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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                            ------------------------

                                    FORM 10-K

                FOR ANNUAL REPORT AND TRANSITION REPORTS PURSUANT
          TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


   /X/     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934

                    FOR THE FISCAL YEAR ENDED APRIL 27, 2002
                                       OR

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

                          Commission file number 1-4737

                            ------------------------

                      HIGH VOLTAGE ENGINEERING CORPORATION
             (Exact name of Registrant as specified in its charter)


            MASSACHUSETTS                               04-2035796
  (State or Other Jurisdiction of          (I.R.S. Employer Identification No.)
  Incorporation or Organization)


               401 EDGEWATER PLACE, SUITE 680, WAKEFIELD, MA 01880
               (Address of Principal Executive Offices) (Zip Code)


               Registrant's telephone number, including area code
                                 (781) 224-1001

                            ------------------------

        SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE

<TABLE>
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             TITLE OF EACH CLASS                 NAME OF EACH EXCHANGE ON WHICH REGISTERED
             -------------------                 -----------------------------------------
<S>                                            <C>
                    None                                           None
</TABLE>

        SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE

                            ------------------------

    Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                              (1) Yes /X/  No / /

                              (2) Yes / /  No /X/

    Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. /X/

    The number of shares of the Registrant's Common Stock, par value $.01 per
share, outstanding as of July 30, 2002 was 1082.7429.

                    DOCUMENTS INCORPORATED BY REFERENCE: NONE


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                                    CONTENTS

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                                                                                        PAGE
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<S>                                                                                 <C>
                                            PART I

Item 1.                 Business....................................................      1
Item 2.                 Properties..................................................     11
Item 3.                 Legal Proceedings...........................................     12
Item 4.                 Submission of Matters to a Vote of Security Holders.........     12

                                           PART II

Item 5.                 Market for Registrant's Common Equity and Related
                        Stockholder Matters.........................................     12
Item 6.                 Selected Historical Consolidated Financial Data.............     13
Item 7.                 Management's Discussion and Analysis of Financial Condition
                        and Results of Operations...................................     17
Item 7A.                Quantitative and Qualitative Disclosures About Market
                        Risk........................................................     24
Item 8.                 Financial Statements and Supplementary Data.................     25
Item 9.                 Changes in and Disagreements With Accountants on Accounting
                        and Financial Disclosure....................................     25

                                           PART III

Item 10.                Directors and Executive Officers of the Registrant..........     26
Item 11.                Executive Compensation......................................     27
Item 12.                Security Ownership of Certain Beneficial Owners and
                        Management..................................................     30
Item 13.                Certain Relationships and Related Transactions..............     31

                                           PART IV

Item 14.                Exhibits, Financial Statement Schedules, and Reports on
                        Form 8-K....................................................     32
</TABLE>


                                        i


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                                     PART I.

ITEM 1.--BUSINESS

Company Overview

    High Voltage Engineering Corporation (the "Company") owns and operates a
diversified group of three industrial and technology based manufacturing
business segments. The Company's businesses focus on designing and manufacturing
high quality, applications engineered products which are designed to address
specific customer needs. The Company's products are sold to a broad range of
domestic and foreign Original Equipment Manufacturers (OEMs) and end-users in a
variety of industries including process automation, metal and steel, water and
wastewater treatment, petrochemicals, pulp and paper, marine and cable, oil and
gas extraction and transportation, semiconductor fabrication, chemicals,
construction, agriculture, materials handling, and for scientific and
educational research. The diversified nature of the products sold and
end-markets served by the Company's businesses reduce the effect on the Company
of operating performance fluctuations in any single operating unit arising from
cyclical downturns within individual industries and end-markets. As used in this
filing, the terms "fiscal 2002, "fiscal 2001", "fiscal 2000", "fiscal 1999" and
"fiscal 1998" refer to the Company's fiscal years ended April 27, 2002, April
28, 2001, April 29, 2000, April 24, 1999, and April 25, 1998,respectively. The
Company operates on a 52 or 53 week fiscal year. Fiscal 2002 and 2001 include
the results of operations of the Company for 52 week periods. Fiscal 2000
includes the results of operations of the Company for a 53 week period. Fiscal
1999 and fiscal 1998 include the results of operations of the Company for 52
week periods.

Business Segment Information

    The Company's products and services are divided into three segments:
Industrial Power Control segment includes Ansaldo Sistemi Industriali, S.p.A.
and subsidiaries ("ASI"), Robicon Corporation and subsidiaries ("Robicon"),
together operated as "ASIRobicon". The Advanced Surface Analysis segment has two
main components, equipment sales and analytical services. The segment consists
of Physical Electronics, Inc. and subsidiaries ("PHI") and High Voltage
Engineering Europa, B.V. ("HVE Europa"), together operated as "Phymetrics". The
third industry segment, Customized Monitoring Instrumentation, reflects the
results of operations of Maxima Technologies, Inc. and subsidiaries ("Maxima").
The principal products and services offered by the Company in the three industry
segments are described in detail below (see "The Operating Units"). Financial
information concerning the Company's industry segments is summarized in Note S
to the Consolidated Financial Statements included in Item 8, herein.

                                        1


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The Operating Units

ASIRobicon

Ansaldo Sistemi Industriali, S.p.A.

    ASI is one of the leading manufacturers of electrical and automation
systems, power electronics, motors and generators for various applications
and industrial sectors, such as iron and steel, non-ferrous metals, pulp and
paper, rubber and plastics, power generation, cement, marine and offshore,
chemical and petrochemical, cable transport, glass, textile, food and water
treatment. ASI headquarters are located in Milan, Italy with additional
operations in Genoa, Montebello, Brendola (Vicenza), Monfalcone and Trieste,
Italy. For fiscal 2002, ASI's net sales amounted to $174.4 million, which
represented 43.2% of the Company's consolidated net sales for such period.

        Products

    ASI power converters offer advanced technology, versatility, reliability and
ease of use with high technology power modules, standardization and unified
control systems. ASI power electronics are used in many applications such as
pumps, fans, compressors, mixers, extruders, mills, and cranes in many
industrial sectors. Power electronics products include AC/AC and, AC/DC
converters, special converters, excitation systems and static reactive power
compensators.

    The product power range comprises:

    - DC converters from 25A up to 20,000A

    - AC converters from 1kVA up to 30 MW

    - Cyclo converters for AC motors up to 30 MW

    - Reactive power static compensators up to 200 MVAR, 36 kV

    - High current AC/DC convectors for arc furnaces up to 300 kA

    - Static excitation systems for synchronous machines from 10 A up to
      6,000 A

    - Special converters, DC feeders

    ASI supplies turn-key electrical and automation systems for manufacturing
industries, especially those requiring advanced real time control technologies,
where ASI's capabilities are internationally recognized. ASI is capable of
assuming complete project responsibility, starting from basic design up to
system tuning, which satisfies customer demand for requiring a unified interface
and reduces engineering, purchasing and plant maintenance costs. ASI provides
power distribution, coordinated drives, process automation, mathematical models
and production management facilities. Computer simulation tools are used for the
in-house tests of the complete systems with the aim of minimizing commissioning
time. ARTICS (Ansaldo Real Time Integrated Control System) automation system is
an open architecture VME-based system designed to meet the requirements of
sophisticated real time applications. One advantage of ASI's products is the
capability to integrate most brands of industry standard programmable logic
controllers ("PLC's"). This is especially useful in plants with a current
installed base of PLC's or in revamp projects. The ASI process knowledge, based
on hundreds of applications already supplied, is implemented in software
packages including:

    - level 1--basic automation

    - level 2--process control optimization

    - level 3--plant supervision and production management

ASI drives are fully integrated into the control system allowing set-up,
monitoring and diagnostics from a central room.


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    In the sector of motors and generators, ASI's production range includes
machines with a variety of mounting arrangements, degrees of protection, and
cooling types. Based on a long-term manufacturing and service experience in both
standard and specific custom applications, ASI motors and generators incorporate
modern design and technology. A flexible modular design structure using
progressive computer engineering methods, allows appropriate selection of
constant and variable speed rotating machinery for diverse and sophisticated
applications. Motors and generators produced by ASI meet all acknowledged
standards: IEC, National Standards harmonized by CENELEC (BSI, VDI, etc.), NEMA
(electromagnetic performance only), and industry specific standards (API, AISE,
etc.).

    Production range includes:

    - High voltage, constant speed squirrel cage and wound rotor induction
      motors and generators from 150kW to 21,000kW

    - High voltage, constant speed synchronous motors and generators from 500kVA
      up to 40,000kVA

    - DC motors and generators from 2kW up to 5,000kW at 400rpm

    - Variable speed induction and synchronous motors

    - High speed and low speed large power induction and synchronous motors

    - Low voltage AC machines for vector control inverters completely
      interchangeable with DC machines

    Markets and Customers

    ASI markets and sells adjustable speed AC and DC drives ("ASD's"), motors
and generators, and specialty power converters primarily in Europe and the
Middle East with an expanding presence in North America. Electrical and
automation systems are sold worldwide with significant sales in Europe, Asia and
the Middle East.

    The metals industry represents over 60% of the global market for ASI's
electrical and automation systems. Steel processing can be broken down into two
segments: "primary" applications for blast furnaces, melt shop and continuous
casting and "secondary" applications for hot and cold rolling mills, tube mills
and finishing lines. In addition to metals, ASI provides comprehensive solutions
for the production and finishing of paper and paper products including
converting. ASI's electrical and automation systems customers include Danieli,
SMS, Thyssen Krupp Stahl, Valmet, Voest-Alpine, IPSCO Steel, Sollac, Pechiney,
China Steel, Burgo Group and the Lucchese Group.

    Major industrial markets for variable frequency drives (VFD's) and motors
and generators include oil and gas extraction, transportation and storage, power
generation and load management, cement, marine including main propulsion and
auxiliaries, chemical and petro-chemical, and cable transport including cable
lifts and funicular railways. In many cases ASI bundles VFD's, motors and
auxiliary electrical equipment to provide comprehensive process solutions.
Industrial market customers include Sulzer Turbo, Italcementi, Pirelli, Suncor,
Snamprogetti, Enel, British Gas, Duke Power, Schlumberger and Hyundai.

    The market for specialty power converters includes DC arc furnaces for iron
and steel making, traction and railway power distribution, static excitation
systems for synchronous motors and generators, static VAR compensators for power
quality management and cyclo-converters for large AC machines. In the metals
industry specialty power converters and static VAR compensators are often
bundled as part of an integrated solution. Specialty power conversion customers
include Clecim, Mannesmann-Demag, SNCF, Dalmine and Ansaldo Transporti.

    Sales and Marketing

    ASI products are sold through a direct sales force and by independent
representatives worldwide. In addition, ASI operates through its subsidiaries
and certain affiliates: Ansaldo Loire Automation SA, based in Roche-La-Moliere,
France, operating in the sector of industrial systems with special focus on the
sector of iron and steel; Ansaldo Industrial Systems Gmbh, based in Dusseldorf,
Germany operating in the sector of industrial systems and components; and Hill
Graham Controls LTD, based in High Wycombe, England operating in the sector of
Marine and Industrial systems and components. In the US markets, ASI sells its
products through Robicon located in New Kensington, Pennsylvania.


                                        3


<PAGE>


    ASI also has equity investments in two companies in the same sector located
in Russia (Ansaldo VEI), and India (Kirloskar Ansaldo Industrial Systems), and
representative offices in Cairo, Egypt, Bangkok, Thailand and Beijing, China.
Technical assistance, warranty and support are provided by a large network of
service centers worldwide.

    Competition

    Within the metals and motors markets, increased competition is evident,
especially in countries where low production costs and growing supply are
combined to improve technological capabilities. In addition, many international
groups are rationalizing their production and commercial synergies, thus
increasing their competitiveness. Siemens, ABB, Alstom and GE are regarded as
ASI's principal competitors.

Robicon

    Robicon is a leading designer and manufacturer of high power conversion
products, which are used to regulate electric power, reduce energy costs and
improve process control in a wide variety of industrial applications. Products
include variable frequency drives ("VFDs") for large electric motors and power
control systems for other applications. These products are used in process
automation, water and wastewater treatment, electric utility power generation,
oil and gas extraction and transportation, petrochemical processing, silicon
processing, glass manufacturing, cement production and other general industrial
applications. In general, Robicon's products are designed to provide engineered
solutions to specific customer requirements by utilizing a combination of
standard product platforms and options, with customized features. Robicon's
growth strategy is to increase sales of existing product lines through focused
global penetration of existing markets, entrance into selected new end markets,
and to add new products and services complementary to its existing product
lines. The Company believes that Robicon is able to differentiate itself from
its competitors through the use of proprietary technology, innovative product
development, superior customer service, and the ability to offer
applications-engineered solutions based on standard platforms. Robicon's
headquarters and primary manufacturing facility are located in New Kensington,
Pennsylvania. For fiscal 2002, Robicon had net sales of $100.9 million, which
represented 25.0% of the Company's consolidated net sales for such period.

    Products

    Historically, Robicon primarily manufactured low voltage (480 volts) VFDs
for small and medium size electric motors (20 to 1,500 horsepower) for use in
industrial applications such as commercial building climate control,
incinerators and water and wastewater treatment plants, and in other general
industrial uses. In 1995, Robicon introduced the Perfect Harmony-TM- series of
medium voltage (2,300 to 13,800 volts) VFDs for large electric motors (400 to
30,000 horsepower).

    Heavy industrial processes such as water and wastewater treatment, oil and
gas extraction and transportation, petrochemical processing, and cement
production, utilize large electric motors that require high levels of power to
drive pumps and fans. An undesirable byproduct of using medium voltage VFDs on a
large electric motor is the creation of harmonic distortion which causes stress
and fatigue to the electric motor and shortens its useful life, as well as
current and voltage fluctuations which may result in damage to other equipment
on the power grid. Most VFDs also place greater demands on a power grid than the
actual power consumed by the motor, an occurrence referred to as reduced power
factor, which can result in assessments of penalty charges against the user by
the local utility. Perfect Harmony, Robicon's patented technology for medium


                                        4



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voltage VFDs, virtually eliminates harmonic distortion and poor power factor in
large electric motors and as a result has significantly expanded the market for
medium voltage VFDs. The Company believes that Perfect Harmony is the leading
technology for reducing harmonic distortion and improving power factor in medium
voltage VFD applications and that this technology complements Robicon's
applications expertise and long-term customer relationships. Perfect Harmony
drives can be installed on virtually any large electric motor without costly
modifications and can be customized using a standard set of options.

    While VFDs regulate electricity for motors, power control systems regulate
electric power for other applications. Typical applications for Robicon's power
control systems include: (i) power supplies for high-power melting applications,
such as glass and fiberglass furnaces and plasma arc torches used in steel mills
and smelters; (ii) power supplies for polysilicon extraction and silicon crystal
growing for use in the semiconductor industry; and (iii) power supplies for
plasma generators used in sputtering equipment for coating the surface of glass
or plastics. Power control systems are critical to process control and reducing
overall energy costs in these applications. Robicon's power control systems
incorporate patented technology that virtually eliminates harmonic distortion
and "flicker."

    Markets and Customers

    Robicon markets and sells VFDs primarily in North and South America, the
United Kingdom and Southeast Asia. The market for VFDs is comprised primarily of
three customer segments: industrial, energy and municipal. The industrial market
for VFDs is comprised of large power users such as metals smelting plants,
cement plants, pulp and paper mills, chemical processing plants and power
generation facilities. The energy market consist of oil and gas extraction and
transportation. The municipal market for VFDs is comprised primarily of
municipalities which operate water and wastewater treatment facilities.

    Demand for power control systems is driven by the construction of new, or
the upgrading of existing, steel mills or smelting facilities, polysilicon
extraction facilities, glass and fiberglass furnaces and other large electrical
process manufacturing facilities. Because of the long lead time required to
design, permit and build such facilities, demand for power systems does not
necessarily correlate to general economic cycles.

    Sales and Marketing

    Robicon's VFDs and power control systems are sold through Robicon's direct
sales force, ASI's sales channels and by independent manufacturers'
representatives. Robicon targets large industrial users in select markets and
segments and applications engineers in both industrial and commercial projects.
Bids for large municipal VFD contracts are typically conducted through a
"request for proposal" process and handled by Robicon's independent
manufacturers' representatives. In addition to direct sales efforts in the
United States, Robicon has sales offices in Edmonton, Alberta; Shanghai, China,
San Paolo, Brazil and London, England.

    Competition

    Robicon's principal competitors in the VFD market are Rockwell Automation
and ABB. Other competitors include divisions of multinational corporations such
as Eaton, Toshiba and Siemens. Robicon's major competitors in the power control
systems market include multinational corporations such as ABB and Siemens, and
several niche engineering firms. As with VFDs, power systems are often produced
by divisions of large multinational corporations that may offer a broader
product range than that of Robicon.

Phymetrics

    The has two main components: equipment and analytical services. The
equipment part of this segment consists of PHI and HVE Europa. Analytical
services consists of Charles Evans & Associates ("CE&A"), a subsidiary of PHI
purchased on July 2, 1999 and PHI's analytical services business, operating as
Evans Analytical Group ("EAG").


                                        5


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    PHI is a designer and manufacturer of advanced surface analysis
instruments and components used to determine the elemental and/or chemical
composition of materials found on or near the surface of a sample. Advanced
surface analysis instruments are used in commercial applications in central
support laboratories that support semiconductor fabrication, computer
peripherals, chemicals, aerospace, metals, polymers, automotive and
biomaterials industries, among others, for product and process development,
process control, defect review and failure analysis, and for other
applications. Surface analysis instruments are also used for materials
science research by universities and government institutions. PHI is also a
supplier of ultrahigh vacuum ion pumps and controls required for the
production of clean vacuums used for commercial products and scientific
applications. PHI's headquarters are located in Eden Prairie, Minnesota.

    HVE Europa is a leading designer and manufacturer of particle accelerator
systems used in scientific, educational and industrial research. HVE Europa's
products are used primarily for materials science, semiconductor research and
carbon dating. HVE Europa's headquarters are located in Amersfoort, The
Netherlands. In addition to its core research markets, HVE Europa is a supplier
of ion accelerator subsystems to a major equipment manufacturer in the high
energy ion implantation market that supplies complete systems to leading
semiconductor manufacturers.

    For fiscal 2002, Phymetrics and its subsidiaries had net sales of $81.3
million, which represented 20.2% of the Company's consolidated net sales for
such period.

    Products

    PHI's products include Auger Electron Spectroscopy ("Auger"), Electron
Spectroscopy for Chemical Analysis ("ESCA"), Time-of-Flight Secondary Ion
Mass Spectrometry ("TOF-SIMS") and Dynamic Secondary Ion Mass Spectrometry
("Dynamic SIMS") instruments. Under ultrahigh vacuum conditions, PHI's
surface analysis instruments direct a particle beam at the surface of a solid
under investigation, causing the emission of particles from the specimen that
may be analyzed to determine the elemental and/or chemical composition of the
sample surface. Analytical software, customized for each of PHI's surface
analysis instruments, interprets data received from the instrument's analyzer
and creates images that show the distribution of elements or molecules on a
surface. Graphical and numerical data may also be obtained. In addition, by
removing and analyzing successive layers of material, each surface analysis
instrument is capable of generating a depth profile, which indicates how
elemental and/or chemical composition varies throughout the thickness of a
sample.

    PHI's Auger surface analysis instruments direct a highly focused continuous
electron beam onto a sample, which causes high energy "Auger electrons" to be
emitted from the sample surface. Because the energy level of such Auger
electrons is unique to the element from which they were emitted, it may be
measured to identify the elements present on the surface.

    PHI's ESCA surface analysis instruments direct a continuous x-ray beam onto
a sample, which causes "photoelectrons" to be emitted from the sample surface.
Because the energy level of such photoelectrons is unique to the element or
arrangement of atoms from which they were emitted, it may be measured to
identify the elements and/or determine the chemical composition of molecules on
the surface.

    PHI's TOF-SIMS surface analysis instruments direct short, intermittent
bursts of charged atoms ("ions") onto a sample, which causes other ions to be
emitted from the sample surface. These emitted ions traverse a long flight path,
with the time required for an ion to reach the analyzer (the "time of flight")
being directly related to its mass. Because the mass of such ions is unique to
the material from which they were emitted, it may be measured to identify the
elements or molecules present. The "time of flight" method of determining the
mass of the emitted ions is highly precise and can be used to accurately
identify both the elemental and chemical composition of a surface.

    PHI's Dynamic SIMS surface analysis instruments direct a highly focused
continuous beam of ions onto a sample, which causes other ions to be emitted
from the sample surface. Because the mass of such ions is unique to the material
from which they were emitted, it may be measured to identify the elements
present. In general, Dynamic SIMS is used to examine inorganic samples.

                                        6


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    EAG's principal services in commercial analytical techniques use beams of
ions, electrons or x-rays to probe the surface and micro-regions of
high-technology materials in order to provide information on composition and
chemistry.

    HVE Europa's products include ion accelerator systems, research ion
implanters, accelerator mass spectrometer systems and component parts such as
accelerator tubes. In a particle accelerator, ions are accelerated to a high
velocity under the influence of a strong electrical field and then fired into
the material to modify its properties and/or analyze its structure. Accelerator
mass spectrometer systems are specialized ion accelerator systems for which uses
include carbon dating in the fields of archeology, oceanography and geosciences.

    Markets and Customers

    PHI markets and sells its surface analysis instruments worldwide, with Japan
and North America representing its two largest markets.

    The diversity of applications for PHI's surface analysis instruments reduces
the effect of operating performance fluctuations resulting from cyclical
downturns with any one individual market. PHI's products are suitable for a wide
variety of applications without the need for substantial customization or
significant modification. This versatility of function permits PHI to respond
quickly to changes in the marketplace that favor new technologies or demonstrate
new applications. In addition, PHI has the ability to tailor each surface
analysis instrument to specific applications through changes in hardware
configuration, software customization and varying degrees of automation of
operation in response to industry-specific demands or customer requirements.

    EAG's services are used in industrial markets where there is a high
value-added in a high-technology product. Customers are typically engineers or
scientists. EAG's services are used primarily by the following industries:
semiconductors (manufacturers of integrated circuits and their suppliers of
capital equipment and materials), optoelectronics, data storage and biomedical
devices. These services are used by customers in their research and development,
manufacturing yield improvements and failure analysis, and in technical sales of
their products. EAG supports a "one-stop" worldwide analytical service business,
through its California and Minnesota operations, and through a U.S., European
and Pacific Rim network of affiliates.

    HVE Europa's products are been sold for various applications in materials
science, including semiconductor research. Other applications include ratio
spectrometry in archaeology, oceanography, geosciences, materials science and
biochemistry. Accelerator mass spectrometer systems are used by universities and
research institutes for carbon dating in the fields of archaeology, oceanography
and geosciences. The demand for particle accelerator systems has historically
been tied to the construction of new or expanded research facilities, which for
educational institutions is mainly dependent upon grants and fundraising.

    Sales and Marketing

    PHI markets its products domestically and internationally on the basis of
product performance and quality, availability and quality of after-sales support
and industry reputation in the manufacture of advanced surface analysis
instruments.

    PHI's experienced and technically oriented sales force is organized
geographically and consists of teams responsible for North America, Japan, the
Pacific Rim region and Europe. Technical service personnel (most of whom are
scientists and engineers) are decentralized within each region and strategically
situated in close proximity to major customers. PHI presently has a 50% interest
in a joint venture with ULVAC, a Japanese company, which resells and services
PHI's surface analysis instruments in the Japanese market. This joint venture
(ULVAC-PHI) has enabled PHI to successfully sell products into Japan, currently
one of the top two markets for advanced surface analysis instruments. In
addition, PHI provides surface analysis services on a contract basis in its
analytical laboratories located in the United States and Japan.


                                        7


<PAGE>


    EAG's services are sold worldwide, primarily through contacts often
initiated by scientific/technical personnel. Due to the complex nature of
technical problems clients want addressed, frequent and extensive interaction is
required between EAG and its customers. EAG presents technical papers at, and
participates in, scientific conferences, advertises in scientific periodicals
and distributes product literature and information on new developments to its
existing and potential new customers.

    HVE Europa's products are sold worldwide by its direct sales force. Due to
the complex, custom-built nature of HVE Europa's particle accelerators, frequent
and extensive interaction is required between HVE Europa and the customer. HVE
Europa presents technical papers at, and participates in, scientific
conferences, advertises in scientific periodicals and distributes product
literature and information on new developments to its existing and potential new
customers.

    Competition

    Competition in the surface analysis market is highly concentrated. The only
broad-line competitor in the markets served by PHI's products is VG Scientific
(Thermo Electron). In Auger, PHI's primary competitors are VG Scientific and
JEOL (Nihon Densi). In ESCA, PHI's primary competitors are Kratos Analytical
(Shimadzu) and VG Scientific. In TOF-SIMS, PHI's primary competitor is ION-TOF.
In Dynamic SIMS, PHI's primary competitor is Cameca.

    Competition in HVE Europa's market is highly concentrated. HVE Europa's
sales in the particle accelerator market are often bid competitively against
National Electrostatics Corporation, a privately held U.S. manufacturer.

Maxima Technologies

    The Company believes that Maxima Technologies is a leading designer,
manufacturer and supplier of electronic controls, monitoring systems and
accessories for the off-highway vehicle, industrial, specialty vehicle and
on-highway (truck & bus) markets, as well as the heavy-duty and automotive
retail aftermarket.

    Maxima's products include electronic control units (ECUs), instrument
controllers, vehicle and battery-related monitoring systems, Smart-Registered
Trademark- instrument products with engine shut-down features, analog and
digital instrument clusters, displays and conventional instruments,
fuel/temperature/pressure and specialty gauges, tachometers and speedometers,
voltmeters and ammeters, hourmeters, pyrometers and thermocouples,
fuel/temperature/pressure senders, electronic fuel sensors
(IntelliSensor-Registered Trademark-), speed sensors, switches, flashers and
relays, steering column modules, vehicle accessories and custom-engineered
products. Markets served include the off-highway, industrial (in-plant
equipment), engine-powered equipment, on-highway (truck & bus), specialty
vehicle and motorcycle, marine, power turf equipment, emergency vehicle, and
recreational vehicle markets, as well as the heavy-duty aftermarket. Maxima's
business is split between original equipment manufacturers (OEMs) (approximately
75% of total sales) and the aftermarket (25%). Products are sold directly to
either OEMs or through a worldwide network of more than 500 distributors.

    Maxima is a leading manufacturer and supplier to the agricultural vehicle
market in Western Europe. Maxima is also a supplier to the heavy-duty (truck)
and automotive aftermarket in North America. Maxima also acquired the exclusive
distribution rights for Hobbs brand products for the heavy-duty aftermarket from
its acquisition of Stewart Warner in 1998. Hobbs is a leading producer of hour
meters, lighting products and switches.

    A principal element of Maxima's strategy is to position itself as a
strategic consolidator of high-quality brands and a systems integrator in order
to offer value-added modules of products and services. As such, Maxima is able
to provide a more complete solution for OEM customers who will consolidate their
supply base. Maxima operates a Technology Center in Lancaster, Pennsylvania to
develop new products and applications for its core markets and customers.

    For fiscal year 2002, Maxima's net sales totaled $46.3 million, which
represented 11.5% of the Company's consolidated net sales.

                                        8


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    Products

    Due in large measure to its past acquisitions and marketing agreements,
Maxima believes that its product portfolio is one of the broadest in its
markets. The company has specifically defined its product lines along four
categories: 1) "standard" products (i.e. warehoused items that are sold "as
is"), 2) "custom" (typically, "same as except..." products that reflect only
minor changes), 3) "engineered" (meaning that products are significantly
changed), and 4) "IPD" (i.e. developed as completely new products using
"Integrated Product Development" and a method for planning and implementation
called "Integrated Product and Quality Planning", or IPQP that is compliant with
QS-9000 requirements).

    In an ongoing effort over the past several years to increase market share,
Maxima has introduced many new innovative products including
IllumaSeal-Registered Trademark-, a line of fully sealed instruments for
applications in high-moisture environments (currently approved and in use by
Caterpillar, Harley-Davidson, and many others); Smart-Registered Trademark-
instrument-Registered Trademark- products featuring integral warning lights,
switch outputs and engine shut-down features; IntelliSensor-Registered
Trademark-, a fully electronic hydrocarbon-based liquid-level sensing unit);
INFOTRAK 2000-TM- and DATLINK-TM- data-bus systems which include instrument
controllers and corresponding digital gauges and meters; Streamline-TM-
instruments, a new product line featuring unique retro styling and oversized
meters; Sentinel-TM- hourmeters, featuring a new quartz stepper motor movement;
Sentry-TM- vehicle/battery monitoring systems for gasoline and electrically
powered industrial and specialty vehicles; Compatino-TM-, a new line of stylish,
yet compact instrument clusters; and Wings-TM-, a family of 1940s-style Stewart
Warner branded gauges and meters especially designed for the classic car and
performance oriented aftermarket.

    Maxima has developed a "menu" of electronically oriented, data-bus related
products that tap into a vehicle's "distributed network" of nodes which in turn
manage the vehicle's various functions. One benefit resulting from Maxima's
focus on OEM business and its approach to systems integration is that the
company naturally extends these same products into the aftermarket. Further, the
aftermarket typically has different expectations and thus, Maxima's products are
more easily accepted without the normal long and involved qualification process.
Maxima believes that having a strong OEM focus naturally contributes to a
certain amount of "pull-through" of product into the aftermarket.

    Markets and Customers

    Approximately one third of Maxima's sales come from the OEM "off-highway"
vehicle market (agricultural, construction and mining equipment). Maxima's top
five market segments account for over 80% of sales and its top 25 customers
account for over 50% of total sales. Products are sold in 42 countries.

    Competition

    Maxima's frame of reference for its competition has fundamentally changed as
a result of the push toward electronic products and systems integration. Major
competitors include Ametek-Dixson, Cobo, Planar, Phoenix, Pollak, Preco,
Taytronics, Vansco and VDO, among others. Some OEMs make their own display and
control systems, typically through specialized operations that support assembly
plants.

    Maxima's formula for differentiating itself from the competition depends on:
high-quality, on-time delivery, competitive price, good service and engineering
support--coupled with breakthroughs in product applications and a systems
integration approach that seeks to provide value-added solutions with Maxima's
emphasis on speed-to-market within its customer-focused philosophy.

    Sales and Marketing

    Maxima's sales force is located primarily in North America and Europe.
Customers are supported based on certain criteria that take into account
customer preferences, geography and a particular expertise. In addition, Maxima
employs regionally based sales agents and in some cases, distributors which use
their own sales personnel to provide coverage in the market.


                                        9


<PAGE>


    Marketing activities include direct mail, targeted advertising, media
relations and trade show participation, promotional support for distributors,
ongoing distributor training and workshops, and general control and support of
corporate identification programs. Each brand is also supported to retain their
unique identity and sustain brand awareness. Maxima Technologies also made an
investment in Six Sigma training and education. Twenty-three associates received
greenbelt certificates and Six-Sigma concepts are now used throughout the
company for problem analysis and resolution and for cost savings.

    Distribution

    AST and Datcon products are distributed through a network of over 70 Class
"A" distributors who generally operate as "master" distributors. Stewart Warner
products are marketed through a large network of wholesale distributors located
in North America, who typically resell products to jobbers. In addition, Stewart
Warner brand products are distributed through large retail outlets such as NAPA
and CarQuest, where the products are marketed directly to end-users.
Distribution sales represent approximately 25% of Maxima's total business.

    Operations

    Maxima's European operations are located in Barcelona, Spain. Maxima's U.S.
operations are located in Lancaster, Pennsylvania and in El Paso, Texas where
Maxima warehouses Stewart Warner brand products. The operation in Juarez, Mexico
is set up as a "Maquiladora", wherein products are manufactured in Juarez and
moved to El Paso for warehousing and distribution.


BACKLOG

    The Company's backlog was as follows as of the dates indicated (dollars in
thousands):

<TABLE>
<CAPTION>

                                      April 27, 2002           April 28, 2001           April 29, 2000
                                  ----------------------   ----------------------   ----------------------
                                             Percentage               Percentage               Percentage
                                   Amount     of Total      Amount     of Total      Amount     of Total
                                  --------   -----------   --------   -----------   --------   -----------
<S>                             <C>        <C>            <C>       <C>           <C>         <C>
ASI.............................  $124,840       60.5%     $115,245       56.6%     $126,553        61.9%
Robicon.........................    57,749       28.0        52,804       25.9        44,296        21.7
Phymetrics......................    14,972        7.2        26,379       12.9        20,323         9.9
Maxima Technologies.............     8,873        4.3         9,433        4.6        13,129         6.5
                                  --------      -----      --------      -----      --------       -----
Total...........................  $206,434      100.0%     $203,861      100.0%     $204,301       100.0%
                                  ========      =====      ========      =====      ========       =====
</TABLE>

    The Company believes that its backlog as of any particular date may not be
indicative of sales for any future period. The Company expects that $186,941
million of its backlog will be shipped before April 26, 2003.

Research and Development

    Research and development activities are conducted separately by each
operating unit. The Company's operating units focus on developing
applications-engineered products designed to meet their customers' needs. Teams
representing different functional areas within an operating unit work closely
with customers early in the product design process to ensure that the product
meets the customer's specifications and is designed for ease of manufacturing.
Research and development expenditures that the Company has made have resulted in
innovative new products such as Phymetrics' new SMART-Tool, Robicon's Perfect
Harmony series of medium voltage VFDs, and Maxima's Intellisensor fuel
measurement systems. Phymetrics incurs significant research and development
expenses due to the high technology content of its surface analysis instruments
and its growth strategy of increasing penetration to the semiconductor
fabrication market, increasing sales through the identification of new
applications for its existing products, enhancements in the technological
capability of its instruments, the development of application-specific hardware
configurations for its instruments and the continued improvement in the
operating ease and efficiency of its instruments through increased automation
and software development. The Company's research and development expenses were
$16.5 million, $16.5 million and $17.4 million for fiscal 2002, 2001 and 2000,
respectively. In addition, the Company recorded charges to earnings of $1.7
million in fiscal 2000 for the write-off of purchased research and development
related to the acquisitions of CE&A. Substantially all research and development
expenses of the Company are related to Company-sponsored research.

                                       10


<PAGE>


Patents and Trademarks

    The Company holds domestic and foreign patents covering certain products and
processes in all of its operating units, as well as trademarks covering certain
of its products. Certain patents relating to Robicon's Perfect Harmony series of
medium voltage VFDs are of particular significance; these patents were issued in
April and June of 1997 and expire in 2014.

Employees

    At April 27, 2002, the Company had a total of 2,591 employees, of whom 2,577
were employed by the Company's operating units. The Company's domestic employees
are not covered by collective bargaining agreements, however, substantially all
of the personnel employed by its foreign subsidiaries belong to national
workers' councils. The Company considers it relations with its employees to be
good.

    The following table provides information relating to the employees of the
Company's operating units as of April 27, 2002:

<TABLE>
<CAPTION>
                                                                Total
Operating Units                                               Employees
---------------                                               ---------
<S>                                                         <C>
ASI.........................................................    1,326
Robicon.....................................................      420
Phymetrics..................................................      386
Maxima......................................................      445
                                                                -----
    Total Operating Unit Employees..........................    2,577
                                                                ======
</TABLE>


ITEM 2.--PROPERTIES

    The following are the principal operating facilities of the Company listed
by operating unit, each of which includes general office and administrative
space:

<TABLE>
<CAPTION>
                                                                         Usable Space
Operating Units                                       Function           (Square Feet)   Owned/Leased
---------------                               -------------------------  -------------   ------------
<S>                                         <C>                        <C>              <C>
ASI:
  Milan, Italy..............................  Design and assembly            126,000       Leased
  Monfalcone, Italy.........................  Design and assembly            408,880        Owned
  Montebello Vicentino, Italy...............  Design and assembly            201,240        Owned
  Trieste, Italy............................  Design and assembly             78,480        Owned

ROBICON:
  New Kensington, Pennsylvania..............  Design and assembly            123,000        Owned
  Pittsburgh, Pennsylvania..................  Design                          80,000        Owned

PHYMETRICS:
  Eden Prairie, Minnesota...................  Design and assembly            205,000        Owned
  Sunnyvale, California.....................  Design and service              74,859       Leased
  Amersfoort, The Netherlands...............  Design and assembly             60,000        Owned

MAXIMA:
  Barcelona, Spain..........................  Design and assembly             76,773        Owned
  Lancaster, Pennsylvania...................  Design and assembly             71,873       Leased
  Juarez, Mexico............................  Assembly                        75,000       Leased
</TABLE>

-------------------------

    In addition to the facilities described above, the Company leases various
warehouses and sales and administrative facilities. The Company believes that
its manufacturing facilities are properly maintained and that production
capacity is adequate to meet the requirements of its operating units.

                                       11


<PAGE>


ITEM 3.--LEGAL PROCEEDINGS

    In March 1998, the Company's Robicon Corporation subsidiary initiated
litigation against Toshiba International Corporation ("Toshiba") in the
United States District Court for the Western District of Pennsylvania
alleging infringement of one of Robicon's Perfect Harmony patents. In June
1998, Toshiba filed suit against Robicon and several other defendants in the
United States District Court for the Southern District of Texas alleging,
among other things, false and disparaging comments concerning Toshiba,
interference with contract, violation of the Texas Competition and Trade
Practices Statute and civil conspiracy to restrict Toshiba's business and
cause the wrongful termination of a purchase order of one of its customers.
Damages under each section are claimed to be in excess of $75,000, the
federal statutory minimum, in addition to a claim for punitive damages. In
its suit, Toshiba has also claimed that Robicon is infringing a patent held
by Toshiba and requested a declaratory judgment that Robicon's patent, which
is the subject of the Pennsylvania action, is invalid. In March 1999, the
Texas District Court dismissed without prejudice all claims except the
alleged patent infringement by Robicon and the request for declaratory
judgment. These claims were then transferred to the Western District of
Pennsylvania. Also in March 1999, Toshiba filed a petition in Harris County,
Texas in which it realleged the claims dismissed by the Texas district court,
citing the additional costs by Toshiba to reinstate its purchase order and
damages to its reputation not exceeding $5.0 million. On November 29, 1999,
the Pennsylvania district court granted Robicon's Motion to dismiss Toshiba's
patent infringement claim against Robicon. The only remaining transferred
claim is Toshiba's request for declaratory judgment. In November 1999,
Toshiba filed a motion to dismiss without prejudice all of the claims pending
in Harris County, Texas pursuant to a Tolling Agreement which permitted
Toshiba one (1) year to re-file its claims. In December 1999, the Texas state
court granted Toshiba's motion. Toshiba did not re-file its claims prior to
the expiration of the Tolling Agreement. There has been no substantive change
in the status of this litigation.

    Certain other claims, suits and complaints have been filed or are pending
against the Company. In the opinion of the Company, all such matters are without
merit or are of such kind, or involve such amounts, as would not have a material
effect on the consolidated financial position or the results of operations of
the Company if resolved unfavorably to the Company. If estimates change, there
is no assurances these items will not require additional accruals by the
Company.

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

    None.

                                    PART II.

ITEM 5.--MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

    The Company's common stock is not publicly traded.

                                       12


<PAGE>


ITEM 6.--SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA

                             (Dollars in Thousands)

    The Selected Historical Consolidated Financial Data presented below under
the captions "Statement of Operations Data" and "Balance Sheet Data" as of and
for each of the fiscal years in the five-year period ended April 27, 2002, are
derived from the audited consolidated financial statements of High Voltage
Engineering Corporation and its subsidiaries, as restated.

    The Selected Historical Consolidated Financial Data of the Company should be
read in conjunction with the audited historical consolidated financial
statements of Company for the fiscal years in the three-year period ended April
27, 2002 and the notes thereto included elsewhere herein.

<TABLE>
<CAPTION>
                                                                  Fiscal Years Ended
                                            --------------------------------------------------------------
                                            April 27,    April 28,    April 29,    April 24,    April 25,
                                               2002         2001         2000         1999         1998
                                            ----------   ----------   ----------   ----------   ----------
<S>                                       <C>           <C>          <C>         <C>           <C>
Statement of Operations Data:
  Net sales...............................   $403,012     $416,547     $271,485     $220,683     $192,658
  Cost of sales (Includes subassembly exit
    costs of $2,661 and $405 in fiscal
    2001 and 2000, respectively, and
    restructuring charge--inventory
    markdown of $855 in fiscal 2000)(a)...    306,533      322,593      199,654      144,426      125,354
                                             --------     --------     --------     --------     --------
  Gross profit............................     96,479       93,954       71,831       76,257       67,304
  Administrative and selling
    expenses(b)...........................     83,547       73,636       56,108       46,328       43,958
  Research and development expenses.......     16,485       16,533       17,361       16,518       14,615
  Write off of purchased in-process
    research and development..............         --           --        1,650           --        8,100
  Restructuring charge(a).................        859          143        1,795          580          186
  Other, net(c)...........................      6,314        5,106        7,172       (1,131)       4,084
                                             --------     --------     --------     --------     --------
  (Loss) income from operations...........    (10,726)      (1,464)     (12,255)      13,962       (3,639)
  Interest expense........................    (25,043)     (22,044)     (19,122)     (17,242)     (17,077)
  Interest income.........................      1,690          753          921        1,886          983
                                             --------     --------     --------     --------     --------
    Loss from continuing operations before
      income taxes, discontinued
      operations and extraordinary item...    (34,079)     (22,755)     (30,456)      (1,394)     (19,733)
  Income taxes (credit)...................      2,948       (2,291)        (631)      (3,606)      (2,355)
                                             --------     --------     --------     --------     --------
  (Loss) income from continuing operations
    before discontinued operations and
    extraordinary item....................    (37,027)     (20,464)     (29,825)       2,212      (17,378)
  Discontinued operations:
    Income from discontinued operations,
      net of income taxes.................         --        2,078        2,158        3,188        3,327
    Gain on disposal of discontinued
      operations, net of income taxes.....         --       34,270          559        9,633        8,771
  Extraordinary loss, net of income
    taxes.................................       (327)        (530)          --           --       (7,464)
                                             --------     --------     --------     --------     --------
  Net (loss) income.......................   $(37,354)    $ 15,354     $(27,108)    $ 15,033     $(12,744)
                                             ========     ========     ========     ========     ========
</TABLE>


                                       13


<PAGE>

<TABLE>
<CAPTION>
                                                                  FISCAL YEAR ENDED
                                            --------------------------------------------------------------
                                            April 27,    April 28,    April 29,    April 24,    April 25,
                                               2002         2001         2000         1999         1998
                                            ----------   ----------   ----------   ----------   ----------
<S>                                       <C>          <C>          <C>          <C>          <C>
Balance Sheet Data (at Period End):
  Working capital.........................   $ 53,500     $ 44,007     $  5,991     $ 79,269     $ 39,388
  Total assets............................    372,389      411,623      357,812      243,455      225,376
  Total indebtedness (including redeemable
    put warrants and foreign receivable
    facilities)...........................    244,936      229,368      204,912      174,731      174,627
  Redeemable preferred stock..............     53,847       46,122       40,642       35,229       30,457
  Stockholders' deficiency................   (117,835)     (65,521)     (73,568)     (40,961)     (50,935)
Other Data:
  Adjusted EBITDA (unaudited)(d)..........   $ 25,097     $ 27,467     $ 14,655     $ 22,292     $ 16,511
  Depreciation and amortization(e)........     28,755       20,766       16,486        9,075        5,976
  Capital expenditures(f).................     20,191        9,563       12,898       10,564        4,058
  Backlog (unaudited).....................    206,434      203,861      204,301       56,338       72,432
  Ratio of earnings to fixed charges(h)...         --           --           --           --           --
Operating Unit Data:
  Net sales:
    ASI...................................   $174,423     $178,283     $ 53,960     $     --     $     --
    Robicon...............................    100,912       85,986       74,913       84,299       94,192
    Phymetrics............................     81,340       96,319       81,418       75,453       60,508
    Maxima................................     46,337       55,959       61,194       60,931       37,958
                                             --------     --------     --------     --------     --------
      Total net sales.....................   $403,012     $416,547     $271,485     $220,683     $192,658
                                             ========     ========     ========     ========     ========
  Adjusted EBITDA (unaudited):
    ASI...................................   $  7,579     $  7,220     $ (5,762)    $     --     $     --
    Robicon...............................      7,954        4,565        3,407        5,927        8,140
    Phymetrics............................      7,958       10,530       10,360        9,855        8,713
    Maxima................................      5,245        7,305        8,672        9,127        5,491
                                             --------     --------     --------     --------     --------
      Total operating unit Adjusted
        EBITDA............................     28,736       29,620       16,677       24,909       22,344
    Corporate overhead....................     (3,639)      (2,153)      (2,022)      (2,617)      (5,828)
                                             --------     --------     --------     --------     --------
      Total Adjusted EBITDA...............   $ 25,097     $ 27,467     $ 14,655     $ 22,292     $ 16,516
                                             ========     ========     ========     ========     ========
Cash Flow Provided By (Used for):
    Operating activities..................   $(34,568)    $(32,682)    $   (149)    $  8,617     $     --
    Investing activities..................    (10,605)      60,491      (70,580)      13,589           --
    Financing activities..................     33,684       (2,401)     (46,452)      (7,381)          --
</TABLE>

   See accompanying Notes to Selected Historical Consolidated Financial Data.

                                       14


<PAGE>


                 NOTES TO SELECTED CONSOLIDATED FINANCIAL DATA

                             (Dollars in Thousands)

(a) In fiscal 2002, the Company incurred a total restructuring charge of $859
    which comprised of $732 related to the closing of the HVE Europa Billerica,
    Massachusetts facility and $127 for the closing of PHI's Singapore
    analytical service facility. In fiscal 2001, the Company incurred a total
    restructuring charge of $143 comprised of severance relating to reducing the
    headcount at Robicon. In fiscal 2000, the Company incurred a total
    restructuring charge of $2,650 comprised primarily of: (i) $1,830 at PHI for
    severance and inventory markdown relating to the outsourcing of certain
    manufacturing activities and (ii) $820 at Robicon for severance relating to
    the reduction of headcount. In fiscal 1999, the Company incurred a total
    restructuring charge of $580 comprised primarily of: (i) $390 at Robicon for
    severance relating to the reduction of headcount and (ii) $190 at PHI for
    severance paid to a former executive. In fiscal 1998, the Company incurred
    restructuring costs of $186 at PHI relating to a program designed to reduce
    costs to manage the weaker order rates expected from Asia.

(b) Adjusted EBITDA excludes severance expenses of $636 included in
    administrative and selling expenses in fiscal 1998. See note (d) below.

(c) Other, net is comprised of the following:

<TABLE>
<CAPTION>
                                                                      Fiscal Years Ended
                                                 --------------------------------------------------------------
                                                  April 27,    April 28,    April 29,    April 24,    April 25,
                                                    2002         2001         2000         1999         1998
                                                 ----------   ----------   ----------   ----------   ----------
<S>                                            <C>          <C>          <C>           <C>          <C>
Write-down of notes receivable, deposits and
  impaired capital equipment..................    $   159      $   457      $   628     $   250       $   --
Net loss (gain) on disposition of
  miscellaneous assets........................        313         (256)         608         507         (710)
Excess facilities (income) expense, net.......        666         (383)        (357)       (219)        (390)
Aborted acquisition, offering costs and related
  litigation, net of recoveries (note Q)......        221          350           28      (1,809)       1,442
Patent defense costs and related litigation,
  net of recoveries...........................          6          390          901          35           --
Equity in earnings of joint venture and other
  affiliates..................................     (1,584)        (876)         239        (188)         109
Bondholders' consent fees and financing
  agreement amendment fees and related costs..        265            --        3,451          --           --
Discount on sale of receivables...............        356         2,519          857          --           --
Facility relocation costs.....................        202         1,145          413          --           --
Workforce reduction costs.....................      4,326         1,708           --          --           --
Reimbursed environmental and litigation costs,
  net (note Q)................................        839            52          404         293        3,633
ASI acquisition integration costs.............        545            --           --          --           --
                                                   ------       -------      -------     -------       ------
Total.........................................     $6,314       $ 5,106      $ 7,172     $(1,131)     $ 4,084
                                                   ======       =======      =======     =======       ======
</TABLE>

(d) Adjusted EBITDA is defined as earnings from continuing operations before
    interest, income taxes, depreciation, amortization and non-recurring items.
    Non-recurring items are comprised of: (i) restructuring charge, and other,
    net (ii) non-recurring severance payments of $636 to certain former senior
    executives included in administrative and selling expenses of the Company in
    fiscal 1998, and (iii) purchase accounting expenses relating to the
    acquisition of CE&A of $1,650 in fiscal 2000, and purchase accounting
    expenses relating to the acquisitions of PHI of $6,800 and Stewart Warner of
    $2,620 in fiscal 1998. See notes (a) through (c) above and notes I, N and Q
    to "Notes to Consolidated Financial Statements" of High Voltage Engineering
    Corporation and subsidiaries. Adjusted EBITDA is not considered a measure of
    performance under GAAP. While Adjusted EBITDA should not be considered as a
    substitute for net income, cash flows from operating activities, other
    income or cash flow statement

                                       15


<PAGE>


    data prepared in accordance with GAAP, or a measure of profitability or
    liquidity, management understands that some form of EBITDA is often used as
    a measurement in evaluating companies. In particular, since Adjusted EBITDA
    excludes the non-recurring items described above, the Company believes that
    trends in Adjusted EBITDA may provide meaningful information as to one
    factor in the Company's ability to satisfy its cash requirements on an
    on-going basis. Moreover, substantially all of the Company's financing
    agreements contain covenants in which EBITDA, as defined therein, is used as
    a measure of financial performance. See "Management's Discussion and
    Analysis of Financial Condition and Results of Operations" for a discussion
    of other measures of performance determined in accordance with GAAP and an
    analysis of changes in Adjusted EBITDA in recent periods. Readers should
    note, however, that "Adjusted EBITDA" as used in this document may not be
    comparable to similarly titled measures presented by other companies and
    could be misleading, since not all companies and analysts calculate such
    measures in the same fashion or on the same basis.

(e) Depreciation and amortization excludes $1,409, $1,393, $2,082, and $2,157
    attributable to discontinued operations in fiscal 2001, 2000, 1999 and 1998,
    respectively, and $118, $120, $217, $194 and $147 related to assets held for
    sale in fiscal 2002, 2001, 2000, 1999 and 1998, respectively. Depreciation
    and amortization in fiscal 2000 includes $1,236 for the writedown of long
    lived assets and assets held for sale to net realizable value.

(f) Capital expenditures include assets acquired under capital leases and
    exclude capital expenditures from discontinued operations in the amounts of
    $2,038, $1,244, $2,252, and $2,723 in fiscal 2001, 2000, 1999, and 1998,
    respectively.

(g) For purposes of this computation, earnings are defined as income or loss
    from continuing operations before income taxes, discontinued operations and
    extraordinary item and fixed charges. Fixed charges are the sum of:
    (i)interest cost; (ii) accretion of redeemable put warrants; (iii)
    amortization of deferred financing costs; (iv) the portion of operating
    lease rental expense that is representative of the interest factor (deemed
    to be one third); (v) accretion of preferred stock; (vi) preferred stock
    dividends; and (vii) capitalized interest. Earnings were inadequate to cover
    fixed charges by $41,804, $29,461, $35,869, $6,166 and $23,088 in fiscal
    2002, 2001, 2000, 1999, and 1998, respectively.

                                       16


<PAGE>


ITEM 7.--MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS

    Except as otherwise indicated, the following discussion relates to the
Company on a historical basis without giving effect to certain acquisitions
completed by the Company. This report may make forward-looking statements
regarding future events or the future financial performance of the Company. We
caution you that these statements are only predictions and that actual events or
results may differ materially. We refer you to documents the Company files from
time to time with the Securities and Exchange Commission. This document
identifies and describes important factors that can cause the after-results to
differ materially from those contained in any forward looking statements we may
make. The following discussion should be read in conjunction with the Selected
Historical Consolidated Financial Data and the consolidated financial statements
and notes thereto contained elsewhere in this document.

    The consolidated financial statements of the Company include the accounts of
High Voltage Engineering Corporation and its subsidiaries after elimination of
material inter-company transactions and balances.

    As a result of the sale by the Company of substantially all of the assets of
the Company's Anderson operating unit on March 7, 2001, the Company's
consolidated results have been restated to reclassify the results of such
operations as discontinued operations.

Seasonality; Variability Operating Results

    The majority of the Company's operating units have historically recorded the
strongest operating results in the fourth quarter of the fiscal year due in part
to seasonal considerations and other factors.

    The timing of orders placed by the Company's customers has varied with,
among other factors, the introduction of new products, product life cycles,
customer attempts to manage inventory levels, competitive conditions, general
economic conditions and the availability of funding for scientific and
educational research. The variability of the level and timing of orders has,
from time to time, resulted in significant periodic and quarterly fluctuations
in the operations of the Company's operating units.

Results of Operations

Consolidated

    Net sales for the fiscal 2002 were $403.0 million, which was a decrease of
$13.5 million or 3.2% from fiscal 2001. The Company reported a net loss from
continuing operations before extraordinary item and discontinued operations of
$37.0 million for fiscal 2002 compared to an operating loss of $20.5 million for
the same period in fiscal 2001. The primary differences in the results of
operations of fiscal 2002 as compared to fiscal 2001 were: (i) lower sales
volume due to the depressed semiconductor market, served by Phymetrics,
continued downward trend in the off-highway equipment, heavy truck and specialty
vehicles markets served by Maxima and a weak global economy, (ii) offset by
higher margins primarily in the Industrial Power Control segment(iii) increase
in goodwill amortization, (iv) increase in workforce reorganization costs, (v)
higher foreign tax provisions and (vi) higher interest costs offset by lower
receivable securitization costs.

Segment Analysis:

Fiscal 2002 Compared to Fiscal 2001

    The Industrial Power Control Segment reported net sales of $275.3 million
for fiscal 2002, an increase of $11.1 million or 4.2% from fiscal 2001. Net
sales for Robicon increased $14.9 million or 17.4% during the fiscal 2002
compared to fiscal 2001. The increase in net sales was primarily attributable to
the increased volume in the Medium Voltage product line and higher service
revenues due to stronger energy and utility markets, partially offset by
weakness in products serving industrial markets. Net sales for ASI decreased
$3.9 million or 2.2% during fiscal 2002 as compared to fiscal 2001. The decrease
can be attributed to a stronger U.S. dollar during fiscal 2002 as compared to
fiscal 2001. Excluding the effect of the currency translation, net sales
increased 1.0% during fiscal 2002 as compared to fiscal 2001. This increase is
due in part to and increase in the Motor and Power Control businesses, driven by
strong demand in the Energy and power generation and


                                       17


<PAGE>


transmission markets and higher volumes of add-on revenues. This impact was
offset by significant reduction in sales that had contained a large one time
contract in fiscal 2001. Order levels remain strong increasing 5.1% and 12.0% at
ASI and Robicon, respectively during fiscal 2002 compared to fiscal 2001.

    Backlog at ASI has increased $9.6 million or 8.3% to $124.8 million compared
to the backlog at April 28, 2001 of $115.2 million due to strong demand for AC
Motors, Medium voltage drives and systems, combined with the booking of a large
Metals systems order. Backlog at Robicon increased $4.9 million or 9.4% to $57.7
million compared to backlog at April 28, 2001 of $52.8 million.

    Operating income for the segment increased $5.5 million to $6.5 million
during fiscal 2002 compared to operating income of $1.0 million in fiscal 2001.
This increase in operating income was primarily due to improved gross margins of
2.6% or $9.5 million during fiscal 2002 compared to fiscal 2001. This was the
result of higher volumes, cost reductions and efficiencies of production at
Robicon. ASI increased gross margin by 2.2% as the benefits of the restructuring
carried out during fiscal 2001, improved product mix with increased service
revenue and more selective contract management improved the profitability of the
company. The improved gross margin was offset by increases in operating expenses
as the whole business segment invested in sales channel development and
infrastructure to create the organization and structure to deliver sustained
growth in the future.

    The Advanced Surface Analysis Segment reported net sales of $81.3 million
for fiscal 2002, which is a decrease of $15.0 million or 15.6% compared to
fiscal 2001. Equipment sales, which includes PHI and HVE Europa, declined $10.8
million or 15.8% to $57.6 million during fiscal 2002 as compared to fiscal 2001.
The decrease is the result of the severely depressed conditions in the
semiconductor markets, weakness in the worldwide market for electronics and
other markets in the U.S. This has resulted in many companies canceling or
postponing capital expenditures during fiscal 2002 as compared to fiscal 2001.
The stronger U.S. dollar has increased the cost of PHI's equipment products in
certain foreign markets compared to PHI's foreign based competitors.

    Operating loss increased $12.8 million to $16.1 million for fiscal 2002
compared to fiscal 2001. The increase in operating loss is primarily due to
the decreased gross margin on certain equipment sales and the higher mix of
sales to Ulvac-PHI which has lower gross margins. Also contributing to the
increase operating loss is an increase in operating expenses of $9.5 million,
which is due to the write off of goodwill of $8.8 million, and a
restructuring charge of $0.7 million recorded during the fourth quarter of
fiscal 2002 related to the closing of the Billerica, Massachusetts facility.
Also contributing to the increase in operating loss is $2.8 million of other
expenses related to reorganization efforts at PHI during fiscal 2002. The
Company has implemented cost reduction plans that has resulted in reduced
headcount, greater focus on the semiconductor industry, outsourcing of
certain subassemblies and reduction of many variable costs to help offset the
reduced gross margin.

    The Customized Monitoring Instrumentation Segment reported net sales of
$46.3 million during fiscal 2002, which was a decrease of $9.6 million or 17.2%
compared to fiscal 2001. The reduction in this segment was primarily a result of
reduced volume from the continued weakness in OEM and distribution channels in
all major markets. New products such as the digital tachometer and instrument
clusters partially offset the sales reduction. An adverse economy that resulted
in reduced sales from both the OEM and distribution markets on a worldwide basis
is the major cause for the volume reduction. The focus for turnaround and growth
is in development of new electronic products for distribution and OEM markets
and the attainment of new programs from major OEM customers.

    The operating income decreased $1.6 million to $2.7 during fiscal 2002 as
compared to fiscal 2001 due to the sales volume decline and 2.7% decline in the
gross margin that was significantly offset by cost containment in all areas of
spending. Cost containment included a 19% reduction in headcount and significant
material cost reductions.


                                       18


<PAGE>


    Maxima Technologies has made major investments during fiscal 2002 to
position itself for the coming years. These investments include a Surface Mount
Technology (SMT) based production line for assembly of electronic circuits
(screen printer, component pick and place, axial component insertion, re-flow
oven, wave solder and in-circuit test system). In addition, Maxima has invested
in "pockets of automation" for mistake-proofing and productivity improvements.

Fiscal 2001 Compared to Fiscal 2000

    The Industrial Power Control Segment reported net sales of $264.3 million
for fiscal 2001 which was a increase of $135.4 million, or 105.1%, from fiscal
2000. The primary difference in the results of operations in fiscal 2001 as
compared to fiscal 2000 was a full year of operations from ASI, which was
acquired on December 22, 1999. Net sales for Robicon increased $11.1 million or
14.8% during fiscal 2001 as compared to fiscal 2000. The increase in net sales
was due to incremental increases across all Robicon product lines with the
greatest increase in revenue from power control systems which increased 78.4%
over fiscal 2000 net sales. The core product lines, consisting of medium voltage
drives, low voltage drives, heating and regulating and service, increased a
combined $6.1 million or 8.8% over fiscal 2000 net sales. Order levels have been
strong and backlog for Robicon has increased $8.5 million or 19.2% to $52.8
million compared to backlog at April 29, 2000. Robicon saw stronger activity in
the energy market as evidenced by orders received in the fourth quarter of
fiscal 2001 totaling $5.3 million, which is an increase of $2.7 million or
103.8% compared to the same period in fiscal 2000.

    Operating income for fiscal 2001 of $1.0 million increased $9.8 million
compared to a loss of $8.8 million in fiscal 2000. The increase in operating
income is due primarily to realizing the benefits of the restructuring plan at
ASI and continued streamlining of synergies between ASI and Robicon. Integration
of the ASI operations, Robicon, and the subsidiaries in France, Germany, and the
UK progressed according to plan. The Company created a single, company-wide
technology organization and developed multi-generation product development plans
for each major product line. Excluding operating income of $1.9 million at ASI,
operating loss in fiscal 2001 of $0.9 million remained flat compared to fiscal
2000. The operating loss was primarily due to significant cost overruns on
certain power control systems contracts and higher amortization of $1.7 million.
Also contributing to the loss was lower medium voltage margins due to price
erosion on orders taken in the prior fiscal year and margin erosion in the low
voltage drives product line due to a higher mix of low horsepower drives. Fiscal
2000 included a restructuring charge of $0.8 million.

    The Advanced Surface Analysis Segment reported net sales of $96.3 million
for fiscal 2001 which was an increase of $14.9 million, or 18.3% from fiscal
2000. Excluding net sales from CE&A, which was acquired on July 2, 1999, net
sales for this segment increased $8.9 million during fiscal 2001 as compared to
the fiscal 2000. The increase was the result of PHI shipping two additional
large systems and HVE Europa shipping one additional system during fiscal 2001
as compared to fiscal 2000.

    Operating loss decreased $0.3 million to a loss of $3.3 million in fiscal
2001 as compared to $3.6 million in fiscal 2000. Excluding operating income from
CE&A, operating loss increased $0.4 million to a loss of $4.5 million during
fiscal 2001 as compared to $4.1 million in fiscal 2000. The increase in the
operating loss was partially due to a decline in the gross margin percentage of
2% or $1.2 million on PHI's fiscal 2001 sales due to a shift to lower margins
systems in addition to non-recurring charges incurred in the outsourcing of
major subassemblies of $2.7 million in fiscal 2001 compared to $0.4 million in
fiscal 2000. Backlog at April 28, 2001 of $26.4 million increased $6.1 million
or 29.8% over the backlog at April 29, 2000.

    During fiscal 2001, net sales from CE&A of $24.7 million increased $5.9
million or 31.5% from fiscal 2000. This increase is a result of two additional
months of sales at CE&A in fiscal 2001 or $3.2 million as compared to fiscal
2000. Additionally, fiscal 2001 included higher volume and a price increase,
which was effective January, 2001.

    Operating income from analytical services of $1.2 million in fiscal 2001
increased $0.7 million compared to fiscal 2000 income of $0.5 million. This
increase reflects twelve months results in fiscal 2001 versus ten months in
fiscal 2000 and is offset by a one time charge in fiscal 2000 of $1.7 million to
write off purchased in-process research and development expense, which had been
valued in accordance with purchase accounting procedures.


                                       19


<PAGE>


    The Customized Monitoring Instrumentation Segment reported net sales of
$56.0 million for fiscal 2001 which was a decrease of $5.2 million, or 8.6%,
from fiscal 2000. The reduction in net sales was primarily a result of lost
business early in fiscal 2001 from a large customer due to a planned model year
changeover and reduced volume from the heavy truck market including a major
company that was placed on credit hold. The total value of lost sales to these
two customers amounts to $2.5 million for fiscal 2001 as compared to fiscal
2000. These factors plus the slowdown in distribution markets coupled with
forced price concessions from certain key accounts reflect the major cause for
the sales decline. New products such as the digital tachometer and instrument
clusters partially offset the sales reduction. Gross margin declined $4.4
million, due to a decrease in the gross margin percentage of 5.1% during fiscal
2001 as compared to fiscal 2000. The decrease in gross margin is a result of
higher warranty cost on some discontinued Stewart Warner brand products and a
shift towards lower margin products. To offset the deterioration of gross
margin, Maxima announced a 5% price increase during the second quarter of fiscal
2001. Operating income decreased $1.7 million to $4.3 million for fiscal 2001 as
compared to fiscal 2000. The decrease in operating income was attributable to
lost business, lower gross margin of $0.2 million due to foreign currency
translation which was partially offset by expense savings during fiscal 2001.

Liquidity and Capital Resources

    The Company's liquidity needs are primarily for working capital, capital
expenditures and debt service. The Company's primary sources of liquidity have
been funds provided by operations, proceeds from the sale of discontinued
operations and asset sales, and proceeds from financing activities.

    The Company has made significant acquisitions, which are inherently subject
to risk. The successful integration of the acquired operations and the
substantial demands on the attention of senior management may adversely impact
their ability to manage the Company's existing businesses.

    On March 7, 2001, the Company completed the sale of substantially all the
net assets of its Anderson Power division and all the capital stock of
Anderson Power Products Ireland B.V. (together "Anderson") to Ideal
Industries, Inc. for $78.7 million in cash. The Asset Sale Proceeds, as
defined, received by the Company in connection with the disposition of
Anderson was subject to a covenant of the Senior Notes Indenture which
requires the Company to apply the net cash received to (i) repay debt ranking
pari passu to the Senior Notes within 180 days, (ii) contractually commit to
acquisitions, capital expenditures or investments relating to the Company's
presently conducted business within 180 days and paid within 360 days or
(iii) offer to purchase the Senior Notes pursuant to an Excess Proceeds
Offer, as defined. In connection with the sale of Anderson the Company has
invested a portion of the Asset Sale Proceeds through the purchase of certain
receivables from High Voltage Funding Corporation ("HV-FC") a limited purpose
subsidiary of the Company and invested in certain capital expenditures.

    From time to time, the Company achieves liquidity through receivables
purchase arrangements with HV-FC, a limited purpose subsidiary of the
Company. Under these arrangements, the domestic subsidiaries of the Company
sell a defined pool of trade accounts receivables, and the related rights
inherited from the Company and its domestic subsidiaries to HV-FC. HV-FC then
sells participating interests in such assets to one or more third parties
which, in turn, purchases and receives ownership and security interests in
those assets. Under the Company's Senior Notes Indenture, the Company is
limited to making investments in HV-FC of up to $25.0 million. While the
Company is not currently utilizing these receivables purchase arrangements,
the Company has retained the right to reinitiate these arrangements with
HV-FC or another limited purpose subsidiary at any time.


                                       20


<PAGE>


    On June 19, 2001, the Company signed an amendment to the Financing
Agreement ("Amended and Restated Financing Agreement"). The Amended and
Restated Financing Agreement amends certain financial ratios and restates the
Refinanced Revolving Credit Facility, Term Loan A, and Term Loan B to a
combined $25,000 revolving credit facility ("New Revolving Credit Facility")
with a sub-facility of $5.0 million for the issuance of letters of credit.
Availability under the New Revolving Credit Facility is limited to the sum of
(i) 85% of eligible receivables, (ii) 50% of eligible joint venture
receivables, (iii) 125% of the appraised orderly liquidation value of the
eligible inventory less certain reserves as is considered reasonable and
customary by the lenders and (iv) $5.0 million. Interest under the facility
is computed and payable monthly at the greater of the lender's reference rate
(4.75% at April 27, 2002) or 7.0% plus 2.5%. At April 27, 2002, $25.0 million
was outstanding under the New Revolving Credit Facility Agreement.

    As of April 27, 2002, the Company had total indebtedness (including
redeemable put warrants and foreign receivables facilities) of $244.9 million
and mandatory redeemable preferred stock with an aggregate liquidation
preference of $55.9 million. The change in total indebtedness of $15.6 million
as compared to $229.4 million at April 28, 2001 is the result of an net increase
of $11.5 million in unrestricted subsidiary borrowings and $4.1 million net
increase in restricted subsidiary borrowings.

    As of April 27, 2002, the Company had outstanding and issuable redeemable
put warrants representing 6.25% of its fully diluted common stock. The holders
of such warrants have the right to require the Company to purchase all or any
portion of such warrants or any shares of common stock issued upon the exercise
of such warrants at the greater of (i) a valuation prepared by an independent
financial advisor or (ii) a formula value calculated as 8.0x the Company's
EBITDA (as defined therein) less preferred stock and debt outstanding plus
excess cash.

    The ability of the Company to satisfy its obligations under existing
indebtedness and preferred stock will be primarily dependent upon the future
financial and operating performance of its operating units and upon the
Company's ability to renew or refinance borrowings, to sell assets or to raise
additional equity capital as necessary. The Company expects it will be able to
refinance any principal payment obligations that are scheduled to mature
prior to maturity of the Senior Notes.

    The Company's working capital was $53.5 million at April 27, 2002. The
Company's cash flows used in continuing operations were $34.6 million during the
fiscal 2002 which includes $17.2 million of federal, state and foreign income
tax related to the sale of the Company's Anderson division and certain tax
obligations in Italy and The Netherlands, $23.0 million in cash interest
payments, $4.7 million of post employment payments in Italy, as compared to cash
used in continuing operations of $37.6 million in fiscal 2001. The Company's
principal source of liquidity is operating cash flows, including improvements in
working capital turns, the refinancing of existing indebtedness and occasional
asset sales. If there was further decrease in demand for the Company's
products and services due to either economic or competitive conditions, there
could be a reduction in liquidity due to (i) lower margins, since the Company
might not be able to cut costs in the full amount of revenue decreases, (ii)
lower working capital turns due to a longer inventory-to-receivables cycle time,
or reduced customer advance progress payments, or slower receivable payments
from customers, during such economic conditions, or (iii) reduced collateral
available for financing due to lower, or overall older receivables held during
such economic conditions or a period of reduced sales.

    The Company invested $20.1 million in capital expenditures during fiscal
2002 including $10.9 million at ASI for facility upgrades and investment in
information technology and $5.3 million in upgrades and additions to PHI's demo
and lab equipment.

    On June 14, 2002 the Company sold a former manufacturing facility located
in Brighton, Massachusetts for $9.2 million of gross proceeds. Net proceeds
of $8.0 million from the asset sale were deposited in a restricted account
pursuant to the New Revolving Credit Facility Agreement.

Critical Accounting Policies and Significant Judgments and Estimates

    The Company's discussion and analysis of its financial condition and results
of operations are based on the Company's consolidated financial statements,
which have been prepared in accordance with generally accepted accounting
principles. The preparation of these financial statements requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements and the reported revenues and expenses during the
reporting periods. On an ongoing basis, management evaluates its estimates and
judgments, including those related to revenue recognition, receivable reserves,
inventory reserves, warranty reserves, goodwill and intangible assets and income
taxes.


                                       21


<PAGE>


Management bases its estimates on historical experience and on various other
factors that are believed to be reasonable under the circumstances, the results
of which form the basis for making judgments about the carrying value of assets
and liabilities that are not readily apparent from other sources. Actual results
may differ from these estimates under different assumptions or conditions.

    The significant accounting policies that management believes are most
critical to aid in fully understanding and evaluating the Company's reported
financial results include the following:

Revenue Recognition

    Sales of goods that are not part of a long-term contract are generally
recognized upon shipment of products, in accordance with SEC Staff Accounting
Bulletin No. 101, Revenue Recognition. Service revenue is recognized when the
service is performed and accepted by the customer. Product revenue is recognized
when there is persuasive evidence of an arrangement, the fee is fixed or
determinable, delivery of the product to the customer has occurred and the
Company has determined that collection of the fee is probable. Title to the
product generally passes upon shipment of the product as the products are
shipped FOB shipping point, except for certain foreign shipments. If the product
requires significant installation to be performed by the Company that is not
perfunctory and inconsequential, such revenue related to the product is deferred
and recognized upon the completion of the installation. The Company provides for
a warranty reserve at the time the product's revenue is recognized.

    The Company follows both the completed-contract method and the percentage-of
completion methods of accounting for contract revenue. Contracts are considered
complete upon completion of all essential contract work, including support for
integrated testing and customer acceptance.

    Under the completed-contract method, revenue and costs of individual
contracts are included in operations in the year during which they are
completed. Losses expected to be incurred on contracts in progress are charged
to operations in the period such losses are determined. The aggregate of costs
of uncompleted contracts in excess of related billings is shown as a current
asset, and the aggregate of billings on uncompleted contracts in excess of
related costs is shown as a current liability.

    Under the percentage-of-completion method, income is recognized on contracts
as work progresses based on the relationship between total contract revenues and
total estimated contract costs. The percentage of work completed is determined
by comparing the accumulated costs incurred to date with management's current
estimate of total costs to be incurred at contract completion. Revenue is
recognized on the basis of actual costs incurred plus the portion of income
earned.

    Contract costs include all direct material, subcontractor costs, and labor
costs and those indirect costs related to contract performance. Revisions in
profit estimates during the period of a contract are reflected in the accounting
period in which the revised estimates are made on the basis of the stage of
completion at the time. If estimated total costs on a contract indicate a loss,
the entire amount of the estimated loss is provided for currently.

    Costs and estimated earnings in excess of billings on uncompleted contracts
represent revenue recognized in excess of amounts billed to customers. These
amounts are not yet billable under the terms of the contracts and are
recoverable from customers upon various measures of performance. Billings in
excess of costs and estimated earnings on uncompleted contracts represents
billings to customers in excess of earned revenue and advances on contracts.

Goodwill and Intangible Assets

    Purchase accounting requires extensive use of accounting estimates and
judgments to allocate the purchase price to the fair market value of the assets
purchased and liabilities assumed. The Company has accounted for its
acquisitions using the purchase method of accounting. Values were assigned to
goodwill and intangible assets based on third-party independent valuations, as
well as management's forecasts and projections that include assumptions related
to future revenues and cash flows generated from the acquired assets.


                                       22


<PAGE>


    Effective April 28, 2002, the Company adopted the provisions of SFAS No.
142, Goodwill and Other Intangible Assets. This statement affects the Company's
treatment of goodwill and other intangible assets. The statements require that
goodwill existing at the date of adoption be reviewed for possible impairment
and that impairment tests be periodically repeated, with impaired assets written
down to fair value. Additionally, existing goodwill and intangible assets must
be assessed and classified within the statement's criteria. Intangible assets
with finite useful lives will continue to be amortized over those periods.
Amortization of goodwill and intangible assets with indeterminable lives will
cease.

    The Company completed the first step of the transitional goodwill impairment
test during the three months ended July 27, 2002 based on the amount of goodwill
as of the beginning of the fiscal year ending April 26, 2003, as required by
SFAS No. 142. The Company utilized a third party independent valuation to
determine the fair value of each of the reporting units based on a discounted
cash flow income approach. Based on the results of the first step of the
transitional goodwill impairment test, the Company has determined that the fair
value of each of the reporting units exceeded their carrying amounts and,
therefore, no goodwill impairment existed as of July 27, 2002. As a result, the
second step of the transitional goodwill impairment test is not required to be
completed. The Company will be required to continue to perform a goodwill
impairment test on an annual basis.

Accounting for Income Taxes

    The preparation of the Company's consolidated financial statements requires
it to estimate its income taxes in each of the jurisdictions in which it
operates, including those outside the United States which may be subject to
certain risks that ordinarily would not be expected in the United States. The
income tax accounting process involves estimating its actual current exposure
together with assessing temporary differences resulting from differing treatment
of items, such as deferred revenue, for tax and accounting purposes. These
differences result in the recognition of deferred tax assets and liabilities.
The Company must then record a valuation allowance to reduce its deferred tax
assets to the amount that is more likely than not to be realized.

    Significant management judgment is required in determining its provision for
income taxes, its deferred tax assets and liabilities and any valuation
allowance recorded against deferred tax assets. The Company had recorded a full
valuation allowance against its deferred tax assets as of April 27, 2002, due to
uncertainties related to its ability to utilize these assets. The valuation
allowance is based on its estimates of taxable income by jurisdiction in which
it operates and the period over which its deferred tax assets will be
recoverable. In the event that actual results differ from these estimates or the
Company adjusts these estimates in future periods it may need to adjust its
valuation allowance which could materially impact its financial position and
results of operations.

New Accounting Pronouncements

    In August 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS No. 144"), Accounting for
the Impairment or Disposal of Long-Lived Assets, which supersedes SFAS
No. 121. SFAS No. 144 addresses financial accounting and reporting for the
impairment or disposal of long-lived assets and is effective for fiscal
years beginning after December 15, 2001. The Company is currently evaluating
the impact of SFAS No. 144.

    In June 2001, the FASB issued SFAS No. 141, Business Combinations, and SFAS
142, Goodwill and Intangible Assets. SFAS No. 141 is effective for all business
combinations completed after June 30, 2001. SFAS No. 142 is effective for fiscal
years beginning after December 15, 2001; however, certain provisions of this
statement apply to goodwill and other intangible assets acquired between July 1,
2001 and the effective date of SFAS 142. Major provisions of these statements
and their effective dates for the Company are as follows: (i) all business
combinations initiated after June 30, 2001 must use the purchase method of
accounting; (ii) under certain conditions intangible assets acquired in a
business combination must be recorded separately from goodwill; (iii) goodwill
and intangible assets with indefinite lives acquired after June 30, 2001, will
not be amortized. Effective April 28, 2002, the Company adopted the
Provisions of SFAS No. 141 and SFAS 142. Adoption is not expected to have a
material impact on the Company's financial statements.


                                       23


<PAGE>


    Effective April 29, 2001, the Company adopted SFAS No. 133, Accounting for
Derivative Instruments and Hedging Activities, as amended, which requires that
all derivative instruments be reported on the balance sheet at fair value and
that changes in a derivative's fair value be recognized currently in earnings
unless specific hedge criteria are met. If the derivative is designated as a
fair value hedge, the changes in the fair value of the derivative and of the
hedged item attributable to the hedged risk are recognized as a charge or credit
to earnings. Adoption did not have a material impact on the Company's financial
statements.

ITEM 7A.--QUANTATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

    The primary market risks for the Company is interest rate risk and foreign
currency risk. Other risks dealing with contingencies are described in Note Q to
the Company's consolidated financial statements included under Item 8.

Interest Rate Risk

    The Company's exposure to interest rate risk is limited to the Company's
borrowing arrangements under the New Revolving Credit Facility, Term Loans and
certain foreign bank and loan facilities. The interest rates on the Company's
other long-term debt are fixed and primarily matures in 2004. The Company has
not, to date, engaged in derivative transactions, such as interest rate swaps,
caps or collars, in order to reduce it risk, nor does the Company have any plans
to do so in the future. A 100 basis point increase in interest rates would have
approximately a $350,000 negative impact on the earnings of the Company.

Foreign Currency Risk

    The Company manufactures product in the U.S., Italy, The Netherlands, Spain
Germany, France, England and Mexico and sells products worldwide. Therefore the
Company's operating results are subject to fluctuations in foreign currency
exchange rates, as well as the translation of its foreign operations into U.S.
dollars. The risks associated with operating in foreign currencies could
adversely affect the Company's future operating results. Additionally, currency
fluctuations could improve the competitive position of the Company's foreign
competition if the value of the U.S. Dollar rises in relation to the local
currencies of such competition. The Company sometimes enters into forward
exchange contracts to manage exposure related to certain foreign currency
commitments, certain foreign currency denominated balance sheet positions and
anticipated foreign currency denominated expenditures. All forward exchange
contracts are designated as and effective as a hedge and are highly inversely
correlated to the hedged item. If a derivative contract terminates prior to
maturity, the investment is shown at its fair value with the resulting gain or
loss reflected in operating results. Gains and losses on contracts to hedge
identifiable foreign currency commitments are deferred and accounted for as part
of the related foreign currency transaction. Gains and losses on all other
forward exchange contracts are included in current income.


                                       24


<PAGE>


ITEM 8.--FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

    The Company's Financial Statements, together with the auditors' reports
thereon, appear at pages F-1 through F-7 of this annual report Form 10-K.

ITEM 9.--CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

    None.


                                       25


<PAGE>


                                    PART III.

ITEM 10.--DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Executive Officers and Directors

    The executive officers, directors and key employees of the Company as of
April 27, 2002 were as follows:

<TABLE>
<CAPTION>
Name                                       Age                            Position
-----                                     --------   -----------------------------------------------------
<S>                                     <C>       <C>
Clifford Press.........................     48      Chairman of the Board, President and Director

Russell L. Shade, Jr...................     52      Chief Executive Officer and Director

Laurence S. Levy.......................     46      Vice President and Director

Joseph W. McHugh, Jr...................     47      Vice President and Chief Financial Officer

Oddie V. Leopando......................     56      President of Maxima

David Ring.............................     40      President of Phymetrics

Christopher F. Carmel..................     47      Director

H. Cabot Lodge III.....................     46      Director
</TABLE>

    Clifford Press is the Chairman of the Board, President and a Director of the
Company. Mr. Press joined the Company in 1988 in connection with its acquisition
and reorganization and has been a member of the Board of Directors since that
time. Since 1991, he has served as President. From 1983 to 1986, Mr. Press was
employed by Morgan Stanley & Co., Incorporated in its Mergers and Acquisitions
Department. Mr. Press is a graduate of Oxford University and the Harvard
Business School.

    Russell L. Shade, Jr. is the Chief Executive Officer and a Director of the
Company. Prior to joining the Company, Mr. Shade was Vice President, Industrial
Systems, at GE. Mr. Shade was named a Corporate Officer of GE and Vice President
of GE Drive Systems in March 1995. During his 25-year career with GE, Mr. Shade
held numerous design, engineering, and manufacturing positions in power
generation, as well as general management positions in the military and
industrial product lines. Mr. Shade graduated from M.I.T with a Master of
Science degree in Mechanical Engineering and holds five U.S. patents.

    Laurence S. Levy is a Vice President and a Director of the Company.
Mr. Levy joined the Company in 1988 in connection with its acquisition and
reorganization and has been a member of the Board of Directors since that time.
From 1983 to 1986, Mr. Levy was a consultant with Bain & Co., a leading
strategic management company. Mr. Levy is a graduate of the University of
Witwatersrand in South Africa and the Harvard Business School.

    Joseph W. McHugh, Jr. is a Vice President and the Chief Financial Officer of
the Company. Mr. McHugh joined the Company in January 1992. From 1983 to 1992,
Mr. McHugh worked at GCA Corporation as a Division Controller and later as
Controller. In the former capacity, he participated in the workout and
recapitalization of GCA before its purchase in 1988 by General Signal. From 1977
to 1983, Mr. McHugh served in various financial management positions at
Honeywell Information Systems. Mr. McHugh received both a Bachelor of Science
degree in accounting and a Masters degree in Business Administration from
Bentley College.

    Oddie V. Leopando has served as President of Maxima since November 1995.
Prior to joining the Company, Mr. Leopando was employed by MascoTech, Inc. as
President of the MascoTech Body Systems & Assembly Division from 1994 to 1995.
From 1991 to 1994, Mr. Leopando was the Senior Vice President/General Manager of
MascoTech Manufacturing & Assembly Division. Prior to 1991, Mr. Leopando acted
in managerial roles in several other companies, including Massey Ferguson, Inc.


                                       26


<PAGE>


and Daimler/Chrysler. Mr. Leopando earned a Masters of Business Administration
in Finance and Operations from the University of Detroit and a Bachelor of
Science in Mechanical Engineering from the Mapua Institute of Technology in
Manila, Philippines. Mr. Leopando is a licensed professional engineer.

    David Ring became President and CEO of Phymetrics in November 2001. Mr. Ring
joined Phymetrics from LTX Corporation, a leading supplier of semiconductor test
equipment, where he was executive vice president of the LTX's Worldwide Customer
Operations Group. Prior to LTX Corporation, Mr. Ring was President of the
Microelectronics Group of Entegris, Incorporated, a leading provider of wafer
handling products. Mr. Ring holds an MBA from Lehigh University and a BS in
Business from the University of Minnesota.

    Christopher F. Carmel became a Director of the Company effective July 12,
2001. Mr. Carmel is the managing member of Echo Bridge LLC, which is a private
equity investment firm. Prior to founding Echo Bridge LLC, Mr. Carmel was a
managing member of ROC Partners Inc., and APS Partners LLC between 2000 and
2001. From 1995 to 2000, Mr. Carmel was a partner of Hamilton Robinson LLC,
which is a private equity investment firm. Mr. Carmel served on the board of
directors of Applied Process Solutions, Inc., was audit committee chairman and
served as a member of the executive committee. From 1992 to 1995, Mr. Carmel was
a consultant at Citicorp Venture Capital, Ltd. Prior to 1992, Mr. Carmel acted
in managerial roles in several other companies, including The Lynx Partners,
Inc. Cazenove, Inc. and Casscapedia Partners, L.P. Mr. Carmel earned a Bachelor
of Arts degree from the University of Vermont.

    H. Cabot Lodge III has been a Director of the Company since August 8, 1997.
Mr. Lodge is Executive Vice President of iStar Financial, the largest publicly
traded finance company focused on the commercial real estate industry. He is a
principal of Carmel Lodge LLC, a New York based financial advisory firm he
founded in 1996. Mr. Lodge also served as Executive Vice President, Managing
Director and in other senior management positions at W.P. Carey & Co., an
investment banking firm from 1983 to 1995. Mr. Lodge is a director of Meristar
Hospitality Corporation and of TelAmeria Media, Inc. From 1995 to 1997 Mr. Lodge
was Chairman of Superconducting Core Technologies, Inc. ("SCT"), a manufacturer
of high tech wireless telecommunications equipment he co-founded in 1988. Mr.
Lodge is a graduate of Harvard University and the Harvard Business School.

Section 16(A) Beneficial Ownership Reporting Compliance

    Not applicable.

ITEM 11.--EXECUTIVE COMPENSATION

Compensation Committee Interlocks and Insider Participation

    The Board of Directors appoints the member of the Compensation Committee.
At April 27, 2002 the committee consisted of Mr. Clifford Press and
Mr. Christopher Carmel.

Employment Agreements

    Russell L. Shade, Jr., the Company's Chief Executive Officer and a Director,
entered into an employment agreement with the Company (the "Employment
Agreement"), dated February 24, 1998. For each year of Mr. Shade's employment,
the Compensation Committee of the Company's Board of Directors establishes a
base salary and an incentive compensation program generally based upon the
Company's performance. The Employment Agreement contains a customary
confidentiality provision and an agreement that Mr. Shade will not, for three
years after his employment ends, engage in business competitive with the Company
or solicit customers or employees of the Company.

    The Employment Agreement also provides shadow stock benefits, shadow stock
appreciation benefits and deferred compensation benefits described in the
following paragraphs.

    Upon the commencement of his employment with the Company, Mr. Shade received
twenty-two shadow stock units. The stock units vest in yearly increments over a
period of five years, beginning on April 30, 1998, with each vested stock unit
representing the right to receive, following the fifth


                                       27


<PAGE>


anniversary after the vesting thereof, an amount of cash equal to the market
value of a share of the Letitia common stock determined as of the end of the
most recent fiscal quarter.

    Upon termination of employment for any reason other than death, all unvested
stock units shall be forfeited, and any vested units shall become redeemable by
the Company, at the market value of a share of Letitia Common Stock determined
as of the end of the most recent fiscal quarter preceding redemption, at any
time, but in any event the Company shall redeem the vested units on the
scheduled payment date therefore. Upon death, all stock units vest and each
stock unit shall be promptly redeemed at the market value of a share of common
stock of Letitia Corporation, the corporate parent of the Company, at the end of
the most recent fiscal quarter.

    The Employment Agreement further provides for a stock appreciation
arrangement whereby Mr. Shade is entitled to receive additional shadow stock
units each year during the term of the Employment Agreement. At April 27, 2002,
the shadow stock units granted pursuant to this arrangement represents 8.75% of
the outstanding shares of Letitia common stock upon vesting. For the Company's
fiscal 2000 and each subsequent year, the number of shadow stock units granted
is calculated based on a formula taking into account Mr. Shade's base salary and
the market value of Letitia Common Stock.

    Under the deferred compensation arrangement, the Company shall contribute
$35,000 per year into a designated account and Mr. Shade may elect to make
additional contributions. Mr. Shade will receive distributions from the account
in ten installments, commencing in 2011, or earlier upon termination of
employment or death.

    The Employment Agreement terminates upon Mr. Shade's resignation or
discharge, with or without cause. Upon termination by reason of disability,
death, or resignation or discharge under certain circumstances, Mr. Shade shall
be entitled to receive compensation through the date of his termination,
including all benefits enjoyed under the Employment Agreement. Upon termination
by reason of resignation or discharge under certain other circumstances, Mr.
Shade shall be entitled to receive his base salary and all benefits until the
earlier of one year following the date of termination or receipt of income
earned from a source unaffiliated with the Company.

    Laurence S. Levy, a Vice President and Director of the Company, entered into
an employment agreement, dated as of May 10, 2001 ("Levy Employment Agreement").
The Levy Employment Agreement has an initial three year term, which may be
extended for an additional three years at Mr. Levy's option. The Levy Employment
Agreement otherwise terminates upon Mr. Levy's resignation, discharge under
certain circumstances or by reason of disability or death. Under the agreement,
Mr. Levy is to be employed as Vice President of the Company and the Company is
required to cause him to be elected to the Board of Directors of the Company.
The Levy Employment Agreement provides for an annual base salary of $140,000 or
such greater amount as may be determined by the Board, provided that it shall
not be less than what Mr. Clifford Press shall receive as President of the
Company, and other customary benefits including office space and support at a
location specified by Mr. Levy. In addition, the Levy Employment Agreement
entitles Mr. Levy to receive, substantially concurrent with the payment of any
management fees, bonus or other distribution made by the Company, excluding
distributions made proportionately to equity holders, a payment equal to 42.86%
of such amounts made directly or indirectly to Mr. Clifford Press.

Value Creation Plan and Related Plans

    The Company's Value Creation Plan (the "VCP") is a long-term cash incentive
compensation plan for certain key officers and employees of the Company which is
intended to provide participants in the VCP with an opportunity to share in an
increase in the value of the Company or operating unit with which the
participating employee is associated. The VCP is designed to provide incentives
for employees in the Company's by tracking increases in the economic value based
generally upon a multiple of EBITDA, as defined in the VCP, but also reflecting
actual proceeds of dispositions of


                                       28


<PAGE>


operating units or public offerings of operating units. An aggregate amount
equal to up to 5-7% of the incremental increases in value achieved in the
Company is allocated to the VCP. In the event that the value of the Company or
any of the operating units increases over time, the interests of its
participating employees in the VCP will increase proportionally.

    Interests are granted in the VCP to certain key employees as they are hired
or promoted and vest over five years. The value of an employee's interest is
based on increases in value (based generally on a multiple of EBITDA but also
reflecting actual proceeds of dispositions of operating units or public
offerings by operating units) from the date of grant to the end of the year
prior to the determination date. Vested interests are cashed out when an
employee leaves the Company or retires, or when his operating unit is sold or he
is transferred to another division; provided that if the employee is dismissed
for cause, his interests (vested and unvested) are forfeited. Subject to the
Company's discretion to defer cash payments, an employee may cash out up to 50%
of his vested interest while remaining employed. The VCP is a non-qualified and
non-funded plan. While Messrs. Leopando, McHugh and certain other key employees
have each received interests in the VCP, Mr. Laurence S. Levy, Mr. Press and Mr.
Shade currently do not participate in the VCP. As of April 27, 2002, the Company
had an accrued liability of $273,000 under the VCP.

Stock Appreciation Rights Plan

    PHI maintains a Phantom Stock Appreciation Rights Plan ("PSAR") which has
two variations, an Appreciation Rights Plan, under the terms of which PSARs are
offered at the fair market value ("FMV") of PHI and its wholly owned
subsidiaries including, CE&A and a Discounted Appreciation Rights Plan, under
the terms of which PSARs are offered at a discounted FMV. The authorized amount
of PSARs which can be issued under these plans equals 12% of the authorized
capital of PHI. The plans are designed to provide incentives for certain key
employees of PHI and CE&A, by tracking increases in the FMV of the combined PHI
and CE&A subsidiaries. The exercise rights under the Plans are subject to
vesting schedules ranging from 4 to 5 years from date of award. The plans have a
ten year termination date. Discounted PSARs were issued to certain employees of
CE&A who at the time of the acquisition of CE&A by PHI in July of 1999 had an
"in the money value" of their unvested CE&A options. The discount amounted equal
75% of the then combined FMV. The CE&A vesting schedule was carried over for the
exercise rights of these discounted PSARs. Additionally, PHI created a Deferred
Value plan, which is a deferred compensation plan and does not include the
issuance of PSARs. The plan was created for the benefit of certain CE&A
employees at the time of the CE&A acquisition in July of 1999. Awards earn
interest at the rate of prime as of July 1st of each year, plus 1%. Exercise
rights are subject to a four or five year vesting schedule from date of award.
No additional awards have been made under this plan since its inception. At the
time employees exercise their vested rights under the Discounted Appreciation
Rights Plan they must execute a Protection Agreement which, among other items,
stipulates that for a period of 18 months after termination of a Participant's
employment by PHI, or any of its subsidiaries (the "PHI Group") the employee
cannot participate in any business which is then in competition with the PHI
Group. Appreciation Rights PSARs are awarded at their FMV to certain employees
as they are hired or promoted. All three Plans are non-qualified and non-funded.

    ASIRobicon also maintains a PSAR plan. The authorized amount of PSARs which
can be issued under this plan equals 10% of the authorized capital of
ASIRobicon. This plan is designed to provide an incentive for certain key
employees by tracking increases in the FMV of ASIRobicon. The exercise rights
under the plan are subject to a vesting schedule of 5 years from date of award.
The plan has a ten year termination date.

Retirement Plans

    The Company maintains the High Voltage Engineering Corporation 401(k)
Retirement Plan, a Section 401(k) savings plan for qualified domestic employees,
pursuant to which the Company matches fixed employee contributions up to $1,800
and currently contributes an annual profit-sharing amount equal to 2.5% of the
employee's annual salary and bonus. Messrs. Laurence S. Levy, Press, Leopando,
Shade, and McHugh currently participate in this plan.

    The Company also maintains the High Voltage Engineering Corporation
Retirement Plan (the "Retirement Plan"), a defined benefit plan, which provides
for the payment of annual pension benefits, payable on retirement, based on the


                                       29


<PAGE>


participating employee's salary during the time of accrual. Participation in the
Retirement Plan, and the accrual of additional benefits there under, was frozen
by the Company in 1992. Messrs. Laurence S. Levy and Press will receive monthly
benefits under the Retirement Plan of $191.05 and $148.35, respectively,
beginning upon their retirement. Mr. Shade does not participate in the
Retirement Plan.

Bonus Plans

    The Company has in effect various plans pursuant to which the Company's
executive officers and certain other employees may receive incentive cash
bonuses based upon the achievement of certain earnings goals in the preceding
fiscal year by an operating unit or by the Company as a whole, and upon
individual performance. The amounts of incentive and discretionary awards, and
the performance criteria for such awards, are currently fixed by the Board of
Directors. Such amounts, and the related performance criteria, will be set by
the Compensation Committee.

ITEM 12.--SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

    The following table sets forth information concerning the beneficial
ownership of the Company's common stock, as of the date of this filing by: (i)
each person known to the Company to own beneficially more than 5% of the
outstanding shares of common stock; (ii) each director; and (iii) all directors
and executive officers of the Company as a group. All shares are owned by such
person with sole voting and investment power.

<TABLE>
<CAPTION>
                                                                     Common Stock
                                                              -------------------------
                                                              Number of    Percent of
Name of Stockholders, Directors and Executive Officers         Shares     Common Shares
-------------------------------------------------------        ---------   -------------
<S>                                                         <C>          <C>
Letitia Corporation(1)......................................    1,000         92.4%
Laurence S. Levy(1)(2)......................................    1,000         92.4%
Clifford Press(1)(3)........................................    1,000         92.4%
Russell L. Shade, Jr........................................     0.60(4)        --(5)
Christopher F. Carmel.......................................       --           --
H. Cabot Lodge III..........................................       --           --
Directors and executive officers as a group.................    1,000         92.4%
</TABLE>

-------------------------

(1) The address of each of these persons or organizations is c/o Hyde Park
    Holdings, Inc., 595 Madison Avenue, 35th Floor, New York, New York 10022.

(2) All of such shares of the Company's Common Stock (92.4% of the outstanding
    common stock) are held by Letitia Corporation. Mr. Laurence S. Levy is an
    officer of Letitia Corporation. Mr. Laurence S. Levy is also a limited
    partner of, and an executive officer and 50% shareholder of the corporate
    general partner of, a limited partnership that owns all of the stock of
    Letitia Corporation. Mr. Laurence S. Levy disclaims beneficial ownership of
    any shares of the Company's common stock.

(3) All of such shares of the Company's common stock (92.4% of the outstanding
    common stock) are held by Letitia Corporation. Mr. Press is the Chairman of
    the Board and President of Letitia Corporation. Mr. Press is also a limited
    partner of, and an executive officer and 50% shareholder of the corporate
    general partner of a limited partnership that owns all of the stock of
    Letitia Corporation. Mr. Press disclaims beneficial ownership of any shares
    of the Company's common stock.

(4) Represents shares issuable upon exercise of warrants to purchase shares of
    the Company's common stock.

(5) Mr. Shade beneficially owns less than 1% of the Company's common stock.


                                       30


<PAGE>


ITEM 13.--CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

    Laurence S. Levy and Clifford Press, officers and directors of the Company,
are directors of Letitia Corporation, which owns 92.4% of the Company's
outstanding Common Stock. Hyde Park Holdings, Inc. ("Hyde Park"), a corporation
wholly owned by Laurence S. Levy and Clifford Press, is a minority stockholder
of Letitia Corporation.

    Historically, the Company has paid to Hyde Park and its affiliates an
annual fee for services performed in managing the Company.

    The management fees paid to Hyde Park and its affiliates were $0.6 million,
$0.8 million and $0.8 for fiscal 2002, 2001 and 2000, respectively. Under the
terms of the Indenture, while there are any of the Senior Notes outstanding,
management fees to Hyde Park in excess of $0.8 million for any fiscal year of
the Company subsequent to August 8, 1997 are limited by the Indenture.


                                       31


<PAGE>


                                    PART IV.

ITEM 14.--EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

<TABLE>
<CAPTION>
       Exhibit
       Number                                   Description
----------------------                          -----------
<S>                    <C>
         3.1            Restated Articles of Organization of the Registrant.*

         3.2            Amended and Restated By-laws of the Registrant.*

         4.1            Indenture, dated as of August 8, 1997, by and between
                        Registrant and State Street Bank and Trust Company as
                        Trustee.*

         4.2            First Supplemental Indenture, dated as of March 19, 1998
                        to Indenture, dated as of August 8, 1997, by and between
                        the Registrant and State Street Bank and Trust Company,
                        as Trustee.**

         4.3            Registration Rights Agreement, dated as of March 19,
                        1998, by and among the Registrant and CIBC Oppenheimer
                        Corp.**

         4.4            Form of Exchange Note.**

         4.5            Second Supplemental Indenture, dated as of December 22,
                        1999, to Indenture, dated as of August 8, 1997, by and
                        between the Registrant and State Street Bank and Trust
                        Company, as Trustee.

        10.2            Lease Agreement, dated as of November 10, 1988, by and
                        between Corporate Property Associates 8, L.P. and Datcon
                        Instrument Company (Lancaster, PA).*

        10.4            Installment Sale Agreement, dated as of September 23,
                        1994, by and between Monroeville Area Industrial
                        Development Corporation and Robicon Corporation (New
                        Kensington, PA).*

        10.7            Value Creation Plan of the Registrant.*

        10.8            High Voltage Engineering Corporation Employment
                        Agreement, by and between Registrant and Russell L.
                        Shade, Jr., dated as of February 24, 1998.**

        10.9            Amended and Restated Financing Agreement, dated as of
                        June 19, 2001, by and among the Registrant and the other
                        Borrowers named therein, Ableco Finance LLC and the
                        other Lenders named therein, and the Guarantors named
                        therein.

        12              Statement of Computation of Financial Ratios.

        21.1            List of Subsidiaries.

        24.1            Power of Attorney (included in signature page to
                        Form 10-K).
</TABLE>

-------------------------

*   Incorporated by reference from the Registrant's Registration Statement No.
    333-33969, on Form S-4, filed by the Registrant with respect to $135,000,000
    aggregate principal amount of the Registrant's 10 1/2% Senior Notes due
    2004.

**  Incorporated by reference from the Registrant's Registration Statement No.
    333-51643, on Form S-4, filed by the Registrant with respect to $20,000,000
    aggregate principal amount of the Registrants 10 1/2% Senior Notes due 2004.

(b) All schedules have been omitted because either they are not required, are
    not applicable, or the information is otherwise set forth in the
    Consolidated Financial Statements and notes thereto.


                                       32


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

<TABLE>
<CAPTION>
                                                                PAGE
                                                              --------
<S>                                                          <C>
Consolidated Financial Statements--April 27, 2002,
  April 28, 2001, April 29, 2000
Report of Grant Thornton LLP, Independent Certified Public
  Accountants...............................................    F-2
Consolidated Balance Sheets.................................    F-3
Consolidated Statements of Operations.......................    F-4
Consolidated Statements of Stockholders' Deficiency.........    F-5
Consolidated Statements of Cash Flows.......................    F-6
Notes to Consolidated Financial Statements..................    F-8
</TABLE>


                                       F-1


<PAGE>


               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors and Stockholders
High Voltage Engineering Corporation

    We have audited the accompanying consolidated balance sheets of High Voltage
Engineering Corporation and subsidiaries as of April 27, 2002 and April 28, 2001
and the related consolidated statements of operations, stockholders' deficiency,
and cash flows for each of the three years in the period ended April 27, 2002.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these consolidated financial
statements based on our audits.

    We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. 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
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

    In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of High Voltage
Engineering Corporation and subsidiaries as of April 27, 2002 and April 28, 2001
and the consolidated results of their operations and their consolidated cash
flows for each of the three years in the period ended April 27, 2002, in
conformity with accounting principles generally accepted in the United States of
America.

                                          GRANT THORNTON LLP

Boston, Massachusetts
July 12, 2002


                                       F-2


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                                               April 27,   April 28,
                                                                 2002        2001
                                                               ---------   ---------
<S>                                                          <C>         <C>
                                     ASSETS
CURRENT ASSETS
  Cash and cash equivalents.................................   $ 15,133    $ 26,932
  Restricted cash...........................................      4,891      29,472
  Accounts receivable, net of allowance for doubtful
    accounts................................................    136,117      81,853
  Refundable income taxes...................................        266          --
  Inventories...............................................     60,542      61,631
  Costs and earnings in excess of billings..................     11,343      13,032
  Prepaid expenses and other current assets.................      7,016       8,694
                                                               --------    --------
    Total current assets....................................    235,308     221,614
PROPERTY, PLANT AND EQUIPMENT, NET..........................     85,489      82,980
INVESTMENT IN JOINT VENTURE.................................      3,263       2,040
ASSETS HELD FOR SALE........................................      2,393       2,510
OTHER ASSETS, NET...........................................     25,912      69,447
COST IN EXCESS OF NET ASSETS ACQUIRED, NET..................     20,024      33,032
                                                               --------    --------
                                                               $372,389    $411,623
                                                               ========    ========
                     LIABILITIES AND STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES
  Current maturities of long-term debt obligations..........   $ 14,573    $  8,805
  Foreign receivables facilities............................     12,285       6,075
  Accounts payable..........................................     74,940      73,157
  Accrued interest..........................................      4,602       4,104
  Accrued liabilities.......................................     40,265      43,529
  Billings in excess of costs...............................      5,512       4,296
  Advance payments by customers.............................     22,156      18,886
  Federal, foreign and state income taxes payable...........        557      12,519
  Deferred income taxes.....................................      4,018       3,336
  Redeemable put warrants...................................      2,900       2,900
                                                               --------    --------
    Total current liabilities...............................    181,808     177,607
LONG-TERM OBLIGATIONS, LESS CURRENT MATURITIES..............    215,178     211,588
DEFERRED INCOME TAXES.......................................     14,053      13,519
OTHER LIABILITIES...........................................     25,245      28,249
REDEEMABLE PREFERRED STOCK (AGGREGATE LIQUIDATION PREFERENCE
  OF $55,934 AS OF APRIL 27, 2002)..........................     53,847      46,122
MINORITY INTEREST...........................................         93          59
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIENCY
  Common stock..............................................          1           1
  Paid-in-capital...........................................     20,140      20,140
  Accumulated deficit.......................................   (131,294)    (86,215)
  Common stock warrants.....................................      2,813       2,813
  Other comprehensive (loss)................................     (9,495)     (2,260)
                                                               --------    --------
    Total stockholders' deficiency..........................   (117,835)    (65,521)
                                                               --------    --------
                                                               $372,389    $411,623
                                                               ========    ========
</TABLE>

        The accompanying notes are an integral part of these statements.


                                       F-3


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                 (Dollars in Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
                                                                             Years Ended
                                                               ----------------------------------------
                                                                 April 27,     April 28,      April 29,
                                                                   2002          2001           2000
                                                               -----------   -----------   -----------
<S>                                                         <C>            <C>            <C>
Net sales...................................................     $403,012      $416,547      $271,485
Cost of sales (Includes subassembly exit costs of $2,661 and
  $405 in fiscal 2001 and 2000, respectively, and
  restructuring charge--inventory markdown of $855 in fiscal
  2000).....................................................      306,533       322,593       199,654
                                                                 --------      --------      --------
  Gross profit..............................................       96,479        93,954        71,831
Administrative and selling expenses.........................       83,547        73,636        56,108
Research and development expenses...........................       16,485        16,533        17,361
Write off of purchased in-process research and
  development...............................................           --            --         1,650
Restructuring charge........................................          859           143         1,795
Other, net..................................................        6,314         5,106         7,172
                                                                 --------      --------      --------
  Loss from operations......................................      (10,726)       (1,464)      (12,255)
Interest expense............................................      (25,043)      (22,044)      (19,122)
Interest income.............................................        1,690           753           921
                                                                 --------      --------      --------
  Loss from continuing operations before income taxes,
    discontinued operations and extraordinary item..........      (34,079)      (22,755)      (30,456)
Income taxes (credit).......................................        2,948        (2,291)         (631)
                                                                 --------      --------      --------
   Loss from continuing operations before discontinued
    operations and extraordinary item.......................      (37,027)      (20,464)      (29,825)
Discontinued operations:
  Income from discontinued operations, net of income
    taxes...................................................           --         2,078         2,158
  Gain on disposal of discontinued operations, net of income
    taxes...................................................           --        34,270           559
                                                                 --------      --------      --------
                                                                  (37,027)       15,884       (27,108)
Extraordinary loss, net of income taxes.....................         (327)         (530)           --
                                                                 --------      --------      --------
Net (loss) income...........................................      (37,354)       15,354       (27,108)
Preferred dividends.........................................       (7,036)       (6,101)       (4,965)
Accretion of redeemable preferred stock.....................         (689)         (605)         (448)
                                                                 --------      --------      --------
Net (loss) income applicable to common stockholders.........     $(45,079)     $  8,648      $(32,521)
                                                                 ========      ========      ========
Basic (loss) income per common share:
  Continuing operations.....................................  $(41,322.25)   $(25,087.71)  $(32,537.39)
  Income from discontinued operations.......................           --       1,918.74      1,992.61
  Gain on disposal of discontinued operations...............           --      31,643.58        516.16
  Extraordinary item........................................      (301.94)       (489.38)           --
                                                              -----------    -----------   -----------
  Net (loss) income applicable to common stockholders.......  $(41,624.19)   $  7,985.23   $(30,028.62)
                                                              ===========    ===========   ===========
Diluted (loss) income per common share:
  Continuing operations.....................................                 $(21,512.27)
  Income from discontinued operations.......................                    1,645.29
  Gain on disposal of discontinued operations...............                   27,133.81
  Extraordinary item........................................                     (419.64)
                                                                             -----------
  Net income applicable to common stockholders..............                 $  6,847.19
                                                                             ===========
Weighted average common stock outstanding...................        1,083          1,083         1,083
Weighted average common stock outstanding and dilutive
  equivalents outstanding...................................        1,276          1,263         1,243
                                                              ===========    ===========   ===========
</TABLE>


        The accompanying notes are an integral part of these statements.

                                       F-4


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

              CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIENCY

                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                                                         Common        Other
                                      Common    Paid-In    Accumulated    Stock     Comprehensive
                                      Stock     Capital      Deficit     Warrants      (Loss)        Total
                                     --------   --------   -----------   --------   -------------   --------
<S>                                <C>        <C>        <C>           <C>        <C>             <C>
Balance, April 24, 1999...........    $   1     $19,527     $ (62,342)    $2,200       $  (347)     $ (40,961)
Net loss...........................                           (27,108)                                (27,108)
Preferred stock dividends.........                             (4,965)                                 (4,965)
Accretion of redeemable preferred
  stock...........................                               (448)                                   (448)
Change in foreign currency........                                                         (86)           (86)
                                     --------   -------     ---------     ------       -------      ---------
Balance, April 29, 2000...........        1      19,527       (94,863)     2,200          (433)       (73,568)
Net income........................                             15,354                                  15,354
Preferred stock dividends.........                             (6,101)                                 (6,101)
Accretion of redeemable preferred
  stock...........................                               (605)                                   (605)
Issuable shares of common stock and
  common stock warrants...........                  613                      613                        1,226
Change in foreign currency
  translation.....................                                                      (1,451)        (1,451)
Pension liability adjustment......                                                        (376)          (376)
                                     --------   -------     ---------     ------       -------      ---------
Balance, April 28, 2001...........        1      20,140       (86,215)     2,813        (2,260)       (65,521)
Net loss..........................                            (37,354)                                (37,354)
Preferred stock dividends.........                             (7,036)                                 (7,036)
Accretion of redeemable preferred
  stock...........................                               (689)                                   (689)
Change in foreign currency
  translation.....................                                                        (525)          (525)
Pension liability adjustment......                                                      (6,710)        (6,710)
                                     --------   -------     ----------    ------       -------      ---------
Balance, April 27, 2002...........   $    1     $20,140     $(131,294)    $2,813       $(9,495)     $(117,835)
                                     ========   =======     ==========    ======       =======      =========
</TABLE>


        The accompanying notes are an integral part of these statements.


                                       F-5


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                 (Dollars in Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
                                                                          Years Ended
                                                               ---------------------------------
                                                               April 27,   April 28,   April 29,
                                                                 2002        2001        2000
                                                               ---------   ---------   ---------
<S>                                                          <C>         <C>         <C>
Cash flows from operating activities:
  Net (loss) income.........................................   $(37,354)   $ 15,354    $(27,108)
  Adjustments to reconcile net income (loss) to net cash
    provided by (used in) operating activities:
    Income from discontinued operations, net of income
      taxes.................................................         --      (2,078)     (2,158)
    Extraordinary item, net of income taxes.................        327         530          --
    Depreciation and amortization...........................     28,755      20,766      16,486
    Restructuring charge--inventory markdown................         --          --         855
    Write-off of purchased research and development.........         --          --       1,650
    Non-cash interest.......................................      1,396       1,255       1,095
    Deferred income taxes...................................      1,216       9,346        (897)
    Undistributed earnings of affiliate.....................     (1,256)        (85)       (269)
    Gain on sale of discontinued operations.................         --     (34,270)       (559)
    Gain on sale of assets and other........................       (364)       (250)       (154)
Change in assets and liabilities, net of effects of business acquisitions and
  divestitures:
      Accounts receivable...................................     (4,050)     (9,024)     (3,894)
      Proceeds from the sale of accounts receivable.........    (10,279)     (2,921)     13,200
      Refundable income taxes...............................      2,592       1,075        (596)
      Inventories...........................................      1,089     (11,175)       (718)
      Cost and earnings in excess of billings...............      1,689      (5,618)      4,706
      Prepaid expenses and other current assets.............      1,678       2,400      (3,847)
      Other assets..........................................        258      (7,835)       (719)
      Accounts payable, accrued interest and accrued
        liabilities.........................................    (10,149)    (11,378)     (4,084)
      Billings in excess of cost............................      1,216      (1,492)       (526)
      Advance payments by customers.........................      3,270      11,436       2,726
      Federal, foreign and state income taxes payable.......    (14,602)    (13,682)     (1,209)
                                                               --------    --------    --------
        Net cash used in continuing operations..............    (34,568)    (37,646)     (6,020)
        Net cash provided by discontinued operations........         --       4,964       5,871
                                                               --------    --------    --------
        Net cash used in operating activities...............    (34,568)    (32,682)       (149)
Cash flows from investing activities:
  Additions to property, plant and equipment, continuing
    operations..............................................    (14,605)     (9,365)    (11,531)
  Additions to property, plant and equipment, discontinued
    operations..............................................         --      (2,038)     (1,244)
  Acquisition of Ansaldo Sistemi Industriali, S.p.A., net of
    cash acquired...........................................         --       5,679     (24,202)
  Acquisition of Charles Evans & Associates, net of cash
    acquired................................................         --          --     (38,001)
  Acquisition of Vivirad High Voltage, net of cash
    acquired................................................         --      (2,281)         --
  Proceeds from sales of discontinued operations, net of
    expenses................................................         --      65,011       1,190
  Proceeds from sales of assets and other, net of
    expenses................................................      4,000       3,551       3,208
  Other.....................................................         --         (66)         --
                                                               --------    --------    --------
        Net cash (used in) provided by investing
          activities........................................    (10,605)     60,491     (70,580)
                                                               --------    --------    --------
</TABLE>


                                       F-6


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

               CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

                 (Dollars in Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
                                                                          Years Ended
                                                               ---------------------------------
                                                               April 27,   April 28,   April 29,
                                                                 2002        2001        2000
                                                               ---------   ---------   ---------
<S>                                                          <C>         <C>         <C>
Cash flows from financing activities:
  Net borrowings from foreign credit line. .................   $  6,106    $  4,193    $  2,084
  Net decrease (increase) in restricted cash................     24,581     (25,411)     12,870
  Principal payments on long-term obligations...............     (3,876)     (4,404)     (3,773)
  Net borrowings under credit agreements....................      7,363      16,581       8,373
  Proceeds from the issuance of long-term obligations, net
    of issuance costs.......................................         24       8,941      24,679
  Minority interest.........................................         34          59          --
  Cash overdraft, continuing operations.....................       (548)     (2,360)      2,209
  Cash overdraft, discontinued operations...................         --          --          10
                                                               --------    --------    --------
      Net cash provided by (used in) financing activities...     33,684      (2,401)     46,452
                                                               --------    --------    --------
Effect of foreign exchange rate changes on cash.............       (310)     (3,783)     (1,043)
                                                               --------    --------    --------
      Net (decrease) increase in cash and cash
        equivalents.........................................    (11,799)     21,625     (25,320)
Cash and cash equivalents, beginning of year................     26,932       5,307      30,627
                                                               --------    --------    --------
Cash and cash equivalents, end of year......................   $ 15,133    $ 26,932    $  5,307
                                                               ========    ========    ========

Supplemental Disclosure of Cash Flow Information:
  Cash paid for:
    Interest................................................   $ 23,032    $ 22,496    $ 18,853
    Income taxes............................................     17,196       1,977       3,880
Supplemental Schedule of Non-cash Investing and Financing
  Activities:
  Preferred stock dividends-in-kind and issuable preferred
    stock dividends-in-kind.................................   $  7,036    $  6,101    $  4,965
  Leased asset additions....................................      5,586         198       1,367
</TABLE>


        The accompanying notes are an integral part of these statements.

                                       F-7


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                 (Dollars in Thousands, Except Per Share Data)


NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    A summary of significant accounting policies consistently applied in the
preparation of the accompanying financial statements follows:

Nature of Operations

    High Voltage Engineering Corporation (the "Company") owns and operates a
diversified group of three industrial and technology based manufacturing
business segments with multiple product lines that serve a broad spectrum of
original equipment manufacturers and end-users. Business and customer
concentration is lessened due to the diversified nature of its portfolio of
businesses, with respect to products sold and end-markets served on a
world-wide basis. Examples of end-markets served include process automation,
metal and steel, water and wastewater treatment, petrochemicals, pulp and
paper, marine and cable, oil and gas exploration and transportation,
semiconductor fabrication, chemicals, construction, agriculture, materials
handling, and for scientific and educational research.

Financial Statement Presentation

    The Company is 92.4% owned by Letitia Corporation ("Letitia"). The Company's
wholly owned subsidiaries include Ansaldo Sistemi Industriali S.p.A. and
subsidiaries ("ASI"), Robicon Corporation and subsidiaries ("Robicon"), Physical
Electronics, Inc. and subsidiaries ("PHI"), Maxima Technologies, Inc. and
subsidiaries ("Maxima"), and High Voltage Engineering Europa B.V. ("HVE
Europa").

    The consolidated financial statements include the accounts of the Company
and its domestic and foreign subsidiaries after elimination of material
intercompany transactions and balances.

    The Company maintains non-controlling interest in certain affiliated
companies which are accounted for using the equity method. Separate disclosure
is not presented as the amounts are not significant.

Accounting Period

    The Company operates on a 52 or 53 week fiscal period. The terms "fiscal
2002", "fiscal 2001" and "fiscal 2000" refer to the Company's fiscal years ended
April 27, 2002, April 28, 2001 and April 29, 2000, respectively. Fiscal 2002,
fiscal 2001 and fiscal 2000 include the results of operations of the Company for
52 weeks, 52 weeks and 53 weeks, respectively.

Revenue Recognition

    Sales of goods that are not part of a long-term contract are generally
recognized upon shipment of products, in accordance with SEC Staff Accounting
Bulletin No. 101, Revenue Recognition. Service revenue is recognized when
the service is performed and accepted by the customer. Product revenue is
recognized when there is persuasive evidence of an arrangement, the fee is
fixed or determinable, delivery of the product to the customer has occurred
and the Company has determined that collection of the fee is probable. Title
to the product generally passes upon shipment of the product as the products
are shipped FOB shipping point, except for certain foreign shipments. If the
product requires significant installation to be performed by the Company that
is not perfunctory and inconsequential, such revenue related to the product
is deferred and recognized upon the completion of the installation. The
Company provides for a warranty reserve at the time the product's revenue is
recognized.

    The Company follows both the completed-contract method and the percentage-of
completion methods of accounting for contract revenue. Contracts are considered
complete upon completion of all essential contract work, including support for
integrated testing and customer acceptance.

    Under the completed-contract method, revenue and costs of individual
contracts are included in operations in the year during which they are
completed. Losses expected to be incurred on contracts in progress are charged
to operations in the period such losses are determined. The aggregate of costs
of uncompleted contracts in excess of related billings is shown as a current
asset, and the aggregate of billings on uncompleted contracts in excess of
related costs is shown as a current liability.


                                       F-8


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

    Under the percentage-of-completion method, income is recognized on contracts
as work progresses based on the relationship between total contract revenues and
total estimated contract costs. The percentage of work completed is determined
by comparing the accumulated costs incurred to date with management's current
estimate of total costs to be incurred at contract completion. Revenue is
recognized on the basis of actual costs incurred plus the portion of income
earned.

    Contract costs include all direct material, subcontractor costs, and labor
costs and those indirect costs related to contract performance. Revisions in
profit estimates during the period of a contract are reflected in the accounting
period in which the revised estimates are made on the basis of the stage of
completion at the time. If estimated total costs on a contract indicate a loss,
the entire amount of the estimated loss is provided for currently.

    Costs and estimated earnings in excess of billings on uncompleted contracts
represent revenue recognized in excess of amounts billed to customers. These
amounts are not yet billable under the terms of the contracts and are
recoverable from customers upon various measures of performance. Billings in
excess of costs and estimated earnings on uncompleted contracts represents
billings to customers in excess of earned revenue and advances on contracts.

Allowance for Doubtful Accounts

    A summary of activity in the allowance for doubtful accounts is as follows:

<TABLE>
<CAPTION>
                                                                         Years Ended
                                                              ---------------------------------
                                                              April 27,   April 28,   April 29,
                                                                2002        2001        2000
                                                              ---------   ---------   ---------
<S>                                                          <C>         <C>        <C>
Balance at beginning of year................................  $  4,040    $  7,046    $  1,835
Provision...................................................      (132)       (732)        112
Charge-offs, net of recoveries..............................    (1,254)     (2,197)     (1,407)
Acquisitions, divestitures and effect of receivable
  securitization............................................     1,333         (77)      6,506
                                                              ---------   ---------   ---------
Balance at end of year......................................  $  3,987    $  4,040    $  7,046
                                                              =========   =========   =========
</TABLE>

CASH EQUIVALENTS

    For purposes of the statements of cash flows, all highly liquid debt
instruments purchased with a maturity of three months or less are considered to
be cash equivalents.

    Cash overdrafts included in trade accounts payable were $3,703 and $4,251 at
April 27, 2002 and April 28, 2001, respectively.

    At April 27, 2002 and April 28, 2001, cash in the amounts of $11,361 and
$11,119 respectively, was in uninsured foreign bank accounts, including $4,891
and $4,432, respectively which was generally used for collateral for bank
guarantee facilities in support of customer advances.


                                       F-9


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Inventories

    Inventories are primarily stated at the lower of cost (first-in, first-out
method) or market. Certain inventories are stated at the lower of cost or market
determined by the last-in, first-out (LIFO) method. The amount by which the
replacement cost exceeds the LIFO value was not material at April 27, 2002.

Property, Plant and Equipment

    Property, plant and equipment are recorded at cost. Depreciation and
amortization are provided for in amounts sufficient to relate the cost of
depreciable assets to operations over their estimated service lives. Leasehold
improvements are amortized over the lives of the respective leases or the
service lives of the improvements, whichever is shorter. Leased property under
capital leases is amortized over the lives of the respective leases or over the
service lives of the assets for those leases which substantially transfer
ownership. The straight-line method of depreciation is followed for
substantially all assets for financial reporting purposes, while accelerated
methods are used for tax purposes. Future income taxes resulting from
depreciation temporary differences have been provided for as deferred income
taxes.

    Depreciation is based upon the following estimated useful lives:

<TABLE>
<S>                                                        <C>
Building and building improvements..........................  30 to 40 years
Leasehold improvements......................................  5 to 20 years
Machinery and equipment.....................................  2 to 15 years
Other.......................................................  3 to 5 years
</TABLE>

Cost in Excess of Net Assets Acquired

    The cost in excess of net assets acquired (goodwill) was amortized on the
straight-line basis over the expected period of benefit of three to forty
years, through April 27, 2002. The Company continually evaluates the carrying
value of goodwill. Any impairments are recognized when the expected
undiscounted future operating cash flows derived from such goodwill is less
than the carrying value.

Intangible Assets

    Costs incurred to obtain debt financing are amortized over the expected term
of the related debt. Amortization of deferred financing costs is recorded as
interest expense. The costs associated with consulting agreements are amortized
over the period to which the agreements relate. Patents are amortized on the
straight line basis over the remaining legal lives.

Long-Term Compensation Plans

    Costs associated with a Valuation Creation Plan ("VCP") which provides
long-term compensation for key individuals are recorded, on a quarterly
basis, based on the formula as defined in the VCP. Cost associated with a
Phantom Stock Appreciation Rights Plan ("PSAR Plan") which provides long-term
incentive compensation for key individuals of PHI and reviewed on a quarterly
basis, based on an formula as defined in the PSAR Plan and are recorded on a
quarterly basis.

                                      F-10


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Accumulated Other Comprehensive Income (Loss)

    The after-tax components of accumulated other comprehensive income (loss)
are as follows:

<TABLE>
<CAPTION>
                                         Foreign       Pension         Other
                                         Currency      Liability   Comprehensive
                                        Translation   Adjustment       Loss
                                        -----------   ----------   -------------
<S>                                    <C>          <C>          <C>
Balance, April 24, 1999...............    $  (347)      $    --       $  (347)
Change in foreign currency
  translation.........................        (86)                        (86)
                                          -------       --------      --------
Balance, April 29, 2000...............       (433)           --          (433)
Change in foreign currency
  translation.........................     (1,451)           --        (1,451)
Pension liability adjustment..........         --          (376)         (376)
                                          -------       --------      --------
Balance, April 28, 2001...............     (1,884)         (376)       (2,260)
Change in foreign currency
  translation.........................       (525)           --          (525)
Pension liability adjustment..........         --        (6,710)       (6,710)
                                          --------      --------      --------
Balance, April 27, 2002...............    $(2,409)      $(7,086)      $(9,495)
                                          ========      ========      ========
</TABLE>

    Foreign subsidiaries primarily use the local currency as their functional
currency, except for those in highly inflationary economies. Assets and
liabilities of these entities are translated into U.S. dollars at rates of
exchange in effect at the balance sheet date. The resulting translation
adjustments are accumulated in a separate component of stockholders' deficiency
and are included in operations only upon the sale or liquidation of the
underlying foreign investment. Revenue and expense transactions are translated
at the weighted average exchange rates for the fiscal month in which the
transaction occurred. Also included are the effects of exchange rate changes on
intercompany balances of a long-term investment nature.

Derivatives

    The Company sometimes enters into forward exchange contracts or currency
swaps to manage exposure related to certain foreign currency commitments.
Forward exchange contracts or swaps may be designated as hedges depending upon
their effectiveness as measured by their ability to be considered highly
inversely correlated to the hedged item as required by generally accepted
accounting principles. If a derivative contract terminates prior to maturity,
the investment is shown at its fair value with the resulting gain or loss
reflected in operating results. Gains and losses on contracts to hedge
identifiable foreign currency commitments are deferred and accounted for as part
of the related foreign currency transaction. Gains and losses on all other
forward exchange contracts are included in current income.

    At April 27, 2002, the notional amounts of forward exchange contracts and
currency swaps, primarily to sell or buy U.S. dollars, totaled $5,188. All of
these contracts mature within the next twelve months. Deferred unrealized gains
or losses from hedging firm commitments are immaterial.

    The Company's forward exchange contracts and currency swaps contain credit
risk in that its banking counter-parties may be unable to meet the terms of the
agreements. The Company minimizes such risk by limiting its counter-parties to
major financial institutions. In addition, the potential risk of loss with any
one party resulting from this type of credit risk is monitored. Management does
not expect any material losses as a result of default by other parties.

    The Company does not use derivative financial instruments for speculative
trading purposes, nor does it hold or issue leveraged derivative financial
instruments.


                                      F-11


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Certain Risks and Concentrations

    The Company operates in highly competitive and rapidly changing markets and
some competitors have substantially greater sales and financial resources. Entry
into the market by new competition or the development of new technologies could
adversely affect operating results. Significant concentration of credit risk is
with trade receivables, which is somewhat mitigated due to the Company's
diversity of regions and customers. At April 27, 2002, one customer accounted
for 6.5% of trade receivables.

    Financial instruments that potentially subject the Company to concentrations
of credit risk consist primarily of billed and unbilled receivables.
Concentrations of credit risk with respect to billed and unbilled contracts
receivable is mitigated by obtaining letters of credit to ensure payment from
international customers. Generally, collateral is not required of customers who
are located in countries where the Company has operations.

    The Company has manufacturing operations in seven foreign countries (Italy,
Spain, Germany, France, the United Kingdom, The Netherlands and Mexico). Risks
inherent in foreign operations include changes in social, political and economic
conditions, changes in currency exchange rates, changes in the laws and policies
that govern foreign investments in countries, changes in United States laws and
regulations relating to foreign trade and investment.

    The Company has made significant acquisitions that are inherently subject to
risk. The successful integration of the acquired operations and the substantial
demands on the attention of senior management may adversely impact their ability
to manage the Company's existing businesses.

Liquidity

    The ability of the Company to satisfy its obligations under existing
indebtedness and preferred stock will be primarily dependent upon the future
financial and operating performance of its operating units and upon the
Company's ability to renew or refinance borrowings, to sell assets or to
raise additional equity capital as necessary. The Company expects it will be
able to refinance any principal payment obligations that are scheduled to
mature prior to maturity of the 1998 Senior Notes.

Use of Estimates

    In preparing financial statements in conformity with accounting principles
generally accepted in the United States of America, management is required to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the financial statements as well as revenues and expenses during the
reporting period. Actual results could differ from those estimates.

Income Taxes

    Deferred tax assets and liabilities are determined based on the differences
between the financial statement and tax basis of assets and liabilities as
measured by the enacted tax rates which will be in effect when these differences
reverse, subject to a valuation allowance.


                                      F-12


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

    Deferred income taxes result from changes in deferred tax assets, deferred
tax liabilities and changes in the valuation allowance. Income tax expense
consists of the taxes payable for the year and deferred income taxes as
discussed above.

Net Income (Loss) Per Share

    The Company computes basic EPS utilizing only weighted shares outstanding,
while diluted EPS is computed considering the dilution of warrants and issuable
shares of common stock. Dilutive EPS is not presented for fiscal 2002 and 2000
because losses from continuing operations exist for this period and results in
an antidilutive effect.

Advertising

    Advertising costs are expensed as incurred. Advertising expense was $4,623,
$3,304 and $4,034 for fiscal 2002, fiscal 2001 and fiscal 2000, respectively.

Research and Development

    Research and development costs are substantially charged to operations as
incurred.

Environmental Expenditures

    Costs associated with remediation activities are expensed except to the
extent such expenses were previously accrued. Liabilities relating to probable
remedial activities are recorded when the cost of such activities can be
reasonably estimated. The liability is discounted when the amount and timing of
the cash payments for that remediation site are fixed or reliably determinable.
The liabilities are adjusted as further information develops or circumstances
change.

Fair Value of Financial Instruments

    The carrying amount of cash and cash equivalents approximates fair value.

    The carrying amounts of borrowings under short-term revolving credit
agreements, and variable rate long-term debt instruments approximate their fair
value as the floating rates applicable to the financial instruments reflect
changes in overall market interest rates. The fair value of other long-term debt
is estimated using discounted cash flow analysis, based on the Company's current
incremental borrowing rates for similar types of borrowing arrangements. The
fair value of the Company's long-term debt is estimated based on the quoted
market prices for the same or similar issues. At April 27, 2002, the carrying
amount and estimated fair value of long-term debt and foreign receivables
facilities were $242,036 and $144,085, respectively.

    The carrying value of the redeemable put warrants approximates the fair
value based on an estimate by management.

    The fair value of the Company's redeemable preferred stock at April 27,
2002, is estimated based on the quoted market prices for the same or similar
issues. At April 27, 2002, the carrying amount and estimated fair value of
redeemable preferred stock were $53,847 and $1,615, respectively.


                                      F-13


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

    The estimate fair value of forward currency exchange contracts calculated
using the exchange rate at April 27, 2002, as quoted by the respective brokers
was approximately $4,646.

    Fair value estimates are subjective in nature and involve uncertainties and
matters of significant judgment and therefore cannot be determined with
precision. Changes in assumptions could significantly affect these estimates.

New Accounting Pronouncements

    Effective April 29, 2001, the Company adopted SFAS No. 133, Accounting for
Derivative Instruments and Hedging Activities, as amended, which requires that
all derivative instruments be reported on the balance sheet at fair value and
that changes in a derivative's fair value be recognized currently in earnings
unless specific hedge criteria are met. If the derivative is designated as a
fair value hedge, the changes in the fair value of the derivative and of the
hedged item attributable to the hedged risk are recognized as a charge or credit
to earnings. Adoption did not have a material impact on the Company's financial
statements.

    The Financial Accounting Standards Board (FASB) issued Statement of
Financial Accounting Standards (SFAS) 141, Business Combinations, and SFAS
142, Goodwill and Intangible Assets. SFAS 141 is effective for all business
combinations completed after June 30, 2001. SFAS 142 is effective for fiscal
years beginning after December 15, 2001; however, certain provisions of this
Statement apply to goodwill and other intangible assets acquired between July
1, 2001 and the effective date of SFAS 142. Major provisions of these
statements and their effective dates for the Company are as follows: (i) all
business combinations initiated after June 30, 2001 must use the purchase
method of accounting; (ii) intangible assets acquired in a business
combination must be recorded separately from goodwill if they arise from
contractual or other legal rights or are separable from the acquired entity
and can be sold, transferred, licensed, rented or exchanged, either
individually or as part of a related contract, asset or liability; (iii)
goodwill and intangible assets with indefinite lives acquired after June 30,
2001, will not be amortized. Effective January 1, 2002, all previously
recognized goodwill and intangible assets with indefinite lives will no
longer be subject to amortization. Effective January 1, 2002, goodwill and
intangible assets with indefinite lives will be tested for impairment
annually and whenever there is an impairment indicator and all acquired
goodwill must be assigned to reporting units for purposes of impairment
testing and segment reporting.

    Effective April 28, 2002, the Company adopted the provisions of SFAS No.
141 and SFAS No. 142. Adoption is not expected to have a material impact on
the Company's financial statements.


                                      F-14


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)


    The Company completed the first step of the transitional goodwill impairment
test during the three months ended July 27, 2002 based on the amount of goodwill
as of the beginning of the fiscal year ending April 26, 2003, as required by
SFAS No. 142. The Company utilized a third party independent valuation to
determine the fair value of each of the reporting units based on a discounted
cash flow income approach. Based on the results of the first step of the
transitional goodwill impairment test, the Company has determined that the fair
value of each of the reporting units exceeded their carrying amounts and,
therefore, no goodwill impairment existed as of July 27, 2002. As a result, the
second step of the transitional goodwill impairment test is not required to be
completed. The Company will be required to continue to perform a goodwill
impairment test on an annual basis.

    In August 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards ("SFAS No. 144"), Accounting for
the Impairment or Disposal of Long-Lived Assets, which supersedes SFAS
No. 121. SFAS No. 144 addresses financial accounting and reporting for the
impairment or disposal of long-lived assets and is effective for fiscal
years beginning after December 15, 2001. The Company is currently evaluating
the impact of SFAS No. 144.

Reclassifications

    Certain reclassifications have been made to the fiscal 2001 and fiscal
2000, respectively, consolidated financial statements in order to conform
with the current year's presentation.

NOTE B--DIVESTITURES AND OTHER TRANSACTIONS

    On March 7, 2001, the Company completed the sale of substantially all the
net assets of its Anderson Power division and all the capital stock of
Anderson Power Products Ireland B.V. (together "Anderson") to Ideal
Industries, Inc. for $78,722 in cash. The Company recorded a gain on the
disposal in fiscal 2001 of $34,270, net of income taxes and transaction
related expenses. Revenues attributable to Anderson discontinued operations
were approximately $21,862 for the first nine months of fiscal 2001. As a
result of this sale, the Company's consolidated results of operations have
been restated to reclassify the results of operations of Anderson to
discontinued operations. The Asset Sale Proceeds, as defined, received by the
Company in connection with the disposition of Anderson was subject to a
covenant of the Senior Notes Indenture, which requires the Company to apply
the net cash received to (i), repay debt ranking PARI PASSU to the Senior
Notes within 180 days, (ii) contractually commit to acquisitions, capital
expenditures or investments relating to the Company's presently conducted
business within 180 days and paid within 360 days or (iii) offer to
repurchase the Senior Notes pursuant to an Excess Proceeds Offer, as defined.
The Company has invested a portion of the Asset Sale Proceeds through the
purchase of certain receivables from High Voltage Funding Corporation
("HV-FC") a limited purpose subsidiary of the Company, in connection with the
termination of the Refinanced Receivables Purchase Facility and invested in
certain capital expenditures. The Asset Sale Proceeds included in restricted
cash was $25,040 at April 28, 2001.

    From time to time, the Company achieves liquidity through receivables
purchase arrangements with HV-FC a limited purpose subsidiary of the Company.
Under these arrangements, the domestic subsidiaries of the Company sell a
defined pool of trade accounts receivables, and the related rights inherited
from the Company and its domestic subsidiaries to HV-FC. HV-FC then sells
participating interest in such assets to one or more third parties which, in
turn, purchases and receives ownership and security interests in those
assets. Under the Company's Senior Notes Indenture, the Company is limited to
making investments in HV-FC of up to $25.0 million. While the Company is not
currently utilizing these receivables purchase arrangements, the Company has
retained the right to reinitiate these arrangements with HV-FC or another
limited purpose subsidiary at any time.


                                      F-15

<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE C--INVENTORIES

    Inventories consisted of the following as of:

<TABLE>
<CAPTION>
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                        <C>         <C>
Raw materials.............................................    $30,642     $32,267
Work in process...........................................     22,982      24,776
Finished goods............................................      6,918       4,588
                                                              -------     -------
Total.....................................................    $60,542     $61,631
                                                              =======     =======
</TABLE>


NOTE D--COSTS AND EARNINGS EXCESS OF BILLINGS--BILLINGS IN EXCESS OF COSTS

    Contract costs and related billings consisted of the following as of:

<TABLE>
<CAPTION>
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                       <C>          <C>
Cost incurred and income recognized on uncompleted
  contracts...............................................    $41,074     $38,202
Related billings..........................................     29,731      25,170
                                                              --------    -------
Total costs in excess of billings.........................    $11,343     $13,032
                                                              ========    =======

Billings on uncompleted contracts.........................    $56,767     $52,250
Related costs incurred and income recognized..............     51,255      47,954
                                                              --------    -------
Total billings in excess of costs.........................    $ 5,512     $ 4,296
                                                              ========    =======
</TABLE>

    Accounts receivable include retainages of approximately $3,264 and $4,680 as
of April 27, 2002 and April 28, 2001, respectively. Bill and hold receivables
were immaterial as of April 27, 2002 and April 28, 2001, respectively. Unbilled
receivables were immaterial as a result of the Company's receivable
securitization program as of April 28, 2001 (note B).


NOTE E--PREPAIDS AND OTHER CURRENT ASSETS

    Prepaid and other current assets consisted of the following as of:

<TABLE>
<CAPTION>
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                        <C>         <C>
Value added tax receivable................................    $  387      $2,516
Prepayments and deposits..................................     3,349       3,100
Prepaid insurance.........................................       682         311
Employee advances and other receivables...................     1,108       1,130
Other.....................................................     1,490       1,637
                                                              ------     -------
  Total...................................................    $7,016      $8,694
                                                              ======     =======
</TABLE>


                                      F-16


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)



NOTE F--PROPERTY, PLANT AND EQUIPMENT

    Property, plant and equipment consisted of the following as of:

<TABLE>
<CAPTION>
                                                              APRIL 27,   APRIL 28
                                                                2002        2001
                                                              ---------   ---------
<S>                                                          <C>        <C>
Land and buildings..........................................  $ 46,275     $ 43,854
Machinery and equipment.....................................    89,302       77,975
Construction in progress....................................     3,176        2,819
                                                              --------     --------
  Total.....................................................   138,753      124,648
Less accumulated depreciation and amortization..............   (53,264)     (41,668)
                                                              --------     --------
  Total.....................................................  $ 85,489     $ 82,980
                                                              ========     ========
</TABLE>

    Property under capital leases is included in these amounts (note P).


NOTE G--COST IN EXCESS OF NET ASSETS ACQUIRED AND OTHER NON-CURRENT ASSETS

Investment in Joint Venture

    A subsidiary of the Company owns a 50% interest in a joint venture which is
being accounted for under the equity method. The Company recorded income of
$1,717 and $472 in fiscal 2002 and fiscal 2001, respectively, and a loss of $239
in fiscal 2000, related to this investment.

Assets Held For Sale

    At April 27, 2002, assets held for sale consisted of a former manufacturing
facility. This property was sold by the Company on June 14, 2002 (note T).

Other Assets

    Other assets and costs in excess of net assets acquired consisted of the
following as of:

<TABLE>
<CAPTION>
                                                                                             April 28,
                                                                  April 27, 2002               2001
                                                        ----------------------------------   ---------
                                                                                    Net         Net
                                                         Gross     Accumulated    Carrying   Carrying
                                                         Amount    Amortization    Amount     Amount
                                                        --------   ------------   --------   ---------
<S>                                                   <C>        <C>            <C>         <C>
Cost in excess of net assets acquired (note B).......    $42,828   $    (22,804)  $  20,024   $33,032
                                                         =======   ============   =========   =======
Deferred financing costs (note H)....................    $ 9,580   $     (6,163)  $   3,417   $ 5,194
Prepaid pension cost (note L)........................         --             --          --     3,248
Prepaid taxes on severance indemnities...............      7,961             --       7,961     7,271
Investment in HV-FC (note B).........................         --             --          --    39,935
Investment in affiliates.............................      3,393             --       3,393     3,286
Non-compete and other intangible assets..............      7,159         (3,930)      3,229     4,077
Patents..............................................      7,342         (2,837)      4,505     4,817
Cash collateral for outstanding letters of credit....      2,402             --       2,402        --
Other................................................      6,123         (5,118)      1,005     1,619
                                                         -------   ------------   ---------   -------
  Total..............................................    $43,960   $    (18,048)  $  25,912   $69,447
                                                         =======   ============   =========   =======
</TABLE>


                                      F-17


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)



NOTE G--COST IN EXCESS OF NET ASSETS ACQUIRED AND OTHER NON-CURRENT ASSETS
(Continued)

    Amortization expense was $15,933, $7,849 and $4,316 for fiscal 2002, 2001
and 2000, respectively. During the fourth quarter of fiscal 2002, the Company
determined that the continued worldwide economic slowdown in semiconductor
markets has lessened the demand for certain of it products. This caused the
Company to determine that the goodwill in the amount of $8,108 associated with
the Advanced Surface Analysis segment no longer held future value to the Company
and consequently was charged to amortization expense which is included in
administrative and selling expenses. In addition, the Company determined that
goodwill in the amount of $618 in the Industrial Power Control segment no longer
held future value to the Company based on new product strategies arising from
the ASI acquisition integration. The Company recognized the adjustment to
goodwill based upon its estimate of expected undiscounted future operating cash
flows from product revenue which has not materialized as contemplated at the
date of acquisition. In fiscal 2000, the Company recorded $1,236 for the
writedown of long lived assets and assets held for sale to net realizable
value.

    Letters of credit as of April 27, 2002 and April 28, 2001 were $3,776 and
$2,131 respectively which include $1,520, respectively relating to environmental
matters (see note Q).

NOTE H--LONG-TERM OBLIGATIONS, REDEEMABLE PUT WARRANTS AND FOREIGN RECEIVABLES
FACILITIES

    Long-term obligations consisted of the following as of:

<TABLE>
<CAPTION>
                                                              APRIL 27,   APRIL 28,
                                                                2002        2001
                                                              ---------   ---------
<S>                                                         <C>         <C>
1998 Senior Notes...........................................  $155,000    $155,000
1998 Senior Notes Premium...................................        37          51
New Revolving Credit Facility...............................    25,000      20,130
Term loan...................................................    18,551      18,435
Foreign loans and bank facilities...........................    13,994      12,574
Capital lease obligations (note P)..........................    11,237       7,046
Mortgage notes payable......................................     5,932       6,446
Notes payable...............................................        --         711
                                                              --------    --------
  Total.....................................................   229,751     220,393
  Less current maturities...................................   (14,573)     (8,805)
                                                              --------    --------
  Long-term obligations, net of current maturities..........  $215,178    $211,588
                                                              ========    ========
</TABLE>

1998 SENIOR NOTES

    On December 22, 1999, the Company received the consent of the holders of the
outstanding $155,000, 10 1/2% Senior Notes due 2004, for the waiver of, and
amendment to, certain provisions of the Indenture governing the Notes as more
fully described in the Consent Solicitation.


                                      F-18


<PAGE>


              HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)


NOTE H--LONG-TERM OBLIGATIONS, REDEEMABLE PUT WARRANTS AND FOREIGN RECEIVABLES
FACILITIES (Continued)


    The 1998 Senior Notes are general unsecured obligations of the Company and
rank Senior to any subordinated indebtedness and subordinated to all existing
and future secured indebtedness, including the New Revolving Credit Facility.
Interest is payable semiannually on February 15 and August 15. The Notes may be
redeemed in whole or in part at any time on or after August 15, 2001 at
redemption prices expressed as a percentage of the face value of the Senior
Notes plus accrued and unpaid interest.

<TABLE>
<CAPTION>
YEAR                                                          PERCENTAGE
----                                                          -----------
<S>                                                         <C>
2001........................................................    105.250%
2002........................................................    102.625%
2003........................................................    100.000%
</TABLE>

    The Company is obligated in certain instances to make an offer to purchase
the Senior Notes at a purchase price in cash equal to 100% of the principal
amount thereof, plus accrued and unpaid interest to the purchase date, with
portions of the Available Asset Sale Proceeds, as defined, of certain asset
sales. Upon occurrence of a Change of Control, as defined, each holder of the
Notes will be entitled to require the Company to purchase such holder's Notes at
a purchase price equal to 101% of the principal amount thereof, plus accrued and
unpaid interest to the purchase date.

New Revolving Credit Facility

    On November 30, 2000, the Company simultaneously entered into the
Financing Agreement and Receivables Purchase Agreement ("Refinanced
Receivables Purchase Agreement") for the purpose of refinancing the existing
Revolving Credit Facility and Receivable Purchase Facility. In connection
with the above the Company recorded an extraordinary loss of $530, net of
taxes, to write off deferred financing costs and prepayment penalties.

    On June 19, 2001, the Company signed an amendment to the Financing
Agreement ("Amended and Restated Financing Agreement"). The Amended and
Restated Financing Agreement amends certain financial ratios and restates the
Refinanced Revolving Credit Facility, Term Loan A, and Term Loan B to a
combined $25,000 revolving credit facility ("New Revolving Credit Facility")
with a sub-facility of $5,000 for the issuance of letters of credit.
Availability under the facility is limited to the sum of (i) 85% of eligible
receivables, (ii) 50% of eligible joint venture receivables, (iii) 125% of
the appraised orderly liquidation value of the eligible inventory less
certain reserves as is considered reasonable and customary by the lenders and
(iv) $5,000. Interest under the facility is computed and payable monthly at
the greater of the lender's reference rate (4.75% at April 27, 2002) or 7.0%
plus 2.5%. The interest rate on this facility was 9.5% at April 27, 2002. At
April 27, 2002, $25,000 was outstanding under the New Revolving Credit
Facility. The Company is required to pay monthly in arrears an unused
facility fee of 0.5% of the available funds of the New Revolving Credit
Facility. The facility provides for liens on substantially all domestic
property and assets of the Company.

Term Loan

    On January 18, 2000, in connection with the acquisition of ASI, the Company
entered in to the Term Loan with a syndicate of Italian Banks. The amount
outstanding at April 27, 2002 was $18,551. Interest under the Term Loan is
computed and payable quarterly or semiannually, at the Euribor rate plus 1.75%
(5.13% at April 27, 2002). The loan is collateralized by certain real property
located in Italy and by pledged shares of ASI. The Term Loan is payable in five
installments beginning in fiscal 2003. The Term Loan contains certain
restrictions, including the prohibition of ASI from paying fees and dividends to
the Company and the requirement that ASI meet certain financial ratios.


                                      F-19


<PAGE>


              HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)


NOTE H--LONG-TERM OBLIGATIONS, REDEEMABLE PUT WARRANTS AND FOREIGN RECEIVABLES
FACILITIES (Continued)


Foreign Receivables Facilities

    Certain foreign subsidiaries are parties to facilities in which
receivables are sold with recourse. Amounts outstanding at April 27, 2002 and
April 28, 2001, under the foreign receivables facilities were $12,285 and
$6,075, respectively. The borrowing bears interest from 0.25% to 10% per
annum, and matures at the earlier of the collection of the receivables
securing the credit line or 180 days.

Mortgage Notes Payable

    The mortgage notes generally are due June 2004, September 2009, July 2011
and January 2016, and bear interest between 2% and 9.75% (weighted average
interest rate of 7.5% at April 27, 2002). The notes are collateralized by land
and buildings with a net book value of approximately $10,863 as of April 27,
2002. Certain of these mortgages were issued through the Pennsylvania Economic
Development Financing Authority ("PEDFA") and the Pennsylvania Industrial
Development Authority in conjunction with the construction of a facility for a
subsidiary of the Company in 1995. The subsidiary may prepay the mortgage before
maturity, subject to a prepayment premium ranging from 101% to 105% of the
principal amount thereof.

    As of April 27, 2002, the Company was not in compliance of certain financial
covenants contained in the Loan Agreement with PEDFA governing a $2,267 mortgage
with a subsidiary of the Company. The Company has received a waiver with respect
to such non-compliance. The waiver does not extend to any future periods,
however, the Company believes it will be able to obtain additional waivers and
intends to negotiate an amendment.


RESTRICTIVE COVENANTS

    The New Revolving Credit Facility, the Notes, Term Loan and Mortgage
Notes Payable contain restrictive provisions relating to the maintenance of
certain financial ratios, as defined in the respective agreements,
restrictions on the payment of common stock dividends, leases, capital
expenditures, borrowings, the acquisition or disposition of material
subsidiaries and other matters.

ANNUAL MATURITIES

    Aggregate maturities of long-term obligations are as follows:

<TABLE>
<CAPTION>
FISCAL
------
<S>                                                         <C>
2003........................................................  $ 14,573
2004........................................................    35,842
2005........................................................   165,775
2006........................................................     2,790
2007........................................................     2,771
Thereafter..................................................     8,000
                                                              --------
                                                              $229,751
                                                              ========
</TABLE>


                                      F-20


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)


NOTE H--LONG-TERM OBLIGATIONS, REDEEMABLE PUT WARRANTS AND FOREIGN RECEIVABLES
FACILITIES (Continued)


Redeemable Put Warrants

    As of April 27, 2002, the Company has issued and issuable 79.6688 warrants
to purchase shares of common stock at $.01 per share, subject to a dilution
adjustment, under certain circumstances, as defined. For financial reporting
purposes, the Company has assigned an estimated fair value of $2,900 to the
warrants. The warrants expire on May 9, 2004. As of May 1, 2000, the holders of
the warrants may present, subject to conditions specified in the warrant, the
warrants for payment to the Company for amounts which are the greater of the
then appraised value or by a formula as described in the warrant. The Company
does not believe these matters will have a material change to its financial
statements.

Foreign Loans and Bank Facilities

    At April 27, 2002, the Company had outstanding $6,846, under certain foreign
bank facilities. These facilities are short-term revolving overdraft accounts.
These facilities bear interest at rates between 7.25% and 8.70%, and are
generally payable monthly.

    At April 27, 2002, the Company had outstanding $6,706, under certain foreign
bank and government loans. These loans generally mature between 2007 and 2014.
Interest under these loans are computed and payable at rates between 2.82% and
9.00%, and are generally payable quarterly.


                                      F-21


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE I--ACCRUED LIABILITIES AND OTHER LIABILITIES

    Accrued liabilities consisted of the following:

<TABLE>
<CAPTION>
                                                               April 27,   April 28,
                                                                 2002        2001
                                                               ---------   ---------
<S>                                                          <C>         <C>
Employee compensation and related expenses, including
  current portion of long term compensation (note L)........   $19,118     $19,924
Product warranty costs......................................     5,251       4,511
Deferred maintenance revenue................................     3,696       4,218
Commissions.................................................     2,261       2,625
Restructuring costs.........................................       757         201
Sales, use tax and property tax.............................     1,490       1,128
Customer product installation and training..................     1,125       1,239
Legal and audit.............................................       443         513
Current portion of environmental cleanup....................       942         989
Accrued liabilities on divestitures.........................        --         623
Other.......................................................     5,182       7,558
                                                               -------     -------
  Total.....................................................   $40,265     $43,529
                                                               =======     =======

    Other liabilities consisted of the following:

                                                              April 27,   April 28,
                                                                2002        2001
                                                              ---------   ---------
Environmental cleanup and related litigation costs (note
  Q)........................................................   $ 3,065     $ 4,147
Long term severance and long term incentive compensation
  (note L)..................................................    22,286      24,526
Other.......................................................       836         565
                                                               -------     -------
  Total.....................................................    26,187      29,238
  Less current portion of environmental cleanup included
    in accrued liabilities..................................      (942)       (989)
                                                               -------     -------
                                                               $25,245     $28,249
                                                               =======     =======
</TABLE>

    In fiscal 2002, the Company recorded a restructuring charge of $859 in the
Advanced Surface Analysis segment. Of the amount recorded, $127 related to
certain headcount reductions and $732 related to the closure of a manufacturing
facility in Billerica, Massachusetts. All amounts are expected to be paid out by
April 26, 2003.

    In fiscal 2001, the Company recorded a restructuring charge in the
Industrial Power Control segment of $143 which was relating to the reduction of
some engineering and administrative headcount. In connection with these charges,
the Company paid $63 and $80, respectively, in fiscal 2002 and 2001.

    In fiscal 2000, the Company recorded a restructuring charge in the
Industrial Power Control segment of $3,986. Restructuring charges related to
the acquisition of ASI were $806 for headcount reductions and $2,360 for the
closing of a facility. Robicon recorded a charge of $820 for severance
relating to the reduction of engineering and administrative headcount. The
Company also recorded $975 in the Advanced Surface Analysis segment at PHI
for severance related to certain headcount reductions. In connection with
these charges, the Company paid $3,858 and $849, respectively, in fiscal 2001
and 2000.

                                      F-22


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)


NOTE J--REDEEMABLE PREFERRED STOCK

    Redeemable Preferred Stock consisted of the following:

<TABLE>
<CAPTION>
                                                                      Shares Issued and Issuable
                                                             ---------------------------------------------
                                                               Par        Shares     April 27,   April 28,
                                                              Value     Authorized     2002        2001
                                                             --------   ----------   ---------   ---------
<S>                                                        <C>        <C>         <C>          <C>
Series A Exchange Redeemable Preferred Stock..............   $     1      110,000    $ 55,934    $ 48,892
                                                             ========   ==========   =========   =========
</TABLE>

    Changes in Redeemable Preferred Stock (issued and issuable) were as follows:

<TABLE>
<CAPTION>
                                                                Series A
                                                               ---------
<S>                                                          <C>
Balance at April 29, 2000...................................    $40,642
Preferred stock dividends...................................      6,101
Accretion of redeemable preferred stock.....................        605
Incremental discount (note K)...............................     (1,226)
                                                                -------
Balance at April 28, 2001...................................     46,122
Preferred stock dividends...................................      7,036
Accretion of redeemable preferred stock.....................        689
                                                                -------
Balance at April 27, 2002...................................    $53,847
                                                                =======
</TABLE>

DIVIDENDS AND REDEMPTIONS

    Dividends on Series A Exchange Redeemable Preferred Stock are cumulative and
accrue at a rate of 12 1/2% per annum on the liquidation preference of $1 per
share and are paid semiannually on February 15 and August 15. Dividends are
payable in cash or additional shares at the Company's option, on any dividend
payment date, occurring on or prior to August 15, 2002, except to the extent
restricted by other agreements of the Company. If any dividend payable on any
dividend payment date subsequent to August 15, 2000 is not paid in full in cash,
the per annum dividend rate will be increased by 0.50% from such dividend
payment date, and following two such non-cash payments, the per annum dividend
rate will be increased by 1.00% for each additional semiannual period in which
such non-cash payment occurs, up to a maximum of 2.0%. After the date on which
such dividend default is cured, the dividend rate will revert to the original
rate. After August 15, 2002, dividends must be paid in cash. The dividend rate
at April 27, 2002 was 14.5%. Holders of Series A Exchange Redeemable Preferred
Stock have preference as to payments of dividends over holders of common stock.

REDEMPTION PROVISIONS

    Except to the extent restricted by other agreements, the Series A Exchange
Redeemable Preferred Stock has the following redemption preferences. The Company
may redeem the Series A Exchange Redeemable Preferred Stock in whole or in part
at any time on or after August 15, 2002 at redemption prices expressed as a
percentage of the liquidation preference plus accrued and unpaid dividends. The
Series A Exchange Redeemable Preferred Stock has a mandatory redemption date of
August 15, 2005, at a redemption price equal to the liquidation preference
together with all accumulated and unpaid dividends.


                                      F-23


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE J--REDEEMABLE PREFERRED STOCK (Continued)

VOTING RIGHTS

    The holders of Series A Exchange Redeemable Preferred Stock have no voting
rights except as provided by law or if: the Company after August 15, 2002 is in
arrears in the payment of dividends in an amount equal to or exceeding two
quarterly dividend payments; the Company fails to redeem the Series A Exchange
Redeemable Preferred Stock on or before August 15, 2005 or fails to discharge
any redemption obligation; the Company fails to make an offer to redeem the
Series A Exchange Redeemable Preferred Stock in the event of a change of control
or fails to purchase shares pursuant to a change of control offer; or the
Company is in default of any covenants as defined in the Exchange Description or
fails to pay the stated maturity of any indebtedness in excess of $3,000. In
each event, the holders of the Series A Exchange Redeemable Preferred Stock have
the right to elect directors to the board of the Company.

NOTE K--COMMON STOCK AND COMMON STOCK WARRANTS

    At April 27, 2002 and April 28, 2001, the Company had 4,000 shares of $.01
Par value common stock authorized, and 1,083 shares issued and outstanding. The
declaration or payment of dividends is restricted as discussed in note H and J.

    On August 8, 1997, the Company issued common stock warrants. Each Common
Stock Warrant entitles the holder thereof to purchase .0025 shares of the
Company's common stock at an exercise price of $.01 per .0025 shares subject,
under certain circumstances, to adjustment or exchange for warrants to purchase
shares of common stock of certain of the Company's subsidiaries. The Common
Stock Warrants are exercisable through August 15, 2005 and represent 7.7% of the
Company's common stock on a fully diluted basis.

    In addition, pursuant to the Warrant Agreement, as of August 15, 2000,
neither a Qualified Subsidiary IPO nor an initial public offering of HVE Common
Stock, as defined, had occurred therefore, the Company is obligated to issue and
sell to the then existing holders of certain Common Shares and Common Stock
Warrants, as defined, additional Common Shares and Common Stock Warrants
representing 2.5% of the HVE Common Stock on a fully-diluted basis. In
connection with the above, the Company has recorded the fair value of the
additional common shares issuable and additional warrants issuable of $613 and
$613, respectively offset by an incremental discount to the redeemable preferred
stock of $1,226.


NOTE L--BENEFIT PLANS

Defined Benefit Plans

    The Company and certain subsidiaries have a frozen defined benefit pension
plan (a U.S. Pension Plan). Pension costs are determined in accordance with SFAS
No. 87, Employers' Accounting for Pensions. Service cost is determined using
the projected unit credit actuarial cost method. It is the Company's policy to
make annual contributions to the plan in amounts at least equal to the amounts
required by law. The plan did not require contributions from the Company for the
years ended April 27, 2002 and April 28, 2001, respectively.


                                      F-24


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE L--BENEFIT PLANS (Continued)

    The change in the vested and accumulated benefit obligation is summarized as
follows:

<TABLE>
<CAPTION>
                                                                  Years Ended
                                                             ---------------------
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                         <C>        <C>
Vested and accumulated benefit obligation at the beginning
  of the year.............................................    $18,301     $18,939
Service cost..............................................        131          --
Interest cost.............................................      1,342       1,378
Actuarial (gain) loss.....................................        910        (204)
Benefits paid.............................................     (1,809)     (1,812)
                                                              --------    --------
                                                              $18,875     $18,301
                                                              ========    ========
</TABLE>

    The change in the plan assets is summarized as follows:

<TABLE>
<CAPTION>
                                                                  Years Ended
                                                             ---------------------
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                        <C>          <C>
Fair value of plan assets at the beginning of the year....    $18,334     $20,907
Actual return on plan assets..............................        606        (761)
Benefits paid.............................................     (1,809)     (1,812)
                                                             ---------   ---------
                                                              $17,131     $18,334
                                                             =========   =========

Funded status.............................................   $ (1,744)    $    33
Unrecognized net actuarial loss...........................      4,996       3,215
Additional liability included in other comprehensive
   income (note A)........................................     (4,996)         --
                                                             ---------   ---------
Net prepaid (accrued) benefit cost........................   $ (1,744)    $ 3,248
                                                             =========   =========
</TABLE>

    Weighted-average assumptions:

<TABLE>
<S>                                                        <C>          <C>
Discount rate.............................................     7.25%      7.75%
Expected rate of return...................................     9.00%      9.00%
</TABLE>

    The components of net periodic benefit are summarized as follows:

<TABLE>
<CAPTION>
                                                                Years Ended
                                                     ---------------------------------
                                                     April 27,   April 28,   April 29,
                                                       2002        2001        2000
                                                     ---------   ---------   ---------
<S>                                                <C>         <C>         <C>
Interest cost.....................................     $1,342      $1,378      $1,410
Service cost......................................        131          --          --
Expected return on plan assets....................     (1,561)     (1,793)     (1,680)
Net amortization and deferral.....................         83          --          43
                                                       -------     -------     -------
Net periodic benefit..............................     $   (5)     $ (415)     $ (227)
                                                       =======     =======    ========
</TABLE>


                                      F-25


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE L--BENEFIT PLANS (Continued)

    No compensation increases have been assumed due to the plan being frozen.
The plan assets as of April 27, 2002 and April 28, 2001, consisted primarily of
equity securities, guaranteed interest contracts, fixed income securities and
cash equivalents.

    A foreign subsidiary of the Company sponsors a defined benefit pension plan
which is covered by a group insurance policy. The plan covers 20 employees. The
benefits are based upon the number of years of service and the employees' past
compensation.

    The change in the vested and accumulated benefit obligation is summarized as
follows:

<TABLE>
<CAPTION>
                                                                  Years Ended
                                                             ---------------------
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                        <C>         <C>
Vested and accumulated benefit obligation at the beginning
  of the year.............................................   $    914    $    876
Net periodic benefit cost.................................        144         141
Actuarial gain............................................          7          --
Currency translation adjustment...........................       (104)       (103)
                                                             ---------   ---------
                                                             $    961    $    914
                                                             =========   =========
</TABLE>

    The change in the plan assets is summarized as follows:

<TABLE>
<S>                                                        <C>         <C>
Fair value of plan assets at the beginning of the year....   $    571    $    489
Premiums paid.............................................        123         106
Interest income...........................................         12          11
Currency translation adjustment...........................         51         (35)
                                                             ---------   ---------
                                                                  757         571
                                                             ---------   ---------
Pension liability.........................................   $    204    $    343
                                                             =========   =========
</TABLE>

    Weighted-average assumptions:

<TABLE>
<S>                                                        <C>         <C>
Discount rate.............................................      7.0%       7.0%
Annual compensation increase..............................      4.0%       4.0%
Social security contribution ceiling......................     $ 48       $ 48
Annual pension increase...................................      3.0%       3.0%
</TABLE>

    The components of net periodic benefit cost are summarized as follows:

<TABLE>
<CAPTION>
                                                              Years Ended
                                                    ---------------------------------
                                                    April 27,   April 28,   April 29,
                                                      2002        2001        2000
                                                    ---------   ---------   ---------
<S>                                              <C>          <C>         <C>
Service cost.....................................   $     69    $     68    $     76
Interest cost....................................         67          65          66
Amortization of transition asset.................          8           8           9
                                                    ---------   ---------   ---------
Net periodic benefit cost........................   $    144    $    141    $    151
                                                    =========   =========   =========
</TABLE>


                                      F-26


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE L--BENEFIT PLANS (Continued)

    A subsidiary of the Company sponsors a defined benefit pension plan (a
non-U.S. Pension Plan). The plan is non-contributory. The accrual rate for this
plan is 1/60th of the Final Pensionable Salary (as defined) for each year of
Pensionable Service.

    The policy is for the Company to contribute actuarially determined amounts
into a trust fund at a rate that is intended to remain at a pre-determined
percentage of total Pensionable payroll.

    The change in the vested and accumulated benefit obligation is summarized as
follows:

<TABLE>
<CAPTION>
                                                                  Years Ended
                                                             ---------------------
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                        <C>         <C>
Vested and accumulated benefit obligation at the beginning
  of the year.............................................   $  5,087    $  4,147
Service cost..............................................        299         232
Interest cost.............................................        291         249
Actuarial (gains) losses..................................       (243)        750
Benefits paid.............................................         --         (62)
Currency translation adjustment...........................         70        (229)
                                                             ---------   ---------
                                                             $  5,504    $  5,087
                                                             ---------   ---------
</TABLE>

    The change in the plan assets is summarized as follows:

<TABLE>
<CAPTION>

                                                                 Years Ended
                                                             ---------------------
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                        <C>         <C>
Fair value of plan assets at the beginning of the year....    $ 4,769    $  5,126
Actual return on plan assets..............................       (631)        (43)
Employer contributions....................................        321         242
Benefits paid.............................................         --         (62)
Currency translation adjustment...........................         56        (494)
                                                              --------   ---------
                                                              $ 4,515    $  4,769
                                                              ========   =========

Funded status.............................................    $  (989)   $   (318)
Unrecognized net actuarial loss...........................      3,272       1,792
Unrecognized transition asset.............................       (877)       (952)
Currency translation adjustment...........................       (305)       (464)
Additional liability included in other comprehensive
   income (note A)........................................     (2,090)       (376)
                                                              --------   ---------
Net prepaid (accrued) benefit cost........................    $  (989)   $   (318)
                                                              ========   =========
</TABLE>


                                      F-27


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE L--BENEFIT PLANS (CONTINUED)

    The components of net periodic benefit cost are summarized as follows:

<TABLE>
<CAPTION>
                                                                 Years Ended
                                                             ---------------------
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                        <C>         <C>
Service cost..............................................    $   299     $   232
Interest cost.............................................        291         249
Actual return on plan assets..............................        632        (396)
Net amortization and deferral.............................       (946)         --
                                                              ---------   ---------
Net periodic benefit cost.................................    $   276     $    85
                                                              =========   =========
  Weighted-average assumptions:
Discount rate.............................................      5.50%       6.25%
Annual compensation increase..............................      5.00%       5.00%
Expected rate of return...................................      7.50%       8.00%
</TABLE>

Multi-Employer Plan

    Certain foreign employees participate in a multi-employer pension plan.
Foreign pension expense totaled $220, $192 and $191 in fiscal 2002, 2001 and
2000, respectively.

Employee Benefit Obligations

    A subsidiary of the Company has a post-employment benefit plan (an "Italian
Plan"). In accordance with Italian Law, the Company has an unfunded severance
plan under which all employees are entitled to receive severance indemnities
upon termination of their employment. The amount payable is based on the salary
paid and increases in cost of living. The severance indemnities accrue at a rate
of approximately 7.4% of the gross salaries paid during the year, and are
revalued applying a cost of living factor established by the Italian Government.
The amounts accrued become payable upon termination of the individual employee,
for any reason, e.g., retirement, dismissal or reduction in work force.
Employees are fully vested in the plan benefits after their first year of
service. Employee benefit obligations were $16,711 and $19,605 at April 27, 2002
and April 28, 2001, respectively (note I). Payments by the Company were $4,650
and $3,186 in fiscal 2002 and 2001, respectively.


                                      F-28


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per share Data)


NOTE L--BENEFIT PLANS (Continued)

Defined Contribution Plans

    The Company maintains the High Voltage Engineering Corporation 401(k)
Retirement Plan, a Section 401(k) savings plan covering substantially all U.S.
Employees. The Company matches fixed employee contributions up to $1,800 and
currently contributes an annual profit-sharing amount equal to 2.5% of the
employee's annual salary and bonus. Contributions to the Plans were $2,654,
$2,456 and $1,954 in fiscal 2002, 2001 and 2000, respectively.

Long-Term Compensation Plans

    PHI maintains a Phantom Stock Appreciation Rights Plan which has two
variations, an Appreciation Rights Plan, under the terms of which Phantom Stock
Appreciation Rights ("PSARs") are offered at the fair market value ("FMV"), as
defined, of PHI and specified subsidiaries including, CE&A and a Discounted
Appreciation Rights Plan, under the terms of which PSARs are offered at a
discounted FMV. The authorized amount of PSARs which can be issued under these
Plans equals 12% of the valuation of PHI. The Plans are designed to provide
incentives for employees of PHI and CE&A, by tracking increases in the FMV, of
the combined PHI and CE&A subsidiaries. The exercise rights under the Plans are
subject to vesting schedules ranging from 4 to 5 years from date of award. The
Plans have a ten year termination date. Participants in the Plans are key
employees, including officers. Discounted PSARs were issued to certain employees
of CE&A who at the time of the acquisition of CE&A by PHI in July 1999 had an
"in the money" value of their unvested CE&A options. The discount amount equaled
75% of the then combined FMV. Additionally, PHI created a Deferred Value Plan,
which is a deferred compensation plan and does not include the issuance of
PSARs. The Plan was created for the benefit of certain CE&A employees.

    ASIRobicon also maintains a PSAR plan. The authorized amount of PSARs which
can be issued under this plan equals 10% of the authorized capital of
ASIRobicon. This plan is designed to provide an incentive for certain key
employees by tracking increases in the FMV of ASIRobicon. The exercise rights
under the plan are subject to a vesting schedule of 5 years from date of award.
The plan has a ten year termination date.


                                      F-29


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE L--BENEFIT PLANS (Continued)

Awards earn interest at the prime rate at July 1st of each year, plus 1%.
Exercise rights are subject to a four or five year vesting schedule from date of
award. At the time employees exercise their vested rights under any of these
three plans, they must execute a Protection Agreement which, among other items,
stipulates that for a period of 18 months after termination of a Participant's
employment by PHI, or any of its subsidiaries (the "PHI Group") the employee
cannot participate in any business which is then in competition with the PHI
Group. Appreciation Rights PSARs are awarded at their FMV to certain employees
as they are hired or promoted. All three Plans are non-qualified and non-funded.
As of April 27, 2002 and April 28, 2001, the Company has recorded an accrued
liability of $2,046 and $2,046 under these Plans. The Company recorded a charge
of $368 in fiscal 2001, with respect to these Plans.

    An officer of the Company is the beneficiary of an incentive compensation
plan pursuant to which such officer shall be entitled to receive twenty-two
Shadow Stock Units, as defined. Such units vest in yearly increments over a
period of five years beginning on April 30, 1998, and each vested stock unit
represents the right to receive, following the fifth anniversary after the
vesting thereof, an amount of cash equal to the market value of Letitia Common
Stock determined as of the end of the most recent prior fiscal quarter. The plan
further provides for a stock appreciation arrangement whereby the officer is
entitled to receive additional Shadow Stock Units for each year during the term
of the plan. The Company has accrued the estimated vested balance.

    The Company maintains a Valuation Creation Plan which provides long-term
compensation for key individuals. Upon joining the VCP, benefits vest at twenty
percent a year and participants can "cash out", as defined, up to fifty percent
of their vested value anytime with the remainder paid at retirement or
termination. All payments under the VCP are subject to the availability of
general funds of the Company. The VCP is a nonqualified and non-funded plan. The
Company has accrued $273 and $827 as of fiscal 2002 and 2001, respectively.
administrative and selling expenses include $(232) and $177 for fiscal 2002 and
2001, respectively related to VCP. In the event of the sale of certain other
changes in ownership of a subsidiary or division, impacted key individuals would
become 100% vested. Benefits, if any, would be calculated up to that date based
upon fair values as established by the transaction. Such benefits would be
charged to operations immediately and may be greater than that which would have
been calculated under the original terms of the VCP.


NOTE M--INCOME TAXES

    The foreign and domestic components of (loss) income from continuing
operations before income taxes, discontinued operation and extraordinary item
were as follows:

<TABLE>
<CAPTION>
                                                                      Years Ended
                                                            ---------------------------------
                                                            April 27,   April 28,   April 29,
                                                              2002        2001        2000
                                                            ---------   ---------   ---------
<S>                                                       <C>         <C>         <C>
Domestic.................................................   $(33,952)   $(24,863)   $(25,145)
Foreign..................................................       (127)      2,108      (5,311)
                                                            --------    --------    --------
Total....................................................   $(34,079)   $(22,755)   $(30,456)
                                                            ========    ========    ========
</TABLE>


                                      F-30


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE M--INCOME TAXES (CONTINUED)

    The components of income taxes expense (credit) are:

<TABLE>
<CAPTION>
                                                                      Years Ended
                                                            ---------------------------------
                                                            April 27,   April 28,   April 29,
                                                              2002        2001        2000
                                                            ---------   ---------   ---------
<S>                                                       <C>         <C>         <C>
Continuing operations:
  Current:
    Federal..............................................   $    176    $(10,645)    $(1,289)
    State................................................        127        (992)       (109)
    Foreign..............................................         --          --       1,664
                                                            --------    --------     -------
                                                                 303     (11,637)        266
                                                            --------    --------     -------
Deferred (net of impact of valuation allowance):
    Federal..............................................       (115)      3,925        (897)
    State................................................         76          --          --
    Foreign..............................................      2,684       5,421          --
                                                            --------    --------     -------
                                                               2,645       9,346        (897)
                                                            --------    --------     -------
Total continuing operations..............................      2,948      (2,291)       (631)
                                                            --------    --------     -------
Discontinued operations:
  Current:
    Federal..............................................         --      19,378       1,662
    State................................................         --       4,424         181
    Foreign..............................................         --          76          48
                                                            --------    --------     -------
Total discontinued operations............................         --      23,878       1,891
                                                            --------    --------     -------
Income from discontinued operations......................         --       1,031       1,518
Gain on disposal of discontinued operations..............         --      22,847         373
                                                            --------    --------     -------
                                                                  --      23,878       1,891
                                                            --------    --------     -------
Extraordinary item:
  Current:
    Federal..............................................       (176)       (301)         --
    State................................................        (42)        (28)         --
                                                            --------    --------     -------
  Total extraordinary item...............................       (218)       (329)         --
                                                            --------    --------     -------
  Total discontinued operations and extraordinary item...       (218)     23,549       1,891
                                                            --------    --------     -------
Income taxes.............................................   $  2,730    $ 21,258     $ 1,260
                                                            ========    ========     =======
</TABLE>


                                      F-31


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE M--INCOME TAXES (Continued)

    Total income taxes (benefit) from continuing operations differed from
"expected" income tax expense, computed by applying the U.S. Federal statutory
tax rate of 35 percent to income before income tax, as follows:

<TABLE>
<CAPTION>
                                                                         Years Ended
                                                               ---------------------------------
                                                               April 27,   April 28,   April 29,
                                                                 2002        2001        2000
                                                               ---------   ---------   ---------
<S>                                                          <C>        <C>         <C>
Federal statutory rate applied to income before income,
  discontinued operations and extraordinary item............   $(11,928)   $ (7,804)   $(10,975)
State and local taxes, net of Federal tax benefit...........        132        (645)         47
Effect of foreign operations................................      2,728       4,355       3,487
Nondeductible costs in excess of net assets acquired........      3,580         845         693
Change in valuation reserve.................................      3,676       6,919      12,199
Tax loss benefit............................................         --      (3,419)     (5,215)
Fixed asset valuation increase--foreign.....................         --      (3,283)         --
Reserve for carryback refund request........................      5,168          --          --
Other items.................................................       (408)        741        (867)
                                                               ---------   ---------   ---------
Income tax expense (benefit)--continuing operations.........   $  2,948    $ (2,291)   $   (631)
                                                               =========   =========   =========
</TABLE>

    A deferred income tax (expense) benefit results from temporary differences
in the recognition of income and expense for income tax and financial reporting
purposes. The temporary differences which gave rise to the following deferred
income tax assets and liabilities are:

<TABLE>
<CAPTION>
                                                               April 27,   April 28,
                                                                 2002        2001
                                                               ---------   ---------
<S>                                                          <C>         <C>
Deferred income tax assets:
  Accounts receivable.......................................   $    621    $  1,390
  Inventory.................................................      2,068       1,705
  Accrued liabilities.......................................      7,474       9,852
  Net operating losses......................................     14,483      11,096
  Fixed asset valuation increase--foreign...................      2,243       3,283
  Tax credits...............................................      1,336          --
  Assets held for sale......................................        275         254
  Other.....................................................        857       1,282
                                                               --------    --------
    Total gross deferred income tax assets..................     29,357      28,862
  Valuation allowance.......................................    (29,357)    (25,681)
                                                               --------    --------
    Total net deferred income tax assets....................         --       3,181
Deferred income tax liabilities:
  Depreciation..............................................     (5,850)     (7,151)
  Cost in excess of net assets acquired.....................     (1,608)     (2,022)
  Reserve for IRS examination...............................       (411)       (411)
  Foreign items.............................................       (484)       (231)
  Foreign asset revaluation.................................     (9,103)     (9,526)
  Other.....................................................       (615)       (695)
                                                               --------    --------
    Total gross deferred income tax liabilities.............    (18,071)    (20,036)
                                                               --------    --------
    Net deferred income tax liability.......................   $(18,071)   $(16,855)
                                                               ========    ========
</TABLE>


                                      F-32


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE M--INCOME TAXES (Continued)

    These deferred income tax assets and liabilities are presented as follows in
the consolidated balance sheets:

<TABLE>
<CAPTION>
                                                             April 27,   April 28,
                                                               2002        2001
                                                             ---------   ---------
<S>                                                       <C>         <C>
Current deferred tax liability............................   $ 4,018     $ 3,336
Noncurrent deferred tax liability.........................    14,053      13,519
                                                             -------     -------
                                                             $18,071     $16,855
                                                             =======     =======
</TABLE>

    A valuation allowance against the recoverability of deferred tax assets has
been established because more likely than not the Company will not be able to
utilize certain credits in future years. The Company has offset certain deferred
tax liabilities, with deferred tax assets which are expected to generate
offsetting deductions within the same periods.

    A summary of the activity in the allowance for deferred tax assets is as
follows:

<TABLE>
<CAPTION>
                                                               Years Ended
                                                    ---------------------------------
                                                    April 27,   April 28,   April 29,
                                                      2002        2001        2000
                                                    ---------   ---------   ---------
<S>                                               <C>        <C>          <C>
Balance at beginning of period...................    $25,681     $18,762     $ 6,563
Net change.......................................      3,676       6,919      12,199
                                                     -------     -------     -------
Balance at end of period.........................    $29,357     $25,681     $18,762
                                                     =======     =======     =======
</TABLE>

    At April 27, 2002, the Company has available domestic net operating loss
carryforwards of approximately $14,960 which generally begin to expire in the
fiscal 2018. These carryforwards are substantially limited upon an "ownership
change" as defined in the Internal Revenue Code. In addition, the Company has
foreign net operating loss carryforwards of approximately $22,800 which
generally expire in fiscal 2006. The Company has been audited by the IRS
through the 1995 tax year and maintains reserves for subsequent IRS
examinations. The Company intends to apply for a loss carryback refund. It is
the Company's policy to reserve for such refunds due to the Company's
experience with the inherent uncertainties involved in the realization of the
expected refund.

                                      F-33


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (dollars in Thousands, Except Per Share Data)


NOTE N--OTHER, NET

    Other, net includes the following:

<TABLE>
<CAPTION>
                                                                          Years Ended
                                                               ---------------------------------
                                                               April 27,   April 28,   April 29,
                                                                 2002        2001        2000
                                                               ---------   ---------   ---------
<S>                                                          <C>         <C>         <C>
Write down of notes receivable, deposits and impaired
  capital equipment.........................................   $   159       $  457      $  628
Net loss (gain) on disposition of miscellaneous assets......       313         (256)        608
Facilities (income) expense, net (note G)...................      (329)        (383)       (357)
Recoveries of aborted acquisition, offering costs and
  related litigation, net (note Q)..........................       221          350          28
Patent defense costs and related litigation, net of
  recoveries................................................         6          390         901
Equity in earnings of joint venture and other affiliates....    (1,584)        (876)        239
Bondholders' consent and finance agreement amendment fees
  and related expenses..... ................................       265           --       3,451
Discount on sale of receivables.............................       356        2,519         857
Facility relocation costs...................................     1,197        1,145         413
Workforce reorganization costs..............................     4,326        1,708          --
Reimbursed environmental and litigation costs, net (note Q).       839           52         404
ASI acquisition integration costs...........................       545           --          --
                                                               ---------   ---------   ---------
  Total.....................................................    $6,314       $5,106      $7,172
                                                               =========   =========   =========
</TABLE>

NOTE O--RELATED-PARTY TRANSACTIONS

MANAGEMENT FEES

    Management fees were incurred with respect to services rendered in
connection with financing, mergers and acquisitions and various operational and
strategic matters. Management fees were $572 for fiscal 2002 and $750 for fiscal
2001 and 2000, respectively.


NOTE P--LEASES

Capital and Operating Leases

    The Company conducts a portion of its operations in facilities under capital
and operating leases and also has capital and operating leases covering certain
machinery and equipment. Certain of the leases contain renewal and purchase
options. Rental expenses charged to operations in fiscal 2002, 2001 and 2000
were approximately $3,525, $4,779 and $2,633 and respectively.

    Property under capital leases consisted of the following:

<TABLE>
<CAPTION>
                                                            APRIL 27,   APRIL 28,
                                                              2002        2001
                                                            ---------   ---------
<S>                                                       <C>         <C>
Land, buildings and improvements..........................    $7,803      $4,990
Machinery and equipment...................................     9,530       6,478
Less accumulated amortization.............................    (9,058)     (5,810)
                                                             -------     -------
    Total.................................................    $8,275      $5,658
                                                             =======     =======
</TABLE>


                                      F-34


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE P--LEASES (Continued)

    At April 27, 2002, the minimum rental commitments for noncancelable leases
that have initial or remaining terms of more than one year are as follows:

<TABLE>
<CAPTION>
                                                           CAPITAL    OPERATING
                                                            LEASES     LEASES
                                                           --------   ---------
<S>                                                      <C>         <C>
2003.....................................................  $ 2,909     $ 3,470
2004.....................................................    2,670       3,523
2005.....................................................    2,489       2,967
2006.....................................................    1,870       3,080
2007.....................................................    1,777       2,949
Thereafter through 2015..................................    5,358         781
                                                           -------     -------
Minimum commitments......................................  $17,073     $16,770
                                                                       =======
Less amount representing interest........................   (5,836)
                                                           -------
Capital lease obligations (included in long-term
  obligations) (note H)..................................  $11,237
                                                           =======
</TABLE>


NOTE Q--LITIGATION, CLAIMS AND ENVIRONMENTAL MATTERS

    The Company is obligated to clean up two sites relating to former
manufacturing facilities and has accrued the estimated costs of remediation
(note I). Estimated costs are determined by external and internal environmental
remediation experts. The estimated costs of remediation of one site is based on
its estimated present value. The discount rate used was 6%. The gross
undiscounted amount differs from the estimated present value by approximately
$857 as of April 27, 2002. There are no assurances that additional costs will
not be incurred or that significant changes in estimates or changes in
environmental laws will not require additional amounts to be accrued. The
Company believes that it can continue to meet these environmental standards
without material adverse effect on its financial condition. The expected future
payments for the environmental liabilities is $557 in fiscal 2003, $534 in
fiscal 2004, $501 in fiscal 2005, $280 in fiscal 2006 and $2,193 thereafter.

    The Company is under agreement with the owner of a property adjacent to one
remediation sites. The settlement terms principally include a mutual release of
claims for past costs and an undertaking by the Company to perform certain
future remediation work on the site, for which the Company will pay up to the
first $500 in costs and two thirds of any cost over this threshold. At April 27,
2002, the Company has accrued the estimated remediation cost with respect to
this matter. There are no assurances that additional costs will not be incurred
or that significant changes in estimates or changes in environmental laws will
not require additional amounts to be accrued.


                                      F-35


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE Q--LITIGATION, CLAIMS AND ENVIRONMENTAL MATTERS (Continued)


    In March 1998, the Company's Robicon Corporation subsidiary initiated
litigation against Toshiba International Corporation ("Toshiba") in the United
States District Court for the Western District of Pennsylvania alleging
infringement of one of Robicon's Perfect Harmony patents. In June 1998, Toshiba
filed suit against Robicon and several other defendants in the United States
District Court for the Southern District of Texas alleging, among other things,
false and disparaging comments concerning Toshiba, interference with contract,
violation of the Texas Competition and Trade Practices Statute and civil
conspiracy to restrict Toshiba's business and cause the wrongful termination of
a purchase order of one of its customers. Damages under each section are claimed
to be in excess of $75, the federal statutory minimum, in addition to a claim
for punitive damages. In its suit, Toshiba has also claimed that Robicon is
infringing a patent held by Toshiba and requested a declaratory judgment that
Robicon's patent, which is the subject of the Pennsylvania action, is invalid.
In March 1999, the Texas District Court dismissed without prejudice all claims
except the alleged patent infringement by Robicon and the request for
declaratory judgment. These claims were then transferred to the Western District
of Pennsylvania. Also in March 1999, Toshiba filed a petition in Harris County,
Texas in which it realleged the claims dismissed by the Texas district court,
citing the additional costs by Toshiba to reinstate its purchase order and
damages to its reputation not exceeding $5,000. On November 29, 1999, the
Pennsylvania district court granted Robicon's Motion to dismiss Toshiba's patent
infringement claim against Robicon. The only remaining transferred claim is
Toshiba's request for declaratory judgment. In November 1999, Toshiba filed a
motion to dismiss without prejudice all of the claims pending in Harris County,
Texas pursuant to a Tolling Agreement which permitted Toshiba one (1) year to
re-file its claims. In December 1999, the Texas state court granted Toshiba's
motion. Toshiba did not re-file its claims prior to the expiration of the
Tolling Agreement. There has been no substantive change in the status of this
litigation.

    Certain other claims, suits and complaints have been filed or are pending
against the Company. In the opinion of the Company, all such matters are without
merit or are of such kind, or involve such amounts, as would not have a material
effect on the consolidated financial position or the results of operations of
the Company if disposed of unfavorably. If estimates change, there is no
assurances these items will not require additional accruals by the Company.


                                      F-36


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE R--FOREIGN SALES

    International sales represented 60%, 55% and 41% of the Company's net sales
in fiscal 2002, 2001 and 2000, respectively. The 60% of international sales in
fiscal 2002 included 25% of sales in Italy and 5% of sales in Japan. These sales
represented the combined total of export sales made by United States of America
operations and all sales made by foreign operations outside of the United States
of America.

    Export sales made by domestic operations were approximately 18% of the
Company's net sales for fiscal 2002, 15% for fiscal 2001 and 19% for fiscal
2000.

    The following table summarizes the Company's sales and selected operating
data in different geographic areas:

<TABLE>
<CAPTION>
                                                                          Adjustments
                                                     United                   and
                                                     States    Foreign    Eliminations   Consolidated
                                                    --------   --------   ------------   ------------
<S>                                               <C>        <C>        <C>            <C>
Fiscal 2000
Sales to unaffiliated customers..................   $203,306   $ 68,179      $     --      $271,485
Transfers between geographic locations...........      5,045      5,718       (10,763)           --
                                                    --------   --------      --------      --------
Net sales........................................    208,351     73,897       (10,763)      271,485
(Loss) from operations...........................     (6,395)    (5,860)                    (12,255)
Identifiable assets..............................    217,514    140,298                     357,812

Fiscal 2001
Sales to unaffiliated customers..................   $225,613   $190,934      $     --      $416,547
Transfers between geographic locations...........      8,456     11,083       (19,539)           --
                                                    --------   --------      --------      --------
Net sales........................................    234,069    202,017       (19,539)      416,547
(Loss) income from operations....................     (7,162)     5,698            --        (1,464)
Identifiable assets..............................    272,197    139,426            --       411,623

Fiscal 2002
Sales to unaffiliated customers..................   $210,568   $192,444      $     --      $403,012
Transfers between geographic locations...........      6,878     16,431       (23,309)           --
                                                    --------   --------      --------      --------
Net sales........................................    217,446    208,875       (23,309)      403,012
(Loss) income from operations....................    (12,951)     2,225            --       (10,726)
Identifiable assets..............................    222,259    150,130            --       372,389
</TABLE>

    Identifiable assets by geographic area are those assets used in the
Company's operations in each area.


                                      F-37


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE R--FOREIGN SALES (Continued)

    Net assets for European operations amounted to approximately $28,591 as of
April 27, 2002. Included in net assets of European operations were intercompany
receivables from affiliated companies amounting to approximately $8,404 as of
April 27, 2002.

    Insofar as can be reasonably determined, there is no foreign exchange
restrictions that materially affect the financial position or the operating
results of the Company and its subsidiaries.


NOTE S--SEGMENT DATA

    The Company operates in three industry segments. Each segment operates
independently with its own management team and manufacturing facilities and
maintains its own independent market identity.

    The Industrial Power Control segment includes Ansaldo Sistemi Industriali
S.p.A. ("ASI") and Robicon Corporation and subsidiaries ("Robicon"), together
operated as "ASIRobicon". The Advanced Surface Analysis segment has two main
components, equipment sales and analytical services. The segment consists of PHI
and High Voltage Engineering Europa, B.V. ("HVE Europa") together operated as
"Phymetrics". The results of operations of VHV have been included with the
results of operations of HVE Europa. The third industry segment, Customized
Monitoring Instrumentation, reflect the results of operations of Maxima
Technologies, Inc. and subsidiaries ("Maxima").

    The Company evaluates the performance of each segment on its ability to
generate cash. Information concerning operations in these businesses is as
follows:

<TABLE>
<CAPTION>
                                                     Operating                  Depreciation
                                            Net       Income     Identifiable       and          Capital
                                           Sales      (Loss)        Assets      Amortization   Expenditures
                                          --------   ---------   ------------   ------------   ------------
<S>                                     <C>        <C>         <C>           <C>             <C>
Year End April 29, 2000
Restricted subsidiary (Robicon)........   $ 74,913   $   (834)     $ 38,222        $ 2,077        $ 1,540
Unrestricted subsidiary (ASI)..........     53,960     (8,001)      131,862          1,631            432
                                          --------   --------      --------        -------        -------
Industrial power control...............    128,873     (8,835)      170,084          3,708          1,972
Advanced surface analysis..............     81,418     (3,617)      108,571          9,968          9,192
Customized monitoring
  instrumentation......................     61,194      6,048        42,173          2,472          1,637
Corporate..............................         --     (5,851)       36,984            338             97
                                          --------   --------      --------        -------        -------
Consolidated...........................   $271,485   $(12,255)     $357,812        $16,486        $12,898
                                          ========   ========      ========        =======        =======
Year End April 28, 2001
Restricted subsidiary (Robicon)........   $ 85,986   $   (865)     $ 33,358        $ 3,991        $ 1,978
Unrestricted subsidiary (ASI)..........    178,283      1,869       140,595          3,643          2,291
                                          --------   --------      --------        -------        -------
Industrial power control...............    264,269      1,004       173,953          7,634          4,269
Advanced surface analysis..............     96,319     (3,287)      109,682         10,550          4,696
Customized monitoring
  instrumentation......................     55,959      4,326        38,792          2,386            573
Corporate..............................         --     (3,507)       89,196            196             25
                                          --------   --------      --------        -------        -------
Consolidated...........................   $416,547   $ (1,464)     $411,623        $20,766        $ 9,563
                                          ========   ========      ========        =======        =======
Year End April 27, 2002
Industrial power control...............   $275,335   $  6,518      $207,985        $ 6,024        $12,774
Advanced surface analysis..............     81,340    (16,124)      112,090         20,215          5,676
Customized monitoring
  instrumentation......................     46,337      2,744        42,685          2,335          1,634
Corporate..............................         --     (3,864)        9,629            181            107
                                          --------   --------      --------        -------        -------
Consolidated...........................   $403,012   $(10,726)     $372,389        $28,755        $20,191
                                          ========   ========      ========        =======        =======
</TABLE>


                                      F-38


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)

NOTE S--SEGMENT DATA (CONTINUED)

    The following represents the supplemental consolidating balance sheet for
the Company's restricted and unrestricted subsidiaries at April 27, 2002.

<TABLE>
<CAPTION>
                                                               Restricted     Unrestricted   Eliminations
                                                              Subsidiaries    Subsidiaries   Adjustments      Total
                                                              -------------   ------------   ------------   ---------
<S>                                                         <C>            <C>            <C>             <C>
                          ASSETS
CURRENT ASSETS
  Cash and cash equivalents................................      $ 11,336       $  3,797        $    --     $ 15,133
  Restricted cash..........................................         4,749            142             --        4,891
  Accounts receivable, net of allowance for doubtful
    accounts...............................................        60,148         75,969             --      136,117
  Refundable income taxes..................................             6            260             --          266
  Inventories..............................................        43,685         16,857             --       60,542
  Costs and earnings in excess of billings.................         1,857          9,486             --       11,343
  Prepaid expenses and other current assets................         3,710          3,306             --        7,016
                                                                 --------       --------        -------     --------
    Total current assets...................................       125,491        109,817             --      235,308
PROPERTY, PLANT AND EQUIPMENT, NET.........................        54,667         30,822             --       85,489
INVESTMENT IN JOINT VENTURE................................         3,263             --             --        3,263
ASSETS HELD FOR SALE.......................................         2,393             --             --        2,393
OTHER ASSETS, NET..........................................        18,597          7,315             --       25,912
COST IN EXCESS OF NET ASSETS ACQUIRED......................        20,024             --             --       20,024
Intercompany Accounts, Net.................................        21,543        (21,311)          (232)          --
                                                                 --------       --------       ---------    --------
                                                                 $245,978       $126,643       $   (232)    $372,389
                                                                 ========       ========       =========    ========
                      LIABILITIES AND
                 STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES
  Current maturities of long-term debt obligations.........      $  1,695       $ 12,878       $    --      $ 14,573
  Foreign receivables facilities...........................         1,303         10,982            --        12,285
  Accounts payable and accrued expense.....................        51,744         68,063            --       119,807
  Billings in excess of costs..............................         4,016          1,496            --         5,512
  Advance payments by customers............................        12,878          9,278            --        22,156
  Federal, foreign and state income taxes payable..........           310            247            --           557
  Deferred income taxes....................................         2,896          1,122            --         4,018
  Redeemable put warrants..................................         2,900             --            --         2,900
                                                                 --------       --------        ------      --------
    Total current liabilities..............................        77,742        104,066            --       181,808
LONG-TERM OBLIGATIONS, LESS CURRENT MATURITIES.............       191,134         24,044            --       215,178
DEFERRED INCOME TAXES......................................        13,498            555            --        14,053
OTHER LIABILITIES..........................................         6,750         18,495            --        25,245
REDEEMABLE PREFERRED STOCK (aggregate liquidation
  preference of $55,934 as of April 27, 2002)..............        53,847             --            --        53,847
MINORITY INTEREST..........................................            93             --            --            93
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIENCY, NET..............................       (97,086)       (20,517)         (232)     (117,835)
                                                                 --------       --------        ------      --------
                                                                 $245,978       $126,643        $ (232)     $372,389
                                                                 ========       ========        ======      ========
</TABLE>


                                      F-39


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE S--SEGMENT DATA (CONTINUED)

    The following represents the supplemental consolidating statement of
operation for the Company's restricted and unrestricted subsidiaries as of April
27, 2002.

<TABLE>
<CAPTION>
                                                       Restricted    Unrestricted   Eliminations
                                                      Subsidiaries   Subsidiaries   Adjustments     Total
                                                      ------------   ------------   ------------   --------
<S>                                                 <C>            <C>             <C>            <C>
Net sales..........................................     $232,920       $175,758      $ (5,666)     $403,012
Cost of sales......................................      169,392        142,807        (5,666)      306,533
                                                        --------       --------      --------      --------
  Gross profit.....................................       63,528         32,951            --        96,479
Administrative and selling expenses................       58,100         25,447            --        83,547
Research and development expenses..................       13,421          3,064            --        16,485
Restructuring charge...............................          859             --            --           859
Other, net.........................................        3,763          2,551            --         6,314
                                                        --------       --------      --------      --------
  (Loss) income from operations....................      (12,615)         1,889            --       (10,726)
Interest expense...................................      (20,964)        (4,079)           --       (25,043)
Interest income....................................          562          1,128            --         1,690
                                                        --------       --------      --------      --------
  Loss from continuing operations before income
    taxes, and extraordinary item..................      (33,017)        (1,062)           --       (34,079)
Income taxes (credit)..............................        1,164          1,784            --         2,948
                                                        --------       --------      --------      --------
  Loss from continuing operations before
    extraordinary item.............................      (34,181)        (2,846)           --       (37,027)

Extraordinary loss, net of income taxes............         (327)            --            --          (327)
                                                        --------       --------      --------      --------
Net loss...........................................     $(34,508)      $ (2,846)     $     --      $(37,354)
                                                        ========       ========      ========      ========
Supplemental Data:
  Depreciation.....................................     $ 11,191       $  3,041      $     --      $ 14,232
  Amortization.....................................       14,425             98            --        14,523
  Capital expenditures.............................        9,319         10,872            --        20,191
</TABLE>

                                      F-40


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

                 (Dollars in Thousands, Except Per Share Data)


NOTE S--SEGMENT DATA (CONTINUED)

    The following represents the supplemental consolidating balance sheet for
the Company's restricted and unrestricted subsidiaries at April 28, 2001.

<TABLE>
<CAPTION>
                                                              Restricted     Unrestricted   Eliminations
                                                              Subsidiaries   Subsidiaries   Adjustments     Total
                                                              ------------   ------------   ------------   -------
<S>                                                         <C>            <C>            <C>             <C>
                          ASSETS
CURRENT ASSETS
  Cash and cash equivalents................................    $ 24,189        $  2,743       $    --      $ 26,932
  Restricted cash..........................................      29,143             329            --        29,472
  Accounts receivable, net of allowance for doubtful
    accounts...............................................      11,399          70,454            --        81,853
  Inventories..............................................      43,238          18,393            --        61,631
  Costs and earnings in excess of billings.................       3,379           9,653            --        13,032
  Prepaid expenses and other current assets................       2,386           6,308            --         8,694
                                                               --------        --------        ------      --------
    Total current assets...................................     113,734         107,880            --       221,614
PROPERTY, PLANT AND EQUIPMENT, NET.........................      57,715          25,265            --        82,980
INVESTMENT IN JOINT VENTURE................................       2,040              --            --         2,040
ASSETS HELD FOR SALE.......................................       2,510              --            --         2,510
OTHER ASSETS, NET..........................................      61,997           7,450            --        69,447
COST IN EXCESS OF NET ASSETS ACQUIRED......................      33,032              --            --        33,032
Intercompany Accounts, Net.................................      16,523         (16,408)         (115)           --
                                                               --------        --------        ------      --------
                                                               $287,551        $124,187        $ (115)     $411,623
                                                               ========        ========        ======      ========
                      LIABILITIES AND
                 STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES
  Current maturities of long-term debt obligations.........    $  2,279        $  6,526        $   --      $  8,805
  Foreign receivables facilities...........................       1,675           4,400            --         6,075
  Accounts payable and accrued expense.....................      55,190          65,600            --       120,790
  Billings in excess of costs..............................       1,113           3,183            --         4,296
  Advance payments by customers............................       9,479           9,407            --        18,886
  Federal, foreign and state income taxes payable..........       9,302           3,217            --        12,519
  Deferred income taxes....................................       1,346           1,990            --         3,336
  Redeemable put warrants..................................       2,900              --            --         2,900
                                                               --------        --------        ------      --------
    Total current liabilities..............................      83,284          94,323            --       177,607
LONG-TERM OBLIGATIONS, LESS CURRENT MATURITIES.............     186,104          25,484            --       211,588
DEFERRED INCOME TAXES......................................      13,519              --            --        13,519
OTHER LIABILITIES..........................................       7,947          20,302            --        28,249
REDEEMABLE PREFERRED STOCK (aggregate liquidation
  preference of $48,892 as of April 28, 2001)..............      46,122              --            --        46,122
MINORITY INTEREST..........................................          59              --            --            59
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' DEFICIENCY, NET..............................     (49,484)        (15,922)         (115)      (65,521)
                                                               --------        --------        ------      --------
                                                               $287,551        $124,187        $ (115)     $411,623
                                                               ========        ========        ======      ========
</TABLE>

                                      F-41


<PAGE>


             HIGH VOLTAGE ENGINEERING CORPORATION AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                 (DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)


NOTE S--SEGMENT DATA (CONTINUED)

    The following represents the supplemental consolidating statement of
operation for the Company's restricted and unrestricted subsidiaries as of April
28, 2001.

<TABLE>
<CAPTION>
                                                      Restricted     Unrestricted   Eliminations
                                                      Subsidiaries   Subsidiaries   Adjustments     Total
                                                      ------------   ------------   ------------   --------
<S>                                                 <C>             <C>            <C>            <C>
Net sales..........................................     $241,636       $178,283       $ (3,372)    $416,547
Cost of sales (Includes subassembly exit costs of
  $2,661)..........................................      177,458        148,507         (3,372)     322,593
                                                        --------       --------       --------     --------
  Gross profit.....................................       64,178         29,776             --       93,954
Administrative and selling expenses................       49,818         23,818             --       73,636
Research and development expenses..................       14,152          2,381             --       16,533
Restructuring charge...............................          143             --             --          143
Other, net.........................................        3,398          1,708             --        5,106
                                                        --------       --------       --------     --------
  (Loss) income from operations....................       (3,333)         1,869             --       (1,464)
Interest expense...................................      (19,281)        (2,763)            --      (22,044)
Interest income....................................          557            196             --          753
                                                        --------       --------       --------     --------
  Loss from continuing operations before income
    taxes, discontinued operations and
    extraordinary item.............................      (22,057)          (698)            --      (22,755)
Income taxes (credit)..............................       (8,004)         5,713             --       (2,291)
                                                        --------       --------       --------     --------
  Loss from continuing operations before
    discontinued operations and extraordinary
    item...........................................      (14,053)        (6,411)            --      (20,464)
Discontinued operations:
  Income from discontinued operations, net of
    income taxes...................................        2,078             --             --        2,078
  Gain on disposal of discontinued operations, net
    of income taxes................................       34,270             --             --       34,270
                                                        --------       --------       --------     --------
                                                          22,295         (6,411)            --       15,884
Extraordinary loss, net of income taxes............         (530)            --             --         (530)
                                                        --------       --------       --------     --------
Net income (loss)..................................     $ 21,765       $ (6,411)      $     --     $ 15,354
                                                        ========       ========       ========     ========
Supplemental Data:
  Depreciation.....................................    $  11,159      $   3,028       $    --      $ 14,187
  Amortization.....................................        5,964            615            --         6,579
  Capital expenditures.............................        7,272          2,291            --         9,563
</TABLE>


NOTE T--SUBSEQUENT EVENTS

    On June 14, 2002, the Company sold a property reflected in the
accompanying balance sheets as assets held for sale for $9,180 of gross
proceeds. Net proceeds of $8,000 from the asset sale were deposited in a
restricted account pursuant to the New Revolving Credit Facility agreement.

                                      F-42


<PAGE>


                                   SIGNATURES

    The Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                          HIGH VOLTAGE ENGINEERING CORPORATION

                                          By:   /s/ RUSSELL L. SHADE, JR.
                                                -------------------------------
                                                    Russell L. Shade, Jr.
                                                  CHIEF EXECUTIVE OFFICER
                                                     AND VICE PRESIDENT


                                POWER OF ATTORNEY

    Each person whose signature appears below hereby appoints Clifford Press,
Laurence S. Levy, Joseph W. McHugh, Jr. and Ronald R. Fortier, and each of them
severally, acting alone and without the other, his true and lawful
attorney-in-fact with the authority to execute in the name of each such person,
including exhibits thereto and other documents therewith, any and all amendments
to this Report on Form 10-K necessary or advisable to enable the Form 10-K to
comply with the Securities Act of 1933, as amended, and any rules, regulations
and requirements of the Securities and Exchange Commission in respect thereof
which amendments may make such other changes in the Form 10-K as the aforesaid
attorney-in-fact executing the same deems appropriate.

    Pursuant to the requirements of the Securities Act of 1934, this report has
been signed below by the following persons on behalf of the Registrant in the
capacities and on the dates indicated:

<TABLE>
<CAPTION>
                     SIGNATURE                                     TITLE                     DATE
                     ---------                                     -----                     ----
<S>                                               <C>                                <C>
                /s/ CLIFFORD PRESS
     ----------------------------------------        Chairman of the Board, President   July 30, 2002
                  Clifford Press

               /s/ LAURENCE S. LEVY
     ----------------------------------------        Vice President                     July 30, 2002
                 Laurence S. Levy

             /s/ CHRISTOPHER F. CARMEL
     ----------------------------------------        Director                           July 30, 2002
               Christopher F. Carmel

              /s/ H. CABOT LODGE III
     ----------------------------------------        Director                           July 30, 2002
                H. Cabot Lodge III

             /s/ RUSSELL L. SHADE, JR.
     ----------------------------------------        Chief Executive Officer, Vice      July 30, 2002
               Russell L. Shade, Jr.                   President

                                                     Vice President and Chief
             /s/ JOSEPH W. MCHUGH, JR.                 Financial Officer (principal
     ----------------------------------------          financial and accounting         July 30, 2002
               Joseph W. McHugh, Jr.                   officer)
</TABLE>


<PAGE>


                                  EXHIBIT INDEX


<TABLE>
<CAPTION>
       EXHIBIT
       NUMBER                                   DESCRIPTION
----------------------   ------------------------------------------------------
<S>                   <C>
         3.1            Restated Articles of Organization of the Registrant.*
         3.2            Amended and Restated By-laws of the Registrant.*
         4.1            Indenture, dated as of August 8, 1997, by and between
                        Registrant and State Street Bank and Trust Company as
                        Trustee.*
         4.2            First Supplemental Indenture, dated as of March 19, 1998
                        to Indenture, dated as of August 8, 1997, by and between
                        the Registrant and State Street Bank and Trust Company,
                        as Trustee.**
         4.3            Registration Rights Agreement, dated as of March 19,
                        1998, by and among the Registrant and CIBC Oppenheimer
                        Corp.**
         4.4            Form of Exchange Note.**
         4.5            Second Supplemental Indenture, dated as of December 22,
                        1999, to Indenture, dated as of August 8, 1997, by and
                        between the Registrant and State Street Bank and Trust
                        Company, as Trustee.
        10.2            Lease Agreement, dated as of November 10, 1988, by and
                        between Corporate Property Associates 8, L.P. and Datcon
                        Instrument Company (Lancaster, PA).*
        10.4            Installment Sale Agreement, dated as of September 23,
                        1994, by and between Monroeville Area Industrial
                        Development Corporation and Robicon Corporation (New
                        Kensington, PA).*
        10.7            Value Creation Plan of the Registrant.*
        10.8            High Voltage Engineering Corporation Employment Agreement,
                        by and between Registrant and Russell L. Shade, Jr., dated
                        as of February 24, 1998.**
        10.9            Amended and Restated Financing Agreement, dated as of
                        June 19, 2001, by and among the Registrant and the other
                        Borrowers named therein, Ableco Finance LLC and the
                        other Lenders named therein, and the Guarantors named
                        therein.
          12            Statement of Computation of Financial Ratios.
        21.1            List of Subsidiaries.
        24.1            Power of Attorney (included in signature page to
                        Form 10-K).
</TABLE>

-------------------------

*   Incorporated by reference from the Registrant's Registration Statement No.
    333-33969, on Form S-4, filed by the Registrant with respect to $135,000,000
    aggregate principal amount of the Registrant's 10 1/2% Senior Notes due
    2004.

**  Incorporated by reference from the Registrant's Registration Statement No.
    333-51643, on Form S-4, filed by the Registrant with respect to $20,000
    aggregate principal amount of the Registrants 10 1/2% Senior Notes due 2004.

(b) All schedules have been omitted because either they are not required, are
    not applicable, or the information is otherwise set forth in the
    Consolidated Financial Statements and notes thereto.

or the Borrowers may have against any Lender as a result of any default by such
Lender hereunder.