SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                                  FORM 10-KSB/A
                                 Amendment No. 1

[X]  Annual Report Under Section 13 or 15 (d) of the Securities  Exchange Act of
     1934.

     For the Fiscal Year Ended June 30, 1998

[ ]  Transition Period Under Section 13 or 15 (d) of the Securities Exchange Act
     of 1934.

     For the transition period from ___ to ___.

Commission File Number:  0-15692


                           TOTAL RESEARCH CORPORATION
                           --------------------------
                 (Name of Small Business Issuer in Its Charter)


             Delaware                                   22-2072212
--------------------------------            ------------------------------------
(State or other jurisdiction of             (IRS Employer Identification Number)
 incorporation or organization)
  

                           Princeton Corporate Center
                           --------------------------
                               5 Independence Way
                        Princeton, New Jersey 08543-5305
                    (Address of Principal Executive Offices)

Issuer's Telephone Number, Including Area Code:  (609) 520-9100


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

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

                          Common Stock, $.001 par value
                          -----------------------------
                                (Title of Class)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports),  and (2) has been
subject to such filing requirements for the past 90 days.

                                                               YES |X|   NO  |_|

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation  S-B is not  contained  in  this  form,  and no  disclosure  will  be
contained,  to the best of the  registrant's  knowledge,  in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB.

The issuer's revenues for the fiscal year ended June 30, 1998 were $34,057,084.

The aggregate  market value of the voting and non-voting  stock common equity of
the registrant held by non-affiliates as of September 18, 1998 was approximately
$21,000,000, based on the average bid and asked prices for such common equity as
reported on the Nasdaq SmallCap Market.

The number of shares of Common Stock  outstanding  as of September  18, 1998 was
11,406,299.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the  registrant's  definitive  proxy  statement  for the 1998 Annual
Meeting of  Stockholders  are  incorporated  by reference  into Part III of this
Report.


<PAGE>


                                     PART I

Information  contained or  incorporated  by  reference  in this report  contains
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933, as amended (the "Securities Act"), which represent the expectations
or beliefs of Total Research  Corporation  (the "Company"),  including,  but not
limited  to,  statements   concerning   industry   performance,   the  Company's
operations, performance, financial condition, growth and acquisition strategies,
margins and growth in sales of the Company's  products.  For this  purpose,  any
statements contained in this Annual Report that are not statements of historical
fact may be deemed to be  forward-looking  statements.  Such  statements  can be
identified  by the  use  of  forward-looking  terminology  such  as  "believes,"
"expects,"  "may," "will,"  "should" or "anticipates" or the negative thereof or
other  variations  thereon  or  comparable  terminology,  or by  discussions  of
strategy.  See,  e.g.,   "Management's  Discussion  and  Analysis  of  Financial
Condition and Results of  Operations." No assurance can be given that the future
results  covered  by the  forward-looking  statements  will be  achieved.  These
statements by their nature involve substantial risks and uncertainties,  certain
of which are beyond the  Company's  control.  The following  matters  constitute
cautionary  statements  identifying  important  factors  with  respect  to  such
forward-looking statements, including certain risks and uncertainties that could
cause actual results to vary  materially from the future results covered in such
forward-looking  statements.  Other factors  could also cause actual  results to
vary  materially  from  the  future  results  covered  in  such  forward-looking
statements.


ITEM 1.  DESCRIPTION OF BUSINESS

OVERVIEW OF THE BUSINESS

The  Company  is  a  leading   full-service   consultative   marketing  research
organization  that provides  marketing  research and  information  to assist its
clients with the pricing and positioning of new or existing  products,  customer
loyalty measurements,  brand equity issues,  organizational  structure and other
marketing  concerns.  The  Company  provides  services  for its clients by using
proprietary  market  research  technologies  developed by the Company as well as
other standard market research techniques.

The Company's clients consist principally of Fortune 100 corporations  operating
in a  wide  array  of  industries,  including  automotive,  chemicals,  consumer
products, financial services, government, health care, information technologies,
manufacturing,   telecommunications,   travel  and   utilities.   The  Company's
professional  staff  has  business  experience  in each  industry  for  which it
conducts market research.

The Company  services its clients  through four  research  divisions  (Strategic
Marketing  Services,  Global Health Care,  Customer  Loyalty  Management  and US
Regional),  each of which has specific  industry and/or product  expertise.  The
Company's  divisions  are located in several  cities in the United States and in
London,  England. The Company also maintains  relationships with market research
organizations   in  South   America   and  Asia  to  conduct   market   research
internationally on behalf of the Company.

The Company  operates  telephone data collection  centers in Tampa,  Florida and
London, England to assist in collecting data for clients. Each of the facilities
has 80 fully  computerized  interviewing  


                                       2

<PAGE>

stations.  The Company's phone centers  conduct  interviews  utilizing  computer
programmed questionnaires that are immediately uploaded to the Company's central
data-processing  center,  thereby enabling research to be collected and analyzed
more efficiently and effectively.

The Company has complete in-house data processing operations,  which provide for
rapid,  thorough and secure on-site data  management  and analysis.  The Company
supports  many  platforms  and file types both to  exchange  data and to provide
extensive database design and management capabilities. The Company also provides
its clients with sample  management  and survey data results  using a variety of
software  applications.  It also has a large and continually  expanding array of
proprietary  software developed internally to reduce research labor, assist with
survey data  analysis  and  generate  client  reports.  The  Company's  software
research  and  development  team is  continually  engaged in efforts to develop,
evaluate,  and adapt new  technologies  to  improve  and  expand  the  Company's
processes, services and products.

The Company also  maintains a  state-of-the-art  Optical  Character  Recognition
system for scanning hardcopy sample and surveys.  This scanner technology enters
data directly from thousands of hardcopy  questionnaires  each day,  eliminating
the need for  labor-intensive  manual  data  entry  and  minimizing  the risk of
data-entry error.

The Company was  incorporated  under the laws of the State of New Jersey in 1975
and was  reincorporated  under the laws of the state of  Delaware  in 1986.  The
Company  maintains  its  principal  executive  offices  at 5  Independence  Way,
Princeton, New Jersey 08543, and its telephone number is (609) 520-9100.


                                       3

<PAGE>

CLIENTS

In fiscal 1998,  approximately 73 percent of the Company's  revenues were earned
from among the 100 largest commercial and financial  companies in the world. The
Company  currently serves  approximately  225 commercial  clients and government
agencies. During fiscal 1998, approximately 71 percent of the revenues earned by
the Company were from clients who were previously  retained by the Company.  For
the fiscal years ended June 30, 1998, 1997 and 1996, no single client  accounted
for greater than 10% of the Company's annual revenues.  The following chart sets
forth certain  information  regarding the Company's  annual  revenues during the
past three fiscal years:


                           Fiscal Year Ended June 30,

<TABLE>
<CAPTION>

Industry                              1998         1997          1996       Representative Clients
--------                              ----         ----          ----       ----------------------
<S>                                     <C>          <C>          <C>        <C>
Health Care/                                                                Bristol-Myers Squibb, Amgen, Hoffman-
AgriBusiness                           25.3%        32.0%         28.6%     LaRoche, Pfizer, Eli Lilly, John Deere
Telecommunications/
 Information Systems                   28.1         24.5          28.9      AT&T, IBM, Hewlett Packard, DEC, Bell
                                                                            Atlantic, US West, Microsoft

Manufacturing/Industrial               14.1         11.1           7.2      Monsanto, Dow Chemical, Dow Corning,
                                                                            DuPont, FMC

Consumer Products                       9.3         10.9          10.4      Bausch & Lomb, 3M, Chiquita, Black &
                                                                            Decker, Michelin, Eastman Kodak

Financial Services                      6.8          7.4          13.8      Merrill Lynch, Prudential,
                                                                            Fidelity Investments, Nations Bank,
                                                                            First USA

Other                                  16.4         14.1          11.1      Ford, Mobil, BP Oil, Ryder
                                     ------       ------        ------

Totals                                100.0%       100.0%        100.0%
                                     ------       ------        ------
</TABLE>


                                       4

<PAGE>

PRODUCTS

The Company believes it enjoys advantages over competitors due to its ability to
conduct  predictive  marketing  research  studies,   which  attempt  to  project
consumer,  business, or physician behavior in various alternative scenarios. The
Company believes this is superior to more traditional market research,  which is
diagnostic  in  nature.   The   Company's   principal   proprietary   predictive
technologies include the following:

o    PRICE ELASTICITY  MEASUREMENT  SYSTEM  (PEMS(R))  permits the evaluation of
     pricing strategies for different products and services. PEMS is designed to
     enable the client to predict  sales of products and services  under a broad
     range of possible competitive pricing scenarios.

o    COMPONENT ASSESSMENT  (COMPASS(R)) is designed to enable clients to analyze
     the  structure of a  competitive  market and to  determine  the effect that
     individual  product  attributes  have on a  customer's  purchase  decision.
     COMPASS(R) is commonly used by clients for developmental stage products and
     to understand the key drivers of product choice.

o    PREDICTIVE  SEGMENTATION(R)  is a  technology  that  enables  marketers  to
     identify the various segments and or sub-markets of individual products and
     to differentiate  the demands of each segment.  Clients utilize  Predictive
     Segmentation to combine demographic and usage/attitude factors to determine
     the optimal segmentation for their products.

o    TOTAL  RESEARCH  BIAS  CORRECTION  (TRBC(R)) is a  technology  that enables
     marketers  to improve the  accuracy  and value of any  research by reducing
     fundamental  sources of bias, error and distortion in market research data.
     This  results  in  a  better   understanding  of  marketing   behavior  and
     substantial  improvement  of the  predictive  accuracy  and value of market
     research. TRBC(R) is especially valuable in multi-national studies.

o    EQUITREND(R)  measures the  perceived  quality of a brand or product  based
     upon consumer experiences with, and perceptions of, the brand. This product
     is funded by the Company and is sold to a number of clients.

GEOGRAPHIC LOCATIONS

The Company's headquarters is located in Princeton,  New Jersey. The Company has
domestic  offices  in  Minneapolis  ,  Chicago,  Poughkeepsie,  Tampa,  and  one
international office in London, England.

The Company has an agreement with Paradigma  S.A.  ("Paradigma")  to license the
Company's products and the name "Total Research Argentina". Paradigma represents
the  Company  in  Argentina  and  markets  the  Company's  proprietary  research
techniques.  In consideration for the use of the name "Total Research Argentina"
and the Company's  products,  Paradigma pays royalties  based on the revenues it
generates from such products.

The Company has an  alliance  with Asia  Marketing  Intelligence,  ("AMI"),  the
largest  independent  data collection  services firm in Asia,  which enables the
Company to offer full,  comprehensive  service for the Asian component of global
studies.


                                       5

<PAGE>

INTERNATIONAL OPERATIONS

Approximately  40% of the Company's  revenues are  attributable to projects that
the Company  conducts  for its  clients  involving  market  research on a global
basis.  The Company has conducted  research  projects in Europe,  South America,
Canada,  Africa,  China,  Japan,   Australia,   and  India.  To  engage  in  its
international market research activities, the Company has developed a network of
relationships  (such as those  with  Paradigma  and AMI)  with  market  research
organizations in essential  locations  around the world.  These alliances enable
the Company to  maintain  the quality  and  reliability  of its data  collection
activities.

ORGANIZATIONAL STRUCTURE

The Company currently operates four separate research divisions.

The  Strategic  Marketing  Services  ("SMS")  division  operates  from  both the
Princeton and London  offices.  The SMS division  conducts  market research on a
global  basis in the consumer  products/consumer  packaging  goods,  information
technology,  telecommunications and manufacturing  industries.  This division is
responsible  for  the  Company's   EquiTrend(R)   product.   SMS  accounted  for
approximately 40% of the revenues earned by the Company in fiscal 1998.

The Global Health Care ("GHC") division is also  international  in nature,  with
staff in both the Princeton and London  offices.  The division  conducts  global
market  research  primarily  in the  pharmaceutical,  health care  industry  and
biotechnology but also performs market research in the  over-the-counter  market
and agricultural industries. GHC accounted for approximately 23% of the revenues
generated by the Company in fiscal 1998.

The Customer Loyalty Management division is located in Princeton.  This division
provides  clients  with  an  organized,  controlled  means  of  improving  their
operating  results and  marketplace  performance  through the  effective  use of
information  from  customers  and  employees.  Clients  are  primarily  from the
telecommunications,   travel,  and  banking  industries.  The  Customer  Loyalty
Division  accounted  for  approximately  21% of the revenues  earned this fiscal
year.

The Company's U.S. Regional Offices are located in Minneapolis, MN; Chicago, IL;
and  Poughkeepsie,  NY. The  Minneapolis  office  performs  market  research for
clients  primarily in the  hospitality  and automotive  industry.  Many of these
clients are referred to the Company by the Carlson  Marketing Group. The Chicago
office  conducts  research in consumer  package goods and  information  services
while  Poughkeepsie   conducts  research  solely  in  the  information  services
industry.  Taken together,  the U.S.  Regional Offices account for approximately
16% of the revenues earned during fiscal 1998.

FEE ARRANGEMENTS

The  Company  generally   obtains   full-service  and  advanced  level  research
assignments  through  competitive  bidding.  Most  contracts  are  awarded  on a
fixed-fee basis, subject to adjustment under certain circumstances.

The  Company  also  designs  and  implements   multi-client   studies,  such  as
EquiTrend(R),  to address  informational  needs shared by multiple  existing and
potential  clients.  The Company  usually  develops the initial  focus and study
design of a  multi-client  study at its own expense  prior to  obtaining  client
commitments.  The  Company  then  sells  the  completed  study to  existing  and
potential clients on a non-exclusive basis.


                                       6

<PAGE>

COMPETITION

The market research  industry is highly  competitive and is  characterized  by a
large number of relatively  small  organizations  and a limited  number of large
full  service  organizations,  many of  which  are  believed  to have  financial
resources  greater than those of the  Company.  Management  believes  that it is
currently one of the leading  providers of market research and analysis services
using advanced  statistical  techniques.  In 1997, the Company was listed as the
26th largest company,  measured by revenues,  in the marketing research industry
by Marketing News. The Company's primary  competitors  include:  Burke Marketing
Services, Inc.; M/A/R/C, Inc.; Market Facts, Inc.; National Analysts; and Walker
Research Incorporated.

The Company  believes that the  principal  competitive  factors for  traditional
market research are the quality and validity of data collection,  as well as the
ability  to  efficiently  design,  execute  and  prepare  reports  on  marketing
research. The Company believes that the principal competitive factors for market
research using advanced statistical  techniques are the quality of its personnel
and the  Company's  experience in developing  and executing  statistical  market
research.  During  economic  downturns,  the  Company may  experience  increased
competition for research budgets, which are often vulnerable to global corporate
overhead reduction.

EMPLOYEES

As of June 30, 1998, the Company employed 229 full-time  employees.  The Company
uses  approximately  350  part-time,  hourly  employees  for data  gathering and
processing purposes. All employees are non-union.  The Company believes that its
relationship with its labor force is good.

TRADEMARKS

The Company owns 17  trademarks  registered  with the United  States  Patent and
Trademark  Office and/or  similar  regulatory  authorities  in other  countries.
Federally  registered  trademarks have perpetual life, provided they are renewed
on a timely  basis and used  properly  as  trademarks,  subject to the rights of
third  parties  to seek  cancellation  of the marks.  The  Company  regards  its
trademarks  and other  proprietary  rights as valuable  assets and believes that
they have  significant  value in the  marketing  of its  products.  The  Company
vigorously protects its trademarks against infringement.

ITEM 2.DESCRIPTION OF PROPERTY

The Company's  headquarters and principal  United States  operating  facility is
located in  Princeton,  New Jersey.  As of June 30,  1998,  the  Company  leased
approximately  51,000 square feet of office space for its Princeton  operations;
the  lease  expires  June  30,  2006.  The  Company  is  currently   sub-leasing
approximately 20,000 square feet of this space to third parties.

The  Company  leases  6,083  square  feet  for a sales  office  in  Minneapolis,
Minnesota.  The lease expires on April 30, 2001.The  Company leases 1,926 square
feet for its sales office in Chicago,  Illinois.  The lease  expires on December
31,  1998.  The  Company  leases  2,400  square  feet  for  a  sales  office  in
Poughkeepsie,  New York.  The lease expires on June 30, 2000. The Company leases
7,559 square feet for a telephone  data-collection  facility in Tampa,  Florida.
The lease expires on June 30, 2001.


                                       7

<PAGE>

In the United  Kingdom,  the Company  leases 4,800 square feet for its Chiswick,
London  office  space.  The lease  expires  October 31, 2003 with a tenant break
clause at October 31, 1998. The Company leases  approximately  6,000 square feet
for its Acton, London telephone  data-collection  and data-processing  facility.
The lease expires on March 31, 1999.

ITEM 3.  LEGAL PROCEEDINGS

As of June 30, 1998 there were no material legal actions or proceedings  pending
or, to the  knowledge of the Company,  threatened,  to which the property of the
Company was subject, or to which the Company was a party.

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

During the fourth quarter of fiscal 1998, no matters were submitted to a vote of
security holders of the Company.

                                     PART II

ITEM 5.  MARKET FOR COMMON STOCK AND RELATED STOCKHOLDER
         MATTERS

The Company's Common Stock trades on the Nasdaq Small Cap Market.  The quarterly
high and low bid prices of the Company's common stock, as reported by the Nasdaq
Small Cap Market, from fiscal 1997 to date, were as follows:



                                     High                          Low
                                     ----                          ---
Fiscal 1997
     First Quarter                   $1.44                        $0.88
     Second Quarter                   1.00                         0.63
     Third Quarter                    1.25                         0.81
     Fourth Quarter                   1.28                         0.81
Fiscal 1998
     First Quarter                   $2.03                        $1.03
     Second Quarter                   2.00                         1.34
     Third Quarter                    2.10                         1.50
     Fourth Quarter                   4.25                         2.00
Fiscal 1999
     First Quarter (through
       September 18, 1998)           $2.94                        $2.75

The above listed quotes reflect  inter-dealer  prices  without  retail  mark-up,
mark-down  or  commissions  and are not  necessarily  representative  of  actual
transactions or of the true value of the Common Stock.

As of September  18,  1998,  the Company had 498  shareholders  of record of its
Common Stock.  The Company has never declared a dividend and does not plan to do
so in the near future.

In July of  1998,  the  Company  entered  into an  agreement  with a  number  of
investors pursuant to which the Company sold 1,000,000 shares of Common Stock at
$2.25 per share and issued options to purchase an aggregate of 250,000 shares of
Common Stock at an exercise price of $2.25 per share  (exercisable for 5 years).
Such Common Stock was sold in a  transaction  that was exempt from  registration
under Section 4(2) of the Securities Act of 1933, as amended.


                                       8

<PAGE>

                     SELECTED FINANCIAL DATA FOR YEARS ENDED
                    JUNE 30, 1998, 1997, 1996, 1995 AND 1994

The  following  data has been  extracted  from the annual  financial  statements
attached hereto as an exhibit:

<TABLE>
<CAPTION>
                                                               Year Ended June 30,
                                        -------------------------------------------------------
Statement of Income Data (000):           1998        1997        1996       1995        1994
                                          ----        ----        ----       ----        ----
<S>                                     <C>        <C>         <C>         <C>         <C>     
Revenues                                $ 34,057   $ 29,443    $ 23,715    $ 19,250    $ 13,688
Direct Costs                              16,641     14,942      11,001       7,905       6,070
                                        --------   --------    --------    --------    --------
   Gross Profit                           17,416     14,501      12,714      11,345       7,618
Operating Expenses                        14,868     13,221      13,683       9,785       6,842
Unusual Charges
                                             723         --       1,101          --          --
                                        --------   --------    --------    --------    --------
Income(Loss)from Operations                1,825      1,280      (2,070)      1,560         776
Interest Income (Expense)                     20       (202)       (342)       (307)        (38)
Other Income (Expense),net                    40         50          87          59         (52)
                                        --------   --------    --------    --------    --------
Income(Loss) Before Income Taxes           1,885      1,128      (2,325)      1,312         686
Provision (Benefit) for Income Taxes         760        490        (842)        552         291
                                        --------   --------    --------    --------    --------
Income(Loss) Before Accounting Change   $  1,125   $    638      (1,483)        760         395
                                        --------   --------    --------    --------    --------
FAS 109 Accounting Change                     --         --          --          --          65
                                        --------   --------    --------    --------    --------
Net Income (Loss)                       $  1,125   $    638    $ (1,483)   $    760    $    460
                                        ========   ========    ========    ========    ========
Net Income(Loss)Per Diluted Share       $    .10   $    .06    $  (0.15)   $    .08    $    .05
                                        ========   ========    ========    ========    ========

                                                               Year Ended June 30,
                                        -------------------------------------------------------
Balance Sheet (000):                      1998        1997        1996       1995        1994
                                          ----        ----        ----       ----        ----
Working Capital (Deficiency)            $    801   $ (1,151)   $   (163)   $    210   $  1,573
Total Assets                              15,469     12,948      13,155      11,743      7,440
Capital Lease Obligations And Notes
Payable                                       19        215       2,142       1,406        604
                                        --------   --------    --------    --------   --------
Stockholders' Equity                    $  5,077   $  3,648    $  2,821    $  4,323   $  3,419

</TABLE>


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

The  following  discussion  and  analysis  should  be read in  conjunction  with
"Selected  Historical  Financial  Data" and the audited  Consolidated  Financial
Statements  of the  Company and the notes  thereto  included  elsewhere  in this
Annual Report.

RESULTS OF OPERATIONS

The Company is a full-service  consultative  marketing research corporation that
provides  marketing  research  and  information  to assist its clients  with the
pricing  and  positioning  of  new  or  existing   products,   customer  loyalty
measurements,  brand equity issues and other marketing concerns. It is organized
into four divisions Strategic  Marketing Services,  Global Health Care, Customer
Loyalty Management, and U.S. Regional Offices.


                                       9

<PAGE>

The following table sets forth,  for the periods  indicated  certain  historical
income  statement  and other data for the Company and also sets forth certain of
such data as a percentage of gross revenues.

<TABLE>
<CAPTION>
                                                                                    Year Ended June 30,
                                                            1998                         1997                        1996
                                                            ----                         ----                        ----
<S>                                                   <C>          <C>           <C>           <C>            <C>            <C>
Revenues                                           $34,057        100.0%        $29,443       100.0%        $23,715        100.0%
Direct costs                                        16,641         48.9          14,942        50.8          11,001         46.4
                                                    ------        -----          ------       -----          ------        -----
      Gross profit                                  17,416         51.1%         14,501        49.2%         12,714         53.6
Operating expenses                                  14,868         44.1          13,221        44.9          13,683         57.7
Unusual Costs                                          723          2.1              --          --           1,102          4.6
                                                    ------         ----          ------        ----          ------         ----
Income (loss) from operations                        1,825          4.9%          1,280         4.3%         (2,070)        (8.7)
Interest income (expense)                               20          0.1            (202)       (0.7)           (342)        (1.4)
Other income (expense), net                             40          0.1              50         0.2              87          0.3
                                                     -----          ---           -----        ----          ------         ----
Income (loss) before income taxes                    1,885          5.1%          1,128         3.8%         (2,325)        (9.8)%
Provision for (benefit) from income taxes              760          1.8             490         1.6%           (842)        (3.6)
                                                     -----          ---           -----         ----         -------        -----
Net  income(loss)                                 $  1,125          3.3%      $     638         2.2%        $(1.483)        (6.2%)
                                                  ========          ===       =========         ====        ========        ======
</TABLE>


FISCAL YEAR ENDED JUNE 30, 1998 AS COMPARED TO FISCAL YEAR ENDED JUNE 30, 1997

Revenues  increased  approximately 15.7 percent from fiscal 1997 to fiscal 1998.
This growth is the result of increased  activity in three of the Company's  four
divisions.  The Customer  Loyalty  Division  experienced flat sales from year to
year due to increased competition.

The gross profit of the Company improved from 49.2 percent of revenues in fiscal
1997 to 51.1  percent of  revenues  in fiscal  1998,  primarily  due to improved
operating  efficiencies.  This  improvement  reflects one of management's  goals
which  was to lower the  costs of  performing  research  without  impairing  the
quality of the Company's products.

Operating costs remained flat from year to year as a percentage of revenues. The
Company  realized an unusual cost  associated  with the Employment  Transitional
Agreement with the former Chairman and Chief Executive Officer.

Income from operations increased as a percentage of revenues from 4.3 percent to
4.9  percent in fiscal 1998 or  approximately  $545,000.  On a pro forma  basis,
excluding the unusual cost, income from operations  increased  approximately 2.7
percent from fiscal 1997 to fiscal 1998,  which  reflects the impact of the cost
and expense reductions discussed by management.

Interest  income  (expense)  changed  from (0.7  percent)  in fiscal 1997 to 0.1
percent in fiscal 1998. This primarily  reflects the elimination of bank debt in
the United Kingdom as well as better cash management in the United States.

The provision for income taxes increased due to increased income in fiscal 1998.
Overall,  the Company increased its net income as a percentage of sales from 2.2
percent in fiscal 1997 to 3.3 percent in fiscal 1998 or approximately  $447,000,
including the unusual cost in fiscal 1998.

The Company defines backlog as the unearned  portions of its existing  contracts
at each  balance  sheet  date.  At June  30,  1998,  backlog  was  approximately
$12,300,000  as compared to a backlog of  approximately  $12,000,000 at June 30,
1997. The amount of backlog at any time may not be indicative of intermediate or
long-term trends in the Company's operations.


                                       10

<PAGE>

FISCAL YEAR ENDED JUNE 30, 1997 AS COMPARED TO FISCAL YEAR ENDED JUNE 30, 1996

Revenues  increased  approximately 24.2 percent from fiscal 1996 to fiscal 1997,
due to growth in the core  business for all divisions as well as the impact of a
full year of the Minneapolis office, which was acquired in 1995.

The  increase  in direct  costs from 46.4  percent of revenues in fiscal 1996 to
50.8  percent  of  revenues  in  fiscal  1997,  approximately  $3,940,000,   was
attributed to a change in the type of research  conducted by the Company as well
as to an increase in international  studies.  The Company's research  activities
shifted from qualitative to quantitative studies,  which resulted in substantial
out-of-pocket  costs for data collection.  International  studies also typically
incur more expense  from data  collection  costs.  This shift  contributed  to a
decrease in the Gross Profit.

Operating  expenses  declined as a  percentage  of sales,  from 57.7  percent in
fiscal 1996 to 44.9 percent in fiscal 1997 due to a corporate  expense reduction
initiative  begun in late fiscal 1996.  The impact of the program  along with no
unusual items resulted in an increase of income from operations of $1,280 from a
loss of ($2,070) during fiscal 1996.

The Company defines backlog as the unearned  portions of its existing  contracts
at each  balance  sheet  date.  At June  30,  1997,  backlog  was  approximately
$12,000,000  as compared to a backlog of  approximately  $9,600,000  at June 30,
1996. The amount of backlog at any time may not be indicative of intermediate or
long-term trends in the Company's operations.

Liquidity and Capital Resources

In fiscal 1997, the Company was able to reduce its bank debt from  approximately
$3.7 million to just over $200,000 while building cash balances of approximately
$700,000.  In fiscal 1998,  the Company's  goal was to continue to build cash as
the Company  strengthened its balance sheet. During fiscal 1998, the Company was
able to pay off the  remaining  part of the bank  debt in the UK  (approximately
$215,000) and built its cash reserves to approximately $2.1 million dollars.

At June 30, 1998 the Company's working capital increased  $1,951,770 to $801,048
from a  deficiency  of  ($1,150,722)  at June 30,  1997,  and the current  ratio
increased to 1.08 from 0.87.

For the twelve-month period ended June 30, 1998, the Company generated cash from
operations of approximately  $1,710,000.  Employee exercised stock options added
approximately  $310,000,  for a total of $2,020,000 of cash available during the
year.   The  major  uses  of  this  cash  were  to  increase  cash  balances  by
approximately $1,420,000,  purchase computer equipment and office furnishings of
approximately  $385,000, and completely pay down the balance of the UK bank debt
(approximately $215,000).

While the Company  currently has no bank debt, it does have  operating  lines of
credit in the United States and the United  Kingdom.  The Company  believes that
its current  sources of liquidity  and capital  resources  will be sufficient to
fund its long-term  obligations  and working  capital needs for the  foreseeable
future.


                                       11

<PAGE>

The Company has a loan agreement with Summit Bank, located in Princeton, NJ. The
loan agreement contains the following:

o    A one year $2.5  million  revolving  line of credit at a variable  interest
     rate based on certain  financial  ratios.  As of June 30, 1998, the rate is
     the prime  rate plus  one-half  percent  (prime  rate at June 30,  1998 was
     8.5%).  As of June 30, 1998, the Company was in compliance  with all of the
     financial ratios and has not borrowed against this line.

o    A  three-year  $500,000  term line,  secured by  equipment,  furniture  and
     fixtures at an interest rate based on certain  financial ratios. As of June
     30, 1998, the rate is the prime rate plus one-half percent.  As of June 30,
     1998, the Company has not borrowed against this line.

In addition,  the Company has a bank overdraft  facility  of(pound)300,000  with
Coutts & Company  in  London,  UK.  The  borrowings  are  charged at a rate of 3
percent  above the UK Base Rate  (7.25%).  At June 30,  1998 the Company had not
borrowed against this overdraft facility.

The  Company  is  currently  in   negotiations   with  Summit  Bank  for  a  ten
million-dollar  acquisition line of credit. This facility, once finalized,  will
be used to help fund the Company's growth strategy.

In July of  1998,  the  Company  entered  into an  agreement  with a  number  of
investors pursuant to which the Company sold 1,000,000 shares of common stock at
$2.25 per share and issued options to purchase an aggregate of 250,000 shares of
common stock at an exercise price of $2.25 per share  (exercisable for 5 years).
The  Agreement   also  provides   that  the   investors   will,   under  certain
circumstances,  provide or arrange  for others to provide up to  $25,000,000  in
debt or equity financing to complete  acquisitions  and/or projects  approved by
the Board of Directors.

Recent Trends

In the first quarter of fiscal 1999, the Customer  Loyalty  Division was awarded
the largest  contract in the history of the Company from Microsoft  Corporation.
The  Global   Health  Care   Division   has   expanded   its  scope  to  include
over-the-counter  medications  and  agri-business  markets  while the  Strategic
Marketing  Service  Division is focused on  providing  new  products to meet the
needs  of the  business-to-business  marketplace.  The  United  States  Regional
Offices are embarked on an aggressive  expansion effort; an office was opened in
Detroit, Michigan with two additional offices planned by year-end.

Impact of Inflation

Inflation  had no material  effect on the financial  performance  of the Company
during fiscal 1998.

YEAR 2000

The Company recognizes the importance of ensuring that neither its customers nor
its  business  operations  are  disrupted  as a  result  of Year  2000  software
failures. At the present time, the Company believes that its systems are or will
be  substantially  Year 2000  compliant  and does not expect Year 2000 issues to
materially  affect its  services  competitive  position or  financial  position.
However, there can be no assurance that this will be the case


                                       12

<PAGE>

ITEM 7.  FINANCIAL STATEMENTS

See annexed financial statements.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
         ACCOUNTING AND FINANCIAL DISCLOSURE

Not applicable.
                                    PART III

Information  required  under  Items 9, 10, 11 and 12 is  incorporated  herein by
reference  to the  Company's  definitive  proxy  statement  to be filed with the
Securities  and  Exchange  Commission  within 120 days after the year covered by
this Form 10-KSB with respect to its Annual Meeting of  Stockholders  to be held
on November 18, 1998.

ITEM 13. EXHIBITS

(A) The  following  documents  are filed as part of this Form 10-KSB at the page
indicated.


  Exhibit No.                   Description
  -----------                   -----------

      3.1   Certificate  of  Incorporation  of  the  Company   (incorporated  by
            reference to Exhibit 3.1 to the Registration Statement on Form S-18,
            as amended, Registration No. 33-9078-NY; the "Form S-18");
      3.2   By-laws of the Company  (incorporated by reference to Exhibit 3.2 to
            the Form S-18);
      10.1  Lease,  dated as of  December  12,  1985,  between  the  Company and
            Bellemeade  Development  Corporation  (incorporated  by reference to
            Exhibit 10.2 to the form S-18);
      10.2  Total Research  Corporation  Savings & Retirement Plan (incorporated
            by reference to Exhibit 10.3 to the Form S-18);
      10.3  1995 Stock Incentive Plan to be filed by October 15, 1998;
      10.4  Employment Agreement, dated January 2, 1997, between the Company and
            Patti  Hoffman  (incorporated  by  reference  to  Exhibit  1 of  the
            Company's  Annual  Report on form 10-K,  dated June 30,  1997,  (the
            "1997 Form 10-K");
      10.5  Employment Agreement, dated January 2, 1997, between the Company and
            Eric  Zissman  (incorporated  by  reference to Exhibit 1 of the 1997
            Form 10-K;
      10.6  Employment Agreement, dated January 2, 1997, between the Company and
            Mark Nissenfeld  (incorporated by reference to Exhibit 1 of the 1997
            Form 10-K;
      10.7  Employment Agreement, dated January 2, 1997, between the Company and
            Roger  Thomas  (incorporated  by  reference to Exhibit 1 of the 1997
            Form 10-K;
      10.8  Employment Agreement, dated January 2, 1997, between the Company and
            Terri Flanagan  (incorporated  by reference to Exhibit 1 of the 1997
            Form 10-K;
      10.9  Sublease,  dated July 17,  1997,  between the  Company and  Hexaware
            Technologies;
      21.1  List of Subsidiaries; and
      27    Financial Data Schedule.


                                       13

<PAGE>

(B) Reports on Form 8-K:

Form 8-K,  dated  April 21,  1998,  (announcement  of the  signing  of the Stock
Purchase Agreement);

Form 8-K, dated July 10, 1998  (announcement  of the closing of the transactions
contemplated by the Stock Purchase Agreement);

Form 8-K,  dated  August 11, 1998  (announcement  of the 1998 Annual  Meeting of
Stockholders).


                                       14

<PAGE>

                           TOTAL RESEARCH CORPORATION
                                 AND SUBSIDIARY

                               For the Years Ended
                             June 30, 1998 and 1997



Independent Auditors Reports                                        F-1

Consolidated Balance Sheets as of June 30, 1998 and 1997            F-2

Consolidated Statements of Operations for the Years Ended 
June 30, 1998 and 1997                                              F-3

Consolidated Statements of Stockholders' Equity for the 
Years Ended June 30, 1998 and 1997                                  F-4


Consolidated Statements of Cash Flows for the Years 
Ended June 30, 1998 and 1997                                        F-5

Notes to the Consolidated Financial Statements                      F-6


                                       15

<PAGE>

                          Independent Auditor's Report


To the Board of Directors and
Stockholders of Total Research
Corporation and Subsidiary

We have audited the accompanying  consolidated  balance sheets of Total Research
Corporation  and  Subsidiary  as of June 30,  1998  and  1997,  and the  related
consolidated  statements of operations,  stockholders' equity and cash flows for
the years then ended.  These financial  statements are the responsibility of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statement presentation.  We believe
that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the consolidated  financial position of Total
Research  Corporation  and  Subsidiary  as of June 30,  1998 and  1997,  and the
results  of their  operations  and their  cash flows for the years then ended in
conformity with generally accepted accounting principles.



                                                 AMPER, POLITZINER & MATTIA, PC

September 21, 1998
Edison, New Jersey


<PAGE>

<TABLE>
<CAPTION>

                                       TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                                              Consolidated Balance Sheets
                                                     June 30, 1998
                                                                                1998                   1997
                                                                                ----                   ----
<S>                                                                             <C>                     <C>
Current assets
Cash and cash equivalents                                                $     2,097,347         $      678,350
Accounts receivable, less allowance for                                        6,451,545              5,101,596
 doubtful accounts of $110,000 at June 30, 1998
 and June 30, 1997
Cost and estimated earnings in excess of                                       1,201,265              1,240,852
 billings on uncompleted contracts
Deferred taxes                                                                   243,000                281,900
Other current assets                                                             715,376                567,786
                                                                              ----------              ---------
                                                                              10,708,533              7,870,484

Fixed assets, less accumulated depreciation of $3,923,493 and                  2,110,914              2,316,630
$3,334,556, respectively
Goodwill, net of accumulated amortization of $301,337 and $223,493,            1,722,540              1,800,384
respectively
Deferred Taxes                                                                   361,100                228,880
Other assets                                                                     566,071                731,916
                                                                              ----------             ----------
                                                                              15,469,158             12,948,294
                                                                              ==========             ==========


Liabilities and Stockholders' Equity

Current liabilities
Notes payable                                                                $        --           $   214,575
Accounts payable                                                               3,385,709             2,106,555
Accrued expenses and other current liabilities                                 2,834,060             2,646,230
Billings in excess of costs and estimated earnings                             3,394,545             3,887,372
Income taxes payable                                                             293,171               166,474
                                                                              ----------             ---------
                                                                               9,907,485             9,021,206
                                                                                                
Long-term liabilities                                                                           
Other long-term liabilities                                                      484,207               279,020
                                                                              ----------             ---------
                                                                                                
                                                                              10,391,692             9,300,226
                                                                              ----------             ---------
Commitments and contingencies                                                                   
                                                                                                
Stockholders' equity                                                                            
Common stock authorized 20,000,000 shares                                                       
 .001 par value, 10,476,108 shares issued                                                        
 at June 30, 1998 and 10,044,108                                                                
 Shares issued and outstanding at June 30, 1997                                   10,476               10,044
                                                                                                
Additional paid-in capital                                                     4,172,904            3,576,545
Cumulative translation adjustment                                                 22,602               27,095
                                                                                                
Retained earnings                                                              1,159,201               34,384
                                                                               ---------               ------
                                                                               5,365,183            3,648,068
Less: Treasury Stock                                                           (287,717)                   --
                                                                               --------             ----------
Total Stockholders equity                                                      5,077,466            3,648,068
                                                                               ---------            ---------
                                                                                                
Total liabilities and stockholders' equity                                   $15,469,158          $12,948,294
                                                                             ===========          ===========
</TABLE>
                 See accompanying notes to financial statements


                                      F-2

<PAGE>

                           TOTAL RESEARCH CORPORATION
                      Consolidated Statements of Operations
                          For the Years Ended June 30,



                                                    1998               1997
                                                    ----               ----

Revenues                                        $ 34,057,084       $ 29,443,302

Direct costs                                      16,641,169         14,941,632
                                                ------------       ------------

Gross profit                                      17,415,915         14,501,670

Operating expenses                                14,868,072         13,221,437

Unusual charge                                       723,000                 --
                                                ------------       ------------

Income from operations                             1,824,843          1,280,233

Interest (expense) income                             20,424           (202,133)
Other income, net                                     40,000             50,050
                                                ------------       ------------
Income before provision
   for income taxes                                1,885,267          1,128,150

Provision for income taxes                           760,450            489,955
                                                ------------       ------------

Net income                                      $  1,124,817       $    638,195
                                                ============       ============

Earnings per share
 Basic                                          $       0.11       $       0.06
 Diluted                                        $       0.10       $       0.06

Weighted average common shares
Outstanding  - Basic                              10,118,908          9,978,351
             - Diluted                            11,704,804         10,357,073


                 See accompanying notes to financial statements

                                      F-3

<PAGE>


<TABLE>
<CAPTION>

                           TOTAL RESEARCH CORPORATION
                 Consolidated Statements of Stockholders' Equity

                                           Common   Stock                                                
                                 --------------------------------
                                                                                         Cumulative      
                                      Shares                          Additional         Translation     
                                      Issued          Amount       Paid-In Capital       Adjustment      
                                 ----------------- -------------- ------------------- ------------------ 
<S>                                      <C>            <C>               <C>                 <C>
Balance - June, 1996                    9,882,108        $ 9,882         $ 3,505,835        $  (90,685)  

Exercise of options                       162,000            162              70,710                 --  

Translation adjustment                         --             --                  --            117,780  

    Net Income - 1997                          --             --                  --                 --  
                                       ----------      ---------        -------------       -----------  
                                                                                                       
Balance - June 30, 1997                10,044,108         10,044           3,576,545             27,095  

Exercise of Options                       432,000            432             172,359                 --  

Tax Benefit - Exercise of
Options                                                                      424,000

Translation adjustment                         --             --                  --            (4,493)  

    Net Income - 1998                          --             --                  --                 --  
                                      ------------      --------        -------------       -----------  
                                                                                                       

Balance-June 30, 1998                  10,476,108       $ 10,476        $  4,172,904        $    22,602  
                                       ==========       ========        ============        ===========  


                                      Retained                Treasury Stock
                                      Earnings
                                    (Accumulated
                                      Deficit)             Shares             Amount
                                    -----------------   ---------------   ------------- 
Balance - June, 1996                    $ (603,811)               --                --

Exercise of options                              --               --                --

Translation adjustment                           --               --                --

    Net Income - 1997                       638,195               --                --
                                         ----------         ---------         --------

Balance - June 30, 1997                      34,384                           $     --

Exercise of Options                              --            92,930          287,717

Tax Benefit - Exercise of
Options                                          --                --               --

Translation adjustment                           --                --               --

    Net Income - 1998                     1,124,817                --               --
                                          ---------         ---------         --------
Balance-June 30, 1998                   $ 1,159,201           $92,930         $287,717
                                        ===========           =======         ========

</TABLE>


                 See accompanying notes to financial statements


                                      F-4

<PAGE>


                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                      Consolidated Statements of Cash Flows
                          For the Years Ended June 30,

                                                       1998               1997
                                                       ----               ----

Cash flows from operating activities
Net income                                           $ 1,124,817        638,195
                                                     -----------    -----------
Adjustments to reconcile net income
 to net cash provided by operating activities
Depreciation                                             588,937        634,903
Amortization                                             237,844        237,844
Accretion of warrants                                         --          8,000
Deferred tax benefit                                     (93,320)       262,015
(Increase) decrease
Accounts receivable                                   (1,349,949)      (935,110)
Cost and estimated earnings in excess of billing
 on uncompleted contracts                                 39,587        496,882
Other current assets                                    (147,591)       136,047
Other assets                                               5,845         13,251
Income tax refund receivable                                  --        841,495
Increase (decrease) in liabilities
Accounts payable                                       1,279,154        158,151
Accrued expenses and other current liabilities           187,830        942,376
Accrued restructuring costs                                   --       (425,500)
Billings in excess of costs and estimated
 earnings                                               (492,827)     1,772,230
Income taxes payable                                     126,697         80,171
Other long-term liabilities                              205,189         40,957
                                                     -----------    -----------
Net cash provided by operating activities              1,712,213      4,901,907
                                                     -----------    -----------

Cash flows from investing activities
Purchases of equipment                                  (383,221)      (721,328)
                                                     -----------    -----------
                                                        (383,221)      (721,328)
                                                     -----------    -----------

Cash flows from financing activities
Repayment of debt                                       (214,575)    (3,512,217)
Payment under capital lease obligations, net
                                                              --        (97,272)
Proceeds from issuance of common stock                   309,073         70,872
                                                     -----------    -----------
  Net cash provided by (used in) financing
       Activities                                         94,498     (3,538,617)
                                                     -----------    -----------
Effect of exchange rate changes on cash                   (4,493)        32,187
                                                     -----------    -----------
Net increase (decrease) in cash and cash
 equivalents                                           1,418,997        674,149
Cash and cash equivalents - beginning                    678,350          4,201
                                                     -----------    -----------
Cash and cash equivalents  - ending                  $ 2,097,347    $   678,350
                                                     ===========    ===========
Supplemental disclosures
Income taxes paid                                    $    54,750    $    90,149
Interest paid                                        $    17,759    $   191,370

Non-cash financing activity (treasury stock)
Exchange of common stock as payment for  exercised
stock options                                        $   287,717    $        --


                 See accompanying notes to financial statements

                                      F-5

<PAGE>
                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


Note 1 - The Company

The Company was formed in 1975.  The Company  performs  marketing  research  for
various Fortune 100 companies in a broad spectrum of industries.

The Company services these clients through its U.S. locations in Princeton,  NJ;
Minneapolis, MN; Chicago, IL; Poughkeepsie,  NY; Detroit, MI; Tampa, FL; and its
overseas location, London, UK.

Note 2 - Summary of Significant Accounting Policies

Revenue Recognition
The Company  employs the  percentage  of  completion  method of  accounting  for
reporting  its  revenues on its  single-client  studies,  while on  multi-client
studies it  recognizes  revenues  when the results are delivered to its clients.
Clients are  generally  billed in  accordance  with the terms of the  applicable
contracts,  which are not  necessarily  indicative of the stage of completion of
the project.

For  single-client  studies,  the stage of  completion  and earned  revenues are
determined for each project for the applicable  period.  The amount by which the
work completed  exceeds billings to clients is carried as a current asset on the
Company's balance sheet and is shown as "costs and estimated  earnings in excess
of billings" on uncompleted contracts. Where billings exceed work completed, the
amounts are carried on the Company's  balance  sheet as a current  liability and
are shown as "billings in excess of costs and estimated earnings."

Principles of Consolidation
The consolidated  financial  statements  include the accounts of the Company and
its  subsidiary,   Total  Research   Limited,   after  elimination  of  material
intercompany accounts and transactions.

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

Cash and Cash Equivalents
For the  purpose  of the  statement  of cash  flows,  cash  equivalents  include
certificates  of deposit and all highly  liquid debt  instruments  with original
maturities of three months or less.


                                      F-6

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements

Note 2 - Summary of Significant Accounting Policies (cont'd)

Fixed Assets
Fixed assets are stated at cost.  Depreciation is computed using various methods
over the estimated  useful lives of the assets:  three years for  transportation
equipment and five to ten years for office equipment and furnishings.  Leasehold
improvements  are  amortized  over  the  shorter  of the  economic  lives or the
underlying lease term.  Repairs and maintenance,  which do not extend the useful
lives of the related assets, are expensed as incurred.

Capitalized Market Research Products
Market Research products are standardized packages comprised of certain computer
software and proven methodologies which are used to process and analyze data for
single-client or multi-client studies.

Such costs are capitalized on establishment of technological feasibility and are
amortized on the straight line method over five years or the estimated period of
future economic benefit, whichever is shorter. This assessment of recoverability
requires  management's  judgement  relating to analytical future gross revenues,
estimated  economic  life and  changes  in  technology,  on a product by product
basis. Related amortization expense is $80,000 for 1998 and 1997.

Deferred Data Accumulation Costs
The Company  accumulates  data across a wide variety of products and  industries
for use in its analysis of client-specific  data. The costs of accumulating data
related to single-client studies are charged to client projects as incurred. The
costs  of  accumulating  data  for  use in  specific  multi-client  studies  are
capitalized and depreciated over five years or the estimated  remaining  periods
for which the data provides future economic benefits,  whichever is shorter. The
assessment of  recoverability  of such costs requires  considerable  judgment by
management with respect to certain factors  including  anticipated  future gross
revenue  and  estimated  economic  life.  These  factors  are  considered  on  a
database-by-database   basis.  Total  amortization  expense  for  deferred  data
accumulation costs was approximately,  $80,000 for the years ended June 30, 1998
and 1997.

Deferred Rent
The excess of lease  payments on a  straight-line  basis over the actual monthly
payments  is recorded as  deferred  rent which will  reverse in future  periods.
Included  in other  long-term  liabilities  is  deferred  rent of  approximately
$309,000 and $148,000 as of June 30, 1998 and 1997, respectively.


                                      F-7

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements

Note 2 - Summary of Significant Accounting Policies (cont'd)

Goodwill
Goodwill has been recorded in relation to the excess of the purchase  price over
the fair  values  of the  identified  assets  acquired.  The  Company  amortizes
goodwill over 25 years. The carrying value of goodwill is evaluated periodically
in relation to the operating  performance and future undiscounted net cash flows
of the underlying business.  Investment  adjustments will be recorded if the sum
of expected future net cash flows is less than the book value of the goodwill.

Income Taxes
The provision for income taxes includes Federal, foreign, state and local income
taxes currently  payable and receivable and those deferred  because of temporary
differences  between  the  financial  statement  and tax  basis  of  assets  and
liabilities.  The unremitted  earnings of the Company's  foreign  subsidiary are
considered to be  permanently  reinvested and are not expected to be remitted to
the parent company.

Earnings Per Common Share
Effective for the  Company's  financial  statements  for the year ended June 30,
1998, the Company adopted Statement of Financial  Accounting  Standards No. 128,
"Earnings per Share," (SFAS 128).  SFAS128  replaces the presentation of primary
earnings per share  ("EPS") and fully diluted EPS with a  presentation  of basic
EPS and diluted EPS,  respectively.  Basic EPS excludes dilution and is computed
by dividing earnings  available to common  stockholders by the  weighted-average
number of common  shares  outstanding  during the  period.  Diluted  EPS assumes
conversion of dilutive  options and  warrants,  and the issuance of common stock
for all other potentially dilutive equivalent shares outstanding.

All EPS data for prior periods has been  restated.  The adoption of SFAS 128 did
not have a material effect on the Company's reported EPS amounts.

Foreign Operations
The assets and liabilities of Total Research  Limited  operations are translated
at current exchange rates,  and income statement  accounts are translated at the
weighted average rates during the period.  The related  translation  adjustments
are recorded as a separate component of stockholders' equity.

Note 3- Concentration of Cash Balance

At June 30, 1998, a cash balance of $1,300,573  was maintained in a bank account
insured by the  Federal  Deposit  Insurance  Corporation  (FDIC).  This  balance
exceeds the insured amount of $100,000.

                                      F-8

<PAGE>


                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements



Note 4 - Fixed Assets

Fixed assets consist of the following:

                                                    June 30,
                                      1998                          1997
                                      ----                          ----

Office Equipment & Fixtures       $    5,729,984            $    5,346,602

Leasehold Improvements                   304,423                   304,584
                                         -------                   -------

                                       6,034,407                 5,651,186

Less: Accumulated depreciation
        and amortization               3,923,493                 3,334,556
                                       ---------                 ---------
                                  $    2,110,914            $    2,316,630
                                   =============             =============

Depreciation and amortization expense for the years ended June 30, 1998 and 1997
was approximately $589,000 and $635,000, respectively.

Note  5 -         Notes Payable

The Company  currently has no bank debt but does have available  operating lines
of credit in both the United States and the United Kingdom.

The Company has the following agreements in the United States:

A one year $2.5 million  revolving  line of credit at a variable  interest  rate
based on certain  financial ratios. As of June 30, 1998, the rate is prime (8.5%
at June 30,  1998) plus  one-half  percent.  As of June 30,  1998,  the  Company
complied  with all of the  financial  ratios and has not  borrowed  against this
line.

A three-year  $500,000  term line  collateralized  by  equipment,  furniture and
fixtures at an interest rate based on certain  financial  ratios. As of June 30,
1998, the rate is the prime (8.5% at June 30, 1998) plus one-half percent. As of
June 30, 1998, the Company complied with all of the financial ratios and has not
borrowed against this line.

In addition,  the Company has a bank overdraft  facility of (pound)300,000  with
Coutts and Company in London,  United  Kingdom.  The borrowings are charged at a
rate of 3 


                                      F-9

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


percent above the UK base Rate (at 7.25% on June 30,  1998).  At June 30, 1998,
the Company had not borrowed against this line of credit.

Note 6 - Commitments and Contingencies

Operating Leases
The Company is committed under various leases for office space. In addition, the
Company subleases a portion of its office premises.  Approximate  future minimum
rental payments and sublease rentals under non-cancelable leases are as follows:


                                        For the Years Ending
                                              June 30,
                                              --------

                         Rental              Sublease 
                        Payments              Rentals                   Net
                        --------              -------                   ---
1999                 $  1,032,500        $    355,782           $     676,718
2000                    1,182,500             355,782                 826,718
2001                    1,162,500             355,782                 806,718
2002                    1,072,500             355,782                 716,718
2003                    1,028,750             355,782                 672,968
2004                    1,070,000                   -               1,070,000
2005                    1,070,000                   -               1,070,000
2006                                                                1,070,000
                                           -----------              ---------
                        1,070,000                   -
                       -----------                  -
Total minimum
payments required    $  8,688,750         $ 1,778,910            $  6,909,840
                      ===========          ==========             ===========

In addition to the above minimum  rentals,  the leases are subject to escalation
clauses  covering  increases in real estate taxes and  operating  costs over the
base year.  The leases  provide for renewal  options for periods from two to ten
years.  Rental expense  charged to operations was  approximately  $1,128,058 and
$1,572,000 for the fiscal years ended June 30, 1998 and 1997, respectively.

Employment Agreements

The Company entered into employment  agreements with key management personnel in
January  1997  that  extend  through  June  30,  1999.  The  agreements  contain
provisions  for base  salaries for the period July 1, 1997 to June 30, 1999 that
total  $1,190,000.  There is also a bonus  arrangement for up to 20% of the base
salary if certain  goals are met. If they exceed the goals by more than $20,000,
they will receive an additional 4% of the excess over the goal.


                                      F-10

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


On July 1, 1998,  the Company  entered into an Employment  Agreement with Albert
Angrisani,  providing,  among other things, for the employment by the Company of
Mr. Angrisani as the Company's  President and Chief Executive Officer for a term
of three (3) years, effective immediately.

Note 7 - Income taxes

Deferred tax attributes  resulting from differences between financial accounting
amounts and tax basis of assets and liabilities at June 30 are as follows:

Current assets and liabilities                     1998                  1997
                                                   ----                  ----

Allowance for doubtful accounts                 $   44,000         $    44,000
Accrued vacation                                    64,000              79,200
Retirement plans                                    54,000              83,200
Accrued royalties                                   39,000              39,100
Accrued restructuring costs                              -              36,400
Accrued expenses                                    42,000                   -
                                                    ------         -----------
Total current deferred tax asset                $  243,000          $  281,900
                                                 ---------           ---------

Non-current assets and liabilities
Depreciation                                   $ (220,000)          $(214,320)
Deferred rental obligation                         124,000              62,000
Capitalized market research products               119,100             178,800
State net operating loss carryforward               80,000             121,000
Severance plan                                     254,000                   -
Other                                                4,000              81,400
                                                  --------           ---------

Total non-current deferred tax asset           $   361,100         $   228,880
                                                ==========          ==========


The Company has  recorded  deferred  tax assets of $604,100 as of June 30, 1998.
The Company has a history of operating  earnings,  although  recognition  is not
assumed  management  has  determined  that the  future  operating  income of the
Company will more likely than not be  sufficient  to  recognize  fully these net
deferred tax assets. No valuation allowance has been provided for either years.

As of June 30, 1998 the Company has  available a New Jersey net  operating  loss
carry forward for tax purposes of approximately $1,260,000 that begins to expire
in 2003.


                                      F-11

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements

Note 7 - Income taxes (cont'd)

The  sources  of income  before  income  taxes for the year  ended June 30 is as
follows:

                                          1998                       1997
                                          ----                       ----

United States                        $1,444,775               $   808,217
United Kingdom                          740,492                   319,933
                                        -------                   -------
Total                                $1,885,267                $1,128,150
                                      =========                 =========


The components of the provision for income taxes for the years ended June 30 are
as follows:

                                      1998                       1997
                                      ----                       ----
Current expense:
Federal                              $601,320                   $99,600
State                                       -                         -
United Kingdom                        252,450                   128,340
                                      -------                   -------
                                      853,770                   227,940
Deferred expense (benefit)           (93,320)                   262,015
                                     --------                   -------
                                     $760,450                  $489,955
                                      =======                   =======

Reconciliation of the U.S.  statutory tax rate to the effective tax rate for the
years ended June 30 is as follows:

                                      1998                      1997
                                      ----                      ----

Computed provision at the            $641,000                   $383,571
statutory rate

Permanent differences                  33,000                     42,904

International rate differences            450                     17,118

State income tax, net                  69,000                     48,493

Alternative minimum tax                     -                   (40,000)

Other                                  17,000                     37,869
                                       ------                     ------

Income tax provision                 $760,450                   $489,955
                                     ========                   ========


                                      F-12

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


Note 8 - Employee Benefit and Deferred Compensation

The  Company  maintains  a  401(k)  Savings  Plan  for  the  benefit  of all its
employees.  The  401(k)  Savings  Plan  is  funded  through  the  Company's  and
participating employees' contributions and generally provides that employees may
contribute,  through payroll  reductions,  from 1% to 15% of their compensation.
The Company has, in the past, made a matching contribution in an amount equal to
50% of  each  participating  employee's  elective  contribution  up to 6% of the
participating   employee's   compensation.   Company  contributions  charged  to
operating  expense  were  approximately  $193,610  and $213,000 for fiscal years
ended June 30, 1998 and 1997, respectively.

Note 9 - Major Clients

In the  years  ended  June 30,  1998 and  1997,  the  Company  did not  derive a
significant portion of revenues (more than 10%) from any one client

Note  10 - Stock Option Plans

The Company has elected to apply  Accounting  Principles  Board  Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB 25) and related  interpretations
in  accounting  for its  employee  stock  options as permitted  under  Financial
Accounting   Standards   Statement   No.  123,   "Accounting   for   Stock-Based
Compensation,  "(SFAS  123) the fair  value  alternative  method.  Under APB 25,
because the exercise  price of the Company's  employee  stock options equals the
market  price of the  underlying  stock on the date of  grant,  no  compensation
expense is  recognized.  Under SFAS 123,  the Company will provide pro forma net
income and pro forma earnings per share.

The  Company's  1986 Stock  Option Plan has  authorized  the grant of options to
personnel for up to 1,800,000  shares of the Company's  common stock.  Under the
Plan,  options may be granted at not less than fair market  value on the date of
grant (85% of fair market value with respect to non-qualified options).  Options
granted  under the plan  become  exercisable  immediately  and expire five years
after the date of grant  (five years and one day with  respect to  non-qualified
options).  On April 16, 1996 the Company  adopted the 1995 Stock  Incentive Plan
and the 1995 Stock  Incentive Plan for Total  Research,  Ltd. and froze the 1986
Stock Option Plan.

The 1995 Stock  Incentive Plan has the authority to issue  1,750,000  options to
existing  and future  Officers,  Directors,  Employees  and  Consultants  of the
Company.   Incentive  Stock  Options  or  Non-Statutory   Stock  Options  become
exercisable  immediately and may be issued for a term of no more than five years
from the date of grant, at an option price not less than 100% of the fair market
value of the  Company's  common  stock at the date of grant.  In  addition,  any
non-employee  director  and/or  advisory board  director shall be  automatically
granted an option to purchase  10,000  shares of common stock for each year that
such person serves as a director.  However,  such options shall vest 33-1/3% for
each twelve months of continuous service until fully vested.


                                      F-13

<PAGE>


                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


Note  10 - Stock Option Plans (cont'd)

The 1995 Stock  Incentive  Plan for Total  Research,  Ltd. has the  authority to
issue 245,000  options.  This plan has similar terms and  conditions to the 1995
Stock  Incentive Plan. Pro forma  information  regarding net income and earnings
per share is required by SFAS 123 and has been  determined as if the Company had
accounted  for its employee  stock  options  under the fair value method of that
Statement.  The fair value for all  options was  estimated  at the date of grant
using   the   Black-Scholes   option   "pricing   model   with   the   following
weighted-average assumptions for June 30, 1998 and 1997 respectively:  risk-free
interest  rates of 5.72% and  6.50%;  dividend  yields of 0% and 0%;  volatility
factors of the expected  market price of the  Company's  common stock of .75 and
 .76; and a weighted average expected life of the option of 5 years.

The Black-Scholes option valuation model was developed for use in estimating the
fair value of traded  options which have no vesting  restrictions  and are fully
transferable.  In addition,  option valuation models require the input of highly
subjective  assumptions  including the expected stock price volatility.  Because
the  Company's  employee  stock  options  have   characteristics   significantly
different from those of traded  options,  and because  changes in the subjective
input assumptions can materially affect the fair value estimate, in management's
opinion,  the  existing  models do not  necessarily  provide a  reliable  single
measure of the fair value of its employee stock options.

For purposes of pro forma  disclosures,  the estimated fair value of the options
is recorded in expense in the year issued.  In  accordance  with  provisions  in
certain employment and consulting  agreements,  1,500,000 options were issued in
the year  ended  June  30,  1997  that do not vest  until  June  30,  1999  (the
termination date of the agreements). Since we expect these options to fully vest
at that date, the compensation expense arising from those stock options has been
reflected in the 1997 pro forma  amounts.  The Company's  pro forma  information
follows:

                                                     June 30,
                                         1998                     1997
                                         ----                     ----
Pro forma net income                     $  817,563            $   70,437

Pro forma income per share
                     Basic                     0.08                  0.01
                     Diluted                   0.07                  0.01


Pro forma  compensation  expense  arising  from stock  options was  $512,090 and
$946,264 for the years ended June 30, 1998 and 1997,  respectively.  However, no
compensation expense was recorded for the years ended June 30, 1998 and 1997.


                                      F-14

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


Note  10 - Stock Option Plans (cont'd)

A summary of the Company's stock option  activity,  and related  information for
the years ended June 30, follows:

<TABLE>
<CAPTION>

                                       1998                                           1997
                                   Weighted - Average                              Weighted - Average
                        Options    (000) Exercise Price          Options           (000) Exercise Price
<S>                       <C>             <C>                    <C>                     <C>  
Outstanding  -
Beginning of Year

                          2,832           $ 0.78                 1,526                   $0.71
   Granted                  330             2.38                 1,726                    0.83
   Exercised              (431)           (0.43)                 (162)                  (0.44)
   Forfeited               (21)           (0.86)                 (258)                  (0.87)
                           ----           ------                 -----                  ------
Outstanding  - end
of year                   2,710            $1.04                 2,832                   $0.78
                          =====            =====                 =====                   =====

Exercisable  - end
of year                   1,209            $1.32                 1,332                   $0.75

Weighted-average fair
value of options granted
during the year:

   Where exercise price
   equals stock price                                $1.55                                              $0.55

</TABLE>


Following is a summary of the status of stock  options  outstanding  at June 30,
1998:

<TABLE>
<CAPTION>


                                             Outstanding           Options           Exercisable        Options
                                        -------------------------------------------------------------------------

                                             Weighted
                                        Average Remaining   Weighted Average                     Weighted Average
Exercise Price Range          Number        Contractual Life    Exercise Price       Number       Exercise Price 
----------------------------------------------------------------------------------------------------------------
<S>                        <C>               <C>                   <C>               <C>                    <C>  
$ .00 - $ .99              1,996,000         3.2 years             $0.79             496,000                $0.74
$1.00 - $1.99                533,000         3.1 years             $1.10             533,000                $1.10
$2.00 - $2.99                 10,000         1.8 years             $2.13              10,000                $2.13
$3.00 - $3.99                170,000         5.0 years             $3.63             170,000                $3.63

</TABLE>


The Company  received  92,300  shares of its own Common Stock with a fair market
value of $288,000 in  connection  with the  exercise  of certain  stock  options
during 1998.


                                      F-15

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


Note 11 - Segment Information

The Company  operates in one  principal  industry  segment:  marketing  research
services.  Geographic  financial  information  for the years  ended  June 30 (in
000's) is as follows:

                                          1998                         1997
                                          ----                         ----
Revenue
 - United States                        $    23,319                  $   20,781
 - Europe                                    10,738                       8,662
                                            ------                        -----
Totals                                  $    34,057                  $   29,443
                                         ==========                   =========

Operating income
  - United States                       $       980                  $      912
  - Europe                                      844                         368
                                                ---                         ---
Totals                                  $     1,824                  $    1,280
                                        ===========                  ==========

Identifiable Assets
  - United States                       $     9,718                  $    7,837
  - Europe                                    5,751                       5,111
                                              -----                       -----
Totals                                  $    15,469                  $   12,948
                                         ==========                   =========

Note 12 - Subsequent Event

On July 1, 1998,  the Company  closed an agreement  with a number of  investors,
pursuant to which among other things,  the  Investors  purchased an aggregate of
1,000,000  shares of the  Company's  Common Stock at a price of $2.25 per share,
and the Company  issued  options,  exercisable  at any time within five(5) years
from the issuance  thereof,  to purchase an  aggregate of 250,000  shares of the
Company's Common Stock at an exercise price of $2.25 per share.

The terms of the Purchase  Agreement  include an  undertaking  by the Investors,
under certain circumstances,  to assist the Company in obtaining the $25,000,000
in debt or equity financing for  acquisitions or other projects  approved by the
Board of Directors of the Company.

Note 13-  Unusual Item

The Company has  entered  into an  employment  transition  agreement  with Lorin
Zissman;  Mr.  Zissman,  the former  Chairman  of the Board and Chief  Executive
Officer,  now hold the  position of Chairman  Emeritus and retains a seat on the
Corporation's  Board of Directors.  The Agreement ends on June 30, 2001 and sets
forth the total compensation to Mr. Zissman, which amounts to $723,000.


<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


Note 14- Year 2000

The Company has a Year 2000 Compliance team comprised of essential  managers and
staff.  They have  performed an audit of the Company's  systems,  which included
software,  hardware, operating systems, data bases and processes utilized and/or
created by the Company,  including those used for non-information purposes, such
as the building  security  system.  The scope of the audit included all domestic
and international  offices.  Through these efforts, the Company believes it will
be fully protected from any risk resulting from Year 2000 situations.

As of  June  30,  1998,  approximately  10% of Year  2000  solutions  have  been
implemented.  By year-end 1998, the Company  estimates that 70% of the solutions
will be implemented for all of the Company's critical functions. The majority of
the solutions involve relatively simple operating  system/applications  software
upgrades of currently used systems.

The Company expects to spend about $150,000  incrementally during Fiscal 1999 to
ensure all risks associated with the Year 2000 situation are mitigated.

Note 15 - New Accounting Standards

Comprehensive Income

In June 1997,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial  Accounting Standards No. 130 ("SFAS 130"),  "Reporting  Comprehensive
Income." SFAS 130  establishes  standards for the reporting and  presentation of
comprehensive  income,  its components and accumulated  balances.  Comprehensive
income,  as defined,  includes all changes to equity except those resulting from
investments by or distributions  to owners.  Among other  disclosures,  SFAS 130
requires  that all  items  that are  required  to be  recognized  under  current
accounting  standards as  components  of  comprehensive  income be reported in a
financial  statement  that is  displayed  with  the  same  prominence  as  other
financial statements.  The Company will adopt SFAS 130 in the fiscal year ending
June 30, 1999.  Adoption of this  statement will have no impact on the Company's
financial position or results of operations.

Segment Disclosure

In June 1997,  the  Financial  Accounting  Standards  Board issued  Statement of
Financial Accounting Standards No. 131 ("SFAS 131"), "Disclosures about Segments
of an Enterprise and Related  Information."  SFAS 131 establishes  standards for
the  disclosure  of  certain  information  about  the  operating  segments  of a
business.  It also requires the disclosure of information about the products and
services of the business,  the  geographic  areas in which it operates,  and its
major customers.  The Company will adopt SFAS 131 in the fiscal year ending June
30,  1999.  Adoption  of this  Statement  will have no  impact on the  Company's
financial position or results of operations.


                                      F-17

<PAGE>

                    TOTAL RESEARCH CORPORATION AND SUBSIDIARY
                 Notes to the Consolidated Financial Statements


Note 15 - New Accounting Standards (cont'd)

Accounting for the Costs of Computer Software Developed or Obtained for Internal
Use

In March 1998, the American  Institute of Certified  Public  Accountants  issued
Statement of Position 98-1 (SOP "98-1"),  "Accounting  for the Costs of Computer
Software Developed or Obtained for Internal Use." SOP 98-1 establishes standards
for recording the costs of software for internal  use. SOP 98-1  indicated  that
certain costs incurred in the development or purchase of software designated for
internal  use  should be  capitalized.  All  other  associated  costs  should be
expensed.  The  Company  will adopt SOP 98-1 in the fiscal  year ending June 30,
2000. Adoption of this statement is not anticipated to have a material effect on
the Company's financial position or results of operations.

Reporting on the Costs of Start-Up

In April 1998, the American  Institute of Certified  Public  Accountants  issued
Statement of Position  98-5 ("SOP  "98-5"),  "Reporting on the Costs of Start-Up
Activities." SOP 98-5 requires the costs of start-up activities and organization
costs to be expensed as incurred.  It defines  start-up  activities  as one-time
activities  related  to opening a new  facility,  introducing  a new  product or
service, conducting business in a new territory,  conducting business with a new
class  of  customer,  initiating  a new  process  in an  existing  facility,  or
commencing  some new  operation.  The Company  will adopt SOP 98-5 in the fiscal
year ending June 30, 1999. Adoption of this statement is not anticipated to have
a material effect on the Company's financial position or results of operations.


                                      F-18

<PAGE>

                                   Signatures

In  accordance  with  Section 13 or 15 (d) of the Exchange  Act, the  Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                TOTAL RESEARCH CORPORATION


Dated: October 2, 1998          By:  /s/ ALBERT ANGRISANI
                                     ------------------------------------------
                                     ALBERT ANGRISANI, Chief Executive Officer

In  accordance  with Section 13 or 15 (d) of the Exchange  Act,  this report has
been signed below by the following  persons on behalf of the  Registrant  and in
the capacities and on the dates indicated.

                                TOTAL RESEARCH CORPORATION


Dated: October 2, 1998           By: /s/ DAVID BRODSKY
                                     ------------------------------------------
                                     DAVID BRODSKY, Chairman of the Board of
                                     Directors

Dated: October 2, 1998           By: /s/ ALBERT ANGRISANI
                                     ------------------------------------------
                                     ALBERT ANGRISANI, Chief Executive Officer
                                     (principal executive officer), Director

Dated: October 2, 1998           By: /s/ ERIC C. ZISSMAN
                                     ------------------------------------------
                                     ERIC C. ZISSMAN, Chief Financial Officer
                                     (principal financial and accounting 
                                      officer)

Dated: October 2, 1998           By: /s/HOWARD SHECTER
                                     ------------------------------------------
                                     HOWARD SHECTER, Esq., Director

Dated: October 2, 1998           By: /s/ GEORGE LINDEMANN
                                     ------------------------------------------
                                     GEORGE LINDEMANN, Director

Dated: October 2, 1998           By: /s/ ANTHONY GALLI
                                     ------------------------------------------
                                     ANTHONY GALLI, Director

Dated: October 2, 1998           By: /s/ J. EDWARD SHRAWDER
                                     ------------------------------------------
                                     J. EDWARD SHRAWDER, Director

Dated: October 2, 1998           By: /s/ LORIN ZISSMAN
                                     ------------------------------------------
                                     LORIN ZISSMAN, Director

Dated: October 2, 1998           By: /s/ ROGER THOMAS
                                     ------------------------------------------
                                     ROGER THOMAS, Director