SECURITIES AND EXCHANGE COMMISSION


                             WASHINGTON, D.C. 20549


                                    FORM 8-K
                                    --------

                 CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
                   OF THE SECURITIES AND EXCHANGE ACT OF 1934


Date of Report (Date of Earliest Event Reported) September 1, 1999



                                LYNCH CORPORATION
                                -----------------
             (Exact Name of Registrant as Specified in its Charter)



    Indiana                          1-106                       38-1799862
    -------                          -----                       ----------
(State of other                 (Commission File                (IRS Employer
Jurisdiction of                     Number)                     Identification)
Incorporation)



401 Theodore Fremd Avenue, Rye, NY                                 10580
----------------------------------                                 -----
(Address of Principal Executive Offices                           Zip Code



Registrant's Telephone Number, Including Area Code: 914/921-7601


<PAGE>



Item 2.           Acquisition or Disposition of Assets.
-------           -------------------------------------


On September 1, 1999,  Registrant spun off to its  shareholders all of the stock
of  Lynch  Interactive  Corporation  ("LIC").  Each  shareholder  of  record  of
Registrant  as of the close of business  on August 23,  1999,  the record  date,
received  one share of  common  stock of LIC for each  share of common  stock of
Lynch. The Board of Directors of Registrant authorized the spin off.

At the  time of the  spin  off,  LIC held  all of the  multimedia  and  services
businesses,  plus 1,000,000 shares of Common Stock of Spinnaker Industries, Inc.
("Spinnaker") (AMEX:SKK and SKK.A), previously owned by Registrant.  For further
information  on LIC,  reference  is made to LIC's Form 10A-1,  dated  August 18,
1999,  filed with the  Securities and Exchange  Commission  ("SEC") and to LIC's
Information  Statement,  dated  August 23,  1999 (the  "Information  Statement")
contained as Exhibit 99.1 to the Form 10A-1.

After the spin off,  Registrant  owns (i)  1,237,203  share of Common  Stock and
2,259,063  share of  Class A  Common  Stock  of  Spinnaker  (which  collectively
constitutes  approximately  48% of the equity and 59% of the voting  interest of
Spinnaker,  (ii) 100% pf the stock of M-tron  Industries,  Inc.  ("M-tron")  and
(iii) 91% of the stock of Lynch  Systems,  Inc.  ("LS").  For a  description  of
Spinnaker,  M-tron and LS,  reference is made to Registrant's  Form 10-K for the
year ended December 31, 1998,  and other filings by Registrant  with the SEC and
Spinnaker's  Form 10-K for the year ended December 31, 1998 and other filings by
Spinnaker with the SEC.

In connection with the spin off, Messrs. Paul J. Evanson, John C. Ferrara, David
C.  Mitchell and  Salvatore  Muoio,  who became  directors of LIC,  ceased to be
directors  of  Registrant.  The current  directors  of  Registrant  are Mario J.
Gabelli  (Chairman),  E. Val Cerutti and Ralph R. Papitto.  Messrs.  Gabelli and
Papitto  are also  directors  of LIC.  There is no  change  to the  officers  of
Registrant  as a result of the spin off, and the officers of  Registrant  became
the officers of LIC as well. However, prior to the third anniversary of the spin
off, the officers of  Registrant  and LIC must be  different  persons,  although
Mario J.  Gabelli  may  continue  to be  Chairman of the Board of the company of
which he is not chief executive officer.

At the spin off, the  employees of the  corporate  office of  Registrant  became
employees  of  LIC  and  LIC  will  provide  corporate  management  services  to
Registrant.  With respect to the relationship  Registrant and LIC after the spin
off, reference is made to "Relationship  Between Lynch and Interactive After the
Spin Off" and  "Corporation  Expense"  in the  Information  Statement,  which is
incorporated herein by reference. Registrant and LIC are parties to a Separation
Agreement  described  in the  Information  Statement  and included as an Exhibit
hereto.   Any  arrangements   between  Registrant  and  LIC,  including  without
limitation  the provision of management  services and the allocation of overhead
expense, are subject to modification or cancellation.

This Form 8-K contains certain forward looking information,  which is based upon
certain estimates, projections and/or assumptions. As a result, such information
is subject to uncertainties, risks and inaccuracies that could be material.



<PAGE>



Item 7.           Financial Statements and Exhibits
-------           ---------------------------------

                  (b)      Pro Forma Financial Information.  Unaudited pro forma
                           balance  sheet of the  Registrant as of June 30, 1999
                           and statement of operations  for the six month period
                           ended June 30, 1999. Unaudited pro forma statement of
                           operations for the year ended December 31, 1998.

                  (c)      Exhibits

                  2(a)     Information   Statement  of  LIC   (incorporated   by
                           reference to Exhibit 99.1 to LIC's Form 10A-1,  dated
                           August 18, 1999)

                  2(b)     Separation  Agreement,  dated as of August 31,  1999,
                           between Registrant and LIC (incorporated by reference
                           to Exhibit 2 to LIC's Form  10A-1,  dated  August 18,
                           1999.

         Pursuant to the requirement of the Securities and Exchange Act of 1934,
as  amended,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned thereunto duly authorized.

                                                   Lynch Corporation


                                                   By:/s/Robert E. Dolan
                                                         Robert E. Dolan
                                                         Chief Financial Officer
Date: September 16, 1999


<PAGE>



                                LYNCH CORPORATION


                       UNAUDITED PRO FORMA FINANCIAL DATA


         The  following  unaudited  pro  forma  financial   information  of  the
Registrant is based on the historical  consolidated  financial statements of the
Registrant  adjusted for intervening  transactions  for which the Registrant has
filed Form 8- K's on July 30,  1999,  and has been  prepared to  illustrate  the
effects of the spin off as though it had  occurred  as of the  beginning  of the
periods  presented for the pro forma  statements of operations  and as if it had
occurred on June 30, 1999 for the pro forma balance sheet.  Defined terms herein
have the meanings given to them in the Form 8-K of which this is a part.

         The pro forma adjustments  include,  in the opinion of management,  all
adjustments  necessary  to give pro forma  effect to the Spin Off as though such
transaction had occurred as of the beginning of the period presented for the pro
forma statement of operations and as if it had occurred on June 30, 1999 for the
pro forma balance sheet.

         The  unaudited  pro  forma  financial  information  is not  necessarily
indicative of how the Registrant's balance sheet and results of operations would
have been  presented had the Spin Off actually been  consummated  at the assumed
date,  nor is it  necessarily  indicative of  presentation  of the  Registrant's
balance sheet and results of operations for any future period. The unaudited pro
forma financial  information  should be read in conjunction  with the historical
consolidated  financial  statements  and related notes  thereto  included in the
Registrant's  Annual Report on Form 10-K for the period ended December 31, 1998,
Registrant's  Quarterly  Report on Form 10-Q for the period ended June 30, 1999,
and the Registrant's Current Report on Form 8-K filed on July 30, 1999.

         The pro forma adjustments are based upon available  information.  These
adjustments are directly attributable to the Spin Off and are expected to have a
continuing  impact on the  Registrant's  business,  results of  operations,  and
financial position.


<PAGE>
<TABLE>



                                LYNCH CORPORATION
                 Unaudited Pro Forma Consolidated Balance Sheet
                              (Dollars inThousands)
<CAPTION>

                                               June 30, 1999 Disposition
                                                  Per 8K      of Lynch    Pro Forma     Pro Forma
                                               filed 7/30/99 Interactive  Adjustments  June 30, 1999     Notes
                                               ------------- ------------  -----------  -------------   -------

<S>                                             <C>          <C>          <C>          <C>              <C>
CASH & EQUIVALENTS ..........................   $  75,657    $    --      $    --      $  75,657
RECEIVABLES .................................      24,309         --           --         24,309
INVENTORIES .................................      31,477         --           --         31,477
DEFERRED INCOME TAX BENEFITS ................       8,717         --           --          8,717
OTHER CURRENT ASSETS ........................         809         --           --            809
CURRENT ASSETS. OF SUBS TO BE DISTRB'D TO S/H      50,304      (50,304)        --           --
                                                   ------      -------      -------     --------
                                                  191,273      (50,304)        --        140,969
                                                  -------      -------      -------      -------
PROPERTY, PLANT & EQUIP-NET .................      44,992         --           --         44,992
GOODWILL ....................................      22,472         --           --         22,472
OTHER ASSETS ................................       9,415         --           --          9,415
NON CURR ASSETS OF SUBS TO BE DIST'D TO S/H .     151,677     (151,677)        --              0
NON CURR ASSETS OF DISCONTINUED OPS .........        --           --           --              0
                                                  -------      -------      -------      -------
                                                $ 419,829    ($201,981)   $    --      $ 217,848
                                                =========     ========     ========     ========

NOTES PAYABLE BANKS AND OTHERS ..............   $  27,983    $    --      ($  7,300)   $  20,683           (2)
ACCOUNTS PAYABLE ............................      19,392         --           --         19,392
ACCRUED INTEREST PAYABLE ....................       2,590         --           --          2,590
ACCRUED LIABILITIES .........................       2,454         --           --          2,454
CUSTOMER ADVANCES ...........................       2,714         --           --          2,714
CURRENT PORTION OF LTD ......................       1,055         --           --          1,055
CURRENT LIABS. OF SUBS TO BE DISTRB'D TO S/H       36,272      (36,272)        --           --
CURRENT LIABS OF DISCONTINUED OPS ...........        --           --           --           --
                                                ---------     --------     --------     --------
TOTAL CURRENT LIABILITIES ...................      92,460      (36,272)      (7,300)      48,888
                                                ---------     --------     --------     --------
LONG TERM DEBT ..............................     122,630         --           --        122,630
LONG TERM LIABILITIES .......................       1,901         --           --          1,901
DEFERRED TAXES ..............................      16,582         --           --         16,582
MINORITY INTEREST ...........................      10,345         --          2,826       13,171           (1)
NON CURR LIABS OF SUBS TO BE DIST'D TO S/H ..     139,682     (139,682)        --           --
NON CURR LIABS OF DISCONTINUED OPS ..........        --           --           --           --
                                                ---------     --------     --------     --------
    TOTAL LIABILITIES .......................     383,600     (175,954)      (4,474)     203,172
                                                ---------     --------     --------     --------

SHAREHOLDERS  EQUITY
COMMON STOCK ................................       5,139         --           --          5,139
ADDITIONAL PAID IN CAPITAL ..................       8,298         --           --          8,298
RETAINED EARNINGS ...........................      23,785      (26,027)       4,474        2,232
ACCUMULATED OTHER COMPREHENSIVE INCOME ......         211         --           --            211
TREASURY STOCK ..............................      (1,204)        --           --         (1,204)
                                                ---------     --------     --------     --------
    TOTAL LIABILITIES & EQUITY ..............   $ 419,829    ($201,981)   $    --      $ 217,848
                                                =========     ========    =========    =========
</TABLE>






<PAGE>

<TABLE>

                                LYNCH CORPORATION
             Unaudited Pro Form Consolidated Statement of Opertions
              (Dollars in Thousands, Except for Per Share Amounts)


<CAPTION>
                                                    Six Months
                                                     Ended
                                                  June 30, 1999                  Pro Forma
                                                     Per 8K        Pro Forma  Six Months Ended
                                                  filed 7/30/99   Adjustments  June 30, 1999    Notes
                                                  -------------   -----------  -------------    -----

<S>                                             <C>            <C>           <C>                <C>
SALES AND REVENUES
   MANUFACTURING ............................   $    93,774    $      --     $    93,774
                                                -----------    -----------   -----------
TOTAL SALES & REVENUE .......................        93,774           --          93,774
                                                -----------    -----------   -----------
COSTS & EXPENSES
   MANUFACTURING ............................        82,785           --          82,785
   SELLING & ADMIN ..........................        10,594           --          10,594
                                                -----------    -----------   -----------
OPERATING PROFIT ............................           395           --             395
                                                -----------    -----------   -----------

INVESTMENT INCOME ...........................         1,819           --           1,819
INTEREST (EXPENSE) ..........................        (8,026)          --          (8,026)
                                                -----------    -----------   -----------
  NET OTHER INC.(EXP.) ......................        (6,207)          --          (6,207)
                                                -----------    -----------   -----------
INCOME (LOSS) FROM CONTINUING OPERATIONS
   BEFORE INCOME TAXES AND MINORITY INTERESTS        (5,812)          --          (5,812)
BENEFIT (PROVISION) FOR INCOME TAXES ........         2,311           --           2,311
MINORITY INTERESTS ..........................         1,672            451         2,123             (1)
                                                 -----------    -----------   -----------
NET INCOME (LOSS) FROM CONTINUING OPERATIONS    ($    1,829)   $       451   ($    1,378)
                                                 ===========    ===========   ==========
WEIGHTED AVERAGE SHARES OUTSTANDING .........     1,417,000           --       1,417,000

Basic and diluted earnings per share:
NET INCOME (LOSS) FROM CONTINUING OPERATIONS    ($     1.29)         --      ($     0.97)
</TABLE>

<PAGE>

<TABLE>

                               LYNCH CORPORATION
            Unaudited Pro Forma Consolidated Statement of Operations
                (Dollars in Thousands, Except Per Share Amounts)
<CAPTION>
                                                              Distribution of
                                                             Lynch Interactive
                                                              Corporation to                     Pro Forma
                                                Year Ended   Lynch Corporation   Pro Forma       Year Ended
                                            December 31, 1998  Shareholders      Adjustments  December 31, 1998   Notes
                                            -----------------  ------------      -----------  -----------------   -----
<S>                                               <C>            <C>             <C>          <C>                 <C>
SALES
   MULTIMEDIA ..............................       $54,622        $54,622        $      --      $      --
   SERVICES ................................       150,454        150,454               --             --
   MANUFACTURING ...........................       187,644             --               --        187,644
                                                   -------        -------          -------        -------
TOTAL SALES & REVENUE ......................       392,720        205,076               --        187,644
COSTS & EXPENSES
   MULTIMEDIA ..............................        38,176         38,176               --             --
   SERVICES ................................       138,193        138,193               --             --
   MANUFACTURING ...........................       162,735             --               --        162,735
   SELLING & ADMIN .........................        32,864         12,050               --         20,814
                                                   -------        -------          -------        -------
OPERATING PROFIT ...........................        20,752         16,657               --          4,095

INVESTMENT INCOME ..........................         5,689          1,865               --          3,824
INTEREST (EXPENSE) .........................       (25,877)       (10,383)              --        (15,494)
EQUITY IN EARNINGS OF AFFIL COS ............           317            317               --             --
GAIN ON SALES OF SUBS STOCK & OTHER ASSETS .         4,778          2,709               --          2,069
                                                   -------        -------          -------        -------
  NET OTHER INC.(EXP.) .....................       (15,093)        (5,492)              --         (9,601)

INCOME (LOSS) FROM CONTINUING OPERATIONS
   BEFORE INCOME TAXES & MINORITY INTERESTS          5,659         11,165               --         (5,506)
BENEFIT (PROVISION) FOR INCOME TAXES .......        (2,293)        (5,012)              --          2,719
MINORITY INTERESTS .........................           311         (1,224)             668          2,203           (1)
                                                   -------        -------          -------        -------
 INCOME (LOSS) FROM CONTINUING OPERATIONS ..     $   3,677      $   4,929         $    668       ($   584)
                                                  ========       ========         ========        =======

WEIGHTED AVERAGE SHARES OUTSTANDING ........     1,418,000             --               --      1,418,000

Basic and diluted earnings per share:
NET INCOME (LOSS) FROM CONTINUING OPERATIONS      $   2.59             --               --       ($  0.41)

</TABLE>


<PAGE>





                                LYNCH CORPORATION


                     NOTES TO UNAUDITED PRO FORMA FINANCIAL
                  INFORMATION (Dollars in thousands, except per
                                 share amounts)

         The  Registrant's  unaudited pro forma  statement of operations for the
six months ended June 30, 1999 and for the year ended  December 31, 1998 and the
Registrant's unaudited pro forma consolidated balance sheet at June 30, 1999 are
based on the unaudited pro forma  consolidated  statements of operations at June
30, 1999 and December 31, 1998 and the unaudited pro forma balance sheet at June
30, 1999 filed on Form 8-K as of July 30, 1999,  which reflects the  disposition
of the industrial tape businesses of Spinnaker Industries, Inc.

         (1)      Represents  the  change  in  minority  interests  based on the
                  transfer of one million shares of Spinnaker  Industries,  Inc.
                  common stock to Lynch Interactive Corporation.

         (2)      Represents the transfer of two lines of credit facilities from
                  the Registrant to Lynch Interactive Corporation.
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SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 8-K
                                    --------

                 CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
                   OF THE SECURITIES AND EXCHANGE ACT OF 1934

Date of Report (Date of Earliest Event Reported) September 1, 1999

                                LYNCH CORPORATION
                                -----------------
             (Exact Name of Registrant as Specified in its Charter)

    Indiana                          1-106                       38-1799862
    -------                          -----                       ----------
(State of other                 (Commission File                (IRS Employer
Jurisdiction of                     Number)                     Identification)
Incorporation)

401 Theodore Fremd Avenue, Rye, NY                                 10580
----------------------------------                                 -----
(Address of Principal Executive Offices                           Zip Code

Registrant's Telephone Number, Including Area Code: 914/921-7601
Item 2.           Acquisition or Disposition of Assets.
-------           -------------------------------------

On September 1, 1999,  Registrant spun off to its  shareholders all of the stock
of  Lynch  Interactive  Corporation  ("LIC").  Each  shareholder  of  record  of
Registrant  as of the close of business  on August 23,  1999,  the record  date,
received  one share of  common  stock of LIC for each  share of common  stock of
Lynch. The Board of Directors of Registrant authorized the spin off.

At the  time of the  spin  off,  LIC held  all of the  multimedia  and  services
businesses,  plus 1,000,000 shares of Common Stock of Spinnaker Industries, Inc.
("Spinnaker") (AMEX:SKK and SKK.A), previously owned by Registrant.  For further
information  on LIC,  reference  is made to LIC's Form 10A-1,  dated  August 18,
1999,  filed with the  Securities and Exchange  Commission  ("SEC") and to LIC's
Information  Statement,  dated  August 23,  1999 (the  "Information  Statement")
contained as Exhibit 99.1 to the Form 10A-1.

After the spin off,  Registrant  owns (i)  1,237,203  share of Common  Stock and
2,259,063  share of  Class A  Common  Stock  of  Spinnaker  (which  collectively
constitutes  approximately  48% of the equity and 59% of the voting  interest of
Spinnaker,  (ii) 100% pf the stock of M-tron  Industries,  Inc.  ("M-tron")  and
(iii) 91% of the stock of Lynch  Systems,  Inc.  ("LS").  For a  description  of
Spinnaker,  M-tron and LS,  reference is made to Registrant's  Form 10-K for the
year ended December 31, 1998,  and other filings by Registrant  with the SEC and
Spinnaker's  Form 10-K for the year ended December 31, 1998 and other filings by
Spinnaker with the SEC.

In connection with the spin off, Messrs. Paul J. Evanson, John C. Ferrara, David
C.  Mitchell and  Salvatore  Muoio,  who became  directors of LIC,  ceased to be
directors  of  Registrant.  The current  directors  of  Registrant  are Mario J.
Gabelli  (Chairman),  E. Val Cerutti and Ralph R. Papitto.  Messrs.  Gabelli and
Papitto  are also  directors  of LIC.  There is no  change  to the  officers  of
Registrant  as a result of the spin off, and the officers of  Registrant  became
the officers of LIC as well. However, prior to the third anniversary of the spin
off, the officers of  Registrant  and LIC must be  different  persons,  although
Mario J.  Gabelli  may  continue  to be  Chairman of the Board of the company of
which he is not chief executive officer.

At the spin off, the  employees of the  corporate  office of  Registrant  became
employees  of  LIC  and  LIC  will  provide  corporate  management  services  to
Registrant.  With respect to the relationship  Registrant and LIC after the spin
off, reference is made to "Relationship  Between Lynch and Interactive After the
Spin Off" and  "Corporation  Expense"  in the  Information  Statement,  which is
incorporated herein by reference. Registrant and LIC are parties to a Separation
Agreement  described  in the  Information  Statement  and included as an Exhibit
hereto.   Any  arrangements   between  Registrant  and  LIC,  including  without
limitation  the provision of management  services and the allocation of overhead
expense, are subject to modification or cancellation.

This Form 8-K contains certain forward looking information,  which is based upon
certain estimates, projections and/or assumptions. As a result, such information
is subject to uncertainties, risks and inaccuracies that could be material.
Item 7.           Financial Statements and Exhibits
-------           ---------------------------------

                  (b)      Pro Forma Financial Information.  Unaudited pro forma
                           balance  sheet of the  Registrant as of June 30, 1999
                           and statement of operations  for the six month period
                           ended June 30, 1999. Unaudited pro forma statement of
                           operations for the year ended December 31, 1998.

                  (c)      Exhibits

                  2(a)     Information   Statement  of  LIC   (incorporated   by
                           reference to Exhibit 99.1 to LIC's Form 10A-1,  dated
                           August 18, 1999)

                  2(b)     Separation  Agreement,  dated as of August 31,  1999,
                           between Registrant and LIC (incorporated by reference
                           to Exhibit 2 to LIC's Form  10A-1,  dated  August 18,
                           1999.

         Pursuant to the requirement of the Securities and Exchange Act of 1934,
as  amended,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned thereunto duly authorized.

                                                   Lynch Corporation

                                                   By:/s/Robert E. Dolan
                                                         Robert E. Dolan
                                                         Chief Financial Officer
Date: September 16, 1999
LYNCH CORPORATION

                       UNAUDITED PRO FORMA FINANCIAL DATA

         The  following  unaudited  pro  forma  financial   information  of  the
Registrant is based on the historical  consolidated  financial statements of the
Registrant  adjusted for intervening  transactions  for which the Registrant has
filed Form 8- K's on July 30,  1999,  and has been  prepared to  illustrate  the
effects of the spin off as though it had  occurred  as of the  beginning  of the
periods  presented for the pro forma  statements of operations  and as if it had
occurred on June 30, 1999 for the pro forma balance sheet.  Defined terms herein
have the meanings given to them in the Form 8-K of which this is a part.

         The pro forma adjustments  include,  in the opinion of management,  all
adjustments  necessary  to give pro forma  effect to the Spin Off as though such
transaction had occurred as of the beginning of the period presented for the pro
forma statement of operations and as if it had occurred on June 30, 1999 for the
pro forma balance sheet.

         The  unaudited  pro  forma  financial  information  is not  necessarily
indicative of how the Registrant's balance sheet and results of operations would
have been  presented had the Spin Off actually been  consummated  at the assumed
date,  nor is it  necessarily  indicative of  presentation  of the  Registrant's
balance sheet and results of operations for any future period. The unaudited pro
forma financial  information  should be read in conjunction  with the historical
consolidated  financial  statements  and related notes  thereto  included in the
Registrant's  Annual Report on Form 10-K for the period ended December 31, 1998,
Registrant's  Quarterly  Report on Form 10-Q for the period ended June 30, 1999,
and the Registrant's Current Report on Form 8-K filed on July 30, 1999.

         The pro forma adjustments are based upon available  information.  These
adjustments are directly attributable to the Spin Off and are expected to have a
continuing  impact on the  Registrant's  business,  results of  operations,  and
financial position.
LYNCH CORPORATION
                 Unaudited Pro Forma Consolidated Balance Sheet
                              (Dollars inThousands)
June 30, 1999 Disposition
                                                  Per 8K      of Lynch    Pro Forma     Pro Forma
                                               filed 7/30/99 Interactive  Adjustments  June 30, 1999     Notes
                                               ------------- ------------  -----------  -------------   -------
CASH & EQUIVALENTS ..........................   $  75,657    $    --      $    --      $  75,657
RECEIVABLES .................................      24,309         --           --         24,309
INVENTORIES .................................      31,477         --           --         31,477
DEFERRED INCOME TAX BENEFITS ................       8,717         --           --          8,717
OTHER CURRENT ASSETS ........................         809         --           --            809
CURRENT ASSETS. OF SUBS TO BE DISTRB'D TO S/H      50,304      (50,304)        --           --
                                                   ------      -------      -------     --------
                                                  191,273      (50,304)        --        140,969
                                                  -------      -------      -------      -------
PROPERTY, PLANT & EQUIP-NET .................      44,992         --           --         44,992
GOODWILL ....................................      22,472         --           --         22,472
OTHER ASSETS ................................       9,415         --           --          9,415
NON CURR ASSETS OF SUBS TO BE DIST'D TO S/H .     151,677     (151,677)        --              0
NON CURR ASSETS OF DISCONTINUED OPS .........        --           --           --              0
                                                  -------      -------      -------      -------
                                                $ 419,829    ($201,981)   $    --      $ 217,848
                                                =========     ========     ========     ========

NOTES PAYABLE BANKS AND OTHERS ..............   $  27,983    $    --      ($  7,300)   $  20,683           (2)
ACCOUNTS PAYABLE ............................      19,392         --           --         19,392
ACCRUED INTEREST PAYABLE ....................       2,590         --           --          2,590
ACCRUED LIABILITIES .........................       2,454         --           --          2,454
CUSTOMER ADVANCES ...........................       2,714         --           --          2,714
CURRENT PORTION OF LTD ......................       1,055         --           --          1,055
CURRENT LIABS. OF SUBS TO BE DISTRB'D TO S/H       36,272      (36,272)        --           --
CURRENT LIABS OF DISCONTINUED OPS ...........        --           --           --           --
                                                ---------     --------     --------     --------
TOTAL CURRENT LIABILITIES ...................      92,460      (36,272)      (7,300)      48,888
                                                ---------     --------     --------     --------
LONG TERM DEBT ..............................     122,630         --           --        122,630
LONG TERM LIABILITIES .......................       1,901         --           --          1,901
DEFERRED TAXES ..............................      16,582         --           --         16,582
MINORITY INTEREST ...........................      10,345         --          2,826       13,171           (1)
NON CURR LIABS OF SUBS TO BE DIST'D TO S/H ..     139,682     (139,682)        --           --
NON CURR LIABS OF DISCONTINUED OPS ..........        --           --           --           --
                                                ---------     --------     --------     --------
    TOTAL LIABILITIES .......................     383,600     (175,954)      (4,474)     203,172
                                                ---------     --------     --------     --------

SHAREHOLDERS  EQUITY
COMMON STOCK ................................       5,139         --           --          5,139
ADDITIONAL PAID IN CAPITAL ..................       8,298         --           --          8,298
RETAINED EARNINGS ...........................      23,785      (26,027)       4,474        2,232
ACCUMULATED OTHER COMPREHENSIVE INCOME ......         211         --           --            211
TREASURY STOCK ..............................      (1,204)        --           --         (1,204)
                                                ---------     --------     --------     --------
    TOTAL LIABILITIES & EQUITY ..............   $ 419,829    ($201,981)   $    --      $ 217,848
                                                =========     ========    =========    =========
LYNCH CORPORATION
             Unaudited Pro Form Consolidated Statement of Opertions
              (Dollars in Thousands, Except for Per Share Amounts)
Six Months
                                                     Ended
                                                  June 30, 1999                  Pro Forma
                                                     Per 8K        Pro Forma  Six Months Ended
                                                  filed 7/30/99   Adjustments  June 30, 1999    Notes
                                                  -------------   -----------  -------------    -----
SALES AND REVENUES
   MANUFACTURING ............................   $    93,774    $      --     $    93,774
                                                -----------    -----------   -----------
TOTAL SALES & REVENUE .......................        93,774           --          93,774
                                                -----------    -----------   -----------
COSTS & EXPENSES
   MANUFACTURING ............................        82,785           --          82,785
   SELLING & ADMIN ..........................        10,594           --          10,594
                                                -----------    -----------   -----------
OPERATING PROFIT ............................           395           --             395
                                                -----------    -----------   -----------

INVESTMENT INCOME ...........................         1,819           --           1,819
INTEREST (EXPENSE) ..........................        (8,026)          --          (8,026)
                                                -----------    -----------   -----------
  NET OTHER INC.(EXP.) ......................        (6,207)          --          (6,207)
                                                -----------    -----------   -----------
INCOME (LOSS) FROM CONTINUING OPERATIONS
   BEFORE INCOME TAXES AND MINORITY INTERESTS        (5,812)          --          (5,812)
BENEFIT (PROVISION) FOR INCOME TAXES ........         2,311           --           2,311
MINORITY INTERESTS ..........................         1,672            451         2,123             (1)
                                                 -----------    -----------   -----------
NET INCOME (LOSS) FROM CONTINUING OPERATIONS    ($    1,829)   $       451   ($    1,378)
                                                 ===========    ===========   ==========
WEIGHTED AVERAGE SHARES OUTSTANDING .........     1,417,000           --       1,417,000

Basic and diluted earnings per share:
NET INCOME (LOSS) FROM CONTINUING OPERATIONS    ($     1.29)         --      ($     0.97)
LYNCH CORPORATION
            Unaudited Pro Forma Consolidated Statement of Operations
                (Dollars in Thousands, Except Per Share Amounts)
Distribution of
                                                             Lynch Interactive
                                                              Corporation to                     Pro Forma
                                                Year Ended   Lynch Corporation   Pro Forma       Year Ended
                                            December 31, 1998  Shareholders      Adjustments  December 31, 1998   Notes
                                            -----------------  ------------      -----------  -----------------   -----
SALES
   MULTIMEDIA ..............................       $54,622        $54,622        $      --      $      --
   SERVICES ................................       150,454        150,454               --             --
   MANUFACTURING ...........................       187,644             --               --        187,644
                                                   -------        -------          -------        -------
TOTAL SALES & REVENUE ......................       392,720        205,076               --        187,644
COSTS & EXPENSES
   MULTIMEDIA ..............................        38,176         38,176               --             --
   SERVICES ................................       138,193        138,193               --             --
   MANUFACTURING ...........................       162,735             --               --        162,735
   SELLING & ADMIN .........................        32,864         12,050               --         20,814
                                                   -------        -------          -------        -------
OPERATING PROFIT ...........................        20,752         16,657               --          4,095

INVESTMENT INCOME ..........................         5,689          1,865               --          3,824
INTEREST (EXPENSE) .........................       (25,877)       (10,383)              --        (15,494)
EQUITY IN EARNINGS OF AFFIL COS ............           317            317               --             --
GAIN ON SALES OF SUBS STOCK & OTHER ASSETS .         4,778          2,709               --          2,069
                                                   -------        -------          -------        -------
  NET OTHER INC.(EXP.) .....................       (15,093)        (5,492)              --         (9,601)

INCOME (LOSS) FROM CONTINUING OPERATIONS
   BEFORE INCOME TAXES & MINORITY INTERESTS          5,659         11,165               --         (5,506)
BENEFIT (PROVISION) FOR INCOME TAXES .......        (2,293)        (5,012)              --          2,719
MINORITY INTERESTS .........................           311         (1,224)             668          2,203           (1)
                                                   -------        -------          -------        -------
 INCOME (LOSS) FROM CONTINUING OPERATIONS ..     $   3,677      $   4,929         $    668       ($   584)
                                                  ========       ========         ========        =======

WEIGHTED AVERAGE SHARES OUTSTANDING ........     1,418,000             --               --      1,418,000

Basic and diluted earnings per share:
NET INCOME (LOSS) FROM CONTINUING OPERATIONS      $   2.59             --               --       ($  0.41)
LYNCH CORPORATION

                     NOTES TO UNAUDITED PRO FORMA FINANCIAL
                  INFORMATION (Dollars in thousands, except per
                                 share amounts)

         The  Registrant's  unaudited pro forma  statement of operations for the
six months ended June 30, 1999 and for the year ended  December 31, 1998 and the
Registrant's unaudited pro forma consolidated balance sheet at June 30, 1999 are
based on the unaudited pro forma  consolidated  statements of operations at June
30, 1999 and December 31, 1998 and the unaudited pro forma balance sheet at June
30, 1999 filed on Form 8-K as of July 30, 1999,  which reflects the  disposition
of the industrial tape businesses of Spinnaker Industries, Inc.

         (1)      Represents  the  change  in  minority  interests  based on the
                  transfer of one million shares of Spinnaker  Industries,  Inc.
                  common stock to Lynch Interactive Corporation.

         (2)      Represents the transfer of two lines of credit facilities from
                  the Registrant to Lynch Interactive Corporation.