  has agreed to certain
confidentiality, work-for-hire and non-competition covenants.

     The Company has entered into three-year  employment agreements with each of
Messrs. Wood  and  Rosenfeld  effective  September  1, 1998,  pursuant  to which
Messrs. Wood  and  Rosenfeld  receive  annual  base  salaries  of  $150,000  and
$125,000,  respectively,  subject to periodic increases at the discretion of the
Board of  Directors,  and are  entitled  to  participate  in any cash bonus plan
maintained by the Company and to participate in the SERP Plan. In the employment
agreements,  the Company has agreed to maintain term life insurance policies for
the  benefit of each of them in an amount  not less than four  times Mr.  Wood's
base  salary and not less than three  times Mr.  Rosenfeld's  base  salary.  The
employment  agreements  for each of Messrs.  Wood and Rosenfeld  provide,  among
other things,  that, in the event of a termination  of employment by the Company
without  cause,  the  employee  will be entitled to receive a severance  payment
equal to his then  current  base  salary for a period of twelve  months from the
effective  date of such  termination.  In the event  that  Messrs.  Wood  and/or
Rosenfeld are terminated  pursuant to a Without Cause Termination (as defined in
the employment agreements), they are entitled to receive their base salary as in
effect at the time of such  termination  for a period of twelve  months from the
effective date of such termination. Upon the occurrence of a "change in control"
of the  Company,  the  employee  will be  entitled to receive the greater of his
annual base salary  pursuant to the  employment  agreement  or his then  current
annual base salary for the remainder of the term (payable in a single lump sum).
Both  of  the  employment  agreements  also  contain  certain   confidentiality,
work-for-hire and non-competition  provisions which continue in effect following
the termination of the employee's employment by the Company.

<PAGE>

Directors' Compensation

     Outside  directors are entitled to an annual retainer of $3,000 per quarter
(plus a $500 quarterly fee for each committee  chairperson)  and a fee of $1,000
for  each  meeting  attended  and  $500  for  each  committee  meeting  attended
(regardless of whether or not the committee meeting is held on the same day as a
meeting  of the Board of  Directors).  Pursuant  to the terms of the 1997  Stock
Compensation Program, each director who has not been a full-time employee of the
Company or any subsidiary for at least the prior 12 months receives an option to
purchase  3,000  shares of Common Stock each year on the earlier of (i) the date
of the Company's annual meeting of stockholders, or (ii) June 1. Options granted
to such  directors  under the 1997 Stock  Compensation  Program have an exercise
price  equal to the fair  market  value per  share as of the date of grant.  See
"1997 Stock Compensation Program."

Compensation Committee Interlocks and Insider Participation

     The   Company's   Executive   Compensation   Committee   is   comprised  of
Messrs. Abernathy,  Condon,  Harte and  McGrath.  No  executive  officer  of the
Company and no member of the Executive Compensation Committee is a member of any
other business  entity that has an executive  officer that sits on the Company's
Board or on the Executive Compensation Committee.

Section 16(a) Beneficial Ownership Reporting Compliance

     Under Section 16(a) of the Exchange Act, the Company's directors, executive
officers,  and persons  holding  more than ten percent of the  Company's  Common
Stock are required to report their  initial  ownership of the  Company's  Common
Stock  and  any  changes  in  such  ownership  to the  Securities  and  Exchange
Commission.  These  persons are also required to furnish the Company with a copy
of all Section  16(a) forms they file.  The Company is obligated to disclose any
failures to, on a timely basis, file such reports.  To the Company's  knowledge,
based solely on a review of such reports and any  amendments  thereto which have
been  furnished  to the  Company, except  as  set forth  below,  the Company has
not  identified  any reports required to be filed during the year ended December
31, 1998 that was not filed in a timely  manner.  Mr. Davies did not timely file
a Form 4 in  connection  with  his purchase of 20,000 shares  of Common Stock on
December 10, 1998.

Item 12.  Security Ownership of Certain Beneficial Owners and Management.
 
     The following  table sets forth,  as of March 1, 1999, the number of shares
of Common  Stock, Class  A  Convertible Preferred Stock and Class  B Convertible
Preferred Stock owned by (i) each Named  Executive  Officer, (ii) each  director
(iii) all directors  and executive  officers  as a  group and (iv) any person or
entity known by the  Company to own  beneficially 5% or more of such securities.
As of March 1, 1999,  there were 7,773,347 shares of Common Stock, 38,616 shares
of   Class  A   Convertible  Preferred  Stock  and  22,500  shares  of  Class  B
Convertible  Preferred  Stock  issued and outstanding.  As  of that  date,  none
of the officers and directors of the Company owned shares of the Company's Class
A  Convertible  Preferred  Stock or Class B  Convertible  Preferred  Stock.  The
business address for  all of the executive officers and directors of the Company
is 30 Technology Drive,  Warren, New Jersey 07059.

<PAGE>


<TABLE>
<CAPTION>

                                    Beneficial Ownership              Beneficial Ownership     Beneficial Ownership
                                   of Class A Convertible             of Class B Ownership       of Common Stock
                                      Preferred Stock                   Preferred Stock                 (1)
                                   Number of    Percent of          Number of     Percent       Number of   Percent of
Name                               Shares         Class              Shares       Class          Shares      Class

<S>              <C>                                                                             <C>          <C> 
Stanley S. Binder(3)                   --         --                  --          --            216,136      2.7%
John H. Davies(4)                      --         --                  --          --            160,732      2.0%
John J. Harte(5)                       --         --                  --          --             70,100        *
Richard D. Condon(6)                   --         --                  --          --             51,250        *
John D. Abernathy(7)                   --         --                  --          --             44,454        *
James C. McGrath(8)                    --         --                  --          --             41,250        *
Kenneth S. Wood(9)                     --         --                  --          --             96,636       1.2
Lorraine M. Lavet                      --         --                  --          --             10,000        *
Richard S. Rosenfeld (10)              --         --                  --          --             84,036       1.1
All directors and executive
  officers as a group
  consisting of nine
  (9) persons                          --         --                  --          --             774,594      9.5
 
Austin W. Marxe (11)                   --         --                  --          --             890,821     11.0
153 E. 53rd St.
NY, NY 10022

Corbyn Investment
 Management, Inc.(12)                  --         --                  --          --             852,150     11.0
2330 W. Joppa Road
Suite 108
Lutherville, MD 21093

Lionheart Group, Inc.                  --         --                  --          --             423,100      5.4
230 Park Avenue
New York, NY 10169
 
William D. Witter, (13)                --         --                  --          --             655,140      8.4
153 East 53rd Street
New York, NY 10022

Angelo Logozzo Ex. UW                 3,918      10.1%                --          --              1,417        *
Frederick D'Amico (14)
415 S. 3rd St.
Hamilton, MT 59840

Max Gerber(15)                         --         --                12,500       55.6%            4,447        *
26 Broadway
New York, NY 10004-1776

Paul Spitzberg (16)                    --         --                10,000       44.4             3,558        *
16 Whiteowl Road
Tenafly, NJ 07670

</TABLE>

  *      Less than 1%

(1)  Assumes the  exercise of all  outstanding  warrants for Common  Stock,  the
     conversion of each outstanding share of Class A Convertible Preferred Stock
     and Class B Convertible  Preferred Stock into Common Stock and the exercise
     of all options  exercisable within 60 days of March 1, 1999 for each person
     or entity.
(2)  Certain amounts shown are subject to adjustment in certain circumstances.
(3)  Includes  100,000 shares of Common  Stock  issuable  upon the  exercise  of
     options  exercisable  within 60 days of March 1, 1999 and 12,500  shares of
     Common  Stock  issuable  upon  exercise  of warrants  owned by  Mr. Binder.
     Excludes  shares of  Common  Stock  beneficially  owned by SSF III of which
     Mr. Binder is an  independent  general  partner.  Mr. Binder  disclaims any
     beneficial interest in such shares.
(4)  Includes  69,500  shares of Common  Stock  issuable  upon the  exercise  of
     options  exercisable  within 60 days of March 1, 1999 and 12,500  shares of
     Common Stock issuable upon the exercise of warrants owned by Mr. Davies.
(5)  Includes  22,500  shares of Common  Stock  issuable  upon the  exercise  of
     options exercisable within 60 days of March 1, 1999 owned by Mr. Harte.
(6)  Includes  22,500  shares of Common  Stock  issuable  upon the  exercise  of
     options  exercisable  within 60 days of March 1,  1999 and 5,000  shares of
     Common Stock issuable upon the exercise of warrants owned by Mr. Condon.
(7)  Includes  22,500  shares of Common  Stock  issuable  upon the  exercise  of
     options  exercisable  within 60 days of March 1,  1999 and 2,500  shares of
     Common Stock issuable upon the exercise of warrants owned by Mr. Abernathy.
(8)  Includes  22,500  shares of Common  Stock  issuable  upon the  exercise  of
     options exercisable within 60 days of March 1, 1999 owned by Mr. McGrath.
(9)  Includes  60,000 Shares  of Common  Stock  issuable  upon the  exercise  of
     options exercisable within 60 days of March 1, 1999 owned by Mr. Wood.
(10) Includes  50,000  shares of Common  Stock  issuable  upon the  exercise  of
     options  exercisable  within  60 days of March 1, 1999 and 5,000  shares of
     Common Stock issuable upon the exercise of warrants owned by Mr. Rosenfeld.
     Also includes 3,636 shares of Common Stock owned by Mr. Rosenfeld's child.

<PAGE>

(11) Includes  (i) 393,579  shares of Common Stock and 229,167  shares of Common
     Stock issuable upon the exercise of warrants owned by SSF III, (ii) 134,742
     shares of Common Stock and 83,333 shares of Common Stock  issuable upon the
     exercise of warrants  owned by Special  Situations  Cayman Fund,  L.P. (the
     "Cayman  Fund"),  and (iii) 50,000  shares of Common Stock owned by Special
     Situations  Technology Fund, L.P.  ("SST").  AWM Investment  Company,  Inc.
     ("AWM") is the sole general partner of the Cayman Fund and the sole general
     partner of MGP  Advisors  Limited  ("MGP"),  a general  partner of SSF III.
     Mr. Marxe  is the  President  and Chief  Executive  Officer  of AWM and the
     principal limited partner of MGP.  Accordingly,  Mr. Marxe may be deemed to
     be the  beneficial  owner of all of the shares of Common  Stock held by SSF
     III, the Cayman Fund and SSTF. Mr. Binder is an independent general partner
     of SSF III. Mr. Binder disclaims beneficial ownership of all shares held by
     SSF III.
(12) Consists  of  446,150  shares of Common  Stock  owned by Corbyn  Investment
     Management,  Inc. and 406,000  shares of Common Stock owned by  Greenspring
     Fund, Inc.

<PAGE>

(13) Includes  575,140  shares of Common Stock owned by William D. Witter,  Inc.
     ("WDWI") and 80,000 shares of Common Stock owned by Penfield Partners, L.P.
     ("PP").  William D.  Witter  owns 98.6% of WDWI.  WDWI is the sole  general
     partner of Pine  Creek  Advisors  Limited  Partnership  ("PCA")  which is a
     general  partner of PP. 
(14) Includes 1,417 shares of Common Stock issuable upon conversion of the Class
     A Convertible  Preferred Stock.  
(15) Includes 4,447 shares of Common Stock issuable upon conversion of the Class
     B Convertible  Preferred Stock.  (16) Includes 3,558 shares of Common Stock
     issuable upon conversion of the Class B Convertible Preferred Stock.

Item 13.  Certain Relationships and Related Transactions

     In July 1998, the Company made a $500,000  non-recourse loan to Mr. Binder.
The loan is  repayable  on July 5, 2003 and bears  interest at the rate of 5.68%
per  annum,  payable  annually.  Mr.  Binder's  obligation  to repay the loan is
secured  by  49,000  shares  of  Common Stock. In addition, the Company has made
certain  loans to the Named  Executive  Officers  and  directors.  See "Item 11.
Executive Compensation--Exercise Program" and  "Item  11. Executive Compensation
--Stock Purchase Program."

     Mr. Abernathy is currently the Executive  Director of Patton Boggs,  LLP, a
Washington,  D.C. law firm.  During 1998, the Company retained Patton Boggs, LLP
to represent the Company in various matters and has retained such firm in 1999.

                                     PART IV

Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K.

         (a) Exhibits.

Exhibit
  No.             Description                                       Page

        3.1     Certificate of Incorporation of the Company,
                as  amended,  (previously  filed as  Exhibit
                3.1A to the Company's Registration Statement
                on  Form  SB-2  (File  No.   333-33129)  and
                incorporated herein by reference).

        3.2     By-laws of the Company  (previously filed as
                Exhibit 3.1 to the Company's  Current Report
                on  Form 8-K  dated  August  26,  1998 (File
                No. 0-3207)  and   incorporated   herein  by
                reference).

        10.1    Amended and Restated  Employment  Agreement,
                dated as of December 31,  1997,  between the
                Company and  Stanley S.  Binder  (previously

<PAGE>

                filed  as  Exhibit  10.1  to  the  Company's
                Annual  Report on Form 10-KSB for the fiscal
                year  ended  December  31,  1997  (File  No.
                0-3207)   and    incorporated    herein   by
                reference)

        10.2    Employment  Agreement, dated as of September
                1, 1998,  between the Company and Richard S.
                Rosenfeld.

        10.3    Employment  Agreement, dated as of September
                1,  1998, between the Company and Kenneth S.
                Wood.

        10.4    Form of  1995   nonqualified   stock  option
                agreement  (previously filed as Exhibit 10.6
                to the Company's  Registration  Statement on
                Form SB-2    (File     No. 333-13703)    and
                incorporated herein by reference).

        10.5    Form of  1996   nonqualified   stock  option
                agreement  (previously filed as Exhibit 10.6
                to the Company's  Registration  Statement on
                Form SB-2    (File     No. 333-13703)    and
                incorporated  herein  by  reference).   

        10.6    Description  of  Exercise  Plan  (previously
                filed  as   Exhibit 10.9  to  the  Company's
                Registration  Statement on  Form SB-2  (File
                No. 333-13703)  and  incorporated  herein by
                reference).

        10.7    Barringer   Technologies   Inc.  1997  Stock
                Compensation  Program  (previously  filed as
                Exhibit 10.9 to the  Company's  Registration
                Statement on Form SB-2 (File No.  333-33129)
                and incorporated herein by reference.)

        10.8    License Agreement, dated February 27,  1989,
                between  Canadian  Patents  and  Development
                Limited--Societe  Canadienne  Des Brevets Et
                D'Exploitation    Limite    and    Barringer
                Instruments     Limited    (the     "License
                Agreement"),  Supplement #1,  dated March 4,
                1991, Assignment of License Agreement, dated
                January 2, 1992, to Her Majesty the Queen in
                Right  of  Canada,  as  Represented  By  the
                Minister    of    National    Revenue    and
                Supplemental    Letter   Agreement,    dated
                October 7,   1996   (previously   filed   as
                Exhibit 10.10 to the Company's  Registration
                Statement on Form SB-2 (File  No. 333-13703)
                and incorporated herein by reference).

        10.9    Letter  Agreement,  dated July 25,  1997, by
                and between  Barringer  Research Limited and
                Her Majesty the Queen in Right of Canada, as
                Represented  By  the  Minister  of  National
                Revenue  (previously  filed as Exhibit 10.11
                to the Company's  Registration  Statement on
                Form   SB-2   (File   No.   333-33129)   and
                incorporated herein by reference.)

        10.10   Warrant Agreement by and between the Company
                and American Stock  Transfer & Trust Company
                (previously  filed  as  Exhibit 4.1  to  the
                Company's    Registration    Statement    on
                Form SB-2    (File     No. 333-13703)    and
                incorporated herein by reference).

        10.11   Form of Warrant issued to Janney  Montgomery
                Scott Inc.  (previously filed as Exhibit 4.2
                to the Company's  Registration  Statement on
                Form SB-2    (File     No. 333-13703)    and
                incorporated herein by reference).

        10.12   Lease, dated as of July 1, 1998, between the
                Company and Mt. Bethel Corporate Center.


<PAGE>

        10.13   Lease,  dated as of July 27,  1995,  between
                Barringer  Research  Limited  and  Lehndorff
                Management  Limited   (previously  filed  as
                Exhibit 10.18 to the Company's  Registration
                Statement on Form SB-2 (File  No. 333-13703)
                and incorporated herein by reference).

        10.14   Supplemental   Executive   Retirement   Plan
                (previously  filed as  Exhibit  10.18 to the
                Company's  Registration  Statement  on  Form
                SB-2 (File No.  333-33129) and  incorporated
                herein by reference).

        10.15   Revolving  Credit  Note dated March 13, 1998
                between   the   Company   and  Fleet   Bank,
                (previously  filed as  Exhibit  10.19 to the
                Company's  Registration  Statement  on  Form
                SB-2 (File No.  333-33129) and  incorporated
                herein by reference).

        10.16   Unlimited    Guaranty    of   Payment    and
                Performance dated March 13, 1998 between the
                Company  and Fleet  Bank,  N.A.  (previously
                filed  as  Exhibit  10.20  to the  Company's
                Registration  Statement  on Form SB-2  (File
                No.  333-33129) and  incorporated  herein by
                reference).

        10.17   Revolving  Credit Loan Agreement dated March
                13,  1998  amongst  the  Company,  Barringer
                Instruments,    Inc.,   Barringer   Research
                Limited  and Fleet  Bank,  N.A.  (previously
                filed  as  Exhibit  10.21  to the  Company's
                Registration  Statement  on Form SB-2  (File
                No.  333-33129) and  incorporated  herein by
                reference).

        10.18   Stockholder   Protection  Rights  Agreement,
                dated  as of  August  26,1998,  between  the
                Company  and  American  Stock  Transfer  and
                Trust Company, as Rights Agent, including as
                Exhibit A the form of Rights Certificate and
                of Election to Exercise and as Exhibit B the
                form of Certificate  of Designation  and the
                Terms of the  Participating  Preferred Stock
                of the Company  (previously filed as Exhibit
                4.1 to the Company's  Current Report on Form
                8-K dated August 26, 1998 (File  No. 0-3207)
                and incorporated herein by reference).

        10.19   Pledge Agreement,  dated as of July 6, 1998,
                made by Stanley S. Binder.

        10.20   Non-Recourse  Secured Promissory Note, dated
                July 6, 1998,  made by Stanley S.  Binder in
                favor of the Company.

        10.21   Form of Pledge Agreement.

<PAGE>

        10.22   Form of Note for Executive Officers.

        10.23   Form of Note for Non-employee Directors.

        21.1    List of the Company's Subsidiaries

        23.1    Consent  of BDO  Seidman,  LLP,  independent
                certified public accountants.

        27.1    Financial  Data  Schedule for the year ended
                December 31, 1998.

         (b) Reports on Form 8-K.

                  None


<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, thereunto duly authorized.

                                           BARRINGER TECHNOLOGIES INC.

                                           By: /s/ Stanley S. Binder  
                                              ---------------------------
                                              Stanley S. Binder, Chairman
                                              and Chief Executive Officer

Dated: March 30, 1999

     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 dates indicated.

<TABLE>

        Signature                                Title                                Date

<S>                                          <C>                                   <C> <C> 
/s/ Stanley S. Binder                        Chief Executive Officer               March 30, 1999
_____________________                        and Director (Principal Executive
    Stanley S. Binder                        Officer)
                                             
/s/ John D. Abernathy                        Director                              March 30, 1999
______________________
    John D. Abernathy

/s/ Richard D. Condon                        Director                              March 30, 1999
______________________
    Richard D. Condon

/s/ John H. Davies                           Director                              March 30, 1999
______________________
    John H. Davies

/s/ John J. Harte                            Director                              March 30, 1999
______________________
    John J. Harte

/s/ James C. McGrath                         Director                              March 30, 1999
______________________
    James C. McGrath

/s/ Kenneth Wood                            Director                               March 30, 1999
______________________
    Kenneth Wood

/s/ Lorraine Lavet                          Director                               March 30, 1999
______________________
    Lorraine Lavet

/s/ Richard S. Rosenfeld                    Vice President-Finance,                March 30, 1999
________________________                    Chief Financial Officer
    Richard S. Rosenfeld                    and Treasurer
                                            (Principal Financial Officer
                                            and Principal Accounting Officer)
</TABLE>


<PAGE>

                           BARRINGER TECHNOLOGIES INC.

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                          Page

Consolidated Financial Statements

Report of Independent Certified Public Accountants                        F-2

Consolidated Balance Sheets as of December 31, 1997 and 1998              F-3

Consolidated Statements of Operations
  for the Years Ended December 31, 1996, 1997 and 1998                    F-4

Consolidated Statements of Stockholders' Equity for the Years Ended
  December 31, 1996, 1997 and 1998                                        F-5

Consolidated Statements of Cash Flows for the Years Ended December31,
  1996, 1997 and 1998                                                     F-6

Notes to Consolidated Financial Statements                                F-7


Financial Statement Schedule

Schedule II - Valuation and Qualifying Accounts                           F-22


<PAGE>

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


Barringer Technologies Inc.
Warren, New Jersey


     We have audited the accompanying  consolidated  balance sheets of Barringer
Technologies Inc. as of December 31, 1997 and 1998, and the related consolidated
statements of operations,  stockholders'  equity, and cash flows for each of the
three years in the period  ended  December 31,  1998.  We have also  audited the
schedule  listed in the  accompanying  index.  These  financial  statements  and
schedule are the responsibility of the Company's management.  Our responsibility
is to express an opinion on these financial statements and schedule 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  and schedule are
free of material  misstatement.  An audit includes  examining,  on a test basis,
evidence supporting the amounts and disclosures in the financial  statements and
schedule.  An audit also includes  assessing the accounting  principles used and
significant   estimates   made   by   management,  as  well  as  evaluating  the
presentation  of the  financial  statements  and  schedule.  We believe that our
audits provide a reasonable basis for our opinion.

     In our opinion,  the consolidated  financial  statements  referred to above
present fairly, in all material  respects,  the financial  position of Barringer
Technologies  Inc.  at  December 31,  1997  and  1998,  and the  results  of its
operations  and its cash flows for each of the three  years in the period  ended
December 31, 1998, in conformity with generally accepted accounting principles.

     Also,  in our  opinion,  the  schedule  presents  fairly,  in all  material
respects, the information set forth therein.


                                                           BDO Seidman, LLP

Woodbridge, New Jersey
February 24, 1999


<PAGE>
<TABLE>
<CAPTION>

                  BARRINGER TECHNOLOGIES INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                        (In thousands, except par value)

                                                                                                      December 31,
                                                                                                  1997             1998

                                                      ASSETS
<S>                                                                                             <C>              <C>    
Current assets:
  Cash and cash equivalents                                                                     $ 8,188          $18,802
  Marketable securities                                                                           2,499           15,606
  Trade receivables, less allowances of $109 and $626                                             7,908            6,502
  Inventories (note 2)                                                                            3,049            3,943
  Prepaid expenses and other                                                                        887            1,111
  Deferred tax asset (note 6)                                                                     1,506            3,092
                                                                                                 ------           ------
         Total current assets                                                                    24,037           49,056

Machinery and equipment, net (note 3)                                                             1,505            2,349

Other (note 15)                                                                                   66            1,239
                                                                                                 ------           ------
                                                                                               $ 25,608         $ 52,644
                                                                                                =======          =======

                                       LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                                                             $  1,324         $  1,169
  Accrued liabilities                                                                               473              946
  Accrued payroll and related taxes                                                               1,520            1,005
  Accrued commissions                                                                               801              127
  Foreign income taxes payable (note 6)                                                             255              112
                                                                                                  -----            -----
         Total current liabilities                                                                4,373            3,359

Non-current liabilities                                                                             121              145

Commitments (notes 4 and 7)

Stockholders' equity (note 5):
  Convertible preferred stock, $1.25 par value, 1,000 shares
   authorized, none outstanding                                                                      -                -
  Preferred stock, $2.00 par value, 4,000 shares authorized
   270 shares designated class A convertible preferred
    stock, 45 and 39 shares outstanding, respectively, less
    discount of $35 and $30, respectively                                                            55               47
   730 shares designated class B convertible preferred
    stock, 23 shares outstanding                                                                     45               45
  Common stock, $0.01 par value, 20,000 shares authorized,
    and 5,495 and 7,851 shares issued, respectively                                                  55               79
  Additional paid-in capital                                                                     30,209           54,693
  Accumulated deficit                                                                            (8,780)          (4,359)     
Cumulative foreign currency translation adjustment
                                                                                                   (457)            (786)
                                                                                                 -------          -------
                                                                                                 21,127           49,719
  Less: common stock in treasury, at cost, 31 shares and
    92 shares, respectively                                                                         (13)            (579)
                                                                                                 -------          -------
         Total stockholders' equity                                                              21,114           49,140
                                                                                                 -------          ------
                                                                                               $ 25,608         $ 52,644
                                                                                                 =======          ======

                 See notes to consolidated financial statements.
</TABLE>

<PAGE>

<TABLE>
<CAPTION>

                  BARRINGER TECHNOLOGIES INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      (In thousands, except per share data)


                                                                                          Year Ended December 31,
                                                                               1996               1997            1998

<S>                                                                             <C>             <C>              <C>    
Revenues                                                                        $10,923         $22,689          $20,458
Cost of revenues                                                                  5,363           9,008            7,954
 
         Gross profit                                                             5,560          13,681           12,504

Operating expenses:
  Selling, general and administrative                                             3,734           7,971            8,552
  Amortization of goodwill                                                           --              --              104
  Write-off of acquired technology (note 15)                                         --              --              435
  Product development                                                               230             715            1,975
                                                                                  -----           -----           ------
         Total operating expenses                                                 3,964           8,686           11,066
                                                                                  -----           -----           ------
         Operating income                                                         1,596           4,995            1,438

Other income (expense):
  Interest expense                                                                 (228)             (9)              (9)
  Equity in earnings of unconsolidated
    subsidiary                                                                      117              --               --
  Gain on sale of investment in
    unconsolidated subsidiary                                                       123              --               --
  Investment income                                                                  72             450            1,641
  Other, net                                                                        (12)            (53)              52
                                                                                  -----           ------           ------
                                                                                     72             388            1,684
 
         Income before income tax benefit                                         1,668           5,383            3,122
Income tax benefit (note 6)                                                         391             371            1,309
                                                                                  -----           -----            -----
         Net income                                                               2,059           5,754            4,431

Preferred stock dividends                                                           (39)            (12)             (10)

Net income attributable to common stockholders                                  $ 2,020         $ 5,742          $ 4,421
                                                                                 ======           =====            =====


Per share data (notes 1 and 14):
         Basic                                                                   $ 0.55          $ 1.05           $ 0.62
                                                                                  =====            ====            =====
         Diluted                                                                 $ 0.46          $ 0.92           $ 0.58

Weighted average common and common
  equivalent shares outstanding:
  Basic                                                                           3,695           5,456            7,153
                                                                                  =====           =====            =====
  Diluted                                                                         4,440           6,257            7,612
                                                                                 =======          =====            ======

</TABLE>
                        See notes to consolidated financial statements.

<PAGE>

<TABLE>
<CAPTION>

                                            BARRINGER TECHNOLOGIES INC.

                                  CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                                  (In thousands)

                                         Common Stock   Class A     Class B
                                                       Pfd Stock    Pfd Stock
                                         -------------------------------------------------------
                                 Total                                          Paid-in             Foreign   Treas.  Comprehensive
                                 Equity   Shrs   Am't   Shrs  Am't  Shrs   Am't Capital    Deficit  Transl.   Stock      Income
                                 ---------------------------------------------------------------------------------------------------
<S>            <C>             <C>       <C>      <C>    <C> <C>    <C>   <C>   <C>      <C>        <C>      <C>   
 Bal - January 1, 1996         $ 1,325   3,479    $35    83  $101   258   $ 515  $17,685  $(16,542) $(456)   $ (13)
 Net income                      2,059                                                    $  2,059                      $   2,059
 Translation adjustment             41                                                                 41                      41
                                                                                                                       -------------
 Comprehensive income                                                                                                   $   2,100
                                                                                                                       =============
 Preferred stock conversion                 55      1   (23)  (27) (135)   (270)    296
 Issuance and exercise of
  stock options and
  warrants                           42     15                                       42
 Conversion of debentures         1,000    364      4                               996
 Preferred stock dividends          (15)     7                                       24        (39)
 Sale of securities net of
  expenses ($741)                10,401  1,437     14                            10,387
                                 ---------------------------------------------------------------------------------------------------
Bal - December 31, 1996          14,853  5,357     54    60    74   123     245  29,430    (14,522)   (415)    (13)
 Net income                       5,754                                                      5,754                          5,754
 Translation adjustment             (42)                                                               (42)                   (42)
                                                                                                                        ------------
 Comprehensive income                                                                                                   $   5,712
                                                                                                                        ============
 Preferred stock conversion                 41          (15)  (19) (100)   (200)    219
 Issuance and exercise of
  stock options and
  warrants                          490     97      1                               489
 Repayment stockholder loan          71                                              71
 Preferred stock dividends          (12)                                                       (12)
                                 ---------------------------------------------------------------------------------------------------
Bal - December 31, 1997          21,114  5,495     55    45    55    23      45  30,209     (8,780)   (457)    (13)
 Net income                       4,431                                                      4,431                      $   4,431
 Translation adjustment            (329)                                                              (329)                  (329)
                                                                                                                           ---------
 Comprehensive income                                                                                                   $   4,102
                                                                                                                          ==========
 Sale of securities net of
  expenses ($2,394)              25,211  2,300     23                            25,188
 Preferred stock conversion           0      2           (6)   (8)                    8
 Issuance and exercise of
  stock options and
  warrants                          263     54      1                               262
 Repurchase of common stock      (1,540)                                                                    (1,540)
 Sale of treasury stock,
  net of notes receivable             0
  ($1,281)                                                                         (974)                       974
 Preferred stock dividends          (10)                                                       (10)
                                 ---------------------------------------------------------------------------------------------------
Bal - December 31, 1998          $49,140 7,851  $  79    39  $ 47    23    $ 45 $54,693    $(4,359)  $(786) $ (579)
                                 ===================================================================================================
</TABLE>

*    At December 31, 1998 and 1997 net of notes  receivable  of $1,484 and $203,
     respectively,  from the sale of stock. See notes to consolidated  financial
     statements.

<PAGE>

<TABLE>
<CAPTION>

                  BARRINGER TECHNOLOGIES INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In thousands)

                                                                                      Year Ended December 31,
                                                                               1996            1997            1998

<S>                                                                          <C>             <C>              <C>    
Net income                                                                   $ 2,059         $ 5,754          $ 4,431
Items not affecting cash:
  Depreciation and amortization                                                  115             272              741
  Inventory and accounts receivable reserves                                      22             332              382
  Income from and gain on sale of investment
    in Labco                                                                    (240)             --               --
  Write-off of acquired technology                                                --              --              435
  Deferred tax benefit                                                          (506)           (775)          (1,586)
  Other                                                                           50              30             (184)
Increase in non-cash working capital balances                                 (2,947)         (3,655)          (1,465)
         Cash provided by (used in) operating
           activities                                                         (1,447)          1,958            2,754
Investing activities:
  Purchase of equipment and other                                               (124)         (1,190)          (1,510)
  Sale of (investment in) marketable securities                               (4,328)          1,829          (13,107)
  Purchase of Digivision and related costs                                       --              --              (821)
  Proceeds on sale of investment in Labco                                        574             --               --
         Cash provided by (used in) investing
           activities                                                         (3,878)            639          (15,438)
Financing activities:
  Proceeds on issuance of Convertible
    Subordinated Debentures                                                    1,000              --               --
  Reduction in long-term debt                                                   (300)             --               --
  Decrease in bank debt and other                                               (570)           (174)             (67)
  Proceeds on sale of equity securities, net                                  10,443             430           25,211
  Warrant and option exercise                                                                                     204
  Repayment from (loan to)employee                                               --               71             (500)
  Acquisition of treasury stock                                                                                (1,540)
  Payment of dividends on preferred stock                                        (15)            (12)             (10)
         Cash provided by financing activities                                10,558             315           23,298
Increase in cash and cash equivalents                                          5,233           2,912           10,614
Cash and cash equivalents--beginning of year                                      43           5,276            8,188
Cash and cash equivalents--end of year                                      $  5,276        $  8,188         $ 18,802

Changes in components of non-cash working
  capital balances related to operations:
  Trade receivables                                                          $(2,010)        $(4,433)         $   951
  Inventories                                                                   (649)         (1,065)            (567)
  Other current assets                                                          (248)           (389)            (206)
  Other assets                                                                    39              38               --
  Accounts payable and accrued liabilities                                       (79)          2,194           (1,643)
Increase in non-cash working capital balances                                $(2,947)        $(3,655)         $(1,465)

</TABLE>


                 See notes to consolidated financial statements.

<PAGE>

                  BARRINGER TECHNOLOGIES INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Summary of Significant Accounting Policies

  Principles of Consolidation

     The accompanying consolidated financial statements comprise the accounts of
the  Company  and  its  continuing   subsidiary   companies.   All  intercompany
transactions have been eliminated.

  Principles of Translation

     Assets and liabilities of the Company's foreign subsidiaries are translated
by using year-end exchange rates and statement of operation items are translated
at average exchange rates for the year. Translation  adjustments are accumulated
in a separate component of stockholders' equity.

  Marketable Securities

     Marketable  securities  consist primarily of commercial paper with original
maturities  at date of  purchase  of less than 12 months.  The  Company has both
positive  intent and ability to hold these  securities to maturity.  The Company
carries these  securities at cost,  which  approximates  fair value,  due to the
short period of time to maturity.

  Inventories

     Materials  and  supplies  are  carried  at the  lower  of  average  cost or
replacement cost. Finished goods and work-in process are carried at the lower of
average cost or net realizable value.

  Property and Equipment

     Property and equipment are carried at cost. Depreciation of owned equipment
is computed on a  straight-line  basis over the  estimated  useful  lives of the
related assets,  generally from three to ten years.  Leasehold  improvements are
amortized over the term of the related lease,  generally from five to ten years,
which  approximates  the useful  lives of these  improvements.  Equipment  under
capital leases is amortized on a straight-line basis over the term of the lease,
generally four to ten years,  which  approximates  the estimated useful lives of
the leased equipment.

  Per Share Data

     Basic earnings per share is computed by dividing income available to common
stockholders by the weighted average number of common shares outstanding for the
period.  Diluted  earnings  per share is computed  assuming  the  conversion  of
convertible  preferred stock and the exercise or conversion of common equivalent
shares, if dilutive, consisting of unissued shares under options and warrants.

  Statement of Cash Flows

     For purposes of the  Statement  of Cash Flows,  the Company  considers  all
highly liquid  investments with an original  maturity of three months or less to
be cash equivalents.

  Revenue Recognition

     The Company  recognizes  revenue on the percentage of completion method for
its research and development contracts with progress measured based on the ratio
of costs

<PAGE>

incurred to the total estimated cost, and generally, when product is shipped for
all other  sales.  Where the  Company  receives  contracts  for the  design  and
construction of specialty instruments that require long manufacturing times, the
Company will also  recognize  revenue on the  percentage  of  completion  method
similar to its recognition method in the research and development business.

     For the years ended  December 31,  1996, 1997 and 1998, the Company did not
have any significant contracts in progress.

  Financial Instruments and Credit Risk Concentration

     Financial   instruments   which   potentially   subject   the   Company  to
concentrations  of credit risk consist  primarily of trade accounts  receivable.
Concentrations  of credit risk with respect to such  receivables  are limited to
primarily  governmental  agencies.  Marketable  securities consists primarily of
investments in U.S. government and agency obligations and commercial paper.

  Long-Lived Assets

     Long-lived  assets,  such as machinery  and  equipment,  are  evaluated for
impairment  when events or changes in  circumstances  indicate that the carrying
amount of the assets may not be recoverable  through the estimated  undiscounted
future cash flows from the use of these assets.  If and when any such impairment
exists, the related assets will be written down to fair value. This policy is in
accordance  with  Statement of Financial  Accounting  Standards No. 121,  ("SFAS
121")  "Accounting for the Impairment of Long-Lived Assets and Long-Lived Assets
to be Disposed of". No  write-downs  have been  necessary  through  December 31,
1998.

  Stock-Based Compensation

     The  Company  has  adopted  the  disclosure  only  provisions  of SFAS 123,
"Accounting  for Stock-Based  Compensation",  but applies  Accounting  Principle
Board Opinion No. 25  "Accounting for Stock Issued to Employees",  in accounting
and measuring  compensation  expense related to stock option plans. There was no
compensation  expense  related to the issuance of stock options to employees for
the years ended  December 31, 1996,  1997 and 1998. For the years ended December
31, 1996, 1997 and 1998, the Company recorded compensation expense in the amount
of $0, $60,000 and $33,500,  relating to stock options  awarded to the Company's
independent   directors  (see  note 5  for  pro-forma   disclosure  required  by
SFAS 123).

  Fair Value of Financial Instruments

     The carrying amounts  reported in the consolidated  balance sheets for cash
and cash  equivalents,  marketable  securities,  accounts  receivable,  accounts
payable, accrued liabilities and notes payable approximate fair value because of
the immediate or short-term maturity of these financial instruments. The Company
has the  ability  and intent to hold all  marketable  securities  through  their
respective maturity dates.

  Use of Estimates

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  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 these estimates.  Many of the
Company's  estimates and assumptions used in the financial  statements relate to
the Company's  products,  which are subject to technology and market changes. It
is reasonably possible that changes may occur in the near term that would affect
management's  estimates  with  respect  to  accounts  receivable,   inventories,
equipment and deferred income taxes.

<PAGE>

  Recent Pronouncements of the Financial Accounting Standards Board

     In June 1998, the Financial  Accounting Standards Board issued Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and Hedging  Activities"  ("SFAS No. 133"),  which  establishes  accounting  and
reporting  standards for  derivative  instruments  and hedging  activities.  The
Company is currently  reviewing the effects of SFAS No. 133, but does not expect
the new guidelines to have a material impact on the Company's financial position
and  results of  operations.  This  statement  will be adopted by the Company no
later than its year ending December 31, 2000.

2.  Inventories

     At  December 31,  1997 and 1998, the Company had parts,  subassemblies  and
work in process of $2,748,000 and $2,959,000 and finished goods of $301,000, and
$984,000, respectively.

3.  Machinery and Equipment

     The major categories of machinery and equipment are as follows:

<TABLE>
<CAPTION>

                                                                                               December 31,
                                                                                         1997                  1998

<S>                                                                                      <C>                 <C>        
         Office equipment                                                                $   969,000         $ 1,415,000
         Machinery and equipment                                                           1,986,000           2,492,000
         Leasehold improvements                                                               70,000             325,000
                                                                                           3,025,000           4,232,000
         Accumulated depreciation                                                         (1,520,000)         (1,883,000)
           Totals                                                                        $ 1,505,000         $ 2,349,000

</TABLE>

4.  Bank Credit Facility

     On March 13, 1998, the Company  established a $5.0 million unsecured credit
facility  with Fleet Bank,  N.A.  (the  "Bank") to be used for  general  working
capital  purposes,  including  the  issuance  of standby  letters of credit (the
"Facility").  Drawings  under the Facility may not be used to fund  acquisitions
unless  approved in advance by the Bank.  Amounts  drawn under the Facility bear
interest  at a variable  rate per annum  selected  by the  Company  and equal to
either the Bank's prime rate less 0.75% or LIBOR  (determined  on the basis of a
30-, 60- or 90-day  interest  period,  as  applicable)  plus 2.0%.  The Facility
expires on June 30,  1999, subject to renewal. The Facility is guaranteed by the
Company's primary U.S. subsidiary,  Barringer Instruments Inc. ("BII"). Pursuant
to the  Facility,  the  Company  and BII are  required  to comply  with  certain
customary covenants, including certain financial tests. In addition, BII and the
Company's Canadian subsidiary,  Barringer Research Limited ("BRL"),  have agreed
not to pledge  their  assets to any other  creditor  without  the  Bank's  prior
written  consent.  At December 31, 1998,  the Company had  $4,800,000  available
under  this  facility.  Approximately  $200,000  was used to  secure a letter of
credit.
 
5.   Stockholders' Equity

  Stockholder Protection Rights Plan

     On August 26, 1998,  the Company's  Board of Directors  declared a dividend
payable September 9, 1998 of one right (a "Right") for each outstanding share of
common  stock,  par value $.01 per share,  of the Company  held of record at the
close of business on September 8, 1998,  or issued  thereafter  and prior to the
Separation Time (generally the date of the  commencement of a tender or exchange
offer or at such time as an acquirer  becomes a 15% or more  shareholder  of the
Company)  and  thereafter   pursuant  to  options  and  convertible   securities
outstanding at the 

<PAGE>

Separation Time. Each Right entitles its registered  holder to purchase from the
Company,  after the Separation  Time, one one-hundreth of a share of a new class
of preferred stock designated Participating Preferred Stock, par value $2.00 per
share, for $32.50, subject to adjustment.

  Stock Repurchase Program

     On July 7,  1998 the  Company  announced  that its Board of  Directors  had
authorized the repurchase of up to 1,000,000  shares or  approximately  12.7% of
the Company's outstanding Common Stock. As of December 31, 1998, the Company had
repurchased  212,500  shares  at an  aggregate  cost of  $1,540,000.  Additional
repurchases  will be made  from  time to  time in open  market  transactions  in
amounts as determined by the Company's  management and will be funded out of the
Company's working capital.

  Public Offerings

     On April 3, 1998,  the Company  completed  the sale of 2,000,000  shares of
common  stock in a public  underwriting.  On April 30,  1998,  the  underwriters
exercised their over-allotment  option and acquired an additional 300,000 shares
of common stock.  The aggregate net proceeds to the Company,  after all expenses
of the offering was approximately $25.2 million.

     On November 12,  1996, the Company  completed the sale of 1,250,000  shares
("Shares") of common stock and 1,250,000 Common Stock Purchase Warrants ("Public
Warrants") in a public  underwriting.  On  December 12,  1996, the  underwriters
exercised their over-allotment  option and acquired an additional 187,500 Shares
and 187,500 Public  Warrants.  The aggregate net proceeds to the Company,  after
all expenses of the offering, was approximately $10,401,000.
 
  Due from Officers/Shareholders

     In connection with the exercise of options to acquire 190,000 shares of the
Company's  Common  Stock,  two  officers  of the Company  signed  full  recourse
interest bearing (no interest the first year,  prime rate thereafter)  unsecured
promissory  demand notes  aggregating  $274,000 under the Company's stock option
purchase program. Under that program the Company has arranged for a market-maker
in the Company's Common Stock, to coordinate the orderly sale in the open market
of a portion  of the  Common  Stock to be  received  by the  employees  upon the
exercise of their options in an amount  sufficient to repay the loan and related
interest. As of December 31, 1998, and 1997, $203,000 was outstanding.

     In July 1998,  the Company made a $500,000  non-recourse  loan to its Chief
Executive  Officer.  The loan is repayable on July 5, 2003 and bears interest at
the rate of 5.68% per annum, payable annually.  The obligation to repay the loan
is secured by 49,000 shares of the Company's common stock.

     In December 1998, the Company sold an aggregate of 153,000 shares of Common
Stock held in the treasury to the senior  executive  officers of the Company and
certain of the Company's independent directors at a purchase price of $8.375 per
share,  the  closing  price  of the  Common  Stock  on  the  date  of the  sale.
Substantially  all of the purchase price for the shares of Common Stock sold was
paid  in  the  form  of  five-year  non-recourse  promissory  notes  aggregating
approximately  $1.3 million  secured by pledges of the underlying  Common Stock.
The notes bear interest at a rate of 4.52% per annum.


<PAGE>
 
  Common Stock Outstanding or Reserved for Issuance

     The  following  table  sets  forth the  number  of  shares of Common  Stock
outstanding  as of  December 31,  1998 as well as the number of shares of Common
Stock  that  would be  outstanding  in the  event  that all of the  options  and
warrants  are  exercised  and all  Series  of  Convertible  Preferred  Stock and
Debentures are converted into Common Stock.

<TABLE>
<CAPTION>


                                                                                                           Common stock
                                                                                            Exercise,      outstanding or
                                                                                         conversion or      reserved for
                                                                                         option price         issuance

<S>                                                                                         <C>                <C>      
         Common stock                                                                                          7,759,597
         Class A convertible preferred stock                                                 0.361745             13,969
         Class B convertible preferred stock                                                 0.355839              8,006
         Stock options (i)                                                           $1.00 to $11.813            852,988
         Private placement warrants (ii)                                                        $1.96            349,999
         Public warrants (iii)                                                                 $9.847            330,825
         Underwriter's warrants (iii)                                                         $10.276            125,000
         Underlying warrants (iii)                                                             $9.847             31,250
         Directors' warrant (iv)                                                                $7.11              3,750
                                                                                                               ---------
         Total                                                                                                 9,475,384
                                                                                                               =========
</TABLE>

     All  outstanding  warrants expire between January 12, 1999 and November 12,
2001.

  (i)  Stock Compensation Plans

     From time to time, the Company has granted options to various employees and
directors.  The Company applies APB Opinion 25,  "Accounting for Stock Issued to
Employees",  and related  Interpretations in accounting for the plans. Under APB
Opinion 25,  because the exercise price of the Company's stock options issued to
employees  equals the market price of the underlying stock on the date of grant,
no compensation expense is recognized.

     SFAS 123, "Accounting for Stock-Based  Compensation",  requires the Company
to provide pro forma information  regarding net income and earnings per share as
if  compensation  cost  for the  stock  option  grants  had been  determined  in
accordance with the fair value based method  prescribed in SFAS 123. The Company
estimates  the fair  value of each  stock  option at the grant date by using the
Black-Scholes option-price model with the following weighted average assumptions
used for grants in 1996, 1997 and 1998; no dividend yield;  expected  volatility
of 46.1% in 1998,  46.5%  in 1997 and 30% in 1996;  risk-free  weighted  average
interest  rates of 4.75% in 1998,  6.03% in 1997 and 7.11% in 1996; and expected
lives for the options of 7.4 years in 1998, 5 years in 1997 and 5 years in 1996.

<PAGE>

     Under the  accounting  provisions  of SFAS 123, the  Company's  net income,
basic earnings per share and diluted earnings per share on a pro-forma basis are
as follows:
<PAGE>

<TABLE>
<CAPTION>

                                                                                      Year Ended December 31,
                                                                            1996               1997            1998

Net income:
<S>                                                                       <C>                <C>              <C>       
  As reported                                                             $2,059,000         $5,754,000       $4,431,000
  Pro-forma                                                               $1,986,000         $5,567,000       $4,031,000
Basic earnings per share from
  continuing operations:
  As reported                                                               $   0.55           $   1.05       $   0.62
  Pro-forma                                                                 $   0.53           $   1.02       $   0.56
Diluted earnings per share from
  continuing operations:
  As reported                                                               $   0.46           $   0.92       $   0.58
  Pro-forma                                                                 $   0.44           $   0.89       $   0.53

</TABLE>

     In 1997, the Company's  stockholders approved the adoption of the Company's
1997 Stock Compensation Program ("Program"). The Program authorizes the granting
of  incentive  stock  options,   non-qualified   supplementary   options,  stock
appreciation rights,  performance shares and stock bonus awards to employees and
consultants  of the  Company and its  subsidiaries,  including  those  employees
serving as officers or directors of the Company ("Employee Plans").  The Program
also  authorizes  automatic  option  grants to directors  who are not  otherwise
employed by the Company  ("Independent  Director Plan").  In connection with the
Program,  600,000 shares of Common Stock are reserved for issuance,  of which up
to  500,000  shares  may be issued  under the  Employee  Plans and up to 100,000
shares may be issued under the  Independent  Director Plan. In the event that an
option or award granted under the Program expires, is terminated or forfeited or
certain  performance  objectives  with  respect  thereto  are not met  prior  to
exercise or vesting,  then the number of shares of Common Stock covered  thereby
will again become eligible for grant under the Program. The Company will receive
no  consideration  for grants of options or awards  under the  Program.  Options
issued under the Employee  Plan expire ten years from the dates of grant and are
generally  exercisable  and vested as to 25% of the  optioned  shares  after the
first year,  50% after the second year,  75% after the third year and 100% after
the fourth year. Options issued under the Independent  Director Plan expire five
years  from the  dates of grant  and are fully  exercisable  after one year.  At
December  31,  1998,  there were 96,300  options  available  for grant under the
Employee  Plans and 100,000  options  available for grant under the  Independent
Director Plan.

<PAGE>

     A summary of the status of the Company's  outstanding  options is presented
below:

<TABLE>
<CAPTION>

                                                                         Year ended December 31,
                                                  1996                        1997                         1998
                                                      Weighted                    Weighted                   Weighted
                                                       Average                     Average                   Average
                                         Number of    Exercise       Number of    Exercise     Number of    Exercise
                                          Shares        Price         Shares        Price        Shares       Price

<S>                                       <C>          <C>            <C>          <C>             <C>           <C>
Outstanding--
beginning of year                           240,125      $4.54       461,000      $2.19        691,025         $5.31
  Granted                                   253,000       1.00       280,900      10.70        472,000          7.68
  Exercised                                  (1,250)      2.00       (19,937)      1.32         (9,087)         1.31
  Forfeited                                      --         --            --         --        (13,250)         9.95
  Canceled                                  (30,875)     10.66       (30,938)     10.32       (287,700)        10.76
Outstanding--end of year                    461,000       2.19       691,025       5.31        852,988          4.71
Options exercisable--end
  of year                                   164,200      $3.49       227,663      $1.94        334,690         $1.87
Fair value of options
  granted during the year                  $   0.40                $    6.72                   $  5.86 
                                           ========                 ========                    ======             
</TABLE>
 
     On May 13,  1997 and May 13,  1998,  options to acquire  12,000  shares and
12,000 shares, respectively,  of the Company's common stock at $13.875 per share
and  $11.813  per  share,  respectively,  which  was  the  market  value  at the
respective dates of grant,  were issued to the Company's  independent  directors
pursuant to the Independent Director Plan.

     On  October  21,  1998,  the  Company's  Board of  Directors  approved  the
repricing of options  exercisable  for an aggregate of 287,700  shares of Common
Stock  previously  granted to key  employees  of the Company  and the  Company's
non-employee directors pursuant to the Company's 1997 Stock Compensation Program
("the repricing").  Pursuant to the Repricing,  option holders exchanged options
with  exercise  prices  ranging  from  $9.375 to $13.875 per share for new stock
options covering the same number of shares and having an exercise price of $6.19
per share,  the closing price of the Common Stock on the NASDAQ  National Market
on October 21,  1998.  Options  granted  pursuant to the  Repricing  vest over a
four-year  period,  with 25% of the options  becoming  exercisable  in each year
commencing  one year after the date of the  Repricing  and will expire ten years
after  the  Repricing.  In  accordance  with  SFAS  123,  the  Company  recorded
compensation  expense in 1997 and 1998 of $60,000 and $33,500,  respectively  in
connection  with the issuance and repricing of the above noted options  relating
to the non-employee directors.

     Options issued prior to the adoption of the Program are non-qualified stock
options. Options issued in 1996, expire on April 25, 2001 and are exercisable as
to 25% of the optioned shares  immediately,  50% after the first year, 75% after
the  second  year and 100%  after the third  year and for those  issued in 1995,
expire on March 10,  2000 and are  exercisable as to 40% of the optioned  shares
after the first year,  60% after the second  year,  80% after the third year and
100% after the fourth year.

<PAGE>

     The following table summarizes  information about stock options outstanding
at December 31, 1998.

<TABLE>
<CAPTION>


                           Options Outstanding
                                                 Weighted-                                   Options Exercisable
         Weighted                Number           Average            Weighted            Number
          Average            Outstanding at      Remaining            Average        Exercisable at
         Exercise             December 31,      Contractual          Exercise         December 31,         Exercise
           Price                  1998             Life                Price              1998               Price

<S>       <C>                    <C>              <C>                 <C>                  <C>               <C>    
          $  1.00                230,813          2.3 years           $  1.00            173,110           $  1.00
             2.00                164,475          1.2 years              2.00            131,580              2.00
             6.19                287,700          9.9 years              6.19                  0
             6.38                 30,000          4.7 years              6.38             30,000              6.38
             8.38                 50,000          9.9 years              8.38                  0
            11.81                 90,000          9.4 years             11.81                  0
                                 -------                                                 -------
         1.00 to 11.81           852,988          5.9 years           $  5.93            334,690            $ 1.87

</TABLE>

  (ii)  Private Placement Warrants

     In connection with the private placement of securities in 1996, warrants to
purchase  420,000  shares of the Company's  common stock at $1.96 per share were
sold to a group of private  investors  and senior  management.  During  1997 and
1998,  32,500 and 37,500 warrants,  respectively,  were exercised.  The warrants
expire between May 9, 2000 and June 29, 2000.

  (iii)  Public Warrants

     The Public Warrants (see above) are exercisable for three years and entitle
the registered  holder to purchase  one-quarter of a share of Common Stock at an
exercise price of $9.847 per share.  The Public  Warrant  exercise price and the
number of shares  issuable upon  exercise of the Public  Warrants are subject to
adjustment  under  certain  circumstances.  The Company  may redeem  outstanding
Public  Warrants  on not less than 30 days notice at a price of $0.25 per Public
Warrant (subject to adjustment under certain  circumstances)  if the closing bid
price of the Common Stock averages in excess of 200% of the exercise price for a
period of 30 days' ending within 15 days of the redemption  notice date.  During
1997 and 1998, 66,200 and 48,000 Public Warrants, respectively were exercised.

     In  connection  with the  Company's  November  1996  public  offering,  the
managing  underwriter received a warrant  ("Underwriter's  Warrant") to purchase
from the Company  125,000 shares of Common Stock at an exercise price of $10.276
per share ("Exercise Price") and 125,000 Warrants  ("Underlying  Warrant") at an
exercise price of $0.06 per Warrant. Each Underlying Warrant entitles the holder
to  purchase  one-quarter  of a share of Common  Stock at an  exercise  price of
$9.847 per share. The Underwriter's Warrants are exercisable with respect to the
Common Stock for a period of four years  commencing from  November 12,  1997 and
with respect to the  Underlying  Warrants  for a period of two years  commencing
from November 12, 1997.

  (iv)  Directors' warrants

     On  December 31,  1991,  the Board of Directors  adopted the 1991 Directors
Warrant Plan ("Plan"). Pursuant to the Plan, each non-employee director was sold
a five-year  warrant to  purchase  3,750  shares of Common  Stock at an exercise
price equal to the current  market price for such shares at the time of issuance
of the warrant.  The Board of Directors  terminated the Plan effective May 1997.
During 1998, 3,750 warrants expired. During 1997, 3,750 warrants were exercised.
During 1996, 3,750 warrants expired.

6.  Income Taxes

     The provision  (benefit) for income taxes related to continuing  operations
are as follows:
<PAGE>


<TABLE>
<CAPTION>

                                                                                    Year Ended December 31,
                                                                              1996             1997               1998

<S>                                                                        <C>              <C>              <C>   
Current tax expense (benefit):
  Federal                                                                  $ 143,000        $ 983,000        $ 1,058,000
  State                                                                       27,000          285,000            339,000
  Recognition of net operating losses--U.S.                                 (170,000)      (1,268,000)        (1,251,000)
  Foreign (primarily Canada)                                                 297,000          952,000            421,000
  Recognition of net operating losses--Canada                                182,000)        (548,000)          (289,000)
                                                                             --------       ----------         ----------
         Total Current                                                       115,000          404,000            278,000
                                                                             -------        ----------         ----------
Deferred tax expense (benefit):
  Federal                                                                   (130,000)        (728,000)        (1,556,000)
  State                                                                      (22,000)        (128,000)             9,000
  Foreign (primarily Canada)                                                (354,000)          81,000            (40,000)
                                                                            ---------        ---------         ----------
         Total deferred                                                     (506,000)        (775,000)        (1,587,000)
                                                                            ---------        ---------        -----------
Total income tax benefit                                                   $(391,000)       $(371,000)       $(1,309,000)
                                                                            =========        =========        ===========

</TABLE>

     Deferred tax assets are  comprised of the following  temporary  differences
and carryforwards at December 31:

<TABLE>
<CAPTION>

                                                                                              1997               1998
<S>                                                                                      <C>                 <C> 
         Nondeductible allowances against trade
           receivables                                                                   $    20,000        $   155,000
         Nondeductible reserves and accruals                                                 104,000            188,000
         Machinery and equipment                                                             497,000            398,000
         Tax benefit of U.S. operating loss carry
           forwards                                                                        4,404,000          2,562,000
         Other                                                                                53,000              3,000
                                                                                          ----------         ----------
        Gross deferred tax assets                                                          5,078,000          3,306,000
         Deferred tax assets valuation allowance                                          (3,572,000)          (214,000)
                                                                                          -----------        ----------
         Net deferred tax assets                                                         $ 1,506,000        $ 3,092,000
                                                                                          ==========         ==========
</TABLE>

<PAGE>

     At December 31, 1998, a valuation  allowance  has been provided for certain
limitations  applied to the net operating loss carryforward of a subsidiary.  At
December 31, 1997, as a result of the Company's  historical  trend of losses,  a
valuation  allowance has been provided for a substantial portion of the U.S. and
Canadian deferred tax assets.  At December 31,  1998, the net deferred tax asset
of $3,092,000,  included  approximately  $445,000 and $2,647,000  related to the
Company's Canadian and U.S. operations,  respectively. At December 31, 1997, the
net  deferred  tax asset of  $1,506,000,  included  approximately  $405,000  and
$1,101,000 related to the Company's Canadian and U.S. operations,  respectively.
Based on historical results and estimated 1999 earnings,  which include earnings
from certain contracts, as well as available tax planning strategies, management
considers realization of the unreserved deferred tax asset more likely than not.
Additional  reductions to the valuation  allowance will be recorded when, in the
opinion of  management,  the  Company's  ability to generate  taxable  income is
considered more likely than not.

     The Company's  income tax provision  (benefit)  differed from the amount of
income tax determined by applying the applicable  statutory U.S.  federal income
tax  rate to  pretax  income  from  continuing  operations  as a  result  of the
following (in thousands):

<PAGE>

<TABLE>
<CAPTION>

                                                                                         Year Ended December 31,
                                                                                 1996            1997               1998

<S>                                                                          <C>              <C>                <C>    
Income taxes (benefit) computed at the
  U.S. statutory rate                                                          $ 567          $ 1,830            $ 1,061
Income not subject to U.S. tax, net                                             (225)            (239)              (211)
U.S. losses and expenses for which no tax
  benefit has been recognized                                                     25                7                184
Utilization of U.S. net operating losses                                        (143)            (777)              (943)
Decrease in beginning of the year deferred
  tax asset valuation allowance                                                 (590)          (1,217)            (1,546)
State income taxes                                                                --               --                146
Other                                                                            (25)              25                 --
Provision (benefit) for income taxes                                           $(391)         $  (371)           $(1,309)

</TABLE>

     At December 31,  1998, the Company had net operating loss carry forwards in
the U.S. of  approximately  $7.3  million and $3.2 million for federal and state
income tax purposes, respectively, which expire in varying amounts through 2010.

7.  Commitments

     The Company  rents  facilities,  automobiles  and  equipment  under various
operating  leases.  Rental  expenses  under such leases  amounted  to  $325,000,
$324,000 and $444,000 for 1996, 1997 and 1998, respectively.

     At  December 31,  1998,  the  aggregate  minimum  commitments  pursuant  to
operating leases, including a lease renewal are as follows:

         Year ending December 31,

         1999                                                      $  496,000  
         2000                                                         582,000
         2001                                                         515,000
         2002                                                         517,000
         2003 and thereafter                                        2,595,000

     The Company has multi-year  employment contracts with three key executives.
Pursuant to those  contracts the Company has annual minimum  salary  commitments
aggregating $569,000,  $569,000,  $465,000 and $260,000 for the four years ended
December 31, 2002, respectively.

8.  Employee Benefit Plans

     The Company maintains a 401(k) salary deferral plan for all U.S.  employees
and a money purchase plan for its Canadian employees.  As a money purchase plan,
it does not establish any Company liability other than a discretionary  matching
formula to employee contributions.
 
     The  aggregate  cost of both plans for 1996,  1997,  and 1998 was  $87,000,
$103,000 and $141,0000, respectively.

     Effective  January 1, 1998, the Company adopted the Barringer  Technologies
Inc.  Supplemental  Executive  Retirement Plan (the "SERP Plan").  The SERP Plan
provides eligible  participants with certain retirement benefits supplemental to
the  Company's  401(k)  Plan.  Pursuant to the SERP Plan,  the Company will make
annual  contributions  to the  account of each  participant  equal to a variable
percentage of the  participant's  base salary and annual cash bonus depending on
the Company's  achievement of certain performance targets. The actual percentage
contribution will be determined by the Executive Compensation Committee, subject
to certain  parameters.  A  participant  will 

<PAGE>


become vested under the SERP Plan after five years of participation therein. For
the year ended December 31, 1998,  contributions  aggregating $103,000 were made
into the plan.

9.  Supplemental Disclosures of Cash Flow Information

     The  Company  made cash  payments  for  interest of  $246,000,  $17,000 and
$10,000,  for the years ended  December 31,  1996, 1997 and 1998,  respectively.
Additionally,  income taxes of $4,000,  $209,000 and $498,000, were paid for the
years ended December 31, 1996, 1997 and 1998, respectively.

     In the year ended December 31,  1996, the Company satisfied Preferred Stock
dividend  requirements in the amount $24,000 through issuance of 7,949 shares of
common stock.  Subsequent to December 31, 1996,  all dividends have been paid in
cash.

     In December  1996,  the entire  $1,000,000 of the Company's 6%  Convertible
Subordinated  Debentures  were  converted  into 363,628  shares of the Company's
common stock as a result of the public offering (see note 5).

10.  Segment and Geographic Data

     The Company's business focuses on one segment of Business - "IONSCAN",  its
only product.  The Ionscan is currently  used in the areas of drug and explosive
detection for various security applications.

     A summary of the  Company's  revenues and  long-lived  assets by geographic
area for each of the three  years in the period  ended  December 31,  1998 is as
follows (in thousands):

<PAGE>

<TABLE>
<CAPTION>

                                                   Revenues                                  Long-Lived Assets     
                                        1996        1997         1998                 1996         1997          1998
<S>                                  <C>           <C>          <C>                   <C>          <C>          <C>   
United States                        $ 3,411       $13,408      $14,473               $   98       $  217       $  754
Canada                                   825           950          800                  457        1,264        1,423
Other foreign countries                6,687         8,331        5,185                   40           24          172
                                      ------        ------       ------               ------        -----        ------
         Totals                      $10,923       $22,689      $20,458               $  595       $1,505       $2,349
                                      ======        ======       ======                =====        =====        =====
</TABLE>

<PAGE>

     Revenues are attributed to the countries based on location of the customer.

     For the year ended  December 31,  1998, export sales,  including sales from
Canada  to other  countries,  comprised  25.4% of total  revenues  and were made
primarily to Western Europe, Asia and Central and South America.
 
11.  Sales to Major Customers

     For the year ended December 31, 1998,  the FAA accounted for  approximately
46.3% of consolidated  revenues of the Company.  For the year ended December 31,
1997,  two  customers  accounted  for  approximately  27.8%  (14.8%  and 13%) of
consolidated  revenues of the Company. For the year ended December 31, 1996, one
customer  accounted  for  approximately  11%  of  consolidated  revenues  of the
Company.

12.  Fourth Quarter Adjustments

     During the fourth quarter of 1996 and 1998, the Company recorded a deferred
tax benefit related to a decrease in the deferred tax asset valuation  allowance
of $266,000 and $635,000,  respectively.  During the fourth quarter of 1997, the
Company had no material adjustments.

<PAGE>

13.  Sale of Subsidiary
 
     During 1996,  the Company sold all of its remaining  shares and warrants in
Labco and  recognized a gain of $123,000 on the sale. In addition to the gain on
the sale of its  Labco  investment,  the  Company  recorded  $117,000  of income
representing its proportionate share of Labco's net income for 1996.

14.  Earnings Per Share

     Basic and Diluted earnings per share has been computed as follows:

<TABLE>
<CAPTION>


                                                                    Income                Shares             Per Share
For the Year ended December 31, 1998:                             (Numerator)          (Denominator)          Amount

Basic Earnings Per Share:
<S>                                                                  <C>                  <C>                      <C>  
  Income attributable to common
    stockholders                                                     4,421,000             7,153,000               $0.62
  Effect of dilutive securities
  Warrants and options                                                                       437,000
  Convertible preferred dividends                                       10,000                22,000
Diluted Earnings Per Share:
  Income attributable to common
    stockholders and assumed
    conversions                                                     $4,431,000             7,612,000               $0.58
                                                                     ---------             ---------                ----- 
For the Year ended December 31, 1997:
Basic Earnings Per Share:
  Income available to common
    stockholders                                                     5,742,000             5,456,000               $1.05
  Effect of dilutive securities
  Warrants and options                                                                       777,000
  Convertible preferred dividends
    and debentures                                                      12,000                24,000
                                                                    ----------             ---------               ------
Diluted Earnings Per Share:
  Income available to common stockholders
    and assumed conversions                                         $5,754,000             6,257,000               $0.92
                                                                     =========             =========                =====
For the Year ended December 31, 1996:
Basic Earnings Per Share:
  Income available to common
    stockholders                                                     2,020,000             3,695,000              $ 0.55
  Effect of dilutive securities                                                                                     ====
  Warrants and options                                                  27,000               228,000
  Convertible preferred dividends
   and debentures                                                       39,000               517,000
                                                                     ---------             ---------              -------   
Diluted Earnings Per Share:
 Income available to common
   stockholders
   and assumed conversions                                         $ 2,086,000             4,440,000              $ 0.46
                                                                    ==========             =========               =====
</TABLE>

<PAGE>

     Options  and  warrants  to  purchase   577,000   shares  of  common  stock,
exercisable  at  between  $9.847  and $11.81  per  share,  were  outstanding  at
December 31,  1998 but were not included in the computation of diluted  earnings
per share because the exercise prices were greater than the average market price
of the common stock underlying the warrants and options.

     Options to purchase  24,268 shares of common stock,  exercisable at between
$11.78 and $14.00 per share, were outstanding at December 31,  1997 but were not
included in the  computation of diluted  earnings per share because the options'
exercise  price was greater  than the average  market  price of the common stock
underlying the options.

15. Acquisition
 
     On April 30,  1998,  the Company  acquired all of the  outstanding  capital
stock of DigiVision,  Inc. ("DigiVision"),  a San Diego-based developer of video
enhancement  products,  for an aggregate  cash purchase  price of  approximately
$821,000,   including  related  incurred   acquisition   costs,  in  a  business
combination accounted for as a purchase.  DigiVision's results of operations are
included in the  accompanying  financial  statements from the  acquisition  date
forward.  With respect to this acquisition,  DigiVision's  results of operations
from  January  1,  1998  through  the  acquisition  date were not  material  and
accordingly,  pro-forma operating results are not presented. Acquired in-process
research and development projects of DigiVision, which could not be capitalized,
were valued at $435,000 and were  expensed at the time of the  acquisition.  The
excess of the purchase price (including acquisition related costs) over the fair
value of net assets  acquired  ($778,000)  is being  amortized  over a five-year
period.

<PAGE>

<TABLE>
<CAPTION>

                           BARRINGER TECHNOLOGIES INC
                        VALUATION AND QUALIFYING ACCOUNTS
                            YEARS ENDED DECEMBER 31,
                                   SCHEDULE II


                              Balance -                                            Balance
                              beginning                                            end of
                              of period     Addition    Deduction    Recovery      period
------------------------------------------------------------------------------------------
Allowance for doubtful
accounts and
sales allowances:
<S>                                      <C>                      <C>           <C>         
   1998                       $109,000     $543,000                   $26,000      $626,000
   1997                         63,000       46,000                                 109,000
   1996                         41,000       52,000      $30,000                     63,000

</TABLE>