<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

(Mark One)

/X/      Quarterly report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 For the quarterly period ended SEPTEMBER 30, 1998
         or

/ /      Transition report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 For the transition period from ___________ to
         _________

         Commission file number              1-12410

                                  SIMULA, INC.
             (Exact Name of Registrant as Specified in Its Charter)

              ARIZONA                                            86-0320129
(State or Other Jurisdiction of                               (I.R.S. Employer
 Incorporation or Organization)                              Identification No.)

2700 NORTH CENTRAL AVENUE, SUITE 1000, PHOENIX, ARIZONA             85004
      (Address of Principal Executive Offices)                    (Zip Code)

                                 (602) 631-4005
              (Registrant's Telephone Number, Including Area Code)

                 (Former Name, Former Address and Former Fiscal
                      Year, if Changed Since Last Report)

Indicate by check mark whether the registrant:

(1)      has filed all reports required to be filed by Section 13 or 15 (d) of
         the Securities Exchange Act of 1934 during the preceding 12 months (or
         for such shorter period that the registrant was required to file such
         reports)

                                 Yes /X/ No / /

(2)      has been subject to such filing requirements for the past 90 days.

                                 Yes /X/ No / /

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

        Class                                  Outstanding at September 30, 1998
Common Stock, $.01 par value                                 9,914,166
<PAGE>   2
                                  SIMULA, INC.

                                      INDEX

                                                                            PAGE

PART I - FINANCIAL INFORMATION

Item 1 - Financial Statements

         Consolidated Balance Sheets
         September 30, 1998 and December 31, 1997..............................2

         Consolidated Statements of Operations
              Three and Nine Months Ended September 30, 1998 and 1997..........3

         Consolidated Statement of Shareholders' Equity
              Nine Months Ended September 30, 1998 ............................4

         Consolidated Statements of Cash Flows
              Nine Months Ended September 30, 1998 and 1997....................5

         Notes to Interim Consolidated Financial Statements ...............6 - 8

Item 2 - Management's Discussion and Analysis of
              Results of Operations and Financial Condition...............9 - 15

PART II - OTHER INFORMATION

Item 1 - Legal Proceedings ...................................................16

Item 5 - Other - Stock Repurchase Program ....................................16

Item 6 - Exhibits and Reports.................................................17

SIGNATURES....................................................................18


                                       1
<PAGE>   3
PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS.

                                  SIMULA, INC.
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                  SEPTEMBER 30,        DECEMBER 31,
                                                                      1998                  1997
                                                                  -------------        -------------
<S>                                                               <C>                  <C>          
ASSETS
CURRENT ASSETS:
     Cash and cash equivalents                                    $     987,448        $   9,367,031
     Contract and trade receivables  - Net                           28,677,402           22,897,091
     Inventories                                                     32,005,853           23,772,430
     Deferred income taxes                                            3,763,000            3,763,000
     Prepaid expenses and other                                       1,235,447            1,335,366
     Net current assets of discontinued operations                   12,436,978           12,274,200
                                                                  -------------        -------------
          Total current assets                                       79,106,128           73,409,118

PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS - Net                 20,473,167           18,666,140
DEFERRED INCOME TAXES                                                 9,271,000            4,477,000
DEFERRED FINANCING COSTS                                              2,770,503            3,136,898
INTANGIBLES - Net                                                     3,446,076            3,701,494
OTHER ASSETS                                                            388,499              497,823
NET LONG-TERM ASSETS OF DISCONTINUED OPERATIONS                       6,874,759           13,470,801
                                                                  -------------        -------------
          TOTAL                                                   $ 122,330,132        $ 117,359,274
                                                                  =============        =============
LIABILITIES & SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
     Revolving line of credit                                     $  10,600,000
     Trade accounts payable                                           9,474,184        $   9,832,206
     Other accrued liabilities                                        7,239,799            5,662,816
     Advances on contracts                                            1,575,298            1,163,109
     Current portion of long-term debt                                7,100,908            8,096,207
                                                                  -------------        -------------
          Total current liabilities                                  35,990,189           24,754,338

LONG-TERM DEBT - Less current portion                                46,411,470           46,962,530
                                                                  -------------        -------------
          Total liabilities                                          82,401,659           71,716,868
                                                                  -------------        -------------
SHAREHOLDERS' EQUITY
     Preferred stock, $.05 par value - authorized
         50,000,000 shares; no shares issued or outstanding
     Common stock, $.01 par value - authorized 50,000,000
         shares; issued 9,914,166 and 9,850,832                          99,142               98,508
     Additional paid-in capital                                      51,724,524           51,109,830
     Accumulated deficit                                            (12,169,705)          (5,505,822)
     Currency translation adjustment                                    274,512              (60,110)
                                                                  -------------        -------------
          Total shareholders' equity                                 39,928,473           45,642,406
                                                                  -------------        -------------
          TOTAL                                                   $ 122,330,132        $ 117,359,274
                                                                  =============        =============
</TABLE>

             See notes to interim consolidated financial statements.


                                       2
<PAGE>   4
                                  SIMULA, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                          THREE MONTHS ENDED              NINE MONTHS ENDED
                                                                             SEPTEMBER 30,                   SEPTEMBER 30,
                                                                     ----------------------------    ----------------------------
                                                                        1998             1997            1998            1997
                                                                     ------------    ------------    ------------    ------------
<S>                                                                  <C>             <C>             <C>             <C>         
Revenue                                                              $ 23,680,404    $ 18,440,487    $ 71,962,001    $ 42,758,093
Cost of revenue                                                        18,197,029      16,144,823      53,880,615      32,309,526
                                                                     ------------    ------------    ------------    ------------
Gross margin                                                            5,483,375       2,295,664      18,081,386      10,448,567
Administrative expenses                                                 5,138,051       4,771,330      14,225,832      12,979,096
                                                                     ------------    ------------    ------------    ------------
Operating income (loss)                                                   345,324      (2,475,666)      3,855,554      (2,530,529)
Interest expense                                                       (1,326,708)     (1,374,409)     (3,730,358)     (3,375,092)
Interest income                                                            48,234         102,175         163,309         275,502
                                                                     ------------    ------------    ------------    ------------
(Loss) earnings before taxes and discontinued operations                 (933,150)     (3,747,900)        288,505      (5,630,119)
Income tax benefit (expense)                                              374,000       1,485,000        (116,000)      2,253,000
                                                                     ------------    ------------    ------------    ------------
(Loss) earnings from continuing operations                               (559,150)     (2,262,900)        172,505      (3,377,119)
Discontinued operations:
     (Loss) earnings from discontinued operations, net of tax                            (122,110)     (2,156,388)        444,273
     Estimated loss on disposal, net of tax                                                            (4,680,000)
                                                                     ------------    ------------    ------------    ------------
Net loss                                                             $   (559,150)   $ (2,385,010)   $ (6,663,883)   $ (2,932,846)
                                                                     ============    ============    ============    ============
Loss per common share - basic:
     Earnings (loss) from continuing operations                      $      (0.06)   $      (0.25)   $       0.02    $      (0.37)
     Discontinued operations:
          (Loss) earnings from discontinued operations, net of tax                          (0.01)          (0.22)           0.05
          Estimated loss on disposal, net of tax                                                            (0.47)
                                                                     ------------    ------------    ------------    ------------
     Net loss                                                        $      (0.06)   $      (0.26)   $      (0.67)   $      (0.32)
                                                                     ============    ============    ============    ============
Loss per common share - assuming dilution:
     Earnings (loss) from continuing operations                                                      $       0.02
     Discontinued operations:
          (Loss) earnings from discontinued operations, net of tax                                          (0.21)
          Estimated loss on disposal, net of tax                                                            (0.46)
                                                                                                     ------------
     Net loss                                                                                        $      (0.65)
                                                                                                     ============
</TABLE>

             See notes to interim consolidated financial statements.


                                       3
<PAGE>   5
                                  SIMULA, INC.
                 CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
                      NINE MONTHS ENDED SEPTEMBER 30, 1998

<TABLE>
<CAPTION>
                                                                   Additional                         Currency            Total
                                           Common Stock             Paid-in         Accumulated      Translation      Shareholders'
                                       Shares        Amount         Capital           Deficit        Adjustment          Equity
                                   ------------     ------------     ------------    ------------     ------------     ------------
<S>                                <C>              <C>              <C>             <C>              <C>              <C>         
BALANCE, January 1, 1998              9,850,832     $     98,508     $ 51,109,830    $ (5,505,822)    $    (60,110)    $ 45,642,406

Net loss                                                                               (6,663,883)                       (6,663,883)

Issuance of common shares                63,334              634          614,694                                           615,328

Currency translation adjustment                                                                            334,622          334,622
                                   ------------     ------------     ------------    ------------     ------------     ------------
BALANCE, September 30, 1998           9,914,166     $     99,142     $ 51,724,524    $(12,169,705)    $    274,512     $ 39,928,473
                                   ============     ============     ============    ============     ============     ============
</TABLE>

             See notes to interim consolidated financial statements.


                                       4
<PAGE>   6
                                  SIMULA, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                             NINE MONTHS ENDED SEPTEMBER 30,
                                                                                          --------------------------------------
                                                                                                1998                 1997
                                                                                          -----------------    -----------------
<S>                                                                                   <C>                 <C>          
Cash flows used for operating activities:
     Net loss                                                                         $ (6,663,883)       $ (2,932,846)
     Adjustment to reconcile net loss to net cash used by operating activities:
          Estimated loss on disposal of discontinued operations                          7,800,000
          Depreciation and amortization                                                  4,358,101           3,355,699
          Deferred income taxes                                                         (4,794,000)         (1,956,000)
          Currency translation adjustment                                                  334,622            (182,815)
     Changes in net assets and liabilities:
          Contract and trade receivables - net of advances                              (5,843,078)         (6,375,321)
          Inventories                                                                   (9,661,247)        (10,819,135)
          Prepaid expenses and other                                                      (124,346)            890,935
          Other assets                                                                    (463,211)            (10,370)
          Trade accounts payable                                                         1,005,834           2,485,965
          Other accrued liabilities                                                        938,038           2,021,975
                                                                                      ------------        ------------
               Net cash used by operating activities                                   (13,113,170)        (13,521,913)
                                                                                      ------------        ------------
Cash flows used by investing activities:
     Purchase of property and equipment                                                 (4,807,293)         (5,909,810)
     Costs incurred to obtain intangibles                                                 (113,331)           (255,427)
                                                                                      ------------        ------------
               Net cash used in investing activities                                    (4,920,624)         (6,165,237)
                                                                                      ------------        ------------
Cash flows from financing activities:
     Net borrowings (repayments) under line of credit                                   10,600,000          (6,900,000)
     Issuance of 8% Notes - net of expenses                                                                 31,186,126
     Principal payments under other debt arrangements                                   (1,561,117)         (1,399,423)
     Borrowings under other debt arrangements                                                                1,008,511
     Issuance of common shares                                                             615,328           2,046,423
                                                                                      ------------        ------------
               Net cash provided by financing activities                                 9,654,211          25,941,637
                                                                                      ------------        ------------
Net (decrease) increase in cash and cash equivalents                                    (8,379,583)          6,254,487
Cash and cash equivalents at beginning of period                                         9,367,031           1,298,741
                                                                                      ------------        ------------
Cash and cash equivalents at end of period                                            $    987,448        $  7,553,228
                                                                                      ============        ============
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
     Interest paid                                                                    $  4,567,528        $  2,806,141
                                                                                      ============        ============
     Taxes paid                                                                       $      6,424        $    125,900
                                                                                      ============        ============
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES:
     Conversion of notes:
       Conversion of $9,550,000 Series C 10% Senior Subordinated Convertible
       Notes and accrued interest of $475,548 less deferred
       note issuance costs of $432,507 for 679,633 shares of common stock                                 $  9,593,041
                                                                                                          ============
</TABLE>

             See notes to interim consolidated financial statements.


                                       5
<PAGE>   7
                                  SIMULA, INC.
               NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - BASIS OF PRESENTATION:

         The accompanying interim consolidated financial statements of Simula,
         Inc. (the "Company") have been prepared in accordance with generally
         accepted accounting principles for interim financial information and
         with the instructions to Form 10-Q. Accordingly, they do not include
         all of the information and notes required by generally accepted
         accounting principles for complete financial statements. In the opinion
         of Management, all adjustments and reclassifications considered
         necessary for a fair and comparable presentation have been included and
         are of a normal recurring nature. Operating results for the three and
         nine months ended September 30, 1998 are not necessarily indicative of
         the results that may be expected for the year ending December 31, 1998.

NOTE 2 - INVENTORIES:

         At September 30, 1998 and December 31, 1997, inventories consisted of
         the following.

<TABLE>
<CAPTION>
                                              SEPTEMBER 30,          DECEMBER 31,
                                                 1998                    1997
                                              -----------            -----------
<S>                                           <C>                    <C>        
Raw materials                                 $16,536,239            $12,205,813
Work in process                                14,107,498             10,652,149
Finished goods                                  1,362,116                914,468
                                              -----------            -----------
   Total inventories                          $32,005,853            $23,772,430
                                              ===========            ===========
</TABLE>

         Inventories included in net current assets of discontinued operations
         at September 30, 1998 and December 31, 1997 were $5,150,676 and
         $3,733,664, respectively, and consisted mainly of raw materials.

NOTE 3 - DEBT:

         During the third quarter of 1998, the Company commenced a private
         offering of up to $5.7 million principal amount of 9-1/2% Senior
         Subordinated Notes due September 2003 (the "9-1/2% Notes"). This
         offering is being made pursuant to the exemption from registration
         contained in Regulation D under the Securities Act of 1933, as amended.
         Under the terms of this offering, purchases of the 9-1/2% Notes may be
         made in cash or by tender for exchange of the Company's 12% Senior
         Subordinated Notes (the "12% Notes"). The proceeds from the offering
         will be utilized to refinance the 12% Notes which mature in November
         1998. Approximately $3.4 million of the 12% Notes and cash has been
         received by the Company. Therefore, this portion of the 12% Notes has
         been classified as long-term debt at September 30, 1998.

         On November 6, 1998, the Company entered into a new Senior Credit
         Agreement with Bank One, Arizona, N.A. and Imperial Bank, Arizona. This
         new agreement replaces the Company's previous senior credit agreement
         and provides for an increase in capacity to a total of $30 million and
         can be expanded to encompass additional facilities. This agreement
         initially provides for a $20 million revolving line of credit, a $5
         million term note to refinance existing term debt secured by equipment
         and a $5 million term note to refinance certain existing subordinated
         debt. The Company will initially use approximately $2.3 million of the
         second term note to repay the remaining balance of the 12% Notes when
         they become due in November 1998. Therefore, this portion of the 12%
         Notes has been classified as long-term debt at September 30, 1998.

NOTE 4 - COMPREHENSIVE INCOME:

         The Company adopted Financial Accounting Standards No. 130, Reporting
         Comprehensive Income, on January 1, 1998. Comprehensive loss includes
         adjustments made for foreign currency translation. Comprehensive loss
         was ($444,160) and ($2,497,875) for the three months ended September
         30, 1998 and 1997, respectively, and ($6,464,283) and ($3,042,535) for
         the nine months ended September 30, 1998 and 1997, respectively.


                                       6
<PAGE>   8
                                  SIMULA, INC.
               NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5 - EARNINGS PER SHARE:

         The following is a reconciliation of the numerators and denominators of
         basic and diluted per share computations. For the three months ended
         September 30, 1998 and 1997 and the nine months ended September 30,
         1997, earnings per share amounts are calculated using only weighted
         average outstanding shares. Options to purchase common stock and shares
         to be issued upon conversion of the Company's 8% Senior Subordinated
         Convertible Notes (the "8% Notes") and the Series C 10% Senior
         Subordinated Convertible Notes (the "10% Notes") of 4,308,111,
         4,468,980, and 4,525,616, respectively, for these periods were not used
         for computing dilutive earnings per share because the result would be
         anti-dilutive. For the nine month period ended September 30, 1998, the
         effects of 2,253,390 total shares to be issued upon conversion of the
         8% Notes and the 10% Notes were not used for computing dilutive
         earnings per share because the result would be anti-dilutive.

<TABLE>
<CAPTION>
                                                        Three Months Ended September 30,           Nine Months Ended September 30,
                                                      -----------------------------------       -----------------------------------
                                                           1998                 1997                 1998                  1997
                                                      --------------       --------------       --------------       --------------
<S>                                                   <C>                  <C>                  <C>                  <C>            
(Loss) earnings from continuing operations            $     (559,150)      $   (2,262,900)      $      172,505       $   (3,377,119)
Discontinued operations:
     (Loss) earnings from discontinued
          operations, net of tax                                                 (122,110)          (2,156,388)             444,273
     Estimated loss on disposal, net of tax                                                         (4,680,000)
                                                      --------------       --------------       --------------       --------------
Net loss                                              $     (559,150)      $   (2,385,010)      $   (6,663,883)      $   (2,932,846)
                                                      ==============       ==============       ==============       ==============
Basic weighted average shares outstanding                  9,880,703            9,265,429            9,868,452            9,099,186
                                                      ==============       ==============       ==============       ==============
Effect of dilutive securities                                                                          234,095
                                                                                                --------------
Diluted weighted average shares outstanding                                                         10,102,547
                                                                                                ==============
Basic per share amounts:
     (Loss) earnings from continuing operations       $        (0.06)      $        (0.25)      $         0.02       $        (0.37)
     Discontinued operations:
          (Loss) earnings from discontinued
             operations, net of tax                                        $        (0.01)      $        (0.22)      $         0.05
          Estimated loss on disposal, net of tax                                                $        (0.47)
                                                      --------------       --------------       --------------       --------------
     Net loss                                         $        (0.06)      $        (0.26)      $        (0.67)      $        (0.32)
                                                      ==============       ==============       ==============       ==============

Diluted per share amounts:
     (Loss) earnings from continuing operations                                                 $         0.02
     Discontinued operations:
          (Loss) earnings from discontinued
             operations, net of tax                                                                      (0.21)
          Estimated loss on disposal, net of tax                                                         (0.46)
                                                                                                --------------
     Net loss                                                                                   $        (0.65)
                                                                                                ==============
</TABLE>


                                       7
<PAGE>   9
                                  SIMULA, INC.
               NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6 - DISCONTINUED OPERATIONS:

         In 1998, the Company's board of directors adopted a plan to dispose of
         its rail and mass transit seating operations. Accordingly, the
         operating results of these rail and mass transit operations, including
         a provision for estimated loss upon disposition, have been segregated
         from continuing operations and are reported as discontinued operations.
         Interest expense has been allocated to discontinued operations based on
         the ratio of the discontinued operations' net assets to consolidated
         net assets. General corporate administrative expenses are not allocated
         to discontinued operations. Due to the subjective nature of estimated
         future operations and incremental costs of disposal, it is reasonably
         possible that these estimates may change in the future. Future changes
         in estimates will be included in the consolidated statement of
         operations in the reporting period determined. Revenues for the rail
         and mass transit operations were $4,360,279 and $5,202,258, for the
         three months ended September 30, 1998 and 1997, respectively, and
         $13,093,611 and $18,775,839 for the nine months ended September 30,
         1998 and 1997, respectively.


                                       8
<PAGE>   10
                                  SIMULA, INC.

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

GENERAL - The following discussion and analysis provides information that
management of Simula, Inc. (the "Company") believes is relevant to an assessment
and understanding of the Company's results of operations and financial condition
for the three and nine month periods ended September 30, 1998 compared to the
same periods in 1997. This discussion should be read in conjunction with the
Interim Consolidated Financial Statements and the Notes thereto included
elsewhere in this Form 10-Q. This Form 10-Q contains certain forward-looking
statements and information. The cautionary statements contained below should be
read as being applicable to all related forward-looking statements wherever they
appear. See "Forward Looking Information and Risks of the Business."

OVERVIEW

         The Company designs and manufactures occupant safety systems and
devices engineered to safeguard human life in a wide range of air, ground, and
sea transportation vehicles. Utilizing its substantial proprietary technology in
energy-absorbing seating, inflatable restraints, and composite materials, the
Company focuses on reducing injury and increasing survivability in vehicle and
aircraft crashes.

         Since its founding in 1975, the Company's historic business has been as
a government and defense contractor. Additionally, commencing with acquisitions
and commercial products development since 1993, the Company has become the
largest North American-based supplier of seating systems for rail and other mass
transit vehicles and a successful new entrant in the manufacture of new
commercial airliner seating and inflatable restraints for automobiles. Utilizing
its proprietary safety technology, the Company has introduced crashworthy
systems for a variety of vehicles and aircraft including its 16g commercial
airliner passenger seat ("16g Seat") and various inflatable restraint systems
for automobiles including the Inflatable Tubular Structure ("ITS") (TM).

         In 1994, the Company made a strategic decision to enter the inflatable
restraint market for automobiles utilizing its proprietary technology, the ITS.
Through 1996, the Company completed its development of this technology and
start-up of its manufacturing facilities. In 1997, the Company began
manufacturing the ITS for sale to BMW, a major European automobile manufacturer,
which began including it in certain models of its automobiles in 1997.

         In 1993, the Company made a strategic decision to enter the commercial
aircraft seating market to bring its proprietary energy-absorbing technologies
to a new industry and take advantage of positive industry trends. To implement
its decision, the Company completed three acquisitions that allowed it to
develop the necessary infrastructure to support future growth. In 1993, the
Company acquired Airline Interiors, Inc. (the "Airline Acquisition"), which was
primarily involved with the refurbishment, reupholstery, reconditioning, and
reconfiguring of existing passenger seats. The Airline Acquisition provided
certain FAA certifications, enhanced the Company's management team and customer
base, and provided substantial assembly capacity. During 1994, the Company
acquired Coach and Car Equipment Corporation ("Coach and Car") and Artcraft
Industries Corp. ("Artcraft"). Coach and Car, and Artcraft's existing operations
included providing a majority of all manufacturing and refurbishment of rail and
mass transit seating systems in North America. These operations provided the
Company with the substantial large-scale manufacturing capacity and business
volume that were needed to establish the Company as a viable supplier of
commercial airliner seating systems.

         To continue it's strategic plan, in 1998 the Company adopted a plan to
sell its rail and mass transit seating operations at Coach and Car and Artcraft.
Because the Company's commercial airliner seating operation moved into a new
significantly larger facility in July 1998 and has established substantial
production, the rail operations are no longer required to demonstrate the
Company's production capabilities to current and potential airliner seating
customers. The Company believes the sale of these businesses will provide a
significant amount of cash that will be used to repay outstanding indebtedness
and reinvest in its other businesses that have higher current and projected
growth rates and financial returns. In addition, the sale will allow senior
Company management to focus on its other businesses. The Company has initiated
an active marketing plan and anticipates it will sell these operations as
ongoing businesses within twelve months. These companies will continue their
marketing, sales and manufacturing activities as the Company prepares them for
sale. The Company's rail and mass transit seating operations are reported as
discontinued operations.


                                       9
<PAGE>   11
                                  SIMULA, INC.

         The Company is a holding company for wholly-owned subsidiaries, which
operate in three primary business segments. The Commercial Airline Seating
segment includes operations that primarily manufacture and refurbish seating
systems for domestic and foreign passenger airlines. The Government and Defense
segment includes operations that design and manufacture crash resistant
components, energy absorbing devices, ballistic armor and composites principally
for sale to branches of the United States armed forces. The Automobile Safety
Systems segment includes operations encompassing inflatable restraints,
principally the ITS, and related technologies for automobiles. In addition, the
Company maintains general corporate operations. The Company's rail and mass
transit seating operations are reported as discontinued operations.

         The Company's revenue has historically been derived principally from
sales of Company manufactured products. A substantial portion of its current
revenue is generated from long-term production contracts, which are accounted
for under the percentage of completion method of accounting. Under this method,
revenue is recorded as production progresses so that revenue less costs incurred
to date yields the percentage of gross margin estimated for each contract.
Overall gross margin percentages can increase or decrease based upon changes in
estimated gross margin percentages over the lives of individual contracts.

RESULTS FROM CONTINUING OPERATIONS

Three and nine Months Ended September 30, 1998 Compared to 1997:

         Revenue for the three months ended September 30, 1998 increased 28% to
$23.7 million from $18.4 million for the comparable period in 1997. Revenue for
the nine months ended September 30, 1998 increased 68% to $72.0 million from
$42.8 million for the comparable period in 1997. For the three months ended
September 30, 1998, the increase in revenue is primarily due to increased sales
of the ITS and increased Government and Defense revenue offset by a decrease in
16g Seat revenues. The decrease in 16g Seat revenues was due to the adverse
impact resulting from the complexity of new seat programs initiated in the third
quarter, and down time associated with the move into new production facilities
in July. For the nine months ended September 30, 1998, the increase in revenue
is due to increases in all of the Company's segments, the majority of which is
due to increased sales of the ITS and 16g Seats.

         Gross margin for the three months ended September 30, 1998 increased
139% to $5.5 million from $2.3 million for the comparable period in 1997. For
the nine months ended September 30, 1998, gross margin increased 73% to $18.1
million from $10.4 million for the comparable period in 1997. The increase in
gross margin was due to the increase in revenue noted above. As a percent of
sales, gross margin for the three months ended September 30, 1998 increased to
23% from 12%. For the nine months ended September 30, 1998, gross margin as a
percent of sales increased to 25% from 24%, for the comparable period in 1997.
These increases in gross margin percentages are principally due to significant
improvement in the gross margin percentage for the ITS. Revenue from the ITS in
1998 has increased substantially over 1997 and now provides significant
incremental margins over fixed production costs. In addition to realizing lower
revenue from the ITS in 1997, the Company was also incurring pre-contract costs
related to the final pre-production development of the ITS and start-up costs
related to its manufacturing facilities in Arizona and the United Kingdom during
this period. The increase in gross margin percentage from the ITS was partially
offset by lower margins in the Commercial Airline Seating segment. The high
concentration and complexity of new 16g Seat programs negatively impacted 16g
Seat margins in this segment in the third quarter of 1998 by resulting in lower
revenues and higher production costs. In addition, the introduction of new
manufacturing systems and procedures for production of 16g Seats is taking
longer to implement than was previously estimated and the estimated cost savings
have not yet been realized.

         Administrative expenses for the three months ended September 30, 1998
increased 8% to $5.1 million from $4.8 million for the comparable period in
1997. Administrative expenses for the nine months ended September 30, 1998
increased 10% to $14.2 million from $13.0 million for the comparable period in
1997. These increases were primarily attributable to the expansion of the
corporate and sales infrastructure related to the commercial introduction of the
ITS, including resources being utilized for sales and administration versus
pre-contract activities, research and development related to the expansion of
ITS technologies, and legal expenses.


                                       10
<PAGE>   12
                                  SIMULA, INC.

         Interest expense decreased 3% to $1.3 million for the three months
ended September 30, 1998 from $1.4 million for the comparable period in 1997.
Interest expense for the nine months ended September 30, 1998 increased 11% to
$3.7 million from $3.4 million for the comparable period in 1997. This increase
was principally due the issuance of $34.5 million of the 8% Senior Subordinated
Convertible Notes (the "8% Notes") in April 1997 and to increased borrowings on
the Company's line of credit. These borrowings were made to fund the Company's
growth in working capital and fixed assets necessary to support the anticipated
growth in revenues for 1997 and subsequent years. These increases in interest
expense were partially offset by the conversion during the third quarter of 1997
of $9.6 million of the Series C 10% Senior Subordinated Convertible Notes (the
"10% Notes") into common stock of the Company.

         Interest income for the three and nine months ended September 30, 1998
represents income from the investment by the Company of available cash in high
quality government and short-term investment grade, interest bearing securities.

         The effective income tax rate for the three and nine month periods
ended September 30, 1998 and 1997 approximated the Company's combined statutory
rate of 40%.

DISCONTINUED OPERATIONS

         The net loss from discontinued operations was ($6.8) million for the
nine months ended September 30, 1998. Included in this amount is a net loss from
operations of the discontinued segment of ($2.1) million primarily resulting
from unabsorbed overhead costs principally due to production delays. The
remainder of the loss from discontinued operations of ($4.7) million represents
the write-down of the remaining net assets of these businesses to their net
realizable value based upon an independent valuation. This write-down was
principally comprised of the write-off of intangible assets and represented a
non-cash charge. Estimated costs of disposal and projected operating results
have been included in determining the net realizable value of these businesses.
Therefore, the Company does not anticipate that these operations will have any
significant impact on future results of operations during the period prior to
their sale. Due to the subjective nature of estimated future operations and
incremental costs of disposal, it is reasonably possible that these estimates
may change in the future. Future changes in estimates will be included in the
consolidated statement of operations in the reporting period determined.

LIQUIDITY AND CAPITAL RESOURCES

         The Company's liquidity is greatly impacted by the nature of the
billing provisions under its contracts. Generally, in the early period of
contracts, cash expenditures and accrued profits are greater than allowed
billings while contract completion results in billing previously unbilled costs
and profits. Contract and trade receivables, net of advances on contracts,
increased approximately $5.8 million for the nine months ended September 30,
1998 due principally to the throughput on certain Government and Defense
contracts and increased receivables from 16g Seat and ITS sales.

         Operating activities required the use of $13.1 million of cash during
the nine months ended September 30, 1998, compared to the use of $13.5 million
of cash during the same period in 1997. Cash used by operating activities in the
1998 period was primarily used to increase inventories $9.7 million and increase
contract and trade receivables as noted above. The increase in inventories was
primarily due to an increase in 16g Seat inventory necessary to support
anticipated future deliveries. In addition, delays in deliveries of 16g Seats
during the third quarter of 1998 resulted in an additional buildup of inventory.

         Investing activities required the use of $4.9 million of cash during
the nine months ended September 30, 1998, primarily for the purchase of property
and equipment. These purchases included manufacturing equipment for the ITS
located at the Company's facilities in Arizona and the United Kingdom, certain
improvements to these facilities and equipment and improvements for the new 16g
Seat facility in San Diego.


                                       11
<PAGE>   13
                                  SIMULA, INC.

         Financing activities provided $9.7 million of cash during the nine
months ended September 30, 1998 from $10.6 million in net borrowings under the
Company's line of credit and proceeds from the issuance of common stock
partially offset by principal payments under other debt arrangements for
scheduled maturities.

During the third quarter of 1998, the Company commenced a private offering of up
to $5.7 million principal amount of 9-1/2% Senior Subordinated Notes due
September 2003 (the "9-1/2% Notes"). This offering is being made pursuant to the
exemption from registration contained in Regulation D under the Securities Act
of 1933, as amended. Under the terms of this offering, purchases of the 9-1/2%
Notes may be made in cash or by tender for exchange of the Company's 12% Senior
Subordinated Notes (the "12% Notes"). The proceeds from the offering will be
utilized to refinance the 12% Notes which mature in November 1998. Approximately
$3.4 million of the 12% Notes and cash has been received by the Company.
Therefore, this portion of the 12% Notes has been classified as long-term debt
at September 30, 1998.

         On November 6, 1998, the Company entered into a new Senior Credit
Agreement with Bank One, Arizona, N.A. and Imperial Bank, Arizona. This new
agreement replaces the Company's previous senior credit agreement and provides
for an increase in capacity to a total of $30 million and can be expanded to
encompass additional facilities. This agreement initially provides for a $20
million revolving line of credit, a $5 million term note to refinance existing
term debt secured by equipment and a $5 million term note to refinance certain
existing subordinated debt. The Company will initially use approximately $2.3
million of the second term note to repay the remaining balance of the 12% Notes
when they become due in November 1998. Therefore, this portion of the 12% Notes
has been classified as long-term debt at September 30, 1998.

         The Company believes it has sufficient manufacturing capacity in place
at September 30, 1998 to meet its foreseeable delivery requirements. The Company
anticipates cash on hand, cash provided by operating activities once 16g Seat
production stabilizes, cash to be generated from the sale of its rail and mass
transit operations and the availability under its bank credit facilities will be
sufficient to meet its current and foreseeable working capital requirements. The
Company is also pursuing expansion of both its domestic and foreign senior debt
facilities and the sale of certain assets to increase its credit availability.
The Company may also, however, seek to obtain additional capital should demand
for its products exceed current capacity. The raising of additional capital in
public markets will be primarily dependent upon prevailing market conditions and
demand for the Company's technologies and products.

INFLATION

         The Company does not believe that it is significantly impacted by
inflation.

RESEARCH AND DEVELOPMENT

         The Company's research and development occurs under fixed-price,
government-funded contracts and Company-sponsored efforts. Historically,
research and development efforts have fluctuated based upon available
government-funded contracts and available Company funding. The Company
anticipates that future fluctuations may also occur as a result of efforts to
expand its inflatable restraint, commercial airliner and helicopter seating, and
other technologies.

SEASONALITY

         The Company does not believe that it is currently significantly
impacted by seasonal factors.


                                       12
<PAGE>   14
                                  SIMULA, INC.

YEAR 2000 MATTERS

Background

         The Year 2000 issue is the result of computer programs being written
using two digits rather than four to define an applicable year. Any computer
programs or equipment that have time-sensitive software or embedded chips 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 in
commerce, including among other things, a temporary inability to process
transactions, send invoices, or engage in similar normal business activities.

         The Company employs a number of information technology ("IT") systems
in its operations, including computer networking systems, hardware and software,
financial systems, and other similar systems. The Company also employs a number
of non-IT devices such as building security and safety devices, and other
devices containing embedded electronic circuits. Both IT systems and non-IT
devices are subject to potential failure due to the Year 2000 issue.

The Company's Year 2000 Plan

         In 1996, the Company initiated a plan for the conversion from existing
accounting software to new state-of-the-art, Year 2000-compliant, manufacturing
and accounting systems at each of its operating companies. That conversion is
part of an overall plan (the "Year 2000 Plan") the Company has developed to
achieve Year 2000 readiness. The Year 2000 Plan is intended to remediate the
Year 2000 issue in all categories of systems and electronic devices in use by
the Company, including IT and non-IT devices, so that the Company may continue
its operations without interruption or with minimal disruption. The Year 2000
Plan also includes communication with critical third parties such as customers,
vendors and other business partners to determine the expected degree of Year
2000 compliance of those parties and to monitor their progress toward Year 2000
readiness. The Year 2000 Plan includes the following phases: 1) assessment, 2)
remediation, 3) testing, and 4) implementation.

         The Company is in the "assessment" phase with regard to its state of
readiness relative to non-IT devices containing embedded circuitry. The Company
is also in the "assessment" phase with regard to third parties with which the
Company has a material relationship. In connection with this assessment, the
Company has made written inquiries of its significant customers and suppliers.
While the Company has not been made aware of any problems that would materially
impact the Company's operations, there can be no assurance that one or more
material third parties will not have Year 2000 problems that materially impact
the Company's business in some fashion. Various agencies of the U.S. government
and military branches of the U.S. armed forces are significant customers of the
Company. As of the date of this report, the Company has received conflicting
data as to the state of any of such customers' Year 2000 readiness. Therefore,
the Company is unsure at this time the extent, if any, that any entity of the
U.S. government with whom the Company has a material relationship will have
internal Year 2000 issues which may materially impact the Company's business.

         The Company is in the "remediation" phase with regard to its IT
systems. As of September 30, 1998, the Company has three subsidiaries using
accounting and manufacturing systems significantly affected by the Year 2000
issue: Simula Safety Systems, Inc., Coach and Car Equipment Corporation, and
Artcraft Industries Corp. The remediation of these systems is approximately 50%
complete and the Company estimates it will complete the conversion to new, Year
2000-compliant, manufacturing and accounting software by December 31, 1998 at
Artcraft Industries Corp., February 28, 1999 at Simula Safety Systems, Inc., and
May 31, 1999 at Coach and Car Equipment Corporation.

         In addition to the internal assessment and remediation efforts being
conducted by the Company pursuant to the Year 2000 Plan as described above, the
Company has engaged the services of a third party consultant to review Year 2000
matters on a subsidiary-by-subsidiary basis. It is anticipated that the
consultant will commence work during the fourth quarter of 1998.


                                       13
<PAGE>   15
                                  SIMULA, INC.

Costs

         The Company has incurred significant costs in connection with its
conversion, beginning in 1996, to the state-of-the-art manufacturing and
accounting systems discussed above. An incidental benefit of this conversion is
that such systems are Year 2000-compliant.

         In addition to the foregoing, the costs associated with the Company's
Year 2000 Plan, including the on-going systems conversions described above, are
expensed as incurred and to date have not been, and are not anticipated to be,
material to the Company's financial position or results of operations.

Risks of Year 2000 Failure

         The failure on any party's part to correct a material Year 2000 problem
could result in an interruption in, or a failure of, certain normal business
activities or operations. Such failures could materially and adversely affect
the Company's results of operations, liquidity and financial condition. The
Company does not yet have a completed contingency plan in the event of a
particular system not being Year 2000 compliant. It is anticipated that a broad
contingency plan, defining areas where detailed contingency plans must be
created, will be completed by December 31, 1998.

         Due to the general uncertainty inherent in the Year 2000 issue,
resulting in large part from the uncertainty of the Year 2000 readiness of
material third party suppliers and customers, the Company is unsure at this time
the extent, if any, that it might be materially adversely impacted by Year 2000
issues.

         Readers are cautioned that forward-looking statements contained in this
Year 2000 discussion should be read in conjunction with the Company's
disclosures under the heading "Forward Looking Information and Risks of the
Business" below.

FORWARD LOOKING INFORMATION AND RISKS OF THE BUSINESS

         Commencing in fiscal 1997, the Company entered large scale production
of the ITS and 16g Seat. Significant investments to transition to high volume
manufacturing for these products were also made in 1997, which affected
earnings. The Company began to realize significant revenues from the
introduction of these products in 1997, which has continued in 1998 and is
anticipated to continue in 1999. The Company's current focus is on controlling
costs and eliminating inefficiencies resulting from the faster than anticipated
rate of growth in its new product lines, principally the 16g Seat, and this
focus should result in a positive impact on earnings.

         In 1997 and the first half of 1998, the Company experienced some parts
and raw materials shortages, vendor delays and quality problems that caused
delays in production and deliveries. The Company has addressed these issues and
believes that it has established an adequate multiple source supplier base that
is industry standard. However, certain components of the Company's products are
proprietary or highly regulated, including certain types of foam, hydrolocks and
woven materials, and shortages of these items could cause disruptions of
production from time to time. In 1998, the Company continues to focus on further
broadening it vendor base and reliability.

         In mid 1998, the Company's 16g Seat operation completed its move into a
new facility and began implementation of new manufacturing procedures and
systems under the guidance of outside experts in the field. While the Company
believes that the new facility and manufacturing procedures will provide the
long-term capabilities needed, the introduction of these new manufacturing
systems is taking longer to implement than was previously estimated and the
estimated cost savings have not yet been realized. The Company believes that
these new systems will properly position these operations to efficiently handle
its growing production volume.


                                       14
<PAGE>   16
                                  SIMULA, INC.

         The complexity of introducing a significant number of new airliner seat
programs into the production flow, and the design and certification issues
related to them has had a negative impact on the Company's 16g Seat operations
and the industry at large. The introduction of these programs in the fourth
quarter of 1998 and in 1999 will continue to impact the efficiency and operating
margins in this segment. The Company believes that when these designs are
completed and introduced into the normal production flow, they will build the
basis for continued strong growth and the achievement of anticipated operating
margins.

         Projected operating results and capital needs will be affected by a
wide variety of factors which could adversely impact revenues, profitability and
cash flows, many of which are beyond the control of the Company. Factors and
risks that may affect results include those described in the Company's
registration statements and periodic reports filed with the U.S. Securities and
Exchange Commission. In addition, other factors include, but are not limited to,
the ultimate realizable value of assets held for sale; manufacturing capacity
and yield; costs of labor, raw materials, supplies, and equipment; reliability
of vendor base; contract mix and shifting production and delivery schedules;
amount of resources committed to independent research and development from time
to time; success in building strategic alliances with large prime contractors
and first tier suppliers to OEMs; the level of orders which are received and can
be shipped and invoiced in a quarter; customer order patterns and seasonality;
the cyclical nature of the industries and markets addressed by the Company's
products; the level and makeup of military expenditures; technological changes;
increased costs attributable to changes in government regulations and
certifications for transport vehicles; competition and competitive pressures on
pricing; and economic conditions in the United States and worldwide markets
served by the Company. The Company's products are incorporated into a variety of
transportation vehicles. A slowdown in demand for new transportation vehicles or
modifications services to transportation vehicles as a result of economic or
other conditions in the United States or worldwide markets served by the Company
and its customers or other broad-based factors could adversely affect the
Company's operating results or financial condition.


                                       15
<PAGE>   17
                                  SIMULA, INC.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

         On November 3, 1998, the Company filed a complaint in the United States
District Court for the District of Delaware against Autoliv, Inc. seeking
injunctive relief and damages for patent infringement. The Company's complaint
alleges that Autoliv developed, offered, and sold a side impact head protection
device in the United States that infringes the patent that Simula owns for its
Inflatable Tubular Structure ("ITS")(TM). The Company became aware of the
potential infringement in early October 1998 as Autoliv introduced this device
into production automobiles being offered for the first time in the United
States.

         The Company had previously filed a separate lawsuit against Autoliv in
February 1998. This lawsuit alleges certain anti-competitive acts and practices
by Autoliv. This lawsuit is based on unrelated facts and facts arising at an
earlier date than the patent litigation described above. This litigation is
pending.

ITEM 5.  OTHER - STOCK REPURCHASE PLAN

         On November 4, 1998, the Company's Board of Directors approved a Stock
Repurchase Program (the "Program"). Subject to arranging appropriate financing,
the Program is anticipated to become effective during the fourth quarter of 1998
and will extend for one year. Under the Program, the Company may make open
market or negotiated block purchases of the Company's Common Stock up to a
maximum of $5 million in aggregate amount. Shares may be purchased from time to
time depending on market conditions. As of November 9, 1998, the Company was
finalizing negotiations for financing the Program.


                                       16
<PAGE>   18
                                  SIMULA, INC.

ITEM 6. EXHIBITS AND REPORTS.

(a) The following Exhibits are included pursuant to Item 601 of Regulation S-K.

NO.                                DESCRIPTION                         REFERENCE

  3.1    Articles of Incorporation of Simula, Inc., as amended and restated..(4)

  3.2    Bylaws of Simula, Inc., as amended and restated.....................(1)

  4.2    Indenture dated December 17, 1993, as amended.......................(2)

  4.5    Supplemental Indenture No. 2 dated September 12, 1996, entered
         into in connection with the the Company's issuance of Series C
         10% Senior Subordinated Convertible Notes...........................(6)

  4.6    Supplemental Indenture No.3, effective March 14, 1997, amending the
         Indenture of Simula, Inc. dated December 17, 1993...................(7)

  4.7    Indenture dated April 1, 1997, in connection with the Company's
         issuance of the 8% Senior Subordinated Convertible Notes due May 1,
         2004................................................................(7)

*10.11   1992 Stock Option Plan, as amended effective September 15, 1998

 10.12   1992 Restricted Stock Plan..........................................(1)

*10.21   1994 Stock Option Plan, as amended effective September 15, 1998

*10.24   Senior Credit Agreement with Bank One, Arizona, N.A. and Imperial 
         Bank, Arizona dated November 6, 1998...............................(10)

 10.26   Simula, Inc. Employee Stock Purchase Plan...........................(4)

 10.29   Form of Change of Control Agreements, as amended and restated, between
         the Company and Donald W. Townsend, Bradley P. Forst, Sean K. Nolen,
         James A. Saunders, Donald Rutter, and Randall L. Taylor.............(9)

 10.30   Form of Employment Agreements between the Company and Donald W.
         Townsend, Bradley P. Forst, Sean K. Nolen, James A. Saunders, and
         Randall L. Taylor...................................................(8)

 18.     Preference Letter re: change in accounting principles...............(5)

 24.     Powers of Attorney - Directors......................................(8)

*27.     Financial Data Schedule

----------

* Filed herewith.

(1)      Filed with Registration Statement on Form S-18, No. 33-46152-LA, under
         the Securities Act of 1933, effective April 13, 1992.

(2)      Filed with Registration Statement on Form SB-2, No. 33-61028 under the
         Securities Act of 1933, effective December 10, 1993.

(3)      Filed with Registration Statement on Form SB-2, No. 33-87582, under the
         Securities Act of 1933, effective December 28, 1994.

(4)      Filed with Definitive Proxy on May 14, 1996, for the Company's Annual
         Meeting of Shareholders held on June 20, 1996.

(5)      Filed with report on Form 10-Q/A for the quarter ended June 30, 1996.

(6)      Filed with report on Form 10-K for the year ended December 31, 1996.

(7)      Filed with registration Statement on Form S-3, No. 333-13499, under the
         Securities Act of 1993, effective April 24, 1997.

(8)      Filed with report on Form 10-K for the year ended December 31, 1997.

(9)      Filed with report on Form 10-Q for the quarter ended March 31, 1998.

(b)      The Company filed a report on Form 8-K with the Commission on August 5,
         1998 relative to the Company's announcement that going forward it will
         operate its rail seating subsidiaries as discontinued operations as it
         positions them for sale. The press release announcing such event was
         incorporated by reference into the report on Form 8-K, and contained
         the Company's financial results from both continuing and discontinued
         operations for its second quarter ended June 30, 1998.


                                       17
<PAGE>   19
                                  SIMULA, INC.

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report on Form 10-Q for the quarter ended
September 30, 1998 to be signed on its behalf by the undersigned thereunto duly
authorized.

                                                      SIMULA, INC.

DATE: November 13, 1998                               /s/ Donald W. Townsend
                                                      --------------------------
                                                      DONALD W. TOWNSEND
                                                      President
                                                      Chief Executive Officer

                                                      /s/ Sean K. Nolen
                                                      --------------------------
                                                      SEAN K. NOLEN
                                                      Executive Vice President
                                                      Chief Financial Officer


                                       18
<PAGE>   20
                                 Exhibit Index

NO.                                DESCRIPTION                         REFERENCE

  3.1    Articles of Incorporation of Simula, Inc., as amended and restated..(4)

  3.2    Bylaws of Simula, Inc., as amended and restated.....................(1)

  4.2    Indenture dated December 17, 1993, as amended.......................(2)

  4.5    Supplemental Indenture No. 2 dated September 12, 1996, entered
         into in connection with the the Company's issuance of Series C
         10% Senior Subordinated Convertible Notes...........................(6)

  4.6    Supplemental Indenture No.3, effective March 14, 1997, amending the
         Indenture of Simula, Inc. dated December 17, 1993...................(7)

  4.7    Indenture dated April 1, 1997, in connection with the Company's
         issuance of the 8% Senior Subordinated Convertible Notes due May 1,
         2004................................................................(7)

*10.11   1992 Stock Option Plan, as amended effective September 15, 1998

 10.12   1992 Restricted Stock Plan..........................................(1)

*10.21   1994 Stock Option Plan, as amended effective September 15, 1998

*10.24   Senior Credit Agreement with Bank One, Arizona, N.A. and Imperial 
         Bank, Arizona dated November 6, 1998...............................(10)

 10.26   Simula, Inc. Employee Stock Purchase Plan...........................(4)

 10.29   Form of Change of Control Agreements, as amended and restated, between
         the Company and Donald W. Townsend, Bradley P. Forst, Sean K. Nolen,
         James A. Saunders, Donald Rutter, and Randall L. Taylor.............(9)

 10.30   Form of Employment Agreements between the Company and Donald W.
         Townsend, Bradley P. Forst, Sean K. Nolen, James A. Saunders, and
         Randall L. Taylor...................................................(8)

 18.     Preference Letter re: change in accounting principles...............(5)

 24.     Powers of Attorney - Directors......................................(8)

*27.     Financial Data Schedule

----------

* Filed herewith.

(1)      Filed with Registration Statement on Form S-18, No. 33-46152-LA, under
         the Securities Act of 1933, effective April 13, 1992.

(2)      Filed with Registration Statement on Form SB-2, No. 33-61028 under the
         Securities Act of 1933, effective December 10, 1993.

(3)      Filed with Registration Statement on Form SB-2, No. 33-87582, under the
         Securities Act of 1933, effective December 28, 1994.

(4)      Filed with Definitive Proxy on May 14, 1996, for the Company's Annual
         Meeting of Shareholders held on June 20, 1996.

(5)      Filed with report on Form 10-Q/A for the quarter ended June 30, 1996.

(6)      Filed with report on Form 10-K for the year ended December 31, 1996.

(7)      Filed with registration Statement on Form S-3, No. 333-13499, under the
         Securities Act of 1993, effective April 24, 1997.

(8)      Filed with report on Form 10-K for the year ended December 31, 1997.

(9)      Filed with report on Form 10-Q for the quarter ended March 31, 1998.