<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-Q/A

                                   ----------

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

                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1998

                                       OR

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

                  For the transition period from _____ to _____

                         Commission file number 1-19971

                                   ----------

                       UNIVERSAL SEISMIC ASSOCIATES, INC.
                    (Exact name of Registrant in its Charter)

           DELAWARE                                      76-0256086
(State or Other Jurisdiction of                (IRS Employer Identification No.)
 Incorporation or Organization)

    16420 PARK TEN PLACE, SUITE 300
             HOUSTON, TEXAS                                77084-5051
(Address of Principal Executive Offices)                   (Zip Code)

                                 (281) 578-8081
                           (Issuer's Telephone Number)

                                   ----------

         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      No  X
                      ---     ---

         State the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date. 5,234,109 shares of Common
Stock, $.0001 par value, were outstanding as of June 30, 1998.


                                  PAGE 1 OF 15
<PAGE>   2
               UNIVERSAL SEISMIC ASSOCIATES, INC. AND SUBSIDIARIES

                          QUARTERLY REPORT ON FORM 10-Q

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                       PAGE
                                                                                       ----
<S>        <C>                                                                         <C>
PART I.  FINANCIAL INFORMATION

     Item 1. Unaudited Consolidated Financial Statements

               Consolidated Balance Sheets at March 31, 1997 and June 30, 1997.........  3

               Consolidated Statements of Operation for the three and nine months
                ended March 31, 1997 and 1996..........................................  4

               Consolidated Statements of Stockholders' Equity for the nine
                months ended March 31, 1997 and the year ended June 30, 1997...........  5

               Consolidated Statements of Cash Flows for the nine months ended
                March 31, 1997 and 1996................................................  6

               Notes to Consolidated Financial Statements..............................  7

     Item 2.  Management's Discussion and Analysis of Financial Condition
               and Results of Operations............................................... 11

PART II. OTHER INFORMATION

     Item 1.   Legal Proceedings....................................................... 14

     Item 2.   Changes in Securities................................................... 14

     Item 3.   Defaults Upon Senior Securities......................................... 14

     Item 4.   Submission of Matters to a Vote of Security Holders..................... 14

     Item 5.   Other Information....................................................... 15

     Item 6.   Exhibits and Reports on Form 8-K........................................ 15
</TABLE>



                                  PAGE 2 OF 15
<PAGE>   3
                                     PART I
              ITEM 1. UNAUDITED CONSOLIDATED FINANCIAL INFORMATION

UNIVERSAL SEISMIC ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                       MARCH 31,         JUNE 30,
                                 ASSETS                                                  1998              1997
                                                                                     ------------      ------------
<S>                                                                                  <C>               <C>         
Current assets:
  Cash and cash equivalents                                                          $  1,707,676      $  1,859,677
  Accounts receivable, net                                                              3,371,664         5,579,876
  Costs and estimated earnings in excess of billings on uncompleted contracts           2,007,467           702,066
  Prepaid expenses and other current assets                                             1,196,188           498,982
                                                                                     ------------      ------------

                     Total current assets                                               8,282,995         8,640,601

Property and equipment, net:
  Seismic property and equipment                                                       15,397,892        15,896,535
  Seismic property under capital lease                                                  2,486,091                --
  Oil and gas properties, full cost method                                              7,754,251         6,881,115
                                                                                     ------------      ------------

                     Total property and equipment, net                                 25,638,234        22,777,650

Other assets:
  Goodwill, net                                                                           563,561           601,694
  Other                                                                                   126,367           228,088
                                                                                     ------------      ------------
                                                                                          689,928           829,782

                     Total assets                                                    $ 34,611,157      $ 32,248,033
                                                                                     ============      ============

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Current portion of long-term obligations                                           $ 23,047,020      $  1,423,859
  Current portion of capital lease obligations                                            584,923                --
  Billings in excess of costs and estimated earnings on uncompleted contracts           3,149,853           499,916
  Accounts payable                                                                      3,440,953         5,912,647
  Accrued and other current liabilities                                                 2,659,237         2,431,164
                                                                                     ------------      ------------

                     Total current liabilities                                         32,881,986        10,267,586

Long-term obligations:
  Long-term obligations, net of current maturities                                      1,505,470        16,729,140
  Capital lease obligation, net of current maturities                                   1,929,208                --
                                                                                     ------------      ------------

                    Total liabilities                                                  36,316,664        26,996,726
                                                                                     ------------      ------------

Commitments and contingencies

Stockholders' equity:
  Common stock, $.0001 par value; 20,000,000 shares authorized; 5,239,109 
    shares issued and 5,234,109 shares outstanding at March 31, 1998 and 
    June 30, 1997                                                                             523               523
  Additional paid in capital                                                           17,105,444        17,105,444
  Accumulated deficit                                                                 (18,791,474)      (11,834,660)
  Less:  Treasury stock, at cost; 5,000 shares                                            (20,000)          (20,000)
                                                                                     ------------      ------------

                    Total stockholders' equity                                         (1,705,507)        5,251,307
                                                                                     ------------      ------------

                    Total liabilities and stockholders' equity                       $ 34,611,157      $ 32,248,033
                                                                                     ============      ============
</TABLE>

                 See accompanying notes to financial statements.


                                  PAGE 3 OF 15
<PAGE>   4



UNIVERSAL SEISMIC ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)


<TABLE>
<CAPTION>
                                                   THREE MONTHS ENDED                 NINE MONTHS ENDED
                                                        MARCH 31,                          MARCH 31,
                                             ------------------------------      ------------------------------
                                                 1998              1997              1998              1997
                                             ------------      ------------      ------------      ------------
<S>                                          <C>               <C>               <C>               <C>         
Operating revenues:
  Data acquisition                           $  3,375,489      $  6,143,351      $ 15,875,642      $ 24,838,884
  Data processing                                 142,046           261,818           651,246         1,052,696
  Oil and gas production                          308,312                --           739,935                --
                                             ------------      ------------      ------------      ------------

        Total operating revenues                3,825,847         6,405,169        17,266,823        25,891,580

Operating expenses:
  Cost of data acquisition                      3,269,515         5,407,490        16,985,553        20,928,812
  Cost of data processing                         176,177           203,176           553,622           627,151
  Oil and gas operating                            50,351                --           156,705                --
  Selling, general and administrative             932,644           545,561         2,260,464         1,604,886
  Cost of aborted merger, proxy
     contest, and shareholder litigation               --           526,815                --           828,045
  Depreciation, depletion and
     amortization                               1,077,864           779,279         2,762,912         2,315,005
                                             ------------      ------------      ------------      ------------

        Total operating expenses                5,506,551         7,462,321        22,719,256        26,303,899
                                             ------------      ------------      ------------      ------------

        Total operating loss                   (1,680,704)       (1,057,152)       (5,452,433)         (412,319)

Interest expense, net of capitalized
  interest                                       (621,254)         (300,364)       (1,565,253)         (962,407)
Other income, net                                  47,353             8,880            60,872            13,777
                                             ------------      ------------      ------------      ------------

Net loss                                     $ (2,254,605)     $ (1,348,636)     $ (6,956,814)     $ (1,360,949)
                                             ============      ============      ============      ============

Basic and diluted loss per share             $       (.43)     $      (0.26)     $      (1.33)     $      (0.28)
                                             ============      ============      ============      ============
Weighted average common shares
  outstanding                                   5,234,109         5,229,942         5,234,109         4,939,208
                                             ============      ============      ============      ============
</TABLE>


                 See accompanying notes to financial statements.


                                  PAGE 4 OF 15
<PAGE>   5
UNIVERSAL SEISMIC ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE NINE MONTHS ENDED MARCH 31, 1998 AND
THE YEAR ENDED JUNE 30, 1997 (UNAUDITED)


<TABLE>
<CAPTION>
                                  COMMON STOCK                TREASURY STOCK        ADDITIONAL                          TOTAL
                            -------------------------     ----------------------      PAID IN       ACCUMULATED     STOCKHOLDERS'
                             SHARES         AMOUNT        SHARES       AMOUNT         CAPITAL         DEFICIT          EQUITY
                            ---------     -----------     ------     -----------    -----------     ------------    -------------
<S>                         <C>           <C>             <C>        <C>            <C>             <C>             <C>          
Balance June 30, 1996       4,278,147     $       428      5,000     $   (20,000)   $13,553,317     $ (6,310,497)   $   7,223,248

Net loss                                                                                              (5,524,163)      (5,524,163)

  Exercise of stock
    options                    15,000               1                                    51,249                            51,250
  Exercise of convertible
    and exchangeable notes    940,962              94                                 3,500,878                         3,500,972
                            ---------     -----------     ------     -----------    -----------     ------------    -------------

Balance June 30, 1997       5,234,109     $       523      5,000         (20,000)    17,105,444      (11,834,660)       5,251,307

Net loss for nine months
    ended March 31, 1998                                                                              (6,956,814)      (6,956,814)
                            ---------     -----------     ------     -----------    -----------     ------------    -------------

Balance March 31, 1998      5,234,109     $       523      5,000     $   (20,000)   $17,105,444     $(18,791,474)   $  (1,705,507)
                            =========     ===========     ======     ===========    ===========     ============    =============
</TABLE>


                 See accompanying notes to financial statements.


                                  PAGE 5 OF 15
<PAGE>   6
UNIVERSAL SEISMIC ASSOCIATES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


<TABLE>
<CAPTION>
                                                                       NINE MONTHS ENDED MARCH 31,
                                                                     ------------------------------
                                                                         1998              1997
                                                                     ------------      ------------
<S>                                                                  <C>               <C>          
Cash flows from operating activities:
  Net income (loss)                                                  $ (6,956,814)     $ (1,360,949)
  Adjustments to reconcile net (loss) to net cash provided by
    operating activities:
        Depreciation, depletion and amortization                        2,762,913         2,315,005
        Loss on disposal of assets                                        528,630                --
        Changes in operating assets and liabilities:
           Accounts receivable                                          2,208,212           416,039
           Costs and estimated earnings in excess of billings on
                uncompleted contracts                                  (1,305,401)          (62,767)
           Prepaid expenses and other current assets                      638,232           509,239
           Accounts payable                                            (2,471,694)          797,263
           Billings in excess of costs and estimated earnings on
               uncompleted contracts                                    2,649,937           472,834
           Accrued and other current liabilities                        2,482,456           566,618
           Other assets                                                    23,286            31,512
                                                                     ------------      ------------

                 Net cash provided by operating activities                559,757         3,684,794
                                                                     ------------      ------------

Cash flows from investing activities:
  Capital expenditures                                                 (5,093,281)       (7,796,673)
  Proceeds from sale of assets                                          2,707,764         1,244,457
  Proceeds from receivable from stockholder                                    --            28,440
                                                                     ------------      ------------

              Net cash (used in) investing activities                  (2,385,517)       (6,523,776)
                                                                     ------------      ------------

Cash flows from financing activities:
  Proceeds from debt and obligations                                   12,233,432        24,564,046
  Payments on debt and obligations                                    (10,421,974)      (22,541,267)
  Payments on capital lease obligation                                   (137,699)               --
  Proceeds from issuance of common stock, net                                  --            38,750
                                                                     ------------      ------------

               Net cash provided by financing activities                1,673,759         2,061,529
                                                                     ------------      ------------

Net decrease in cash and cash equivalents                                (152,001)         (777,453)
Cash and cash equivalents at beginning of period                        1,859,677           982,431
                                                                     ------------      ------------

Cash and cash equivalents at end of period                           $  1,707,676      $    204,978
                                                                     ============      ============
Supplemental disclosures:
  Cash paid for interest                                                  681,471         1,052,260
  Equipment financed by note payable                                    2,069,893                --
  Prepaid expense financed by note payable                                263,757           214,505
  Conversion of long-term obligations to common stock                          --         3,500,972
  Stockholder litigation settlement financed by note payable            1,880,000                --
</TABLE>

                 See accompanying notes to financial statements.


                                  PAGE 6 OF 15
<PAGE>   7
               UNIVERSAL SEISMIC ASSOCIATES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

1.   GENERAL

     The consolidated financial statements of Universal Seismic Associates, Inc.
     and Subsidiaries (the "Company") included herein have been prepared by the
     Company, without audit, pursuant to the rules and regulations of the
     Securities and Exchange Commission. Certain information and footnote
     disclosures normally included in financial statements prepared in
     accordance with generally accepted accounting principles have been
     condensed or omitted pursuant to such rules and regulations, although the
     Company believes that the disclosures are adequate to make the information
     presented not misleading. These condensed financial statements should be
     read in conjunction with the consolidated financial statements and the
     notes thereto included in the Company's amended Annual Report on Form
     10-KSB/A filed with the Securities and Exchange Commission for the fiscal
     year ended June 30, 1997. In the opinion of the Company, all adjustments,
     consisting only of normal recurring adjustments, necessary to present
     fairly the financial position as of March 31, 1998, the results of
     operations for the three and nine-month periods ended March 31, 1997 and
     1998, stockholders' equity for the nine months ended March 31, 1998 and
     year ended June 30, 1997, and statements of cash flows for the nine-month
     periods ended March 31, 1998 and 1997, have been included.

2.   LIQUIDITY AND OPERATING LOSSES

     The accompanying consolidated financial statements have been prepared
     assuming that the Company will continue as a going concern. As more fully
     explained below, the Company has incurred continuing losses from operations
     of $4,239,383 and $429,877 for the years ended June 30, 1997 and 1996,
     respectively, and these losses have continued during the nine months ended
     March 31, 1998 with an operating loss of $5,452,433, and a net loss of
     $6,956,814 for the nine months ended March 31, 1998. In addition, the
     Company had an accumulated deficit and a net working capital deficiency of
     $18,791,474 and $24,598,991, respectively, as of March 31, 1998. All debt
     due to the Company's major debtholder, RIMCO (defined below), has been
     classified as current maturities as of March 31, 1998.

     As of March 31, 1998, the Company had a cash balance of $1,707,676. If
     losses from operations continue (as is anticipated), the Company believes
     this cash, along with anticipated cash flow from its seismic and
     exploration and production operations and funds available under its credit
     facilities, will not be adequate for its overall working capital
     requirements. The Company believes that it can generate substantial cash
     flow from its oil and gas properties if it had sufficient funding of its
     drilling program. Future cash flows are subject to a number of
     uncertainties, particularly the condition of the oil and gas industry and
     related seismic activity in the Company's markets. Liquidity of the Company
     should be considered in light of the significant fluctuations in demand
     that may be experienced by seismic data acquisition contractors and
     exploration and production owners as rapid changes in oil and gas
     producers' expectations and budgets occur. These 


                                  PAGE 7 OF 15
<PAGE>   8

     fluctuations can rapidly impact the Company's liquidity as supply and
     demand factors directly affect utilization and contract revenues, which are
     primary determinants of cash flow from the Company's operations.

     As of March 31, 1998, the Company was in default on certain covenants of
     its financing agreements with RIMCO Partners, L.P., RIMCO Partners II,
     L.P., RIMCO Partners III, L.P. and RIMCO Partners IV, L.P. (collectively,
     "RIMCO"). RIMCO has waived such defaults and principal and interest payment
     covenants through July 1, 1998. The Company is negotiating an extension of
     this waiver and a debt-to-equity exchange with RIMCO whereby the
     indebtedness to RIMCO, including accrued interest, would be converted into
     equity and subordinated debt. In the original agreement with RIMCO, which
     was executed on February 9, 1998 and expired on June 1, 1998, $15,000,000
     was to be converted into common stock of the Company and the balance into
     convertible subordinated notes. The shares to be issued in the conversion
     were to be tied to the average price of the Company's common stock for the
     30-day period prior to receiving stockholder approval. As of June 30, 1998,
     the Company was indebted to RIMCO under the various financing agreements
     for $22,168,899 principal and $1,896,450 accrued interest. Until such time
     as the Company and RIMCO are able to consummate the debt-to-equity
     exchange, all RIMCO debt has been classified as current maturities.

     The above factors raise substantial doubt about the Company's ability to
     continue as a going concern. The financial statements do not include any
     adjustments relating to the recoverability and classification of assets
     carrying amounts or the amount and classification of liabilities that might
     result should the Company be unable to continue as a going concern.

3.   RESTATEMENT AND RECLASSIFICATIONS

     In its June 30, 1997 Form 10-KSB/A, the Company restated and reclassified
     its financial statements for the fiscal years ended June 30, 1997 and 1996.
     In addition, unaudited quarterly financial data for fiscal 1997 and 1996
     have also been restated and reclassified. Except as otherwise stated
     herein, all information presented in this Report on Form 10-Q includes all
     such restatements and reclassifications as they apply to the fiscal 1997
     period.

     In February 1998, the Company's independent accountants (Coopers & Lybrand
     L.L.P.), who had issued opinions on the financial statements for the years
     ended June 30, 1997 and 1996, resigned and stated that their opinions with
     respect to the financial statements for those years should no longer be
     relied upon. In March 1998, the Company engaged Arthur Andersen LLP as its
     independent public accountants to perform the necessary audits to issue new
     auditors' reports on the financial statements for fiscal 1997 and 1996.

     As a result of a comprehensive review begun by the Company in December
     1997, and the audits performed by new independent public accountants, it
     was determined that certain adjustments and reclassifications were
     necessary to fairly state the financial statements for the years ended June
     30, 1997 and 1996, and all respective quarterly data. These adjustments
     principally relate to the timing for recognition of contract revenue and
     associated costs under percentage of completion accounting and to certain
     costs which 


                                  PAGE 8 OF 15
<PAGE>   9

     were expensed as cost of data acquisition but should have been recorded as
     capitalized oil and gas properties. In addition, it was determined that the
     gain on the sale of oil and gas properties previously reported of $559,461
     in fiscal 1997, should not have been recognized in income but instead
     recorded as a reduction of oil and gas properties in accordance with full
     cost accounting. The following is a summary of the adjustments and the
     related impact on the statement of operations for the three and nine-month
     periods ended March 31, 1997:

<TABLE>
<CAPTION>
                                               RESTATEMENTS FOR PERIODS ENDED
                                                       MARCH 31, 1997
                                               ------------------------------
                                                  THREE               NINE
                                                  MONTHS             MONTHS
                                               -----------        -----------
<S>                                            <C>                <C>        
     Data acquisition revenue                  $  (130,841)       $ 1,372,812
     Cost of data acquisition                      450,006           (489,750)
     Gain on sale of oil and gas property               --           (559,461)
     Interest expense                               18,042             54,126
                                               -----------        -----------
               Net adjustments                     337,207            377,727

               Net loss previously reported     (1,685,843)        (1,738,676)
                                               -----------        -----------

     Restated net loss for periods             $(1,348,636)       $(1,360,949)
                                               ===========        ===========
</TABLE>

     The net financial impact of these adjustments decreases the net loss
     previously reported for the three-month period ended March 31, 1997 by
     $337,207 to $1,348,636 and decreases the net loss previously reported for
     the nine-month period ended March 31, 1997 by $377,727 to $1,360,949.

4.   DEBT AND FINANCING ARRANGEMENTS

     A summary of the Company's debt and obligations at the respective dates is
     presented below:

<TABLE>
<CAPTION>
                                                   MARCH 31,         JUNE 30,
                                                     1998              1997
                                                 ------------      ------------
<S>                                              <C>               <C>         
     Notes and obligations due RIMCO             $ 21,660,098      $ 16,108,995
     Operating lease for equipment not
       expected to be utilized in the future          815,529           929,191
     Other notes payable                            2,076,863         1,114,813
                                                 ------------      ------------
                                                   24,552,490        18,152,999
     Less current maturities                      (23,047,020)       (1,423,859)
                                                 ------------      ------------

           Total long-term debt                  $  1,505,470      $ 16,729,140
                                                 ============      ============
</TABLE>

     RIMCO has waived defaults under the covenants in its various financing
     agreements until July 1, 1998. (See Note 2 to the Consolidated Financial
     Statements for further discussion.)


                                  PAGE 9 OF 15
<PAGE>   10
5.   EARNINGS (LOSS) PER SHARE

     In February 1997, the Financial Accounting Standards Board issued Statement
     of Financial Accounting Standards No. 128, Earnings Per Share ("SFAS 128").
     SFAS 128 requires presentation of "basic" and "diluted" earnings per share
     which is effective for financial statements issued for periods ending after
     December 15, 1997 and requires restatement of all prior period earnings per
     share amounts. The Company has adopted SFAS 128 and has applied the
     provisions of the statement to current and prior periods. While the Company
     has outstanding stock options and warrants, these are not included in the
     computation of diluted earnings (loss) per share because to do so would be
     anti-dilutive. Earnings (loss) per share under SFAS 128 is the same as has
     been reported under the previously required accounting standards.

6.   COMMITMENTS AND CONTINGENCIES

     The Company is involved in various claims and legal actions arising in the
     ordinary course of business. In the opinion of management, the ultimate
     disposition of these matters will not have a material adverse effect on the
     Company's consolidated financial position. The resolution in any reporting
     period of one or more of these matters in a manner adverse to the Company
     could have a material impact on the Company's results of operations and
     cash flows for that period.

7.   SHAREHOLDER LITIGATION

     The Company was involved in an aborted merger earlier in fiscal 1997 that
     led to a proxy fight with a group of shareholders that styled themselves
     "The Universal Seismic Stockholders' Protective Committee" (the
     "Stockholders' Committee"). The proxy fight was resolved at the reconvened
     Annual Meeting of Shareholders on February 11, 1997, at which time
     management's slate of directors was reelected and all of the Stockholders'
     Committee's proposals were defeated.

     Thereafter, Michael T. Kanarellis, one of the members of the Stockholders'
     Committee, submitted letters to various members of the Audit Committee of
     the Company, alleging that "the Company's financial statements for the
     fiscal year ended June 30, 1996 and the fiscal quarters ended September 30,
     1996 and December 31, 1996 were false and materially misstated" and
     alleging certain specific items of misstatement. The Stockholders'
     committee also filed a suit against the Company and its directors styled
     "The Universal Seismic Associates, Inc. Stockholders' Protective Committee,
     Michael T. Kanarellis, and Robert J. Kecseg Vs. Michael J. Pawelek, Ronald
     L. England, Calvin G. Cobb, Gary Milavec, Steven Oakes, Rick Trapp, RIMCO
     Associates, L.P., Resource Investors Management Company, L.P. and Universal
     Seismic Associates, Inc.", in the United States District Court (the
     "Court") in Delaware. All parties entered into a Stipulation of Settlement
     which was tendered to the Court on August 7, 1997, whereby RIMCO agreed to
     purchase all of the shares of the Company's common stock owned by the
     Stockholders' Committee for an aggregate purchase price of $650,000, or
     $3.17 per share. Also in connection with the settlement, RIMCO entered into
     a $2,000,000 loan agreement with the Company, with the proceeds being used
     to fund the immediate costs of settlement and to pay other expenses
     associated with the lawsuit. The settlement was 


                                  PAGE 10 OF 15
<PAGE>   11

     approved by the Court on October 1, 1997, at which time the Court entered
     judgment dismissing all claims with prejudice. The Company believes that it
     will recover a substantial portion of its costs of settlement and expenses
     associated with the lawsuit from its directors' and officers' liability
     insurance carrier. As of January 30, 1998, the Company had received a
     settlement of $1,245,000 and is pursuing additional recovery.

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

NINE MONTHS ENDED MARCH 31, 1998 COMPARED TO NINE MONTHS ENDED MARCH 31, 1997

OPERATING REVENUES AND EXPENSES

     Operating Revenues. Overall revenues for the nine-month period were down
from $25.9 million to $17.3 million, or 33%, from the comparable period in
fiscal 1997. This decrease was primarily due to a slow down in the data
acquisition activities as backlog was not replaced as rapidly as contracts were
completed. Data processing revenues were down from $1,052,696 to $651,246, or
38%, as a result of fewer jobs being processed. Oil and gas operations began
initial production in May and June 1997 with total revenues of $739,935 in the
period averaging more than $82,000 per month with increased sales expected as
additional production comes on stream. However, any increase is likely to be
limited because the Company lacks sufficient financial resources to fully
develop its properties. Substantially all oil and gas revenue comes from natural
gas sales.

     Operating Expenses. Overall expenses were down from $26.3 million to $22.7
million, or 14%, reflecting a significant erosion of operating margins of the
data acquisition activity. As backlog was not replaced, down time and operating
problems resulted in several jobs experiencing losses. Increases in selling,
general and administrative expenses and depreciation, depletion and amortization
expenses were offset by the prior-year nonrecurring aborted merger, proxy
contest and shareholder litigation expenses of $828,045 in the prior-year
period.

     Selling, General and Administrative Expenses. Expenses in the fiscal 1997
period increased from $1.6 million to $2.3 million or 41%. Much of this increase
was due to higher consulting fees (audit and legal) and higher salary costs as
several management changes occurred in the second and third quarters.

     Depreciation, Depletion and Amortization (DD&A). DD&A was up in the period
by $447,907, or 19%, reflecting, in part, the DD&A from the oil and gas
operations of $209,166 for the nine months ended March 31, 1998, along with
additional seismic equipment upgrades.

     Interest Expense. Interest expense has increased on a period to period
basis by $602,846, or 63%, due to more debt outstanding and payable to RIMCO.
The additional borrowings were for expansion of the oil and gas development and
working capital needs.

     Income Taxes. At the current time the Company has significant net operating
loss carryforwards of approximately $14,145,000 available to offset future
federal taxable income 


                                  PAGE 11 OF 15
<PAGE>   12

which will expire if not used in fiscal years 2007 through 2012. Therefore, no
income tax provision has been reflected in the accompanying financial
statements.

     Net Loss. The Company reported a net loss of $7.0 million for the
nine-month period compared with a net loss of $1.4 million in the same period in
fiscal 1997. Much of this loss came as the result of down time of $2.3 million;
provision for lost equipment of $.48 million; losses on two large contracts of
$1.27 million and higher overhead charges of $2.04 million in the data
acquisition group for a total of $6.09 million. In addition, DD&A was up $.45
million and interest expense was up $.6 million.

THREE MONTHS ENDED MARCH 31, 1998 COMPARED TO THREE MONTHS ENDED MARCH 31, 1997

OPERATING REVENUES AND EXPENSES

     Operating Revenues. Operating revenues for the three months ended March 31,
1998 were down 40% to $3.83 million, reflecting the steep decline in data
acquisition revenues due to the Company being unable to generate new contracts
in this area of operations and a slow down in the overall oil and gas sector.
Data processing revenues were also down in the period from $261,818 to $142,046,
a 46% decline due to fewer data processing jobs. Oil and gas revenues are being
reported for the first time in the quarter ended March 31, 1998 at an average
monthly rate of approximately $100,000 compared with $82,000 per month for the
nine-month period. Substantially all oil and gas revenues come from natural gas
sales.

     Operating Expenses. Overall operating expenses decreased by 26%, mostly due
to a 40% decline in cost of data acquisition offset by higher selling, general
and administrative and depreciation, depletion and amortization expense. Idle
crews due to insufficient work continue to keep the data acquisition group from
having adequate profit margins. The Company has reduced expenses to reflect
current market conditions.

     Selling, General and Administrative Expenses. Selling, general and
administrative expenses were up in the quarter over the prior period from
$545,561 to $932,644 reflecting in part increased legal and accounting expenses
and higher salary expenses due to changes in management.

     Depreciation, Depletion and Amortization. Depreciation, depletion and
amortization (DD&A) was up 38% from $779,279 in the prior three-month period to
$1,077,864. This is due in part to DD&A for the oil and gas operations of
$89,314 which was not in operation in the fiscal 1997 period and the
amortization of seismic property under capital lease of $165,000.

     Interest Expense. Interest expense increased from $300,364 to $621,254.
This increase is due to additional borrowings for financing of the oil and gas
operations and for working capital needs.

     Income Taxes. At the current time, the Company has significant net
operating loss carryforwards of approximately $14,145,000 available to offset
future federal taxable income which will expire if not used in fiscal years 2007
through 2012. Therefore, no income tax provision has been reflected in the
accompanying financial statements.


                                  PAGE 12 OF 15
<PAGE>   13

     Net Loss. The Company had a net loss of $2,254,605 for the current
three-month period compared with $1,348,636 in the same period in fiscal 1997.
The current period loss is primarily due to losses in the data acquisition group
where revenues were down 45% and the group incurred low margins due to slowing
of available contract jobs and idle work crews. Higher selling, general and
administrative and DD&A expense also contributed to the overall loss for the
period due, in part, to increased consulting expenses and higher salary expenses
as a result of management changes.

LIQUIDITY AND CAPITAL RESOURCES

     For the nine-month period ended March 31, 1998, cash and cash equivalents
decreased by $152,001 to $1,707,676. Cash provided by operating activities was
$559,757 reflecting the need for the Company to carefully manage its receivables
and payables. Investing activities used cash of $5,093,281 as the Company
continued investing heavily in oil and gas properties of $4,783,200. In
addition, $27,800 was invested in data processing equipment and upgrades with
the balance of $282,281 used for miscellaneous data acquisition equipment. These
capital expenditures were offset by $2,707,764 for sale of interests in certain
of the Company's oil and gas properties.

     In August 1997, the Company borrowed an additional $2,000,000 from RIMCO.
The proceeds were utilized to fund the shareholder litigation settlement and
legal and accounting fees incurred as a result of such litigation. The Company
expects to recover a substantial portion of its costs of the settlement and
expenses associated with the lawsuit from its directors' and officers' liability
insurance carrier. As of January 30, 1998, the Company had received a settlement
of $1,245,000 and is pursuing additional recovery.

     The Company's accounts payable balance decreased by $2,471,694 in the
nine-month period ended March 31, 1998. This decrease can be attributed to the
Company's continuing efforts to reduce payables. Accounts receivable (net)
decreased by $2,208,212 during the nine-month period, primarily as a result of
settling a number of past due problem accounts. The Company had approximately
$1,580,000 of receivables over 90 days old as of March 31, 1998 for which
adequate reserves have been provided.

     The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. As more fully
explained below, the Company has incurred continuing losses from operations of
$4,239,383 and $429,877 for the years ended June 30, 1997 and 1996,
respectively, and these losses have continued during the nine months ended March
31, 1998, with an operating loss of $5,452,433 and a net loss of $6,956,814. In
addition, the Company had an accumulated deficit and a net working capital
deficiency of $18,791,474 and $24,598,991, respectively, as of March 31, 1998.
All debt due the Company's major debtholder, RIMCO, has been classified as
current maturities as of March 31, 1998.

     As of March 31, 1998, the Company had a cash balance of $1,707,676. If
losses from operations continue (as is anticipated), the Company believes this
cash, along with anticipated cash flow from its seismic and exploration and
production operations and funds available under its credit facilities, will not
be adequate for its overall working capital requirements. The Company believes
that it can generate substantial cash flow from its oil and gas properties if it
had sufficient funding for its drilling program. Future cash flows are subject
to a number of 


                                  PAGE 13 OF 15
<PAGE>   14

uncertainties, particularly the condition of the oil and gas industry and
related seismic activity in the Company's markets. Liquidity of the Company
should be considered in light of the significant fluctuations in demand that may
be experienced by seismic data acquisition contractors and exploration and
production owners as rapid changes in oil and gas producers' expectations and
budgets occur. These fluctuations can rapidly impact the Company's liquidity as
supply and demand factors directly affect utilization and contract revenues,
which are primary determinants of cash flow from the Company's operations.

     Reference is made to Note 2 to the Consolidated Financial Statements for
further discussion of defaults under the RIMCO financing arrangements.

SUBSEQUENT EVENTS

     Reference is made to Note 2 and Note 3 to the Consolidated Financial
Statements for a discussion relating to subsequent events regarding liquidity
and continuing operating losses and the restatement and reclassification of the
financial statements.


                                     PART 2
                                OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

        None

ITEM 2. CHANGES IN SECURITIES

        None

ITEM 3. DEFAULT UPON SENIOR SECURITIES

        As of March 31, 1998, the Company was in default on certain covenants of
its RIMCO financing agreements and RIMCO has waived such defaults and principal
and interest payment covenants through July 1, 1998. the Company is negotiating
an extension of this waiver and debt-to-equity exchange with RIMCO whereby the
indebtedness to RIMCO, including accrued interest, would be converted into
equity and subordinated debt. IN a proposed agreement with RIMCO, which was
executed on February 9, 1998 and expired on June 1, 1998, $15,000,000 was to be
converted into common stock of the Company and the balance into convertible
subordinated notes. The shares to be issued in the conversion were to be tied to
the average price of the Company's common stock for the 30-day period prior to
receiving stockholder approval. As of June 30, 1998, the Company was
indebtedness to RIMCO under the various financing agreements for $22,168,899
principal and $1,896,450 accrued interest.

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

        None


                                  PAGE 14 OF 15
<PAGE>   15
ITEM 5. OTHER INFORMATION

        None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

        On February 23, 1998, the Company filed a Form 8-K in which the Company
provided information under "Item 4. - Changes in Registrant's Certifying
Accountant." The date of the report was February 13, 1998, the date Coopers &
Lybrand L.L.P. resigned as the Company's independent accountants.

        On March 2, 1998 the Company filed a Form 8-K/A in which the Company
provided information under "Item 4. - Change in Registrant's Certifying
Accountant". The date of the Report was February 13, 1998, the date Coopers &
Lybrand L.L.P. resigned as the Company's independent accountants. The report
includes the response of Coopers & Lybrand L.L.P. to the statements made by the
Company on Form 8-K dated February 13, 1998 and filed February 23, 1998.

        On March 16, 1998, the Company filed a Form 8-K in which the Company
provided information under "Item 4. - Changes in Registrant's Certifying
accountant". The date of the report was March 13, 1998, and disclosed that the
Company had engaged Arthur Anderson LLP as the independent public accountants of
the Company approved by the Board Of Directors on March 12, 1998.


                                   SIGNATURES

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

                                   UNIVERSAL  SEISMIC  ASSOCIATES, INC.



                                   /s/ JOE T. RYE
DATE:  AUGUST 4, 1998              PRESIDENT/CHIEF EXECUTIVE OFFICER


                                  PAGE 15 OF 15
<PAGE>   16


                                        
                            INDEX TO EXHIBITS

        EXHIBIT
        NUMBER
        ------

          27             Financial Data Schedule