UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-K

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

                     For the fiscal year ended June 1, 2002
                                               -------------

                                       OR

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

            For the transition period from ___________to ___________

                         Commission file number 1-11479
                                                -------

                                  E-Z-EM, Inc.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                  Delaware                               11-1999504
       -------------------------------               -------------------
       (State or other jurisdiction of                (I.R.S. Employer
       incorporation or organization)                Identification No.)

         717 Main Street, Westbury, New York                    11590
       ----------------------------------------               ----------
       (Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code  (516) 333-8230
                                                    --------------

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

        Title of each class            Name of each exchange on which registered

Class A common stock, par value $.10           American Stock Exchange
Class B common stock, par value $.10           American Stock Exchange

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.

                                 Yes |X| No ||

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 ]


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<PAGE>

The aggregate market value of the registrant's voting Class A and non-voting
Class B common stock held by non-affiliates on August 5, 2002 was $49,001,000.

As of August 5, 2002, there were 4,001,341 shares of the registrant's Class A
common stock outstanding and 5,990,974 shares of the registrant's Class B common
stock outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statement for registrants 2001 Annual Meeting of
Stockholders to be held October 15, 2002 are incorporated by reference in Part
III of this Form 10-K Report.


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<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                                      INDEX

                                                                        Page
                                                                        ----
Part I:
-------

    Item l.  Business                                                      4

    Item 2.  Properties                                                   17

    Item 3.  Legal Proceedings                                            17

    Item 4.  Submission of Matters to a Vote of Security Holders          18

Part II:
--------

    Item 5.  Market for Registrant's Common Equity and Related
             Stockholder Matters                                          19

    Item 6.  Selected Financial Data                                      20

    Item 7.  Management's Discussion and Analysis of Financial
             Condition and Results of Operations                          21

    Item 7A. Quantitative and Qualitative Disclosures About
             Market Risk                                                  28

    Item 8.  Financial Statements and Supplementary Data                  28

    Item 9.  Changes in and Disagreements with Accountants on
             Accounting and Financial Disclosure                          28

Part III:
---------

    Item 10. Directors and Executive Officers of the Registrant           29

    Item 11. Executive Compensation                                       32

    Item 12. Security Ownership of Certain Beneficial Owners
             and Management                                               35

    Item 13. Certain Relationships and Related Transactions               39

Part IV:
--------

    Item 14. Exhibits, Financial Statement Schedules and
             Reports on Form 8-K                                          41


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<PAGE>

                                     Part I
                                     ------

Item 1. Business
        --------

(a)   General Development of Business
      -------------------------------

Overview

E-Z-EM, Inc. (the "Company") develops, manufactures and markets medical
diagnostic and therapeutic products through two business segments.

o     E-Z-EM Business Segment ("E-Z-EM") - E-Z-EM is a leading supplier of
      medical products used by radiologists, gastroenterologists and speech
      language pathologists for diagnostic imaging of diseases and disorders of
      the GI tract, which includes testing for swallowing disorders (dysphagia)
      and colorectal cancers.

o     AngioDynamics Business Segment ("AngioDynamics") - AngioDynamics, Inc.,
      the Company's wholly-owned subsidiary, is a leading supplier of medical
      products used by interventional radiologists and other physicians for the
      minimally invasive diagnosis and therapeutic treatment of peripheral
      vascular disease.

The Company has been in business for more than 40 years. Corporate offices are
located at 717 Main Street, Westbury, N.Y. 11590.

History

In 1961, Howard Stern and Phillip Meyers, M.D. founded the Company to develop
and market a unit dose product for delivering barium sulfate to patients as a
contrast medium for the X-ray visualization of the gastrointestinal ("GI") tract
and the detection of colorectal cancer and other GI related diseases. The Stern-
Meyers product was considered to be a major innovation that virtually eliminated
cross contamination in lower GI examinations. The product also established E-Z-
EM's brand among radiologists around the world.

In 1983, the Company was organized in Delaware and went public through an
initial public offering. In 1985, it acquired Therapex, a Canadian manufacturer
of barium sulfate, creating enhanced manufacturing capacity and providing a
platform for its contract manufacturing operations. In 1988, the Company founded
AngioDynamics to service new procedures being developed by interventional
radiologists. In 2000, the Company launched a plan to expand its two business
segments beyond their core product lines to serve the growing market for new
diagnostic imaging techniques and technologies and preventative and minimally
invasive healthcare.

Recent Developments

During 2002, E-Z-EM sales increased by $1,678,000, or 2%, to $92,288,000 due to
increased sales of contract manufacturing products and CT imaging contrast and
injector systems. In the third quarter, E-Z-EM closed a manufacturing facility
that provided locally manufactured barium contrast products to the Japanese
market, resulting in a charge to earnings of $1,393,000 or $.14 per basic share.
E-Z-EM plans to service this market with products manufactured in the U.S.

During 2002, AngioDynamics sales increased 32% due to the expansion of its
domestic sales organization and the introduction of new products. The domestic
sales force increased 33% to 32 sales employees from 24. Successful new products
included the More-Flow(TM) Long Term Dialysis catheter and the Accu-Vu(TM)
Sizing catheter used during the placement of aortic aneurysm stent graphs.


                                       -4-
<PAGE>

Unless the context requires otherwise, all references herein to a particular
year are references to the Company's fiscal year, which concludes on the
Saturday nearest to May 31st.

(b)   Financial Information About Industry Segments
      ---------------------------------------------

The Company's businesses are categorized into two operating segments: E-Z-EM
(formally called Diagnostic) and AngioDynamics. The following table sets forth
revenues from external customers by operating segment for the last three fiscal
years:

                                                                $ in thousands
------------------------------------------------------------------------------
Fiscal Year                                 2002          2001          2000
------------------------------------------------------------------------------
E-Z-EM                                   $ 92,288      $ 90,610      $ 93,162
AngioDynamics                            $ 29,845      $ 22,676      $ 20,706
------------------------------------------------------------------------------
Total                                    $122,133      $113,286      $113,868
==============================================================================

Certain financial information, including net sales, depreciation and
amortization, net earnings (loss), assets and capital expenditures attributable
to each operating segment, is set forth in Note P to the Consolidated Financial
Statements included herein.

(c)   Narrative Description of Business
      ---------------------------------

E-Z-EM SEGMENT

General

E-Z-EM is a leading supplier of medical products used by radiologists,
gastroenterologists and speech language pathologists for diagnostic imaging of
diseases and disorders of the GI tract, which includes testing for swallowing
disorders (dysphagia) and colorectal cancers. This business addresses five key
product areas:

o     X-Ray Fluoroscopy

o     CT Imaging

o     Virtual Colonoscopy

o     Specialty Diagnostic Tests

o     Accessory Medical Products and Devices

E-Z-EM's strategy is to develop and expand the marketing of GI diagnostic
products, devices and tests that increase the effectiveness of diagnostic
imaging and disease detection and encourage early patient screening. Virtually
all E-Z-EM products are cleared for sale in the U.S. Certain products are
cleared for sale in the European Community, Japan and other major countries.

E-Z-EM also is a third-party contract manufacturer of diagnostic contrast media,
pharmaceuticals, non-prescription healthcare products and defense
decontaminants. Contract manufacturing enables E-Z-EM to leverage its capacity
in quality control, process, automation and manufacturing.


                                       -5-
<PAGE>

GI Disease and Colorectal Cancer

The GI system is one of the most complex in the human body. It processes food,
extracts nutrients and passes wastes and involves all major body parts and
organs used in chewing, swallowing, digestion, absorption and defecation.
Digestive glands also provide moisture, lubrication, emulsification and enzymes
for digestion of proteins, carbohydrates and fats.

Diseases of the GI tract are considered to be the second most prevalent after
cardiac diseases. According to the National Institute of Diabetes and Digestive
and Kidney Diseases, 60 to 70 million people each year are affected by digestive
disease, leading to more than 190,000 deaths, 10 million hospitalizations (equal
to 13 percent of all hospitalizations), 6 million diagnostic and therapeutic
procedures (equal to 14 percent of all procedures), 50 million physician office
visits, 1.4 million people with disabilities, and costs of $107 billion,
including $87 billion in direct medical costs and $20 billion in indirect costs
(e.g., disability and mortality). Colorectal cancer is the second most common
cancer in the U.S., striking 140,000 people annually and causing 60,000 deaths,
according to the American Society of Colon and Rectal Surgeons.

E-Z-EM believes there are four major healthcare trends that will cause a
significant shift in spending from direct care to early detection and
preventative treatment of GI disease:

o     New Research - New research has shown that colorectal cancer and other GI
      diseases have higher cure rates if caught early. As a result, the American
      Cancer Society recommends that Americans 50 or older should be screened on
      a regular basis, and, in 1998, Medicare began reimbursing for colorectal
      cancer screening utilizing GI contrast X-ray examinations, as well as
      other GI related procedures.

o     Aging of the Population - The number of Americans affected by GI diseases
      is expected to increase substantially as the population grows older. While
      colorectal cancer may occur at any age, more than 90% of the patients are
      over age 40, at which point the risk doubles every ten years, according to
      the American Society of Colon and Rectal Surgeons.

o     Technological Innovation - Growth of multi-slice CT, magnetic resonance
      (MR) scanners, three-dimensional and harmonic ultrasound, and innovations
      in digital imaging software are increasing the ability of radiologists and
      gastroenterologists to detect GI problems earlier.

o     Increasing Healthcare Costs - The need to reduce escalating healthcare
      costs for direct care is leading to increased use of lower cost diagnostic
      imaging tests and minimally invasive preventative treatment.

X-Ray Fluoroscopy

GI X-ray contrast media has been E-Z-EM's principal business for more than 40
years. The use of barium sulfate as a contrast medium for X-rays is the most
popular method used by radiologists for diagnostic imaging of the GI tract. A
standard X-ray takes a photograph of bones (hard tissue) and when contrast media
is introduced inside the body, the X-ray can also photograph soft tissue
details. For more than 85 years, barium sulfate has been the contrast medium of
choice for virtually all X-rays of the GI tract. It permits the visualization of
the entire GI tract; has a high absorption coefficient for X-rays; is
biologically inert, insoluble in water and chemically stable; and, compared to
endoscopic procedures, X-ray fluoroscopy with barium sulfate contrast can be
safer, less expensive and provide increased visualization, depending upon the
condition being diagnosed.


                                       -6-
<PAGE>

E-Z-EM believes it has the most comprehensive line of barium sulfate
formulations. In 2002, E-Z-EM marketed 31 fluoroscopy formulations in 88 SKUs.
Formulations focus on five key areas - pharynx, esophagus, stomach and small
intestine and large intestine (colon) - and are packaged in oral, enema, liquid
and powder forms, in different sizes. Each formulation and size is designed to
meet the radiologist's need to optimize visualization of the condition under
diagnosis while improving patient comfort and management. Based upon sales, E-Z-
EM believes that it is the leading manufacturer of these contrast media.

E-Z-EM has an ongoing program to develop new formulations, to extend the GI
diagnostic power of X-ray fluoroscopy and to enhance the effectiveness of
existing E-Z-EM formulations. In 2002, E-Z-EM introduced Entero Vu(TM) 24% to
provide improved visualization during small bowel studies. In 2001, E-Z-EM
introduced the first family of barium sulfate contrast for the X-ray diagnosis
of dysphagia. Varibar(R) provides a range of viscosity barium suspensions from
nectar to honey to pudding to evaluate a patient's ability to swallow liquid and
solid materials of differing viscosities and volumes, resulting in consistent,
repeatable radiographic results. More than 10 million Americans are estimated to
have some degree of swallowing disorder.

E-Z-EM also sells accessory medical devices for use in X-ray procedures, such as
empty enema administration kits and components.

CT Imaging

CT imaging is an increasingly popular technology among radiologists for the
diagnostic imaging of the GI tract. CT takes a rapid stream of X-ray photographs
from different angles. Through computerization, this block of data is used to
create two- and three-dimensional images of bone, other hard tissue
and soft tissue, when contrast media is introduced inside the body. CT is
significantly more expensive than X-ray fluoroscopy, but as the cost of the
technology declines and utilization increases, per procedure costs are expected
to decline. Radiologists typically employ barium sulfate contrast media for
thoracic, abdominal and pelvic studies to mark the GI tract, while water soluble
contrast media are typically used for vascular studies.

E-Z-EM believes it has the most comprehensive line of barium sulfate
formulations for thoracic, abdominal and pelvic CT scanning. In 2002, E-Z-EM
marketed 9 formulations in 25 SKUs under its trade-name Esopho-CAT(R),
E-Z-CAT(R) and Readi-CAT(R) Smoothie lines. The CT contrast line consists of
formulations that are packaged as a liquid or powder, for oral use, and in
various sizes from unit dose to multi-dose for department administration and
economy. Each formulation and size is designed to meet the radiologist's need
for a consistent performance in lumen marking and transit through the GI tract
while maintaining optimal patient comfort and management. During 2002, E-Z-EM
expanded its Readi-CAT(R) Smoothie line to offer two new flavors, apple and
berry.

E-Z-EM also addresses the CT market with a line of electromechanical injectors.
Radiologists use injectors to deliver a controlled volume of iodine-based
contrast media into patients to visualize the vascular structure of the
circulatory system and organs in the thoracic, abdominal and pelvic regions.
Trade named EmpowerCT(TM) with EDA(TM), E-Z-EM's injector aides in the detection
of extravasation, an accidental infiltration of contrast media into surrounding
tissue. EmpowerCT(TM) with EDA(TM) is comprised of an electromechanical
injector, a consumable syringe, and a disposable EDA detector patch.

Based upon sales, E-Z-EM believes that it is the leading manufacturer of CT
barium contrast media and the second largest manufacturer of CT injectors.


                                       -7-
<PAGE>

Virtual Colonoscopy

Virtual Colonoscopy employs a CT scanner and virtual reality (three-dimensional
imaging) software to look inside the body without having to insert a long fiber
optic tube (optical colonoscopy) into the colon or having to fill the colon with
liquid barium (barium enema). E-Z-EM supports Virtual Colonoscopy with a
complete suite of trademarked products:

o     NutraPrep(TM) is a pre-packaged patient food system that eliminates the
      need for a clear diet.

o     LoSo Prep(TM) is a milder, low sodium, patient colon cleanser. LoSo
      Prep(TM) and other E-Z-EM laxative products are also marketed to
      radiologists and gastroenterologists for the preparation and increased
      compliance of patients for any medical procedure requiring a clean colon,
      including X-ray examinations (barium enema) or virtual or optical
      colonoscopy.

o     Tagitol(TM) is a barium sulfate-based tagging agent that differentiates
      residual stool from soft tissue in a CT image.

o     PROTOCO2L(TM) is an insufflator that delivers carbon dioxide into the
      colon to achieve optimal distention of the colon for better visualization.

o     InnerviewGI(TM) is an application software that processes CT scan data to
      create two- and three-dimensional views of the GI tract. InnerviewGI(TM)
      was jointly developed with Vital Images, Inc., which develops, markets and
      supports three-dimensional medical imaging software for use primarily in
      disease screening, clinical diagnosis, surgical and therapy planning.

E-Z-EM is marketing its Virtual Colonoscopy products as a more patient-friendly
procedure to encourage screening. E-Z-EM believes patients, when given the
choice, prefer Virtual Colonoscopy because it is less invasive than optical
colonoscopy and more comfortable than both optical colonoscopy and barium enema
without compromising visualization. Virtual Colonoscopy is gaining academic and
critical acceptance.

Specialty Diagnostic Tests

E-Z-EM has licensed an immunoassay test for use in the detection of Helicobacter
pylori (H. pylori), the bacteria believed to cause ulcers and stomach cancer.
E-Z-EM is seeking to acquire, license or joint venture other tests to identify
other GI related diseases, such as colorectal cancer.

E-Z-EM's H. pylori test analyzes a patient's serum or whole blood sample using a
patented antigen licensed from Baylor College of Medicine. The test is available
for laboratory use and for use in a physician's office. H. pylori has been
identified as the leading cause of duodenal and gastric ulcers, it has been
linked to gastritis and gastric cancer, and the World Health Organization has
categorized H. pylori as a Class 1 carcinogen (a definite cancer-causing agent
in humans). Gastric cancer is a leading cause of death in Asia, Africa and
Eastern Europe.

E-Z-EM co-developed the H. pylori test with the Primary Care Division of Beckman
Coulter, Inc., which markets it in the U.S. and selected territories under the
brand name FlexSure(TM) HP. E-Z-EM receives royalties on these sales and from
the sale of the patented antigen. In addition, E-Z-EM derives revenue from the
sale of HM-CAP(TM), the laboratory version of the blood serum test. E-Z-EM
markets the HM-CAP(TM) test direct and through distributors in the U.S. and
abroad.


                                       -8-
<PAGE>

Accessory Medical Products and Devices

E-Z-EM develops, manufactures and markets consumable and non-consumable medical
products and devices used by radiologists and gastroenterologists in the GI
diagnosis process. These include radiological medical devices, such as entry and
biopsy needles and trays, and patented products such as the Suction Polyp
Trap(TM) used during colonoscopy, and the E-Z-Guard(TM) mouthpiece used during
esophageal, endoscopic and echocardiography procedures.

Contract Manufacturing

Contract manufacturing focuses on four product areas:

o     Diagnostic Contrast Media - E-Z-EM manufactures an oral contrast medium
      for a certain third party.

o     Pharmaceuticals - This includes products for dermatology, cough and cold
      medicines, liquid vitamins and antacids.

o     Non-Prescription Healthcare Products - This includes anti-aging and
      moisturizer skin care products, as well as sunscreen lotions and creams.
      During 2001, E-Z-EM entered into a long-term agreement with Vivier Pharma
      (Vivier") of Vaudreuil, Quebec, Canada to be the exclusive manufacturer of
      products owned and sold by Vivier worldwide directly or through its
      agents. E-Z-EM also has a right of first refusal for the manufacture of
      all future products in development, to be developed or to be acquired by
      Vivier. Vivier holds a leading position, with exclusive know-how, related
      to high potency liquid vitamin C products, used in anti-aging
      cosmeceuticals.

o     Defense Decontaminants - This includes a lotion that neutralizes and
      destroys chemical warfare agents. E-Z-EM has a long-term agreement with
      O'Dell Engineering Ltd. ("O'Dell") of Cambridge, Ontario, Canada, to
      commercialize a product line known as Reactive Skin Decontaminant Lotion
      ("RSDL"), currently marketed to the defense sector. E-Z-EM is the
      exclusive manufacturer of RSDL and may assist in future product
      development.

      RSDL has been shown to be effective against the G and V families of nerve
      agents, which include Sarin (used in the Tokyo subway terrorist attack)
      and VX, and the H and L families of vesicants (blister agents), which
      include Mustard and Lewisite. Developed by the Defense Research
      Establishment of the Canadian Department of National Defense, RSDL is
      patented by the Canadian government, which has entered into an exclusive
      licensing agreement with O'Dell until the year 2010. Patents have been
      issued for RSDL in the U.S., Canada and more than a dozen European
      countries.

E-Z-EM Research and Development and Engineering

E-Z-EM believes that the success of its business is due to its ability to
improve and develop new diagnostic contrast formulations and devices for
different imaging modalities and procedures and to develop new immunodiagnostic
tests for GI disease. To support these activities, E-Z-EM operates three
Research and Development laboratories with a staff of 11 and a product
Engineering department with a staff of 13.

o     Two laboratories specialize in liquid (Montreal, Canada) and powder
      (Westbury, N.Y.) barium sulfate contrast formulations. Capabilities
      include barium sulfate concentration, stabilization, coating or
      non-coating properties, flavorings, and expertise in analytic, organic and
      physical chemistry.


                                       -9-
<PAGE>

o     The third laboratory (also in Westbury, N.Y.) specializes in
      immunodiagnostic tests for GI disease. Capabilities include immunoassay
      development and a wide range of biochemical techniques, including protein
      purification, microbiology, enzyme immunoassay, and antibody
      characterization.

o     The Engineering department (also in Westbury, N.Y.) specializes in FDA
      Class 2 Medical Device development, manufacturing and regulation for
      hardware and disposables. Capabilities include mechanical, electrical and
      software design.

E-Z-EM research and development expenditures totaled $4,269,000, $3,965,000 and
$3,238,000 in 2002, 2001 and 2000, respectively.

E-Z-EM Marketing

E-Z-EM also believes that the success of its business is due to the
effectiveness of its marketing, sales and distribution infrastructure.

In North America, E-Z-EM products are marketed through a sales force of 40
(including 4 regional managers), many of whom have had technical training as X-
ray or CT technologists, reaching the 1,500 major hospitals in North America
where 25,000 radiologists work, and an increasing number of gastroenterologists.
Approximately 140 distributors are used for fulfillment. E-Z-EM also advertises
in medical journals and displays at most national and international radiology
and, more recently, gastroenterology conventions.

Outside North America, E-Z-EM products are marketed through a sales force of 20.
E-Z-EM markets and distributes directly in the United Kingdom, Benelux and
Tokyo, Japan, reaching major hospitals in these markets. Independent
distributors are used in all other markets, such as Nycomed Amersham in Central
and Eastern Europe, Bracco in Italy, and Astra in Scandinavia. Significant sales
are made in Canada, the United Kingdom, Japan, Italy, Holland, Austria, Germany,
Sweden, Spain and Australia. Foreign distributors are generally granted
exclusive distribution rights, where permissible by applicable law, and some
hold governmental product registrations in their names. New registrations are
filed in E-Z-EM's name where permissible by applicable law.

E-Z-EM Competition

Based upon sales, E-Z-EM contrast systems are the most widely used diagnostic
imaging products of their kind in the U.S., Canada and certain European
countries. E-Z-EM faces competition domestically from Mallinckrodt Inc., a
wholly-owned subsidiary of Tyco International Ltd., as well as from small U.S.
competitors, and faces competition outside of the U.S. E-Z-EM competes primarily
on the basis of product quality, customer service, the availability of a full
line of barium sulfate formulations tailored to user needs, and price.

Radiology procedures for which E-Z-EM supplies products complement, as well as
compete with, endoscopic procedures such as colonoscopy and endoscopy. Such
examinations involve direct visual inspection of the GI tract through the use of
a flexible fiber optic instrument inserted into the patient by a
gastroenterologist. The use of gastroenterology procedures has been growing in
both upper and lower GI examinations as patients have been increasingly referred
to gastroenterologists rather than radiologists. Also, the availability of drugs
that successfully treat ulcers and other gastrointestinal disorders has tended
to reduce the need for upper GI tract X-ray examinations.

E-Z-EM also competes in the medical device radiology market, which is highly
competitive. To E-Z-EM's knowledge, no single company, domestic or foreign,
competes with E-Z-EM across all of its medical device product lines. In
electromechanical injectors and syringes, E-Z-EM's main competitors are Schering


                                      -10-
<PAGE>

AG and Mallinckrodt Inc. In needles and trays, E-Z-EM competes with C.R. Bard,
Inc., Baxter Healthcare Corporation, Sherwood Medical Co. and various other
competitors. E-Z-EM also encounters competition in the marketing of its other
medical device products.

Significant Customers

Sales to Philips Medical Systems, Inc., which is a distributor of the Company's
E-Z-EM products, were 13% of total net sales during 2002.

ANGIODYNAMICS SEGMENT

General

AngioDynamics, Inc. is a leading supplier of medical products used by
interventional radiologists and other physicians for the minimally invasive
diagnosis and therapeutic treatment of peripheral vascular disease. The business
addresses seven key areas:

o     Angiographic Products and Accessories

o     Image-Guided Vascular Access Products

o     Dialysis Products

o     Thrombolytic Products

o     PTA Dilation Catheters

o     Biliary Stents

o     Drainage Products

AngioDynamics' strategy is to continue to expand its product offerings to become
a full-service provider to interventional radiologists in the global
marketplace. AngioDynamics believes that it is the only full line supplier whose
primary focus is interventional radiology, whereas other full line suppliers are
focused on interventional cardiology. Except as otherwise noted in the following
discussion, all AngioDynamics products are cleared for sale in the U.S., the
European Community and Japan. AngioDynamics products are also sold in a number
of other countries.

Interventional Radiology

Interventional radiology ("IR") is a rapidly growing area of medicine, according
to the Society of Interventional Radiology. Interventional radiologists use
their expertise in reading medical images (such as X-rays, magnetic resonance
imaging, ultrasound and computed tomography) to guide small instruments such as
catheters (tubes that measure just a few millimeters in diameter) through the
blood vessels or other pathways to treat disease percutaneously (through the
skin).

The improved ability to see inside the body with radiologic imaging and the
development of tools such as balloon catheters, gave rise to IR in the
mid-1970s. In 1992, the American Medical Association officially recognized IR as
a medical specialty. Today there are more than 5,000 interventional radiologists
in the U.S. AngioDynamics believes that the number of interventional
radiological procedures is growing dramatically due to numerous advantages
compared to more traditional surgical procedures:


                                      -11-
<PAGE>

o     Most procedures can be performed on an outpatient basis or require only a
      short hospital stay.

o     General anesthesia usually is not required.

o     Risk, pain and recovery time are often significantly reduced.

o     The procedures are generally less expensive than surgery or other
      alternatives.

As a consequence, AngioDynamics expects the market to expand for IR products as
more physicians become trained in less invasive medical specialties and these
procedures gain wider acceptance and become more widely performed in community
hospitals as well as in major medical centers. Improvements in imaging and
device technology also should expand the application of IR procedures.

Angiographic Products and Accessories

Angiographic products are used during procedures known as "angiograms" and
"venograms", which provide images of the human peripheral vasculature and blood
flow. Angiographic products include diagnostic catheters, fluid management
products, and angiographic accessories specifically designed for IR.

AngioDynamics manufactures three lines of angiographic catheters - Soft-Vu(R),
ANGIOPTIC(TM), and Accu-Vu(TM) - available in over 500 tip configurations and
lengths, either as standard items or made to order.

o     The market leading, proprietary Soft-Vu(R) technology incorporates a soft,
      atraumatic tip, which is easily visualized under fluoroscopy, attached to
      a more rigid shaft. AngioDynamics believes this technology offers
      physicians a safer alternative with less propensity to perforate or
      lacerate an artery or vein than certain competitive products.

o     The ANGIOPTIC(TM) line is distinguished from other catheters because the
      entire instrument is highly visible under fluoroscopy.

o     Introduced in September 2001, the Accu-Vu(TM) sizing catheter answers the
      market need for a highly visible, accurate measuring catheter to determine
      the length and diameter of a vessel for endovascular procedures.
      Accu-Vu(TM) provides a soft, highly radiopaque tip with a choice of
      platinum radiopaque marker patterns along the shaft for enhanced
      visibility and accuracy. Markers are used primarily in preparation for
      aortic aneurysm stent graft (AAA) placement, percutaneous balloon
      angioplasty, peripherally placed vascular stents, or vena cava filters.

AngioDynamics also manufactures several lines of products used to administer
fluids and contain blood and other biological wastes produced during an IR
procedure. These products are designed to minimize exposure and risk for HIV and
hepatitis. The AngioFill(TM) line controls airborne blood borne pathogens by
aspirating a catheter and injecting the blood into an appropriate receptacle.
The patented Pulse-Vu Needle(TM) controls airborne blood born pathogens and the
spurting blood flow normally encountered in a femoral arterial puncture.

Image-Guided Vascular Access Products

Image-Guided Vascular Access ("IGVA") refers to using advanced imaging equipment
to guide the placement of catheters that deliver primarily short-term drug
therapy (such as chemotherapeutic agents, antibiotics and total parental feeding
solutions) into the central circulatory system. In this manner, drugs can mix
with a large volume of blood as compared to intravenous drug delivery that can
harm individual vessels.


                                      -12-
<PAGE>

IGVA procedures include the placement of percutaneous inserted central catheter
("PICC") lines, implantable ports, and central venous catheters ("CVCs").
AngioDynamics offers three IGVA products:

o     The V-Cath(R) PICC designed to facilitate easy placement and provide
      maximum patient comfort.

o     The Chemo-Port(R) that maximizes options for patients with difficult
      and/or complex venous access needs. The port lock system is easy to attach
      and provides a secure connection.

o     The Chemo-Cath(R) that provides easy and convenient access.

AngioDynamics IGVA products are cleared for sale in the U.S.

Dialysis Products

The kidney removes excess water and chemical wastes from blood, permitting fresh
blood to return to the circulatory system. When the kidneys malfunction, waste
substances cannot be excreted, creating an abnormal buildup of wastes in the
bloodstream. Dialysis machines, connected to the body by catheters, are
typically used to treat the problem. AngioDynamics currently offers three high
flow dialysis catheters that allow the blood to be cleaned in a short period of
time:

o     The SchonCath(R) Chronic Dialysis Catheter is designed to be
      self-retaining, deliver high flow rates and provide patient comfort. The
      SchonCath(R) is for long-term use.

o     The More-Flow(TM) Chronic Dialysis Catheter permits easier insertion and
      delivers high flow rates. The material conforms well to the vessel
      anatomy, resulting in higher patient tolerance during extended use. The
      More-Flow(TM) is for long-term use.

o     The SchonXL(R) Acute Dialysis Catheter is designed to be kink resistant,
      deliver high flow rates, offer versatile positioning and provide patient
      comfort. SchonXL(R) is for short-term use.

The More-Flow(TM) Chronic Dialysis Catheter is cleared for sale in the U.S. and
is CE marked in the European common market. AngioDynamics plans to provide a
broader line of dialysis catheters with higher flow rates and minimal site care
requirements.

Thrombolytic Products

Thrombolytic products are used in a procedure to dissolve blood clots in
hemodialysis access grafts, arteries and veins as well as other peripheral
vessels. AngioDynamics' Pulse*Spray(R) Sets and UNI*FUSE(TM) Kits optimize the
delivery of lytic agent (the drug that actually dissolves the clot) by providing
a controlled, forceful, uniform dispersion. Patented slits on the infusion
catheter operate like tiny valves for an even distribution of a lytic agent.
These slits have been clinically shown to reduce the amount of lytic agent and
the time necessary for the procedure by a factor of three, as compared to other
competitive catheters. This represents potentially significant healthcare cost
savings and reduced complications associated with the use of larger volumes of
lytic agent.

PTA Dilation Catheters

Percutaneous Transluminal Angioplasty ("PTA") procedures are used to open
blocked arteries using a catheter that has a balloon at the tip of it. When the
balloon is inflated, the pressure flattens the blockage against the artery wall
to


                                      -13-
<PAGE>

improve the blood flow. Balloon angioplasty is now the most common method for
opening a blocked artery in the heart, legs, kidneys, arms, or neck.
AngioDynamics' Workhorse(TM) is a rugged, high-pressure balloon offered in 54
configurations, at an economical price, for performing nearly 80% of all PTA
procedures. The product is cleared for sale in the U.S., the European Community
and several other countries.

Biliary Stents

Stents hold open passageways in the body that may have closed or become
obstructed as a result of aging, disease or trauma. Stents are being used
increasingly as an alternative or adjunct to surgical procedures to reduce
procedure and recovery time, patient trauma and hospitalization.

The balloon expandable VISTAFLEX(TM) and OMNIFLEX(TM) biliary stents incorporate
a platinum linked-looped design, constructed from a single strand of precision-
formed alloy wire. Unlike stents constructed from stainless steel or nitinol
that contain nickel, platinum offers no potential allergic response. These
stents have virtually no foreshortening upon initial deployment and allow for
accurate placement due to their visibility. Because of its platinum material and
design characteristics, they are magnetic resonance angiography ("MRA")
compatible. During MRA procedures, these stents have been shown to produce
significantly less artifacts than stainless steel or nitinol stents. Artifacts
can reduce the visibility of the stent lumen and make accurate assessment of the
stent patency of that lumen more difficult.

The VISTAFLEX(TM) and OMNIFLEX(TM) stents for the treatment of biliary stricture
are cleared for sale in the U.S. Biliary stricture, a condition common among
hepatic and pancreatic cancer patients, is a narrowing of the bile duct as a
result of tumor ingrowths. The VISTAFLEX(TM) and OMNIFLEX(TM) stents are
marketed outside the U.S., in Europe and a number of other countries for
peripheral vascular applications.

Drainage Products

AngioDynamics' Abscession(TM) General Drainage Catheter and Abscession(TM)
Biliary Drainage Catheter drain abscesses, chest fluid, and urine percutaneously
from the body. These products feature a soft catheter material that is intended
to be more comfortable for the patient. The catheter also recovers its shape if
bent or severely deformed when patients roll over and kink the catheters during
sleep. These products are cleared for sale in the U.S., the European Community
and several other countries.

AngioDynamics Research and Development and Engineering

AngioDynamics is actively engaged in ongoing product development with the goal
of providing interventional radiologists with a steady stream of innovative new
medical products. To support this goal, AngioDynamics operates Product
Development and Feasibility departments with a total staff of 13.

On-site laboratory facilities at AngioDynamics' Queensbury, N.Y. headquarters
support the development of new angiographic catheters, stents, balloons,
dialysis products, thrombolytic devices and vascular access product lines. The
Product Development group focuses on developing new medical devices in
compliance with FDA and ISO standards.

The Feasibility group focuses on assessing the technical design,
manufacturability and marketability of new product ideas in addition to managing
AngioDynamics' intellectual property assets.

AngioDynamics research and development expenditures totaled $1,951,000,
$1,426,000 and $1,642,000 in 2002, 2001 and 2000, respectively.


                                      -14-
<PAGE>

AngioDynamics Marketing

AngioDynamics products are marketed to interventional radiologists in the U.S.
through a direct sales organization of 36 (including 4 regional managers).
AngioDynamics seeks to build and maintain very close relationships with the
5,000 interventional radiologists in the U.S. This strong relationship is
illustrated by the fact that Eamonn P. Hobbs, President and Chief Executive
Officer of AngioDynamics, is the sole industry representative on the Society of
Interventional Radiology (SIR) Strategic Planning Council. Outside the U.S.,
AngioDynamics markets its products via 37 international distributors, including
two of the Company's wholly-owned subsidiaries. Foreign distributors are
generally granted exclusive distribution rights, where permissible by applicable
law, on a country-by-country basis.

AngioDynamics Competition

AngioDynamics competes on the basis of product quality and innovation, sales,
marketing and service effectiveness, and price. There are many large companies,
with significantly greater financial, manufacturing, marketing, distribution and
technical resources than AngioDynamics, focusing on its markets. Those products
that the FDA has already cleared and those products that in the future receive
FDA clearance will have to compete vigorously for market acceptance and market
share.

Cook, Inc. (recently acquired by Guidant Corporation), Boston Scientific
Corporation, Cordis Endovascular Systems, Inc. (a Johnson & Johnson company),
C.R. Bard, Inc., Medtronic, Inc. and Guidant Corporation, among others,
currently compete against AngioDynamics in the development, production and
marketing of minimally invasive IR technology.

AngioDynamics believes that it is perceived as a market leader for angiographic
catheters. AngioDynamics' major competitors are Cook, Inc., Cordis Endovascular
Systems, Inc. and Boston Scientific Corporation.

In the vascular access market, AngioDynamics' major competitors are C.R. Bard,
Inc., Cook, Inc., Deltec, Inc. and Arrow International, Inc. For the dialysis
market, its major competitors are Medcomp, Inc., C.R. Bard, Inc., Boston
Scientific Corporation and Quinton, Inc.

The competitive situation in the market for thrombolytic products is complex.
The first level of competition is the medical profession, where each physician
can decide if any artery or graft will be cleared surgically or by thrombolysis.
If thrombolysis is used, the second level of competition is for the specific
type of catheter or wire that will be used. AngioDynamics' primary competitors
in this market are Boston Scientific Corporation, Micro Therapeutics, Inc.,
Cook, Inc. and Arrow International, Inc.

In the PTA balloon market, AngioDynamics competes against Cordis Endovascular
Systems, Inc., Boston Scientific Corporation, Cook, Inc., and C.R. Bard, Inc.

GENERAL CORPORATE INFORMATION

The following information applies to both the Company's E-Z-EM and AngioDynamics
segments.

Research and Development

The Company's research and development expenditures totaled $6,220,000,
$5,391,000 and $4,880,000 in 2002, 2001 and 2000, respectively.


                                      -15-
<PAGE>

Raw Materials and Supplies

Most of the barium sulfate for the Company's X-ray fluoroscopy and CT imaging
products is supplied by a number of European and U.S. manufacturers, with a
minor portion being supplied by E-Z-EM Canada Inc., a wholly-owned subsidiary of
the Company, which operates a barium sulfate mine and processing facility in
Nova Scotia and whose reserves are anticipated to last a minimum of five years
at current usage rates. The Company believes that these sources should be
adequate for its foreseeable needs.

The Company has generally been able to obtain adequate supplies of all
components for its AngioDynamics business in a timely manner from existing
sources. However, the inability to develop alternative sources, if required, or
a reduction or interruption in supply, or a significant increase in the price of
components, could adversely affect operations.

Patents and Trademarks

Although several products and processes are patented and the Company considers
its trademarks to be a valuable marketing tool, the Company does not consider
any single patent, group of patents, or trademarks to be materially important to
its E-Z-EM business segment. E-Z-EM and AngioDynamics are examples of the
Company's registered trademarks in the U.S.

The Company believes that success in the AngioDynamics products segment is
dependent, to a large extent, on patent protection and the proprietary nature of
its technology. The Company intends to file and prosecute patent applications
for technology for which it believes patent protection is effective and
advisable. The Company believes that issued patents covering Soft-Vu
angiographic catheters, thrombolytic products and VISTAFLEX are significant to
its AngioDynamics business segment.

Because patent applications, in general, are secret until eighteen months after
filing in the U.S. or corresponding applications are published in foreign
countries, and because publication of discoveries in the scientific or patent
literature often lags behind actual discoveries, the Company cannot be certain
that it was the first to make the inventions covered by each of its pending
patent applications, or that it was the first to file patent applications for
such inventions. The Company also relies on trade secret protection and
confidentiality agreements for certain unpatented aspects of its proprietary
technology.

Regulation

The Company's products are registered with the FDA and with similar regulatory
agencies in foreign countries where they are sold. The Company believes it is in
compliance, in all material respects, with applicable regulations of these
agencies.

Certain of the Company's products are subject to FDA regulation as medical
devices and certain other products, such as various X-ray fluoroscopy products
and CT imaging products, are regulated as pharmaceuticals. Outside of the U.S.,
the regulatory process and categorization of products vary on a
country-by-country basis.

The Company's products are covered by Medicare, Medicaid and private healthcare
insurers, subject to patient eligibility. Changes in the reimbursement policies
and procedures of such insurers may affect the frequency with which such
procedures are performed.

The Company operates several facilities within a broad industrial area located
in Nassau County, New York, which has been designated by New York State as a


                                      -16-
<PAGE>

Superfund site. This industrial area has been listed as an inactive hazardous
waste site, due to ground water investigations conducted on Long Island during
the 1980's. Due to the broad area of the designated site, the potential number
of responsible parties, and the lack of information concerning the degree of
contamination and potential clean-up costs, it is not possible to estimate what,
if any, liability exists with respect to the Company. Further, it has not been
alleged that the Company contributed to the contamination, and it is the
Company's belief that it has not done so.

Employees

The Company employs 932 persons, 193 of whom are covered by various collective
bargaining agreements. Collective bargaining agreements covering 75 and 114
employees expire in December 2002 and December 2004, respectively. The Company
considers employee relations to be satisfactory.

(d)   Financial Information Regarding Foreign and Domestic Operations and Export
      --------------------------------------------------------------------------
      Sales
      -----

The Company derived about 29% of its sales from customers outside the U.S.
during 2002. Operating profit margins on export sales are somewhat lower than
domestic sales margins. The Company's domestic operations bill third-party
export sales in U.S. dollars and, therefore, do not incur foreign currency
transaction gains or losses. Third-party sales to Canadian customers, which are
made by E-Z-EM Canada, are billed in local currency. Third-party sales to
Japanese customers, which are made by the Company's Japanese subsidiary, are
also billed in local currency.

The Company employs 317 persons involved in the developing, manufacturing and
marketing of products internationally. The Company's product lines are marketed
through approximately 163 foreign distributors to 81 countries outside of the
U.S.

The net sales of each geographic area and the long-lived assets attributable to
each geographic area are set forth in Note P to the Consolidated Financial
Statements included herein.

Item 2. Properties
        ----------

The Company's headquarters are located in Westbury, New York. They consist of
three buildings, one of which is owned by the Company, containing an aggregate
of 183,800 square feet used for manufacturing E-Z-EM products, warehousing and
administration. One of the Westbury facilities is leased to the Company by
various lessors, including certain related parties. See "Certain Relationships
and Related Transactions". AngioDynamics occupies manufacturing and warehousing
facilities located in Queensbury, New York consisting of two buildings, one of
which is owned by the Company, containing an aggregate of 29,312 square feet.
E-Z-EM Caribe owns a 38,600 square-foot plant in San Lorenzo, Puerto Rico which
fabricates enema tips and heat-sealed products. E-Z-EM Canada occupies
manufacturing and warehousing facilities located in Montreal, Canada consisting
of two buildings, one of which is owned by the Company, containing an aggregate
of 109,950 square feet. E-Z-EM Canada also owns a 29,120 square-foot building in
Debert, Nova Scotia and both owns and leases land encompassing its barium
sulfate mining operation.

Item 3. Legal Proceedings
        -----------------

The Company is presently involved in various claims, legal actions and
complaints arising in the ordinary course of business. The Company believes that
any


                                      -17-
<PAGE>

liability that may ultimately result from the resolution of these matters will
not have a material adverse effect on the Company's financial position or
results of operations.

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

None.


                                      -18-
<PAGE>

                                     Part II

Item 5. Market for Registrant's Common Equity and Related Stockholder Matters
        ---------------------------------------------------------------------

E-Z-EM, Inc. Class A and Class B common stock is traded on the American Stock
Exchange ("AMEX") under the symbols "EZM.A" and "EZM.B", respectively. The
following table sets forth, for the periods indicated, the high and low sale
prices for the Class A and Class B common stock as reported by the AMEX.

                                              Class A           Class B
                                          ---------------   ---------------
                                           High     Low      High     Low
                                          ------   ------   ------   ------

    Fifty-two weeks ended June 1, 2002
    ----------------------------------

    First Quarter.....................    $ 5.65   $ 4.61   $ 5.45   $ 5.00
    Second Quarter....................      9.39     4.65     8.40     4.00
    Third Quarter.....................     10.00     5.25     8.00     4.75
    Fourth Quarter....................     14.05    10.18    12.00     8.25

    Fifty-two weeks ended June 2, 2001
    ----------------------------------

    First Quarter.....................    $ 8.00   $ 6.00   $ 7.38   $ 5.75
    Second Quarter....................      8.13     6.13     7.88     6.25
    Third Quarter.....................      6.25     5.25     6.25     4.75
    Fourth Quarter....................      5.69     5.10     5.70     4.00

As of August 5, 2002 there were 159 and 298 record holders of the Company's
Class A and Class B common stock, respectively.

During fiscal 2002, 2001 and 2000, no dividends were declared. The Company will
continue to evaluate its dividend policy on an ongoing basis. Any future
dividends are subject to the Board of Directors' review of operations and
financial and other conditions then prevailing.

On November 1, 2001, the Company issued 1,000 shares of non-voting Class B
common stock to each of the following directors of the Company in consideration
for services rendered as directors: Michael A. Davis, Paul S. Echenberg, James
L. Katz, Donald A. Meyer, David P. Meyers and Robert M. Topol. All such shares
were issued pursuant to Section 4(2) of the Securities Act of 1933. The basis
upon which the exemption is claimed is that the issued shares were made only to
directors of the Company.


                                      -19-
<PAGE>

Item 6. Selected Financial Data
        -----------------------

<TABLE>
<CAPTION>
                                  Fifty-two                         Fifty-two
                                 weeks ended      Fifty-three      weeks ended
                            -------------------   weeks ended --------------------
                             June 1,    June 2,     June 3,    May 29,     May 30,
                              2002       2001        2000       1999        1998#
                            --------   --------    --------   --------    --------
                                     (in thousands, except per share data)
<S>                         <C>        <C>         <C>        <C>         <C>
Income statement data:
  Net sales (1)...........  $122,133   $113,286    $113,868   $109,054    $104,652
  Gross profit (1)........    51,285     45,692      47,805     42,677      35,042
  Operating profit (loss).     1,906      3,525       8,599      7,242      (5,351)
  Earnings (loss) before
    income taxes..........     2,431      3,637       9,234      6,671      (5,534)
  Net earnings (loss).....       585      3,286       5,965      4,797      (5,967)
  Earnings (loss) per
    common share
      Basic (2)...........       .06        .33         .60        .48        (.60)
      Diluted (2).........       .06        .32         .58        .47        (.60)
  Weighted average common
    shares
      Basic (2)...........     9,848      9,881      10,013     10,077       9,952
      Diluted (2).........    10,160     10,145      10,314     10,314       9,952
</TABLE>

<TABLE>
<CAPTION>
                             June 1,    June 2,     June 3,    May 29,     May 30,
                              2002       2001        2000       1999        1998
                            --------    -------     -------    -------     -------
                                               (in thousands)
<S>                         <C>         <C>         <C>        <C>         <C>
Balance sheet data:
  Working capital.........  $ 56,746    $56,184     $51,434    $48,430     $41,597
  Cash, certificates of
    deposit and short-
    term debt and equity
    securities............    24,064     18,139      13,634     13,289       8,129
  Total assets............   102,281     97,455      99,085     96,059      90,706
  Long-term debt, less
    current maturities....       327        408         453        477         606
  Stockholders' equity....    83,522     81,004      80,034     75,291      71,223
</TABLE>

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

#     Includes the impairment charge of $4,121,000 relating to certain
      long-lived assets pertaining to the acquisition of Leocor, Inc., a
      wholly-owned subsidiary of AngioDynamics, Inc.

(1)   Retroactively restated to reflect the reclassifications of freight billed
      to customers and related freight costs described in Note A for fiscal
      2000, 1999 and 1998.

(2)   Retroactively restated to reflect the total shares issued after the 3%
      stock dividend declared in 1998.


                                      -20-
<PAGE>

Item 7. Management's Discussion and Analysis of Financial Condition and Results
        -----------------------------------------------------------------------
        of Operations
        -------------

The Company's fiscal years ended June 1, 2002 and June 2, 2001 represent fifty-
two weeks and the fiscal year ended June 3, 2000 represents fifty-three weeks.

Results of Operations

Segment Overview

The Company operates in two industry segments: E-Z-EM products and AngioDynamics
products. The E-Z-EM operating segment includes X-ray fluoroscopy products, CT
imaging products, virtual colonoscopy products, specialty diagnostic tests, and
accessory medical products and devices. The E-Z-EM segment also includes third-
party contract manufacturing of diagnostic contrast agents, pharmaceuticals,
non- prescription healthcare products and defense decontaminants. The E-Z-EM
operating segment accounted for 76% of net sales for 2002, as compared to 80%
for 2001 and 82% for 2000. The AngioDynamics operating segment, which includes
angiographic products and accessories, image-guided vascular access products,
dialysis products, thrombolytic products, PTA dilation catheters, biliary
stents, and drainage products used in the interventional radiology marketplace,
accounted for 24% of net sales for 2002, as compared to 20% for 2001 and 18% for
2000.

                                 E-Z-EM    AngioDynamics  Eliminations    Total
                                 ------    -------------  ------------    -----
                                                   (in thousands)

Year ended June 1, 2002
-----------------------

 Unaffiliated customer sales    $92,288       $29,845            --     $122,133
 Intersegment sales                  --         1,045       ($1,045)          --
 Gross profit (loss)             35,786        15,557           (58)      51,285
 Operating profit (loss)           (425)        2,389           (58)       1,906

Year ended June 2, 2001
-----------------------

 Unaffiliated customer sales    $90,610       $22,676            --     $113,286
 Intersegment sales                   1           714         ($715)          --
 Gross profit (loss)             34,770        10,972           (50)      45,692
 Operating profit (loss)          3,865          (290)          (50)       3,525

Year ended June 3, 2000
-----------------------

 Unaffiliated customer sales    $93,162       $20,706            --     $113,868
 Intersegment sales                   2         1,063       ($1,065)          --
 Gross profit                    37,896         9,858            51       47,805
 Operating profit (loss)          9,285          (739)           53        8,599

E-Z-EM Products

E-Z-EM segment operating results for 2002 declined by $4,290,000 due primarily
to costs associated with the December 2001 closing of a Japanese facility and
the Company's continued investment in the areas of virtual colonoscopy and CT
injector systems. The Japanese facility was principally used to manufacture
liquid barium sulfate formulations for sale in the Japanese market. The facility
lacked the necessary manufacturing throughput to justify its continued
existence. The Company's strategy is to service the large Japanese market with
products manufactured in the U.S. As a result of this facility closing, the
Company recorded a $1,393,000 charge to operations during 2002 consisting of i)
a $1,262,000 write-down of property, plant and equipment to management's
estimate of their fair market value, based upon the anticipated proceeds to be
received upon sale, ii) severance costs of $100,000, and iii) a provision for
inventory reserves of $31,000.


                                      -21-
<PAGE>

Excluding the Japanese facility closing costs, E-Z-EM segment operating results
declined by $2,897,000 due primarily to increased operating expenses, slightly
offset by increased sales and gross profit. Net sales increased 2%, or
$1,678,000, due to increased sales of contract manufacturing products and CT
imaging contrast and injector system sales. Price increases accounted for less
than 1% of net sales for 2002. Gross profit expressed as a percentage of net
sales improved to 39% for 2002, from 38% for 2001 due primarily to the favorable
effects of changes in product mix and decreased overhead costs at the Company's
Westbury facility. The decrease in overhead costs can be attributed, in large
part, to severance costs of $332,000 incurred in 2001. Excluding the
aforementioned facility closing costs, operating expenses increased $3,913,000
due, in large part, to: i) the full year effect of the establishment of a
dedicated domestic sales force for the Company's CT injector systems in 2001;
ii) investment in new product introductions in the areas of CT imaging and
virtual colonoscopy; and iii) increased administrative and research and
development ("R&D") expenses.

E-Z-EM segment operating results for 2001 declined by $5,420,000 due to
decreased sales and gross profit and increased operating expenses. Net sales
decreased 3%, or $2,552,000, due to lower sales of X-ray fluoroscopy products,
partially offset by increased sales of CT imaging contrast and injector systems
and sales of contract manufacturing products. The lower sales of X-ray
fluoroscopy products were due, in part, to the strength of the U.S. dollar,
foreign currency exchange rate fluctuations, which adversely affected the
translation of European, Canadian and Japanese sales to U.S. dollars for
financial reporting purposes, and increased competitive pressures in Japan.
Price increases accounted for approximately 1% of net sales for 2001. Gross
profit expressed as a percentage of net sales declined to 38% for 2001, from 41%
for 2000 due primarily to decreased production throughput and severance costs of
$332,000, resulting from operational reorganizations. Increased operating
expenses of $2,294,000 were attributable to: i) the reorganization of operations
which resulted in severance and facility relocation expenses of $554,000; ii) an
impairment charge of $450,000 relating to acquired patent rights to an oral
magnetic resonance imaging ("MRI") contrast agent; iii) the establishment of a
dedicated domestic sales force for the Company's CT injector systems; and iv)
increased administrative and R&D expenses.

AngioDynamics Products

AngioDynamics segment operating results for 2002 improved by $2,679,000. The
operating results for 2001 were adversely affected by the loss on sale of
AngioDynamics Ltd. and related assets of $872,000 (described below). Excluding
the effect of the loss on sale, AngioDynamics segment operating results improved
by $1,807,000 due to increased sales and improved gross profit, partially offset
by increased operating expenses. Net sales increased 32%, or $7,169,000, due
primarily to increased sales of dialysis products, image-guided vascular access
products, angiographic catheters, PTA dilation catheters and biliary stents in
the domestic marketplace. Price increases had little effect on net sales in
2002. Gross profit expressed as a percentage of net sales improved to 50% for
2002, from 47% for 2001 due primarily to increased production throughput at the
Company's Queensbury facility. Excluding the aforementioned loss on sale,
operating expenses increased $2,778,000 primarily due to continued investment in
sales force support and new product line extensions, and increased bonus
compensation costs.

AngioDynamics segment operating results for 2001, which improved by $449,000,
were adversely affected by the sale of AngioDynamics Ltd., a wholly-owned
subsidiary, and certain other assets. AngioDynamics Ltd., located in Ireland,
manufactured cardiovascular and interventional radiology products. The sale was
the culmination of the Company's strategic decision to exit the cardiovascular
market and to focus entirely on the interventional radiology marketplace. As a


                                      -22-
<PAGE>

result of this sale, the Company recognized a pre-tax loss of approximately
$872,000 during 2001. The aforementioned pre-tax loss includes the effect of
previously unrealized losses on foreign currency translation of approximately
$994,000 and the write-off of approximately $673,000 in inventory and
intangibles related to the cardiovascular product line, both of which were
non-cash charges.

Excluding the loss on sale, AngioDynamics segment operating results improved by
$1,321,000 due to increased sales and improved gross profit. Net sales increased
10%, or $1,970,000, due, in large part, to: increased sales of several products
introduced in 2000, namely Workhorse(TM) PTA balloon catheters, Abscession(TM)
fluid drainage catheters, and VISTAFLEX(TM) platinum biliary stents; and sales
of OMNIFLEX(TM) stents, introduced in the third quarter of 2001. International
sales increased 1% despite the Company's exit from the cardiovascular market.
Price increases had little effect on net sales in 2001. Gross profit expressed
as a percentage of net sales improved to 47% for 2001, as compared to 45% for
2000 due primarily to reduced unabsorbed overhead costs, resulting from the sale
of the Irish facility, and increased production throughput at the Queensbury
facility.

Certain financial information, including net sales, depreciation and
amortization, net earnings (loss), assets and capital expenditures attributable
to each operating segment, is set forth in Note P to the Consolidated Financial
Statements included herein.

Consolidated Results of Operations
----------------------------------

The Company reported net earnings of $585,000, or $.06 per common share on both
a basic and diluted basis for 2002, as compared to net earnings of $3,286,000,
or $.33 and $.32 per common share on a basic and diluted basis, respectively,
for 2001, and net earnings of $5,965,000, or $.60 and $.58 per common share on a
basic and diluted basis, respectively, for 2000. Results for 2002 were adversely
affected by the $1,393,000 charge to close a Japanese facility. Increased
operating expenses in both industry segments also adversely affected results for
2002. Results for 2002 were favorably affected by increased sales and improved
gross profit in both industry segments.

Results for 2001 were adversely affected by decreased sales and gross profit in
the E-Z-EM segment and several events, totaling pre-tax charges aggregating
$2,774,000. These events consisted of: i) the reorganization of operations which
resulted in severance and facility relocation expenses of $886,000; ii) the loss
on sale of AngioDynamics Ltd. and related assets of $872,000; iii) an impairment
charge of $566,000 relating to the Company's investment in Cedara Software
Corporation; and iv) the MRI asset impairment charge of $450,000. Results for
2001 were favorably affected by the Company's reversal of a portion of its
income tax valuation allowance against certain domestic tax benefits totaling
$1,344,000, since, at that time, it was more likely than not that such benefits
would be realized.

Net sales increased 8%, or $8,847,000, to $122,133,000 for 2002, and decreased
1%, or $582,000, to $113,286,000 for 2001. Net sales for 2002 were favorably
affected by increased sales of AngioDynamics products of $7,169,000 and E-Z-EM
products of $1,678,000, which resulted from the factors previously disclosed in
the segment overview. Price increases accounted for less than 1% of net sales
for 2002. Net sales for 2001 were adversely affected by lower sales of E-Z-EM
products of $2,552,000, partially offset by increased sales of AngioDynamics
products of $1,970,000, which resulted from the factors previously disclosed in
the segment overview. Price increases accounted for approximately 1% of net
sales for 2001.

Net sales in international markets, including direct exports from the U.S.,
increased less than 1%, or $71,000, to $35,690,000 for 2002 and decreased 5%, or
$1,866,000, to $35,619,000 for 2001. For 2002, increased sales of contract


                                      -23-
<PAGE>

manufacturing products were almost entirely offset by declines in sales across
all other E-Z-EM product groups and declines in sales of AngioDynamics products.
The decline for 2001 was due to lower sales of X-ray fluoroscopy products,
partially offset by increased sales of contract manufacturing products. The
lower sales of X-ray fluoroscopic products resulted from the factors previously
disclosed in the segment overview.

Gross profit expressed as a percentage of net sales was 42% for 2002, as
compared to 40% for 2001 and 42% for 2000. The improvement in gross profit,
expressed as a percentage of net sales, for 2002 was due to increased gross
profit in both the AngioDynamics and E-Z-EM segments, which resulted from the
factors previously disclosed in the segment overview. The decline in gross
profit, expressed as a percentage of net sales, for 2001 was due to reduced
gross profit in the E-Z-EM segment, partially offset by improved gross profit in
the AngioDynamics segment, which resulted from the factors previously disclosed
in the segment overview.

Selling and administrative ("S&A") expenses were $41,766,000 for 2002,
$35,904,000 for 2001 and $34,326,000 for 2000. The increase for 2002 compared to
2001 of $5,862,000, or 16%, was due to increased E-Z-EM S&A expenses of
$3,609,000 and increased AngioDynamics S&A expenses of $2,253,000. Increased
E-Z-EM S&A expenses resulted, in large part, from: i) the full year effect of
the establishment of a dedicated domestic sales force for the Company's CT
injector systems in 2001; ii) investment in new product introductions in the
areas of CT imaging and virtual colonoscopy; and iii) increased administrative
expenses. Increased AngioDynamics S&A expenses was primarily due to continued
investment in sales force support and new product line extensions, and increased
bonus compensation costs. The increase for 2001 compared to 2000 of $1,578,000,
or 5%, was due to increased E-Z-EM S&A expenses, resulting from: i) the
reorganization of operations which resulted in severance and facility relocation
expenses of $459,000; ii) the asset impairment charge of $450,000; iii) the
expansion of the domestic sales force; and iv) increased administrative
expenses.

R&D expenditures for 2002 totaled $6,220,000, or 5% of net sales, as compared to
$5,391,000, or 5% of net sales, for 2001 and $4,880,000, or 4% of net sales, for
2000. The increase for 2002 compared to 2001 of $829,000 was mainly due to
increased spending relating to AngioDynamics projects of $525,000 and expenses
associated with the development of new products in the field of virtual
colonoscopy of $460,000. The increase for 2001 compared to 2000 of $511,000 was
due primarily to redeployment of staff from other departments within the
Company, increased spending relating to X-ray fluoroscopy and CT imaging
projects of $351,000, and severance costs of $95,000, resulting from operational
reorganizations. Of the R&D expenditures for 2002, approximately 39% relate to
X-ray fluoroscopy and CT imaging projects, 31% to AngioDynamics projects, 17% to
general regulatory costs, 8% to virtual colonoscopy projects, 3% to specialty
diagnostic tests, and 2% to other projects. R&D expenditures are expected to
continue at or exceed current levels. In addition to its in-house technical
staff, the Company is presently sponsoring various independent R&D projects and
is committed to continued expansion of its product lines through R&D.

Other income, net of other expenses, totaled $525,000 of income for 2002,
compared to $112,000 of income for 2001 and $635,000 of income for 2000. The
improvement for 2002 compared to 2001 was primarily due to the fact that, in
2001, the Company recorded an impairment charge of $566,000, relating to its
investment in Cedara Software Corporation. Gains on the sale of investments of
$202,000 and reduced foreign currency exchange losses of $104,000 were offset by
decreased interest income of $527,000, resulting, in large part, from lower
interest rates. The decline in other income for 2001 compared to 2000 was
primarily due to the aforementioned impairment charge of $566,000 and increased
foreign currency exchange losses of $128,000, partially offset by increased
interest income of $189,000, resulting from the investment of AngioDynamics Ltd.
sale proceeds.


                                      -24-
<PAGE>

Note I to the Consolidated Financial Statements included herein details the
major elements affecting income taxes for 2002, 2001 and 2000. For 2002, the
Company's unusually high effective tax rate of 76% differed from the Federal
statutory tax rate of 34% due primarily to the fact that the Company did not
provide for the tax benefit on losses incurred in certain foreign jurisdictions,
since it is more likely than not that such benefits will not be realized, and
non-deductible expenses. For 2001, the Company's effective tax rate of 10%
differed from the Federal statutory tax rate of 34% due primarily to the fact
that the Company reversed a portion of its valuation allowance against certain
domestic tax benefits, since, at that time, it was more likely than not that
such benefits would be realized, partially offset by the fact that the Company
did not provide for the tax benefit on losses incurred in certain foreign
jurisdictions, since, at that time, it was more likely than not that such
benefits would not be realized. For 2000, the Company's effective tax rate was
35% as compared to the Federal statutory tax rate of 34%. Losses incurred in a
foreign jurisdiction subject to lower tax rates and the fact that the Company
did not provide for the tax benefit on losses incurred in certain foreign
jurisdictions, since, at that time, it was more likely than not that such
benefits would not be realized, were virtually offset by earnings of the Puerto
Rican subsidiary, which are subject to favorable U.S. tax treatment.

Liquidity and Capital Resources
-------------------------------

For 2002, capital expenditures, the purchase of intangible assets and the
purchase of treasury stock were funded by cash provided by operations. For 2001,
capital expenditures and the purchase of treasury stock were funded by cash
provided by operations. For 2000, capital expenditures, the purchase of treasury
stock and debt repayments were funded by cash provided by operations. The
Company's policy has been to fund capital requirements without incurring
significant debt. At June 1, 2002, debt (notes payable, current maturities of
long-term debt and long-term debt) was $1,204,000 as compared to $1,418,000 at
June 2, 2001. The Company has available $1,309,000 under a bank line of credit
of which no amounts were outstanding at June 1, 2002.

At June 1, 2002, approximately 67% of the Company's assets consist of
inventories, accounts receivable, short-term debt and equity securities, and
cash and cash equivalents. The current ratio was 4.66 to 1, with net working
capital of $56,746,000, at June 1, 2002, compared to the current ratio of 5.24
to 1, with net working capital of $56,184,000, at June 2, 2001.

Net capital expenditures, primarily for machinery and equipment, were $3,393,000
for 2002, compared to $2,743,000 for 2001 and $3,206,000 for 2000. Of the 2002
expenditures, approximately $375,000 relates to the purchase of the Company's
chemical processing facility in Nova Scotia, Canada and approximately $344,000
relates to the upgrading of the Company's information systems data center and
mainframe platform in Westbury, New York. Of the 2001 and 2000 expenditures,
approximately $833,000 and $703,000, respectively, relates to the upgrading of
the Company's information systems at its Canadian subsidiary. No material
increase in the aggregate level of capital expenditures is currently
contemplated for 2003, except for the planned expansion of the AngioDynamics
headquarters and manufacturing facility in Queensbury, New York. The Company
expects this expansion to cost approximately $3,500,000, most of which will be
expended in 2003. Although the Company has the necessary cash reserves to fund
this expansion, it is currently seeking outside financing for this project.

In January 1999, the Board of Directors authorized the repurchase of up to
500,000 shares of the Company's Class B common stock at an aggregate purchase
price of up to $2,000,000. In October 1999, the Board modified the program to
include the Company's Class A common stock. In February 2000, the Board further
modified the program to increase the aggregate purchase price of Class A and
Class B common stock by an additional $2,000,000. As of June 1, 2002, the


                                      -25-
<PAGE>

Company had repurchased 52,859 shares of Class A common stock and 430,789 shares
of Class B common stock for approximately $3,409,000.

Forward-Looking Statements
--------------------------

This Form 10-K contains certain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the "Securities Act"),
and Section 21E of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), which are intended to be covered by the safe harbors created
thereby. Words such as "expects", "intends", "anticipates", "plans", "believes",
"seeks", "estimates", or variations of such words and similar expressions are
intended to identify such forward-looking statements. Investors are cautioned
that all forward-looking statements involve risks and uncertainty, including
without limitation, the ability of the Company to develop its products, future
actions by the FDA or other regulatory agencies, results of pending or future
clinical trials, overall economic conditions, general market conditions, foreign
currency exchange rate fluctuations, the effects on pricing from group
purchasing organizations, and competition, including alternative procedures
which continue to replace traditional fluoroscopic procedures. Although the
Company believes that the assumptions underlying the forward-looking statements
contained herein are reasonable, any of the assumptions could be inaccurate, and
therefore, there can be no assurance that the forward-looking statements
included in this Form 10-K will prove to be accurate. In light of the
significant uncertainties inherent in the forward-looking statements included
herein, the inclusion of such information should not be regarded as a
representation by the Company or any other person that the objectives and plans
of the Company will be achieved.

Critical Accounting Policies
----------------------------

Financial Reporting Release No. 60, which was recently published by the
Securities and Exchange Commission, recommends that all companies include a
discussion of critical accounting policies used in the preparation of their
financial statements. The Company's significant accounting policies are
summarized in Note A to the Consolidated Financial Statements included herein.
While all these significant accounting policies impact its financial condition
and results of operations, the Company views certain of these policies as
critical. Policies determined to be critical are those policies that have the
most significant impact on the Company's financial statements and require
management to use greater degree of judgment and/or estimates. Actual results
may differ from those estimates.

The Company believes that given current facts and circumstances, it is unlikely
that applying any other reasonable judgments or estimate methodologies would
cause a material effect on the Company's consolidated results of operations,
financial position or liquidity for the periods presented in this report. The
accounting policies identified as critical are as follows:

Revenue Recognition - The Company recognizes revenues in accordance with
generally accepted accounting principles as outlined in Staff Accounting
Bulletin No. 101, which requires that four basic criteria be met before revenue
can be recognized: (1) persuasive evidence of an arrangement exists; (2) product
delivery, including customer acceptance, has occurred or services have been
rendered; (3) the price is fixed or determinable; and (4) collectibility is
reasonably assured. Decisions relative to criteria (4) regarding collectibility
are based upon management judgments and should conditions change in the future
and cause management to determine this criteria is not met, the Company's
recognized results may be affected. The Company recognizes revenues as products
are shipped, which is when title passes to customers.

Allowance for Doubtful Accounts - The Company performs ongoing credit
evaluations of its customers and adjusts credit limits based upon payment
history and the


                                      -26-
<PAGE>

customer's current credit worthiness, as determined by a review of their current
credit information. The Company continuously monitors agings, collections and
payments from customers and a provision for estimated credit losses is
maintained based upon its historical experience and any specific customer
collection issues that have been identified. While such credit losses have
historically been within the Company's expectations and the provisions
established, the Company cannot guarantee that the same credit loss rates will
be experienced in the future. Concentration risk exists relative to the
Company's accounts receivable, as 32% of the Company's total accounts receivable
balance for fiscal 2002 is concentrated in two distributors. While the accounts
receivable related to these distributors may be significant, the Company does
not believe the credit loss risk to be significant given the consistent payment
history of these distributors.

Income Taxes - In preparing the Company's financial statements, income tax
expense is calculated for each of the jurisdictions in which the Company
operates. This process involves estimating actual current taxes due plus
assessing temporary differences arising from differing treatment for tax and
accounting purposes that are recorded as deferred tax assets and liabilities.
Deferred tax assets are periodically evaluated to determine their
recoverability, and where their recovery is not likely, a valuation allowance is
established and a corresponding additional tax expense is recorded in the
Company's statement of earnings. In the event that actual results differ from
the Company's estimates given changes in assumptions, the provision for income
taxes could be materially impacted. As of June 1, 2002, the Company's valuation
allowance totaled $5,756,000. The total net deferred tax asset as of June 1,
2002 was $2,417,000.

Inventories - The Company values its inventory at the lower of the actual cost
to purchase and/or manufacture or the current estimated market value of the
inventory. On an ongoing basis, inventory quantities on hand are reviewed and an
analysis of the provision for excess and obsolete inventory is performed based
primarily on product expiration dating and the Company's estimated sales
forecast of product demand, which is based on sales history and anticipated
future demand. The Company's estimates of future product demand may prove to be
inaccurate, in which case the Company may have understated or overstated the
provision required for excess and obsolete inventory. Therefore, although every
effort is made to ensure the accuracy of the Company's forecasts of future
product demand, any significant unanticipated changes in demand could have a
significant impact on the value of the Company's inventory and reported
operating results.

Property, Plant and Equipment - Property, plant and equipment are depreciated
over their useful lives. Useful lives are based on management's estimates of the
period that the asset will generate revenue. Any change in conditions that would
cause management to change its estimate as to the useful lives of a group or
class of assets may significantly impact the Company's depreciation expense on a
prospective basis.

Effects of Recently Issued Accounting Pronouncements
----------------------------------------------------

In August 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") No. 144, "Accounting for the Impairment
or Disposal of Long-Lived Assets". This statement is effective for fiscal years
beginning after December 15, 2001. This statement supercedes SFAS No. 121, while
retaining many of the requirements of such statement. The Company is currently
evaluating the impact this statement may have.

In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." SFAS No. 146 addresses accounting and
reporting for costs associated with exit or disposal activities and nullifies
Emerging Issues Task Force Issue No. 94-3, "Liability Recognition for Certain
Employee Termination Benefits and Other Costs to Exit an Activity (Including
Certain Costs


                                      -27-
<PAGE>

Incurred in a Restructuring)." SFAS No. 146 requires that a liability for a cost
associated with an exit or disposal activity be recognized and measured
initially at fair value when the liability is incurred. SFAS No. 146 is
effective for exit or disposal activities that are initiated after December 31,
2002, with early application encouraged. The adoption of this statement is not
expected to have a material impact on the Company's results of operations or
financial position.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk
         ----------------------------------------------------------

The Company is exposed to market risk from changes in foreign currency exchange
rates and, to a much lesser extent, interest rates on investments and financing,
which could impact results of operations and financial position. The Company
does not currently engage in hedging or other market risk management tools.
There have been no material changes with respect to market risk previously
disclosed in the 2001 Annual Report on Form 10-K.

Foreign Currency Exchange Rate Risk
-----------------------------------

The Company's international subsidiaries are denominated in currencies other
than the U.S. dollar. Since the functional currency of the Company's
international subsidiaries is the local currency, foreign currency translation
adjustments are accumulated as a component of accumulated other comprehensive
loss in stockholders' equity. Assuming a hypothetical aggregate change in the
foreign currencies versus the U.S. dollar exchange rates of 10% at June 1, 2002,
the Company's assets and liabilities would increase or decrease by $2,459,000
and $580,000, respectively, and the Company's net sales and net earnings would
increase or decrease by $2,368,000 and $65,000, respectively, on an annual
basis.

The Company also maintains intercompany balances and loans receivable with
subsidiaries with different local currencies. These amounts are at risk of
foreign exchange losses if exchange rates fluctuate. Assuming a hypothetical
aggregate change in the foreign currencies versus the U.S. dollar exchange rates
of 10% at June 1, 2002, results of operations would be favorably or unfavorably
impacted by approximately $732,000 on an annual basis.

Interest Rate Risk
------------------

The Company is exposed to interest rate change market risk with respect to its
investments in tax-free municipal bonds in the amount of $16,045,000. The bonds
bear interest at a floating rate established weekly. For 2002, the after-tax
interest rate on the bonds approximated 1.9%. Each 100 basis point (1%)
fluctuation in interest rates will increase or decrease interest income on the
bonds by approximately $160,000 on an annual basis.

As the Company's principal amount of fixed interest rate financing approximated
$1,204,000 at June 1, 2002, a change in interest rates would not materially
impact results of operations or financial position. At June 1, 2002, the Company
did not maintain any variable interest rate financing.

Item 8. Financial Statements and Supplementary Data
        -------------------------------------------

Financial statements and supplementary data required by Part II, Item 8 are
included in Part IV of this form as indexed at Item 14 (a) 1.

Item 9. Changes in and Disagreements with Accountants on Accounting and
        ---------------------------------------------------------------
        Financial Disclosure
        --------------------

None.


                                      -28-
<PAGE>

                                    Part III
                                    --------

Certain information required by Part III is omitted from this Annual Report on
Form 10-K because the Company will file a definitive proxy statement within 120
days after the end of its fiscal year pursuant to Regulation 14A (the "Proxy
Statement") for its Annual Meeting of Stockholders, currently scheduled for
October 15, 2002. The information included in the Proxy Statement under the
respective headings noted below is incorporated herein by reference.

Item 10. Directors and Executive Officers of the Registrant
         --------------------------------------------------

The following table sets forth certain information with respect to the Company's
officers and directors.

            Name             Age                    Positions
            ----             ---                    ---------

Anthony A. Lombardo (3)..     55     President, Chief Executive Officer,
                                       Director
Dennis J. Curtin.........     55     Senior Vice President - Chief Financial
                                     Officer
Joseph J. Palma..........     60     Senior Vice President - Global Sales
Jeffrey S. Peacock.......     45     Senior Vice President - Global Scientific
                                       and Technical Operations
Brad S. Schreck..........     45     Senior Vice President - Global Marketing
Arthur L. Zimmet.........     66     Senior Vice President - Special Projects
Sandra D. Baron..........     50     Vice President - Global Human Resources
Robert M. Bloomfield.....     61     Vice President - Market Research
Craig A. Burk............     49     Vice President - Manufacturing
Joseph A. Cacchioli......     46     Vice President - Controller
Agustin V. Gago..........     43     Vice President - Global Contrast Business
                                      Unit
Peter J. Graham..........     36     Vice President - General Counsel and
                                       Secretary
Eamonn P. Hobbs..........     49     Vice President - AngioDynamics
Archie B. Williams.......     51     Vice President - Clinical Affairs and
                                       Medical Community Liaison
Howard S. Stern (1)(3)...     71     Chairman of the Board, Director
Robert J. Beckman........     54     Director
Michael A. Davis, M.D....     61     Medical Director, Director
Paul S. Echenberg (1)(2).     58     Chairman of the Board of E-Z-EM Canada,
                                       Director
James L. Katz CPA, JD....     66     Director
  (1)(2)(4)(5)
Donald A. Meyer (2)(3)(4)     68     Director
David P. Meyers (3)(5)...     38     Director
George P. Ward...........     64     Director

----------

(1)   Member of Executive Committee

(2)   Member of Audit Committee

(3)   Member of Nominating Committee

(4)   Member of Compensation Committee

(5)   Member of Finance Committee

Directors are elected for a three year term and each holds office until his
successor is elected and qualified. Officers are elected annually and serve at
the pleasure of the Board of Directors.


                                      -29-
<PAGE>

Mr. Lombardo has served as President, Chief Executive Officer and Director of
the Company since 2000. Prior to joining the Company, he served as President of
ALI Imaging Systems, Inc. (radiology information management) from 1998 to 2000.
From 1996 to 1998, Mr. Lombardo served as Global Manager of the Integrated
Imaging Systems business of General Electric Medical Systems. Mr. Lombardo is
also a director of PointDx, Inc. The Company has an investment in PointDx, Inc.

Mr. Curtin has served as Senior Vice President - Chief Financial Officer since
1999, and previously served as Vice President - Chief Financial Officer from
1985 to 1999. Mr. Curtin has been an employee of the Company since 1983.

Mr. Palma has served as Senior Vice President - Global Sales since May 2002, and
previously served as Senior Vice President - Sales and Marketing from 1999 to
May 2002, Vice President - Sales and Marketing from 1996 to 1999, and Vice
President - Sales from 1995 to 1996. Mr. Palma has been an employee of the
Company since 1994.

Mr. Peacock has served as Senior Vice President - Global Scientific and
Technical Operations since July 2002, and previously served as Vice President -
Scientific and Technical Operations from 2000 until July 2002. Mr. Peacock has
been an employee of the Company since 1986.

Mr. Schreck has served as Senior Vice President - Global Marketing since May
2002. Prior to joining the Company, he served as a consultant for Vyteris, Inc.
(pharmaceutical/drug delivery) and ACMI, Inc. (urology, gynecology, laproscopy)
from 2000 until May 2002. From 1999 to 2000, he served as Vice President, World
Wide Marketing of Surgical Dynamics Inc., a wholly-owned subsidiary of Tyco Inc.
(spine/sports medicine). In 1999, he served as Vice President, Marketing and
Sales Services of Implex Inc. (orthopedics). From 1996 to 1999, he served as
Vice President, Worldwide Marketing and Product Development for Howmedica, a
division of Pfizer (orthopedics).

Mr. Zimmet has served as Senior Vice President - Special Projects since 1988,
and has been an employee of the Company since 1982.

Ms. Baron has served as Vice President - Global Human Resources since August
2002, and previously served as Vice President - Human Resources from 1995 until
August 2002. She has been an employee of the Company since 1985.

Mr. Bloomfield has served as Vice President - Market Research since 2000, and
has been an employee of the Company since 1985.

Mr. Burk has served as Vice President - Manufacturing since 1987.

Mr. Cacchioli has served as Vice President - Controller since 1988, and has been
an employee of the Company since 1984.

Mr. Gago has served as Vice President - Global Contrast Business Unit since May
2002, and previously served as Vice President - International from 1997 until
May 2002. He has been an employee of the Company since 1979.

Mr. Graham has served as Vice President - General Counsel and Secretary since
2001, and has been an employee of the Company since 1997.

Mr. Hobbs has served as Vice President - AngioDynamics since 1991, and has been
an employee of the Company since 1988.

Mr. Williams has served as Vice President - Clinical Affairs and Medical
Community Liaison since 2000, and previously served as Vice President - Imaging
Products Management from 1993 to 2000. Mr. Williams has been an employee of the
Company since 1980.


                                      -30-
<PAGE>

Mr. Stern is a co-founder of the Company and has served as Chairman of the Board
and Director of the Company since its formation in 1962. Mr. Stern has also
served as President and Chief Executive Officer of the Company from 1997 to
2000. From 1990 to 1994, Mr. Stern served as Chief Executive Officer, and from
the formation of the Company until 1990, he served as President and Chief
Executive Officer. Mr. Stern is also a director of ITI Medical Technologies,
Inc. The Company has an investment in ITI Medical Technologies, Inc.

Mr. Beckman has been a director of the Company since August 2002. He is a
founder and has been a Managing Partner of The Channel Group, a venture
management and corporate advisory business focusing on global life sciences,
since January 2002. Previously, he founded Intergen Co., a global leader focused
on providing technology and biologicals to the pharmaceutical/biotechnology and
clinical diagnostic industries, and served as its Chief Executive Officer from
1987 to December 2001. He is also the Chairman of the Board of Bio Sample Inc.

Dr. Davis has served as Medical Director and Director of the Company since 2000.
Previously, he served as Medical Director/Technical Director and Director of the
Company from 1997 to 2000, as Medical Director and Director of the Company from
1995 to 1996, and as Medical Director from 1994 to 1995. He has been Visiting
Professor of Radiology at Harvard Medical School and Visiting Scientist in
Radiology at Massachusetts General Hospital since May 2002. He has also served
as Senior Vice President and Chief Medical Officer of MedEView, Inc. (radiology
informatics) since May 2002. Previously, he was Professor of Radiology and
Nuclear Medicine and Director of the Division of Radiologic Research, University
of Massachusetts Medical Center from 1980 until May 2002. He also served as the
President and Chief Executive Officer of Amerimmune Pharmaceuticals, Inc. and
its wholly-owned subsidiary, Amerimmune, Inc., during 1999. He is also a
director of MacroChem Corp. and Amerimmune Pharmaceuticals, Inc.

Mr. Echenberg has been a director of the Company since 1987 and has served as
Chairman of the Board of E-Z-EM Canada since 1994. He has been the President,
Chief Executive Officer and Director of Schroders & Associates Canada Inc.
(investment buy-out advisory services) and Director of Schroders Ventures Ltd.
since 1997. He is also a founder and has been a general partner and director of
Eckvest Equity Inc. (personal investment and consulting services) since 1989. He
is also a director of Lallemand Inc., Benvest Capital Inc., Colliers MacAuley
Nicholl, Huntington Mills (Canada) Ltd., ITI Medical Technologies, Inc., Flexia
Corp., Fib-Pak Industries Inc., Med-Eng Systems Inc., MacroChem Corp., Matra
Plast Industries Inc. and A.P. Plasman Corp. The Company has an investment in
ITI Medical Technologies, Inc.

Mr. Katz has been a director of the Company since 1983. He is a founder of
Lakeshore Medical Fitness, LLC (owns and manages medical fitness facilities),
and has served as its Chief Executive Officer since 2000. He is also a founder
of Medical Imaging of Northbrook Court, LLC (screening and diagnostic imaging),
and has served as an administrative member since October 2001. Previously, he
had been a founder and managing director from its organization in 1995 until
2000 of Chapman Partners LLC (investment banking). From its acquisition in 1985
until its sale in 1994, he was the co-owner and President of Ever Ready
Thermometer Co., Inc. From 1971 until 1980 and from 1983 until 1985, he held
various executive positions with Baxter International and subsidiaries of Baxter
International, principally that of Chief Financial Officer of Baxter
International. He is also a director of Intec, Inc., Lakeshore Management Group,
LLC and Lifestart Wellness Network, LLC, as well as a member of the Board of
Advisors of Jerusalem Global and The Patterson Group.

Mr. Meyer has been a director of the Company since 1968. Since 1995, he has
acted as an independent consultant in legal matters to arts and business
organizations, specializing in technical assistance. He had been the Executive
Director of the Western States Arts Federation, Santa Fe, New Mexico, which


                                      -31-
<PAGE>

provides and develops regional arts programs, from 1990 to 1995. From 1958
through 1990, he was an attorney practicing in New Orleans, Louisiana. He is
also a director of Site Santa Fe, Santa Fe Stages, Santa Fe Youth Symphony and
Rancho de las Golondrinas.

Mr. Meyers has been a director of the Company since 1996. He is the founder of
Alpha Cord, Inc., which provides cryopreservation of umbilical cord blood, and
has served as its President since April 2002. He is also the founder of MedTest
Express, Inc., an Atlanta, Georgia based provider of contracted laboratory
services for home health agencies, and has served as its President, Chief
Executive Officer and Director since 1994.

Mr. Ward has been a director of the Company since August 2002. He has served as
Executive Vice President - Business Development of Health Center Internet
Services, Inc. in San Francisco, California from 1997 until 2001. He served as a
director and consultant for ALI Technologies, Inc. of Richmond, British
Columbia, Canada from 1996 until July 2002. After service as a USAF officer, he
began his career as a rocket engineer with Thiokol Chemical Corp. in 1962, then
joined the General Electric Space Division as a program manager and marketing
manager in 1966. After a GE corporate headquarters assignment in 1973, Mr. Ward
moved to the GE Medical Business, where he managed the X-ray and other medical
imaging businesses. In 1977, he became President/CEO/Director of Systron Donner
Corp., Concord, California (then NYSE). In 1982, he became
President/CEO/Director of Vitalink Communications Corp., Mountain View,
California, and in 1986, he founded MEICOR, Inc., Pleasanton, California, as
Chairman/CEO/Director. From 1987 until 1991, he was a World Wide Business Group
Managing Director for Philips Medical, and since 1991, a director/consultant for
several high technology companies. He also was a director of Blue Cross of
California, Woodland Hills, California from 1986 to 1996.

Item 11. Executive Compensation
         ----------------------

Summary Compensation Table

The following table sets forth information concerning the compensation for
services, in all capacities for 2002, 2001 and 2000, of (i) those persons who
were, during 2002, Chief Executive Officer ("CEO") (Anthony A. Lombardo), (ii)
those persons who were, at the end of 2002, each of the four most highly
compensated executive officers of the Company other than the CEO, and (iii) the
former President of E-Z-EM Canada, who was not an executive officer of the
Company, but who is included in this table due to the level of his annual
compensation during 2002 (collectively, the "Named Executive Officers"):


                                      -32-
<PAGE>

<TABLE>
<CAPTION>
                                   Annual Compensation                  Long-Term Compensation
                           ----------------------------------  --------------------------------------
                                                                            Awards            Payouts
                                                               -----------------------------  -------
                                                     Other                     Securities
                                                     Annual    Restricted      Underlying              All Other
    Name and                                        Compensa-    Stock          Options        LTIP    Compensa-
    Principal              Fiscal  Salary    Bonus   tion (1)    Awards     ----------------  Payouts   tion (4)
    Position                Year     ($)      ($)      ($)        ($)        # (2)     # (3)    ($)       ($)
    ---------              ------ --------  ------- ---------  ----------   -------  -------  -------  ---------
<S>                         <C>   <C>      <C>         <C>        <C>       <C>       <C>       <C>    <C>
Anthony A. Lombardo,....    2002  $320,000 $ 71,088    None       None        None     None     None   $ 33,402
President and Chief         2001   261,667   38,125    None       None        None     None     None     25,467
Executive Officer           2000    41,667    None     None       None      300,000    None     None     23,459
(effective April 2000)

Eamonn P. Hobbs,........    2002  $218,820 $114,880    None       None        None     None     None   $ 22,760
Vice President              2001   210,000   23,625    None       None        None    .2273     None     22,384
                            2000   209,166    None     None       None        None    .2273     None     21,973

Dennis J. Curtin,.......    2002  $179,430 $ 44,814    None       None        None     None     None   $ 25,352
Senior Vice President       2001   170,917   11,424    None       None        None     None     None     25,167
                            2000   167,333   42,308    None       None        None     None     None     24,147

Joseph J. Palma,........    2002  $169,488 $ 30,669    None       None        None     None     None   $ 30,683
Senior Vice President       2001   162,500    7,313    None       None        None     None     None     30,213
                            2000   159,792   54,457    None       None       10,000    None     None     30,221

Craig A. Burk,..........    2002  $163,538 $ 28,145    None       None        None     None     None   $ 20,961
Vice President              2001   153,750    6,559    None       None        None     None     None     20,876
                            2000   142,458   46,335    None       None       10,000    None     None     19,894

Pierre A. Ouimet,.......    2002  $166,969 $ 36,653    None       None        None     None     None   $ 24,285
Former President of         2001   175,550   39,624    None       None        None     None     None     24,512
E-Z-EM Canada               2000   223,844   45,344    None       None        None     None     None     22,295
</TABLE>

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

(1)   The Company has concluded that the aggregate amount of perquisites and
      other personal benefits paid to each of the Named Executive Officers for
      2002, 2001 and 2000 did not exceed the lesser of 10% of such officer's
      total annual salary and bonus for 2002, 2001 or 2000 or $50,000; such
      amounts are, therefore, not reflected in the table.

(2)   Options are exercisable into Class B common stock of the Company.

(3)   Options are exercisable into Class B common stock of AngioDynamics, Inc.,
      a wholly-owned subsidiary of the Company. A total of 162.79 shares of
      AngioDynamics Class B common stock may be issued under this plan. A total
      of 500 shares of Class A and 500 shares of Class B common stock of
      AngioDynamics was issued and outstanding at June 1, 2002.

(4)   For each of the Named Executive Officers other than Mr. Ouimet, the
      amounts reported include amounts contributed by the Company under its
      Profit-Sharing Plan and, as matching contributions, under the companion
      401(k) Plan. For 2002, 2001 and 2000, such amounts contributed were:
      $9,375, $1,333 and $0, respectively, for Mr. Lombardo; $9,115, $8,479 and
      $8,208, respectively, for Mr. Hobbs; $8,315, $8,015 and $7,107,
      respectively, for Mr. Curtin; $8,291, $7,706 and $7,830, respectively, for
      Mr. Palma; and $8,232, $8,053 and $7,194, respectively for Mr. Burk. For
      Mr. Ouimet, the amounts reported include amounts contributed by E-Z-EM
      Canada under a defined contribution plan. For 2002, 2001 and 2000, such
      amounts contributed were $8,348, $8,778 and $6,554, respectively.

      For each of the Named Executive Officers, the amounts reported include
      term life insurance premiums paid by the Company. For 2002, 2001 and 2000,
      such amounts paid were: $673, $780 and $105, respectively, for Mr.
      Lombardo; $395, $655 and $515, respectively, for Mr. Hobbs; $409, $524 and
      $412, respectively, for Mr. Curtin; $392, $507 and $391, respectively, for
      Mr. Palma; $379, $473 and $350, respectively, for Mr. Burk; and $450, $247
      and $254, respectively, for Mr. Ouimet.

      For each of the Named Executive Officers, the amounts reported include
      premiums paid by the Company under split dollar life insurance
      arrangements ("arrangements"). Such amounts paid for each of 2002, 2001
      and 2000 were:


                                      -33-
<PAGE>

      $23,354 for Mr. Lombardo; $13,250 for Mr. Hobbs; $16,628 for Mr. Curtin;
      $22,000 for Mr. Palma; $12,350 for Mr. Burk; and $15,487 for Mr. Ouimet.
      Under collateral assignment agreements, the Company will be entitled to
      the lesser of the cash surrender value of the policies or the advances it
      made, upon termination of these policies. The Company is currently
      reviewing these arrangements in light of the recent enactment of the
      Sarbanes-Oxley Act of 2002.

Option/SAR Grants Table

The Company did not grant any stock options or stock appreciation rights to any
of the Named Executive Officers during 2002.

Aggregated Option Exercises and Fiscal Year-End Option Value Table

The following table sets forth certain information concerning all exercises of
stock options during 2002 by the Named Executive Officers and the fiscal
year-end value of unexercised stock options on an aggregated basis:

                                                  Number of
                                                  Securities       Value of
                                                  Underlying     Unexercised
                                                 Unexercised     In-the-Money
                                                  Options at      Options at
                                                 June 1, 2002    June 1, 2002
                                                     (#)            ($) (1)
                                                -------------   -------------

                       Shares        Value      Exercisable/     Exercisable/
                     Acquired on    Realized    Unexercisable    Unexercisable
      Name           Exercise (#)      ($)           (2)             (2)
      ----           ------------   ---------   -------------   -------------

Anthony A. Lombardo.     None          None       150,000/        $ 75,000/
                                                  150,000           75,000

Eamonn P. Hobbs.....     None          None        39,595/        $181,109/
                                                    None             None

Dennis J. Curtin....    15,000      $ 68,714       35,556/        $176,060/
                                                    None             None

Joseph J. Palma.....    22,510      $110,341       15,464/        $ 36,048/
                                                    None             None

Craig A. Burk.......     8,114      $ 23,452       30,259/        $130,582/
                                                    None             None

Pierre A. Ouimet....     None          None        38,240         $164,604/
                                                    None             None

----------

(1)   Options are "in-the-money" if on June 1, 2002, the market price of the
      stock exceeded the exercise price of such options. At June 1, 2002, the
      closing price of the Company's Class B common stock was $9.00. The value
      of such options is calculated by determining the difference between the
      aggregate market price of the stock covered by the options on June 1, 2002
      and the aggregate exercise price of such options.

(2)   Options are exercisable into Class B common stock of the Company.


                                      -34-
<PAGE>

Compensation of Directors

On an annual basis, directors who are not employees of the Company are entitled
to the following compensation: a retainer of $15,000; a fee of $1,000 for each
board meeting attended; a fee of $250 for each telephonic board meeting
attended; 1,000 shares of the Company's Class B common stock; and stock options
for 1,000 shares of Class B common stock, which vest one year from date of
grant. Directors who serve on committees of the Company and who are not
employees of the Company are entitled to a fee of $500 for each committee
meeting attended, except that the chairman of a committee is entitled to a fee
of $1,000 for each committee meeting attended. The Chairman of the Board is
entitled to twice the above-referenced fees. The three members of the special
committee formed to evaluate the proposed recapitalization, Messrs. Katz, Meyer
and Echenberg, each received an additional fee of $15,000 in consideration for
their services.

Employment Contracts

See "Certain Relationships and Related Transactions" for a description of the
consulting agreement between the Company and Howard S. Stern, the Chairman of
the Company's board.

During 2000, the Company entered into an employment contract with Anthony A.
Lombardo in his capacity as President and Chief Executive Officer. This
employment contract provides for annual base salary currently at $300,000. In
addition, Mr. Lombardo receives $20,000 per year in relocation expenses. The
contract is cancellable at any time by either the Company or Mr. Lombardo, but
provides for severance pay of one year's base salary in the event of termination
by the Company without cause, as defined in the contract.

Severance Arrangements

The information required by this caption is incorporated by reference to the
Company's Proxy Statement under the heading "Severance Arrangements."

Compensation and Stock Option Committee Report on Executive Compensation

The information required by this caption is incorporated by reference to the
Company's Proxy Statement under the heading "Compensation and Stock Option
Committee Report on Executive Compensation."

Common Stock Performance

The information required by this caption is incorporated by reference to the
Company's Proxy Statement under the heading "Common Stock Performance."

Item 12. Security Ownership of Certain Beneficial Owners and Management
         --------------------------------------------------------------

The following table sets forth information, as of August 5, 2002, as to the
beneficial ownership of the Company's voting Class A common stock by each person
known by the Company to own beneficially more than 5% of the Company's voting
Class A common stock:

  Name and Address of                      Shares              Percent of
   Beneficial Owner                  Beneficially Owned          Class
   ----------------                  ------------------          -----

Howard S. Stern,..................        956,412 (1)             23.9
Chairman of the Board, Director
717 Main Street
Westbury, NY  11590


                                      -35-
<PAGE>

  Name and Address of                      Shares              Percent of
   Beneficial Owner                  Beneficially Owned          Class
   ----------------                  ------------------          -----

Betty K. Meyers,..................        200,000 (1)(6)           5.0
232 Lake Marina Drive, Unit 12B
New Orleans, LA  70124

David P. Meyers,..................        332,742 (1)(2)(6)        8.3
Director
813 Springdale Road
Atlanta, GA  30306

Jonas I. Meyers,..................        332,742 (1)(3)(6)        8.3
Director
904 Oakland Avenue
Ann Arbor, MI  48104

Stuart J. Meyers,.................        332,742 (1)(4)(6)        8.3
1841 Vermack Court
Dunwoody, GA  30338

Meyers Family Limited Partnership,        620,806 (1)(5)(6)       15.5
c/o David P. Meyers
1534 North Decatur Road, Suite 202
Atlanta, GA  30307

Dimensional Fund Advisors, Inc.,..        233,775 (7)              5.8
1299 Ocean Avenue
Santa Monica, CA  90401

Wellington Management Company,....        219,258 (7)              5.5
75 State Street
Boston, MA  02109

Ira Albert,.......................        200,400 (8)              5.0
1304 SW 160th Avenue, Suite 209
Ft. Lauderdale, FL  33326

----------

(1)   The shares of Class A common stock listed as beneficially owned are
      subject to an irrevocable proxy granted to the members of the special
      committee of the Company's board to vote all of such shares in favor of
      the proposed recapitalization merger at the Company's Annual Meeting of
      Stockholders, currently scheduled for October 15, 2002.

(2)   Includes 36,000 shares in which David P. Meyers has only a remainder
      interest. Betty K. Meyers holds a life estate in such shares. Also
      includes 139,991.75 shares beneficially owned by David P. Meyers as a
      result of his beneficial ownership of 22.55% of the Meyers Family Limited
      Partnership. Information was derived from a Schedule 13D dated June 25,
      2002.

(3)   Includes 36,000 shares in which Jonas I. Meyers has only a remainder
      interest. Betty K. Meyers holds a life estate in such shares. Also
      includes 139,991.75 shares beneficially owned by Jonas I. Meyers as a
      result of his beneficial ownership of 22.55% of the Meyers Family Limited
      Partnership. Information was derived from a Schedule 13D dated June 25,
      2002.

(4)   Includes 36,000 shares in which Stuart J. Meyers has only a remainder
      interest. Betty K. Meyers holds a life estate in such shares. Also


                                      -36-
<PAGE>

      includes 139,991.75 shares beneficially owned by Stuart J. Meyers as a
      result of his beneficial ownership of 22.55% of the Meyers Family Limited
      Partnership. Information was derived from a Schedule 13D dated June 25,
      2002.

(5)   The Meyers Family Limited Partnership is beneficially owned by David P.
      Meyers, Jonas I. Meyers, Stuart J. Meyers and certain other Meyers family
      members and related trusts.

(6)   Collectively, David P. Meyers, Jonas I. Meyers, Stuart J. Meyers, Betty K.
      Meyers and the Meyers Family Limited Partnership own an aggregate of
      1,291,056 shares of Class A common stock, representing approximately 32.3%
      of the currently outstanding shares.

(7)   Information was derived from a Schedule 13G dated December 31, 2001.

(8)   Information was derived from a Schedule 13D dated January 8, 2002.

The following table sets forth information, as of August 5, 2002, as to the
beneficial ownership of the Company's voting Class A and non-voting Class B
common stock, by (i) each of the Company's directors, (ii) each of the Company's
Named Executive Officers, and (iii) all directors and executive officers of the
Company as a group:

                                   Class A                    Class B
                           -----------------------    -----------------------
                              Shares       Percent       Shares       Percent
      Name of              Beneficially      of       Beneficially      of
  Beneficial Owner             Owned        Class       Owned (1)      Class
  ----------------         ------------    -------    ------------    -------

Howard S. Stern,...........    956,412(2)    23.9      1,149,243(2)     18.9
Chairman of the Board,
Director

David P. Meyers,...........    332,742(2)(3)  8.3        463,331(2)(4)   7.7
Director

Anthony A. Lombardo,.......       None         *         150,000         2.4
President, Chief Executive
Officer, Director

Paul S. Echenberg,.........        500         *          90,705         1.5
Chairman of the Board of
E-Z-EM Canada, Director (5)

Donald A. Meyer,...........     17,679         *          43,486          *
Director (5)

James L. Katz,.............        525         *          40,567          *
Director (5)

Dennis J. Curtin,..........      1,944         *          38,236          *
Senior Vice President

Eamonn P. Hobbs,...........         50         *          39,604          *
Vice President

Pierre A. Ouimet,..........        500         *          38,270          *
Former President of E-Z-EM
Canada


                                      -37-
<PAGE>

                                   Class A                    Class B
                           -----------------------    -----------------------
                              Shares       Percent       Shares       Percent
      Name of              Beneficially      of       Beneficially      of
  Beneficial Owner             Owned        Class       Owned (1)      Class
  ----------------         ------------    -------    ------------    -------

Craig A. Burk,.............       None         *          30,259          *
Vice President

Joseph J. Palma,...........       None         *          15,464          *
Senior Vice President

Michael A. Davis, M.D.,....       None         *          13,786          *
Medical Director, Director

Robert J. Beckman,.........       None         *            None          *
Director

George P. Ward,............       None         *            None          *
Director

All directors and executive
 officers as a group (22
 persons)..................  1,498,489 (3)   37.4      2,570,889 (4)    38.5

----------

*     Does not exceed 1%.

(1)   Includes Class B common stock shares issuable upon exercise of options
      currently exercisable or exercisable within 60 days from August 5, 2002 as
      follows: Howard S. Stern (78,786), David P. Meyers (4,000), Anthony A.
      Lombardo (150,000), Paul S. Echenberg (76,015), Donald A. Meyer (20,077),
      James L. Katz (34,756), Dennis J. Curtin (35,556), Eamonn P. Hobbs
      (39,595), Pierre A. Ouimet (38,240), Craig A. Burk (30,259), Joseph J.
      Palma (15,464), Michael A. Davis, M.D. (11,091) and all directors and
      executive officers as a group (688,467).

(2)   The shares of Class A and Class B common stock listed as beneficially
      owned are subject to an irrevocable proxy granted to the members of the
      special committee of the Company's board to vote all of such shares in
      favor of the proposed recapitalization merger at the Company's Annual
      Meeting of Stockholders, currently scheduled for October 15, 2002.

(3)   Includes 36,000 shares in which Mr. Meyers has only a remainder interest.
      Betty K. Meyers holds a life estate in such shares. Also includes
      139,991.75 shares beneficially owned by Mr. Meyers as a result of his
      beneficial ownership of 22.55% of the Meyers Family Limited Partnership.

(4)   Includes 239,874.27 shares beneficially owned by Mr. Meyers as a result of
      his beneficial ownership of 22.55% of the Meyers Family Limited
      Partnership.

(5)   Messrs. Katz, Meyer and Echenberg are the members of the special committee
      of the Company's board and, in this capacity, have been granted an
      irrevocable proxy by certain stockholders of the Company who collectively
      hold 2,567,242 shares of Class A common stock, or approximately 64.2% of
      the Company's voting power, to vote such shares in favor of the proposed
      recapitalization merger. Messrs. Katz, Meyer and Echenberg may be deemed
      to be the beneficial owners of the shares subject to the irrevocable
      proxy, but each of them disclaims such beneficial ownership.


                                      -38-
<PAGE>

Equity Compensation Plan Information

The following table sets forth information, as of June 1, 2002, with respect to
compensation plans under which equity securities of the Company are authorized
for issuance.

<TABLE>
<CAPTION>
                        (a)                     (b)                     (c)
                                                                        Number of securities
                                                                        remaining available
                                                                        for future issuance
                        Number of securities    Weighted-average        under equity
                        to be issued upon       exercise price          compensation plans
                        exercise of             of outstanding          (excluding securities
                        outstanding options,    options, warrants       reflected in
Plan category           warrants and rights     and rights              column (a))
-------------           --------------------    -----------------       ---------------------
<S>                         <C>                       <C>                      <C>
Equity compensation
plans approved
by security
holders                     1,421,994                 $5.93                    722,671 (1)

Equity compensation
plans not approved
by security holders              None                  None                       None

Total                       1,421,994                 $5.93                    722,671
</TABLE>

(1)   Consists of 615,812 shares reserved for issuance under the Company's 1983
      and 1984 stock option plans and 106,859 shares reserved for issuance under
      the Company's 1985 Employee Stock Purchase Plan.

Item 13. Certain Relationships and Related Transactions
         ----------------------------------------------

A facility of the Company located in Westbury, New York is owned approximately
33% by Howard S. Stern, approximately 31% by Betty K. Meyers, a principal
stockholder, and David P. Meyers, a principal stockholder and director of the
Company, approximately 2% by other employees of the Company and approximately
34% by unrelated parties, which includes a 31% owner who manages the property.
Aggregate rentals, including real estate tax payments, were $164,000 during
2002. The lease term expires in 2004.

Two facilities of the Company's wholly-owned subsidiary located in Tokyo, Japan
are owned by Tohru Nagami, the subsidiary's President, and his mother. Aggregate
rentals were $55,000 during 2002. The lease term expires in November 2002.

A facility of the Company located in Old Westbury, New York is owned by Howard
S. Stern. Aggregate rentals, including real estate tax payments, were $48,000
during 2002. The lease term expires in December 2002.

The Company has split dollar life insurance arrangements ("arrangements") with
Howard S. Stern (including his spouse) and Betty K. Meyers (the "insureds"). On
an annual basis, the Company makes advances of approximately $100,000 per
insured toward the cost of such life insurance policies. Through August 2000,
such advances were interest bearing and payable to the Company annually by the
insureds. In August 2000, the arrangements were modified, to conform to the
Company's other split dollar life insurance arrangements, making future advances
non-interest bearing. In May 2002, the Board of Directors approved a resolution
to forgive any unpaid interest. Under collateral assignment agreements, the
proceeds from the policies will first be used to repay all advances made by the
Company. At June 1, 2002, the cash surrender value of such policies aggregated
$1,026,000, and the aggregate amount of advances made by the Company totaled
$1,000,000. The Company is currently reviewing these arrangements in light of
the recent enactment of the Sarbanes-Oxley Act of 2002.


                                      -39-
<PAGE>

The Company has engaged Michael A. Davis, M.D., a director of the Company, for
consulting services. Fees for such services were approximately $126,000, during
2002.

The Company has engaged Donald A. Meyer, a director of the Company, for
consulting services. Fees for such services were approximately $30,000, during
2002.

The Company's employment contract with Howard S. Stern, the Chairman of the
Company's board, expired on November 30, 2001. Effective January 1, 2002, the
Company entered into an agreement with Mr. Stern, pursuant to which Mr. Stern
has agreed to provide certain services to the Company until December 31, 2004.
The Company has agreed to include Mr. Stern in its slate of directors for the
2002 annual meeting and to appoint Mr. Stern as Chairman of the Board for a
one-year term beginning at the annual meeting. So long as Mr. Stern remains
Chairman of the Company, he is entitled to receive twice the regular fees and
other compensation (including cash, stock and options) paid to directors for
service on the board. Under the terms of the agreement, Mr. Stern is entitled to
receive 36 equal monthly payments of $20,833.34, as well as certain bonus
opportunities. Mr. Stern also receives other benefits and perquisites and, so
long as he remains Chairman, an annual sum of up to $80,000 for reimbursement of
reasonable business expenses. Effective January 1, 2002, the Company extended
the exercise period of Mr. Stern's fully vested, expiring stock options. The
Company recorded a compensation charge of $173,000 during 2002 in connection
with this decision.


                                      -40-
<PAGE>

                                     Part IV

Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K
          ---------------------------------------------------------------

                                                                        Page
                                                                        ----

(a) l. Financial Statements
       --------------------

The following consolidated financial statements and supplementary data of
Registrant and its subsidiaries required by Part II, Item 8, are included in
Part IV of this report:

    Report of Independent Certified Public Accountants                    45

    Report of Independent Certified Public Accountants other than
        principal accountants                                             46

    Consolidated balance sheets - June 1, 2002 and June 2, 2001           47

    Consolidated statements of earnings - fifty-two weeks ended June 1,
        2002 and June 2, 2001 and fifty-three weeks ended June 3, 2000    49

    Consolidated statement of stockholders' equity and comprehensive
        income - fifty-two weeks ended June 1, 2002 and June 2, 2001
        and fifty-three weeks ended June 3, 2000                          50

    Consolidated statements of cash flows - fifty-two weeks ended June
        1, 2002 and June 2, 2001 and fifty-three weeks ended June
        3, 2000                                                           51

    Notes to consolidated financial statements                            53

(a) 2. Financial Statement Schedules
       -----------------------------

The following consolidated financial statement schedule is included in
        Part IV of this report:

    Schedule II - Valuation and qualifying accounts                       78

All other schedules are omitted because they are not applicable, or not
required, or because the required information is included in the consolidated
financial statements or notes thereto.

(a) 3. Exhibits
       --------

     3(i)  Certificate of Incorporation                                   (a)

    3(ii)  Amended Bylaws                                                 (b)

    10.1   1983 Stock Option Plan                                         (c)

    10.2   1984 Directors and Consultants Stock Option Plan               (d)

    10.3   Employment Agreement dated April 3, 2000 between E-Z-EM, Inc.
           and Anthony A. Lombardo                                        (e)

    10.4   Income Deferral Program                                        (f)

    10.5   Agreement dated January 1, 2002 between E-Z-EM, Inc. and
           Howard S. Stern                                                79


                                      -41-
<PAGE>

                                                                         Page
                                                                         ----

(a)  3.  Exhibits (continued)
         --------------------

    13     Annual report to security holders                              (g)

    21     Subsidiaries of the Registrant                                 85

    22     Proxy statement to security holders                            (h)

    23     Consent of Independent Certified Public Accountants            86

    99.1   Certification Pursuant to Title 18, United States Code,
           Section 1350 as Adopted Pursuant to Section 906 of the
           Sarbanes-Oxley Act of 2002 (Anthony A. Lombardo)               87

    99.2   Certification Pursuant to Title 18, United States Code,
           Section 1350 as Adopted Pursuant to Section 906 of the
           Sarbanes-Oxley Act of 2002 (Dennis J. Curtin)                  88

----------

            (a)   Incorporated by reference to Exhibit 3(i) of the Company's
                  Annual Report on Form 10-K for the fiscal year ended May 31,
                  1997

            (b)   Incorporated by reference to Exhibit 3(ii) of the Company's
                  Annual Report on Form 10-K for the fiscal year ended May 28,
                  1994 (file No. 1-11479)

            (c)   Incorporated by reference to Exhibit 10 of the Company's
                  Quarterly Report on Form 10-Q for the quarterly period ended
                  February 26, 2000

            (d)   Incorporated by reference to Exhibit 10(b) of the Company's
                  Quarterly Report on Form 10-Q for the quarterly period ended
                  December 2, 1995 (file No. 1-11479)

            (e)   Incorporated by reference to Exhibit 10(e) of the Company's
                  Annual Report on Form 10-K for the fiscal year ended June 3,
                  2000

            (f)   Incorporated by reference to Exhibit 10(c) of the Company's
                  Annual Report on Form 10-K for the fiscal year ended May 29,
                  1993 (file No. 1-11479)

            (g)   The Company intends to mail a copy of its Annual Report on
                  Form 10-K to its security holders. The Company's shareholders
                  letter will be filed on a subsequent date together with its
                  proxy statement to security holders.

            (h)   To be filed on a subsequent date

(b) 1. Reports on Form 8-K
       -------------------

No reports on Form 8-K were filed for the quarter ended June 1, 2002.

Schedules other than those shown above are not submitted as the subject matter
thereof is either not required or is not present in amounts sufficient to
require submission in accordance with the instructions in Regulation S-X or the
information required is included in the Notes to Consolidated Financial
Statements.


                                      -42-
<PAGE>

                                   SIGNATURES

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

                                           E-Z-EM, Inc.
                                          ------------------------------------
                                           (Registrant)

Date  August 29, 2002                      /s/ Howard S. Stern
    -------------------                   ------------------------------------
                                           Howard S. Stern, Chairman of the
                                           Board, Director

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

Date  August 29, 2002                      /s/ Howard S. Stern
    -------------------                   ------------------------------------
                                           Howard S. Stern, Chairman of the
                                           Board, Director

Date  August 29, 2002                      /s/ Anthony A. Lombardo
    -------------------                   ------------------------------------
                                           Anthony A. Lombardo, President,
                                           Chief Executive Officer, Director

Date  August 29, 2002                      /s/ Dennis J. Curtin
    -------------------                   ------------------------------------
                                           Dennis J. Curtin, Senior Vice
                                           President - Chief Financial Officer
                                           (Principal Financial and Chief
                                           Accounting Officer)

Date  August 29, 2002                      /s/ Robert J. Beckman
    -------------------                   ------------------------------------
                                           Robert J. Beckman, Director

Date  August 29, 2002                      /s/ Michael A. Davis
    -------------------                   ------------------------------------
                                           Michael A. Davis, Director

Date  August 23, 2002                      /s/ Paul S. Echenberg
    -------------------                   ------------------------------------
                                           Paul S. Echenberg, Director


                                      -43-
<PAGE>

Date  August 29, 2002                      /s/ James L. Katz
    -------------------                   ------------------------------------
                                           James L. Katz, Director

Date  August 24, 2002                      /s/ Donald A. Meyer
    -------------------                   ------------------------------------
                                           Donald A. Meyer, Director

Date  August 29, 2002                      /s/ David P. Meyers
    -------------------                   ------------------------------------
                                           David P. Meyers, Director

Date  August 23, 2002                      /s/ George P. Ward
    -------------------                   ------------------------------------
                                           George P. Ward, Director


                                      -44-
<PAGE>

                              REPORT OF INDEPENDENT
                          CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors
  E-Z-EM, Inc.

We have audited the accompanying consolidated balance sheets of E-Z-EM, Inc. and
Subsidiaries as of June 1, 2002 and June 2, 2001, and the related consolidated
statements of earnings, stockholders' equity and comprehensive income, and cash
flows for the fifty-two weeks ended June 1, 2002 and June 2, 2001 and the
fifty-three weeks ended June 3, 2000. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits. We did not audit the
financial statements of a certain subsidiary as of and for the fifty-two weeks
ended June 2, 2001, and for the fifty-three weeks ended June 3, 2000, which
statements reflect total assets constituting approximately 17% as of June 2,
2001 and net sales constituting approximately 12% in 2001 and 2000 of the
related consolidated totals. Those statements were audited by another auditor,
whose report thereon has been furnished to us, and our opinion, insofar as it
relates to the amounts included for this subsidiary for the aforementioned
periods, is based solely upon the report of the other auditor.

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 and the report of
the other auditor provide a reasonable basis for our opinion.

In our opinion, based on our audits and the report of the other auditor, the
financial statements referred to above present fairly, in all material respects,
the consolidated financial position of E-Z-EM, Inc. and Subsidiaries as of June
1, 2002 and June 2, 2001, and the consolidated results of their operations and
their consolidated cash flows for the fifty-two weeks ended June 1, 2002 and
June 2, 2001 and the fifty-three weeks ended June 3, 2000 in conformity with
accounting principles generally accepted in the United States of America.

We have also audited the financial statement schedule listed in the Index at
Item 14(a)(2). In our opinion, this schedule presents fairly, in all material
respects, the information required to be set forth therein.


/s/ GRANT THORNTON LLP
Certified Public Accountants

Melville, New York
July 29, 2002


                                      -45-
<PAGE>

                              REPORT OF INDEPENDENT
                          CERTIFIED PUBLIC ACCOUNTANTS

To the shareholder of E-Z-EM Canada Inc.

We have audited the consolidated balance sheet of E-Z-EM CANADA INC. as of May
31, 2001 and the consolidated statements of income, retained earnings and cash
flows for the years ended May 31, 2001 and 2000 included in the consolidated
financial statements of E-Z-EM, Inc. as of June 2, 2001 and June 3, 2000. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our 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 an 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.

In our opinion, these consolidated financial statements present fairly, in all
material respects, the financial position of the Company as of May 31, 2001 and
the results of its operations and its cash flows for the years ended May 31,
2001 and 2000 in accordance with accounting principles generally accepted in the
United States of America.


/s/ Jacques Davis Lefaivre
Chartered Accountants

Montreal, July 6, 2001


                                      -46-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                           CONSOLIDATED BALANCE SHEETS
                                (in thousands)

                                                         June 1,     June 2,
              ASSETS                                      2002        2001
                                                         ------      ------

CURRENT ASSETS
   Cash and cash equivalents                           $  8,019     $ 4,391
   Debt and equity securities                            16,045      13,748
   Accounts receivable, principally
     trade, net of allowance for
     doubtful accounts of $848 in
     2002 and $661 in 2001                               17,721      23,371
   Inventories                                           26,251      22,021
   Other current assets                                   4,218       5,901
                                                        -------      ------

       Total current assets                              72,254      69,432

PROPERTY, PLANT AND EQUIPMENT - AT COST,
   less accumulated depreciation and
   amortization                                          19,187      19,750

GOODWILL, less accumulated amortization
   of $258 in 2002 and $257 in 2001                         377         376

INTANGIBLE ASSETS, less accumulated
   amortization of $668 in 2002 and
   $546 in 2001                                           1,557       1,329

DEBT AND EQUITY SECURITIES                                1,984         846

INVESTMENTS AT COST                                         600

OTHER ASSETS                                              6,322       5,722
                                                        -------      ------

                                                       $102,281     $97,455
                                                        =======      ======

The accompanying notes are an integral part of these statements.


                                      -47-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                           CONSOLIDATED BALANCE SHEETS
                 (in thousands, except share and per share data)

                                                         June 1,     June 2,
    LIABILITIES AND STOCKHOLDERS' EQUITY                  2002        2001
                                                         ------      ------

CURRENT LIABILITIES
   Notes payable                                       $    698     $   854
   Current maturities of long-term debt                     179         156
   Accounts payable                                       6,841       4,798
   Accrued liabilities                                    7,292       7,329
   Accrued income taxes                                     498         111
                                                        -------      ------

       Total current liabilities                         15,508      13,248

LONG-TERM DEBT, less current maturities                     327         408

OTHER NONCURRENT LIABILITIES                              2,924       2,795
                                                        -------      ------

       Total liabilities                                 18,759      16,451
                                                        -------      ------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY
   Preferred stock, par value $.10 per share -
     authorized, 1,000,000 shares; issued, none
   Common stock
     Class A (voting), par value $.10 per
       share - authorized, 6,000,000 shares;
       issued and outstanding 4,002,188 shares
       in 2002 and 4,011,396 shares in 2001
       (excluding 52,859 and 41,860 shares held in
       treasury in 2002 and 2001, respectively)             400         401
     Class B (non-voting), par value $.10 per
       share - authorized, 10,000,000 shares;
       issued and outstanding 5,983,517 shares
       in 2002 and 5,843,426 shares in 2001
       (excluding 430,789 and 395,251 shares held
       in treasury in 2002 and 2001, respectively)          598         584
   Additional paid-in capital                            21,062      20,066
   Retained earnings                                     63,723      63,138
   Accumulated other comprehensive loss                  (2,261)     (3,185)
                                                        -------      ------

       Total stockholders' equity                        83,522      81,004
                                                        -------      ------

                                                       $102,281     $97,455
                                                        =======      ======

The accompanying notes are an integral part of these statements.


                                      -48-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                       CONSOLIDATED STATEMENTS OF EARNINGS
                      (in thousands, except per share data)

                                            Fifty-two weeks ended    Fifty-three
                                            ---------------------    weeks ended
                                             June 1,     June 2,       June 3,
                                              2002        2001          2000
                                             ------      ------        ------

Net sales                                   $122,133     $113,286     $113,868

Cost of goods sold                            70,848       67,594       66,063
                                             -------      -------      -------

      Gross profit                            51,285       45,692       47,805
                                             -------      -------      -------

Operating expenses
  Selling and administrative                  41,766       35,904       34,326
  Loss on sale of subsidiary
    and related assets                                        872
  Asset impairment and facility
    closing costs                              1,393
  Research and development                     6,220        5,391        4,880
                                             -------      -------      -------

    Total operating expenses                  49,379       42,167       39,206
                                             -------      -------      -------

      Operating profit                         1,906        3,525        8,599

Other income (expense)
  Interest income                                378          905          716
  Interest expense                              (273)        (290)        (253)
  Other, net                                     420         (503)         172
                                             -------      -------      -------

      Earnings before income taxes             2,431        3,637        9,234

Income tax provision                           1,846          351        3,269
                                             -------      -------      -------

      NET EARNINGS                          $    585     $  3,286     $  5,965
                                             =======      =======      =======

Earnings per common share
  Basic                                     $    .06     $    .33     $    .60
                                             =======      =======      =======

  Diluted                                   $    .06     $    .32     $    .58
                                             =======      =======      =======

The accompanying notes are an integral part of these statements.


                                      -49-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

     CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME

       Fifty-two weeks ended June 1, 2002 and June 2, 2001 and fifty-three
                            weeks ended June 3, 2000
                        (in thousands, except share data)

<TABLE>
<CAPTION>
                                     Class A            Class B                              Accumulated
                                   common stock       common stock    Additional                other                 Compre-
                                -----------------  -----------------   paid-in    Retained  comprehensive             hensive
                                  Shares   Amount    Shares   Amount   capital    earnings     (loss)       Total     income
                                ---------  ------  ---------  ------  ----------  --------  -------------  -------    ------
<S>                             <C>         <C>    <C>         <C>     <C>        <C>         <C>          <C>        <C>
Balance at May 29, 1999         4,035,346   $403   6,058,277   $606    $21,917    $53,887     $(1,522)     $75,291
Exercise of stock options          17,910      2     137,373     13        807                                 822
Income tax benefits on
  stock options exercised                                                  119                                 119
Compensation related to
  stock option plans                                                         5                                   5
Issuance of stock                                     15,275      2         74                                  76
Purchase of treasury stock        (38,145)    (4)   (301,648)   (30)    (2,401)                             (2,435)
Net earnings                                                                        5,965                    5,965    $5,965
Unrealized holding gain on
  debt and equity securities                                                                      871          871       871
Foreign currency translation
  adjustments                                                                                    (680)        (680)     (680)
                                ---------    ---   ---------    ---     ------     ------       -----       ------     -----

Comprehensive income                                                                                                  $6,156
                                                                                                                       =====

Balance at June 3, 2000         4,015,111    401   5,909,277    591     20,521     59,852      (1,331)      80,034
Exercise of stock options                              8,711      1         38                                  39
Income tax benefits on
  stock options exercised                                                    3                                   3
Compensation related to
  stock option plans                                                         5                                   5
Issuance of stock                                      6,941      1         45                                  46
Purchase of treasury stock         (3,715)           (81,503)    (9)      (546)                               (555)
Net earnings                                                                        3,286                    3,286    $3,286
Unrealized holding losses on
  debt and equity securities:
    Arising during the year                                                                    (2,215)      (2,215)   (2,215)
    Reclassification adjustment
      for losses included in
      net earnings                                                                                349          349       349
Foreign currency translation
  adjustments
    Arising during the year                                                                      (982)        (982)     (982)
    Reclassification adjustment
      for sale of investment
      in a foreign entity                                                                         994          994       994
                                ---------    ---   ---------    ---     ------     ------       -----        -----     -----

Comprehensive income                                                                                                  $1,432
                                                                                                                       =====

Balance at June 2, 2001         4,011,396    401   5,843,426    584     20,066     63,138      (3,185)      81,004
Exercise of stock options           1,791            168,392     17        842                                 859
Income tax benefits on
  stock options exercised                                                  272                                 272
Compensation related to
  stock option plans                                                       178                                 178
Issuance of stock                                      7,237      1         51                                  52
Purchase of treasury stock        (10,999)    (1)    (35,538)    (4)      (347)                               (352)
Net earnings                                                                          585                      585    $  585
Unrealized holding gain on
  debt and equity securities                                                                      620          620       620
Foreign currency translation
  adjustments                                                                                     304          304       304
                                ---------    ---   ---------    ---     ------     ------       -----        -----     -----

Comprehensive income                                                                                                  $1,509
                                                                                                                       =====

Balance at June 1, 2002         4,002,188   $400   5,983,517   $598    $21,062    $63,723     $(2,261)     $83,522
                                =========    ===   =========    ===     ======     ======       =====       ======
</TABLE>

The accompanying notes are an integral part of this statement.


                                      -50-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)

                                            Fifty-two weeks ended    Fifty-three
                                            ---------------------    weeks ended
                                             June 1,     June 2,       June 3,
                                              2002        2001          2000
                                             ------      ------        ------

Cash flows from operating activities:
  Net earnings                               $   585      $ 3,286      $ 5,965
  Adjustments to reconcile net earnings
    to net cash provided by operating
    activities
      Depreciation and amortization            2,788        2,797        2,803
      Impairment of long-lived assets          1,312          450
      Impairment of equity securities                         566
      Provision for doubtful accounts            221           88           37
      Loss on sale of subsidiary and
        related assets                                        872
      (Gain) loss on sale of assets              (12)           5
      Deferred tax benefit                       (58)      (1,269)         (40)
      Stock option compensation cost             178            5            5
      Other non-cash items                        46           41           70
      Changes in operating assets and
        liabilities, net of sale
          Accounts receivable                  5,429       (1,428)        (389)
          Inventories                         (4,230)       3,555          118
          Other current assets                 1,829       (1,422)        (334)
          Other assets                          (666)        (701)        (814)
          Accounts payable                     2,043       (1,227)        (936)
          Accrued liabilities                    (37)        (421)          62
          Accrued income taxes                   662         (374)        (241)
          Other noncurrent liabilities           100          155          162
                                              ------       ------       ------

            Net cash provided by
              operating activities            10,190        4,978        6,468
                                              ------       ------       ------

Cash flows from investing activities:
  Additions to property, plant and
    equipment                                 (3,393)      (2,743)      (3,206)
  Proceeds from sale of subsidiary and
    related assets                                          3,250
  Proceeds from sale of assets                    65            7           33
  Purchase of intangible assets                 (400)
  Investment at cost                            (600)
  Available-for-sale securities
    Purchases                                (85,660)     (97,415)     (36,845)
    Proceeds from sale                        82,863       91,718       34,010
                                              ------       ------       ------

      Net cash used in investing
        activities                            (7,125)      (5,183)      (6,008)
                                              ------       ------       ------

The accompanying notes are an integral part of these statements.


                                      -51-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
                                 (in thousands)

                                            Fifty-two weeks ended    Fifty-three
                                            ---------------------    weeks ended
                                             June 1,     June 2,       June 3,
                                              2002        2001          2000
                                             ------      ------        ------

Cash flows from financing activities:
  Repayments of debt                         $(8,264)     $(3,878)     $(1,100)
  Proceeds from issuance of debt               8,111        3,807           26
  Proceeds from exercise of stock
    options                                      859           39          822
  Purchase of treasury stock                    (352)        (555)      (2,435)
  Proceeds from issuance of stock in
    connection with the stock purchase
    plan                                           6            5            6
                                               -----        -----        -----

      Net cash provided by (used in)
        financing activities                     360         (582)      (2,681)
                                               -----        -----        -----

Effect of exchange rate changes on
  cash and cash equivalents                      203         (405)        (269)
                                               -----        -----        -----

      INCREASE (DECREASE) IN CASH
        AND CASH EQUIVALENTS                   3,628       (1,192)      (2,490)

Cash and cash equivalents
  Beginning of year                            4,391        5,583        8,073
                                               -----        -----        -----

  End of year                                 $8,019       $4,391       $5,583
                                               =====        =====        =====

Supplemental disclosures of cash flow information:
    Cash paid during the year for:
      Interest                                $   74       $  184       $   95
                                               =====        =====        =====

      Income taxes (net of $950, $7
        and $16 in refunds in 2002,
        2001 and 2000, respectively)          $  166       $2,618       $3,577
                                               =====        =====        =====

The accompanying notes are an integral part of these statements.


                                      -52-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      The summary of significant accounting policies is presented to assist the
      reader in understanding and evaluating the consolidated financial
      statements. These policies are in conformity with accounting principles
      generally accepted in the United States of America, and have been applied
      consistently in all material respects.

      Nature of Business
      ------------------

      The Company is primarily engaged in developing, manufacturing and
      marketing medical products used by radiologists, gastroenterologists and
      speech language pathologists for diagnostic imaging of diseases and
      disorders of the GI tract, which includes testing for swallowing disorders
      (dysphagia) and colorectal cancers. The Company also designs, develops,
      manufactures and markets, through its wholly-owned subsidiary,
      AngioDynamics, Inc. ("AngioDynamics"), medical products used by
      interventional radiologists and other physicians for the minimally
      invasive diagnosis and therapeutic treatment of peripheral vascular
      disease (see Note P).

      Basis of Consolidation
      ----------------------

      The consolidated financial statements include the accounts of E-Z-EM, Inc.
      and all 100%-owned subsidiaries (the "Company"). All significant
      intercompany balances and transactions have been eliminated.

      Operations outside the U.S. are included in the consolidated financial
      statements and consist of: a subsidiary operating a mining and chemical
      processing operation in Nova Scotia, Canada and a manufacturing and
      marketing facility in Montreal, Canada; a subsidiary manufacturing
      products located in Puerto Rico; a subsidiary manufacturing and marketing
      products located in Japan; a subsidiary promoting and distributing
      products located in Holland; a subsidiary promoting and distributing
      products located in the United Kingdom.

      Fiscal Year
      -----------

      The Company reports on a fiscal year which concludes on the Saturday
      nearest to May 31. Fiscal years 2002 and 2001 ended on June 1, 2002 and
      June 2, 2001, respectively, for reporting periods of fifty-two weeks and
      fiscal year 2000 ended on June 3, 2000 for a reporting period of
      fifty-three weeks.

      Cash and Cash Equivalents
      -------------------------

      The Company considers all unrestricted highly liquid investments purchased
      with a maturity of less than three months to be cash equivalents. Included
      in cash equivalents are Eurodollar investments and certificates of deposit
      of $770,000 and $3,281,000 at June 1, 2002 and June 2, 2001, respectively.
      The carrying amount of these financial instruments reasonably approximates
      fair value because of their short maturity. Foreign-denominated cash and
      cash equivalents aggregated $3,579,000 and $1,123,000 at June 1, 2002 and
      June 2, 2001, respectively.


                                      -53-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

      Debt and Equity Securities
      --------------------------

      Debt and equity securities are classified as "available-for-sale
      securities" and reported at fair value, with unrealized gains and losses
      excluded from operations and reported as a component of accumulated other
      comprehensive income (loss), net of the related tax effects, in
      stockholders' equity. Cost is determined using the specific identification
      method.

      Inventories
      -----------

      Inventories are stated at the lower of cost (on the first-in, first-out
      method) or market. Appropriate consideration is given to deterioration,
      obsolescence and other factors in evaluating net realizable value.

      Property, Plant and Equipment
      -----------------------------

      Property, plant and equipment are stated at cost, less accumulated
      depreciation. Depreciation is computed principally using the straight-line
      method over the estimated useful lives of the assets. Leasehold
      improvements are amortized over the terms of the related leases or the
      useful life of the improvements, whichever is shorter. Expenditures for
      repairs and maintenance are charged to expense as incurred. Renewals and
      betterments are capitalized. Depreciation expense was $2,666,000,
      $2,653,000 and $2,610,000 in 2002, 2001 and 2000, respectively.

      Accounting for Business Combinations, Goodwill and Intangible Assets
      --------------------------------------------------------------------

      As of June 3, 2001, the Company adopted Statement of Financial Accounting
      Standards ("SFAS") No. 141, "Business Combinations" and SFAS No. 142,
      "Goodwill and Other Intangible Assets". These standards require that all
      business combinations initiated after June 30, 2001 be accounted for under
      the purchase method. In addition, all intangible assets acquired that are
      obtained through contractual or legal right, or are capable of being
      separately sold, transferred, licensed, rented or exchanged shall be
      recognized as an asset apart from goodwill. Goodwill and intangibles with
      indefinite lives are no longer subject to amortization, but are subject to
      at least an annual assessment for impairment by applying a fair value
      based test. The Company has performed a transitional fair value based
      impairment test on its goodwill and determined that no impairment existed
      as of June 3, 2001. Net earnings for 2001 and 2000 would have changed by
      approximately $11,000, net of tax, respectively, if the recorded goodwill
      amortization was added back. Basic and diluted earnings per share in such
      periods would have been unchanged. Annual amortization of intangibles will
      approximate $122,000 for each of the next five years.

      Prior to June 3, 2001, goodwill was amortized on a straight-line basis
      over 40 years. Amortization of goodwill was $16,000 in 2001 and 2000,
      respectively. On an ongoing basis, goodwill will be tested for impairment
      periodically in accordance with SFAS No. 142.


                                      -54-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

      Intangible assets are being amortized on a straight-line basis over the
      estimated useful lives of the respective assets of approximately fifteen
      years. Amortization of intangible assets was $122,000, $128,000 and
      $177,000 in 2002, 2001 and 2000, respectively.

      On an ongoing basis, management reviews the valuation and amortization of
      intangible assets to determine possible impairment by considering current
      operating results and comparing the carrying values to the anticipated
      undiscounted future cash flows of the related assets (see Note E).

      Revenue Recognition
      -------------------

      The Company recognizes revenues as products are shipped, which is when
      title passes to customers.

      Advertising
      -----------

      All costs associated with advertising are expensed when incurred.
      Advertising expense, included in selling and administrative expenses, was
      $1,505,000, $989,000 and $1,103,000 in 2002, 2001 and 2000, respectively.

      Income Taxes
      ------------

      Deferred income taxes are recognized for temporary differences between
      financial statement and income tax bases of assets and liabilities and
      loss carryforwards and tax credit carryforwards for which income tax
      benefits are expected to be realized in future years. A valuation
      allowance has been established to reduce deferred tax assets as it is more
      likely than not that all, or some portion, of such deferred tax assets
      will not be realized. The effect on deferred taxes of a change in tax
      rates is recognized in income in the period that includes the enactment
      date.

      Foreign Currency Translation
      ----------------------------

      In accordance with SFAS No. 52, "Foreign Currency Translation," the
      Company has determined that the functional currency for its foreign
      subsidiaries is the local currency. This assessment considers that the
      day-to-day operations are not dependent upon the economic environment of
      the parent's functional currency, financing is effected through their own
      operations, and the foreign operations primarily generate and expend
      foreign currency. Foreign currency translation adjustments are accumulated
      as a component of accumulated other comprehensive loss in stockholders'
      equity.

      Earnings Per Common Share
      -------------------------

      Basic earnings per share are based on the weighted average number of
      common shares outstanding without consideration of potential common stock.
      Diluted earnings per share are based on the weighted average number of
      common and potential common shares outstanding. The calculation takes into
      account the


                                      -55-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

      shares that may be issued upon exercise of stock options, reduced by the
      shares that may be repurchased with the funds received from the exercise,
      based on the average price during the period.

      The following table sets forth the reconciliation of the weighted average
      number of common shares:

                                              2002        2001        2000
                                             ------      ------      ------

      Basic                                 9,848,473   9,881,299  10,012,973
      Effect of dilutive securities
        (stock options)                       311,347     264,105     301,198
                                           ----------  ----------  ----------

      Diluted                              10,159,820  10,145,404  10,314,171
                                           ==========  ==========  ==========

      Excluded from the calculation of earnings per common share, are options to
      purchase 70,583, 446,663 and 441,880 shares of common stock at June 1,
      2002, June 2, 2001 and June 3, 2000, respectively, as their inclusion
      would be anti-dilutive. The ranges of exercise prices on the excluded
      options were $9.00 to $12.49 per share at June 1, 2002, $7.07 to $12.49
      per share at June 2, 2001 and $6.50 to $12.49 per share at June 3, 2000.

      Use of Estimates and Fair Value of Financial Instruments
      --------------------------------------------------------

      The preparation of financial statements in conformity with accounting
      principles generally accepted in the United States of America requires
      management to make estimates and assumptions that affect the reported
      amounts of assets and liabilities and disclosures of contingent assets and
      liabilities at year-end and the reported amounts of revenues and expenses
      during the reporting period. Actual results could differ from those
      estimates.

      The Company has estimated the fair value of financial instruments using
      available market information and other valuation methodologies in
      accordance with SFAS No. 107, "Disclosures About Fair Value of Financial
      Instruments". Management of the Company believes that the fair value of
      financial instruments, consisting of cash and cash equivalents, accounts
      receivable, accounts payable, notes payable and debt, approximates
      carrying value due to the immediate or short-term maturity associated with
      its cash and cash equivalents, accounts receivable and accounts payable,
      and the interest rates associated with its notes payable and debt.

      Effects of Recently Issued Accounting Pronouncements
      ----------------------------------------------------

      In August 2001, the Financial Accounting Standards Board ("FASB") issued
      SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived
      Assets". This statement is effective for fiscal years beginning after
      December 15, 2001. This statement supercedes SFAS No. 121, while retaining
      many of the requirements of such statement. The Company is currently
      evaluating the impact this statement may have.


                                      -56-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

      In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs
      Associated with Exit or Disposal Activities." SFAS No. 146 addresses
      accounting and reporting for costs associated with exit or disposal
      activities and nullifies Emerging Issues Task Force ("EITF") Issue No.
      94-3, "Liability Recognition for Certain Employee Termination Benefits and
      Other Costs to Exit an Activity (Including Certain Costs Incurred in a
      Restructuring)." SFAS No. 146 requires that a liability for a cost
      associated with an exit or disposal activity be recognized and measured
      initially at fair value when the liability is incurred. SFAS No. 146 is
      effective for exit or disposal activities that are initiated after
      December 31, 2002, with early application encouraged. The adoption of this
      statement is not expected to have a material impact on the Company's
      results of operations or financial position.

      Reclassifications
      -----------------

      Pursuant to the FASB EITF Issue No. 00-10, "Accounting for Shipping and
      Handling Fees and Costs", which was adopted in fiscal 2001, the Company
      has reclassified freight billed to customers from selling and
      administrative expenses to net sales, and has reclassified related freight
      costs from selling and administrative expenses to cost of goods sold.
      Fiscal 2000 amounts have been restated to conform to this presentation.
      This change had no effect on the dollar amount of the Company's operating
      profit or net earnings.

NOTE B - COMPREHENSIVE INCOME

      The components of comprehensive income, net of related tax, are as
      follows:

                                                2002         2001         2000
                                               ------       ------       ------
                                                      (in thousands)

      Net earnings                             $  585       $3,286       $5,965
      Unrealized holding gain (loss) on
        debt and equity securities:
          Arising during the year, net of
            income tax provision (benefit)
            of $16, $(560) and $183 in
            2002, 2001 and 2000,                  620       (2,215)         871
            respectively
          Reclassification adjustment for
            losses included in net
            earnings, net of income tax
            benefit of $217 in 2001                            349
      Foreign currency translation
        adjustments:
          Arising during the year                 304         (982)        (680)
          Reclassification adjustment for
            sale of investment in a
            foreign entity                                     994
                                                -----        -----        -----

              Comprehensive income             $1,509       $1,432       $6,156
                                                =====        =====        =====


                                      -57-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE B - COMPREHENSIVE INCOME (continued)

      The components of accumulated other comprehensive loss, net of related
      tax, are as follows:

                                                         June 1,     June 2,
                                                          2002        2001
                                                         ------      ------
                                                           (in thousands)

     Unrealized holding gain on debt and equity
       securities, net of income tax liability of
       $59 and $43 at June 1, 2002 and June 2,
       2001, respectively                                $   818    $   198
     Cumulative translation adjustments                   (3,079)    (3,383)
                                                           -----      -----

         Accumulated other comprehensive loss            $(2,261)   $(3,185)
                                                           =====      =====

NOTE C - INVESTMENT AT COST

      In August 2001, the Company acquired 240,000 shares of the Series B
      Convertible Preferred Stock, or approximately 5%, of PointDx, Inc.
      ("PointDx") for $600,000. PointDx, a Delaware corporation based in
      Winston-Salem, North Carolina, is an emerging medical technology company
      focused on the development of virtual colonoscopy software and structured
      reporting solutions for radiology. Virtual colonoscopy is an innovative
      technology which visualizes the colon using advanced CT imaging and 3-D
      computer reconstruction of that image data. The Company also acquired a
      three-year warrant to purchase an additional 120,000 shares of the Series
      B Convertible Preferred Stock at $2.50 per share, and the right to
      designate one nominee for the PointDx board of directors. The Company's
      investment in PointDx is accounted for by the cost method.

NOTE D - SALE OF SUBSIDIARY AND RELATED ASSETS

      On July 27, 2000, AngioDynamics sold all the capital stock of
      AngioDynamics Ltd., a wholly-owned subsidiary, and certain other assets to
      AngioDynamics Ltd.'s management. AngioDynamics Ltd., located in Ireland,
      manufactured cardiovascular and interventional radiology products. The
      aggregate consideration paid was $3,250,000 in cash. The sale was the
      culmination of the Company's strategic decision to exit the cardiovascular
      market and to focus entirely on the interventional radiology marketplace.
      As a result of this sale, the Company recognized a pre-tax loss of
      approximately $872,000 during the first quarter of 2001. The
      aforementioned pre-tax loss includes the effect of previously unrealized
      losses on foreign currency translation of approximately $994,000 and the
      write-off of approximately $673,000 in inventory and intangibles related
      to the cardiovascular product line, both of which were non-cash charges.
      Further, AngioDynamics entered into a manufacturing agreement, a
      distribution agreement and a royalty agreement with the buyer. Under the
      two-year manufacturing agreement, the buyer manufactured certain
      interventional radiology products sold by AngioDynamics.


                                      -58-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE E - ASSET IMPAIRMENT CHARGES

      During the second quarter of 2002, the Company adopted a plan, which was
      approved by the Board of Directors, to close a facility owned by its
      wholly-owned Japanese subsidiary in December 2001. The facility was
      principally used to manufacture liquid barium sulfate formulations for
      sale in the Japanese market. The facility lacked the necessary
      manufacturing throughput to justify its continued existence. In connection
      with this plan, the Company recorded a $1,393,000 charge to operations
      during 2002, within the E-Z-EM operating segment, consisting of i) a
      $1,262,000 write-down of property, plant and equipment to management's
      estimate of their fair market value, based upon the anticipated proceeds
      to be received upon sale, ii) severance costs of $100,000, and iii) a
      provision for inventory reserves of $31,000.

      In accordance with SFAS No. 121, "Accounting for the Impairment of
      Long-Lived Assets and for Long-Lived Assets to be Disposed Of," the
      Company's E-Z-EM operating segment recorded impairment charges of $50,000
      and $450,000 during the first quarter of 2002 and 2001, respectively,
      relating to certain acquired patent rights to an oral magnetic resonance
      imaging contrast agent. The Company determined that the revenue potential
      of this technology was impaired, since it believed that the market for
      this technology was significantly less than previously projected. The
      impairment charges represented the difference between the carrying value
      of the intangible asset and the fair market value of this asset based on
      estimated future discounted cash flows. The charges had no impact on the
      Company's cash flow or its ability to generate cash flow in the future.
      For 2002 and 2001, the impairment charges are included in the consolidated
      statements of earnings under the caption "Selling and administrative".


                                      -59-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE F - DEBT AND EQUITY SECURITIES

      Debt and equity securities at June 1, 2002 and June 2, 2001 consist of the
      following:

                                                                   Unrealized
                                            Amortized     Fair      holding
                                              cost        value       gain
                                            ---------     -----    ----------
                                                     (in thousands)

  At June 1, 2002
  ---------------
    Current
    -------
    Available-for-sale securities
      (carried on the balance sheet
      at fair value)
        Debt securities with maturities
          Due in 1 through 10 years          $ 2,845      $ 2,845
          Due after 10 years and through
            20 years                           5,700        5,700
          Due after 20 years                   7,500        7,500
                                              ------       ------

                                             $16,045      $16,045
                                              ======       ======
    Noncurrent
    ----------
    Available-for-sale securities
      (carried on the balance sheet
      at fair value)
        Equity securities                    $ 1,106      $ 1,983       $  877
        Other                                      1            1
                                              ------       ------        -----

                                             $ 1,107      $ 1,984       $  877
                                              ======       ======        =====

  At June 2, 2001
  ---------------
    Current
    -------
    Available-for-sale securities
      (carried on the balance sheet
      at fair value)
        Debt securities with maturities
          Due in 1 through 10 years          $ 2,645      $ 2,645
          Due after 10 years and through
            20 years                           1,055        1,055
          Due after 20 years                  10,000       10,000
        Other                                     48           48
                                              ------       ------

                                             $13,748      $13,748
                                              ======       ======
    Noncurrent
    ----------
    Available-for-sale securities
      (carried on the balance sheet
      at fair value)
        Equity securities                    $   604      $   845       $  241
        Other                                      1            1
                                              ------       ------        -----

                                             $   605      $   846       $  241
                                              ======       ======        =====


                                      -60-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE F - DEBT AND EQUITY SECURITIES (continued)

      The Company recorded an impairment charge in the fourth quarter of 2001,
      with no associated tax benefit, of $566,000, relating to its investment in
      Cedara Software Corporation ("Cedara"), as it was determined that the
      decline in market value of Cedara, which is classified as a noncurrent
      "available for sale" equity security, was deemed to be other than
      temporary. For 2001, the impairment charge is included in the consolidated
      statement of earnings under the caption "Other, net".

NOTE G - INVENTORIES

      Inventories consist of the following:

                                                         June 1,     June 2,
                                                          2002        2001
                                                         ------      ------
                                                           (in thousands)

      Finished goods                                    $13,939     $11,093
      Work in process                                     2,237       1,826
      Raw materials                                      10,075       9,102
                                                         ------      ------

                                                        $26,251     $22,021
                                                         ======      ======

NOTE H - PROPERTY, PLANT AND EQUIPMENT, AT COST

      Property, plant and equipment are summarized as follows:

                                             Estimated
                                              useful       June 1,     June 2,
                                               lives        2002        2001
                                             ---------     ------      ------
                                                             (in thousands)

      Building and building
        improvements                      10 to 39 years  $12,601     $12,064
      Machinery and equipment              2 to 10 years   33,051      32,578
      Leasehold improvements               Term of lease    1,616       1,736
                                                           ------      ------

                                                           47,268      46,378
      Less accumulated depreciation
        and amortization                                   30,500      30,050
                                                           ------      ------

                                                           16,768      16,328
      Land                                                  2,419       3,422
                                                           ------      ------

                                                          $19,187     $19,750
                                                           ======      ======


                                      -61-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE I - INCOME TAXES

      Income tax expense analyzed by category and by income statement
      classification is summarized as follows:

                                                2002        2001        2000
                                               ------      ------      ------
                                                       (in thousands)

      Current
        Federal                               $  824       $  952       $2,304
        State and local                           42          123          199
        Foreign                                1,038          545          806
                                               -----        -----        -----

          Subtotal                             1,904        1,620        3,309

      Deferred                                   (58)      (1,269)         (40)
                                               -----        -----        -----

          Total                               $1,846       $  351       $3,269
                                               =====        =====        =====

      Temporary differences which give rise to deferred tax assets and
      liabilities are summarized as follows:

                                                            June 1,      June 2,
                                                             2002         2001
                                                            ------       ------
                                                              (in thousands)

      Deferred tax assets
        Capital loss carryforward                           $1,219       $1,313
        Tax operating loss carryforwards                     1,964        1,297
        Tax credit carryforwards                               136          131
        Alternative minimum tax ("AMT") credit
          carryforward                                           4            4
        Impairment of long-lived assets                      2,935        2,603
        Expenses incurred not currently deductible           1,051        1,133
        Deferred compensation costs                            767          693
        Inventories                                            724          646
        Write-down of investment in affiliate                  496          496
        Other                                                  112          103
                                                             -----        -----

            Gross deferred tax asset                         9,408        8,419
                                                             -----        -----

      Deferred tax liabilities
        Excess tax over book depreciation                    1,146        1,108
        Tax on unremitted profits of Puerto
          Rican subsidiary                                      63           72
        Other                                                   26           23
                                                             -----        -----

            Gross deferred tax liability                     1,235        1,203

      Valuation allowance                                   (5,756)      (4,842)
                                                             -----        -----

            Net deferred tax asset                          $2,417       $2,374
                                                             =====        =====


                                      -62-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE I - INCOME TAXES (continued)

      In 1994, the Company sold to its Canadian subsidiary warrants to purchase
      396,396 shares of stock in Cedara. This transaction generated a capital
      gain for tax purposes of approximately $3,344,000, utilizing a portion of
      the Company's capital loss carryforward and giving rise to a temporary
      difference pertaining to the difference between the financial statement
      and tax basis in this asset. In 2001, as a result of recording an
      impairment on the aforementioned asset (see Note F), the temporary
      difference was eliminated and a deferred tax asset, relating to the future
      tax benefit from the impairment loss, with a full valuation allowance was
      recorded.

      During the first quarter of 2001, the Company reduced its valuation
      allowance primarily to recognize deferred tax assets of approximately
      $1,344,000. Continued and projected future profitability of the Company's
      U.S. operations, including those of AngioDynamics, made it more likely
      than not that certain deferred tax assets would be realized through future
      taxable earnings.

      If not utilized, the tax operating and capital loss carryforwards will
      expire in various amounts over the years 2003 through 2007. The tax credit
      carryforwards will expire in various amounts over the years 2003 through
      2017.

      Deferred income taxes are provided for the expected Tollgate tax on the
      undistributed earnings of the Company's Puerto Rican subsidiary, which are
      expected to be distributed at some time in the future.

      At June 1, 2002, undistributed earnings of certain foreign subsidiaries
      aggregated $16,673,000 which will not be subject to U.S. tax until
      distributed as dividends. Any taxes paid to foreign governments on these
      earnings may be used, in whole or in part, as credits against the U.S. tax
      on any dividends distributed from such earnings. On remittance, certain
      foreign countries impose withholding taxes that are then available for use
      as credits against a U.S. tax liability, if any, subject to certain
      limitations. The amount of withholding tax that would be payable on
      remittance of the entire amount of undistributed earnings would
      approximate $834,000.

      Deferred tax assets and liabilities are included in the consolidated
      balance sheets as follows:

                                                           June 1,     June 2,
                                                            2002        2001
                                                           ------      ------
                                                             (in thousands)

      Current - Other current assets                        $1,592     $1,446
      Current - Accrued income taxes                           (63)       (72)
      Noncurrent - Other assets                              1,492      1,559
      Noncurrent - Other noncurrent liabilities               (604)      (559)
                                                             -----      -----

        Net deferred tax asset                              $2,417     $2,374
                                                             =====      =====


                                      -63-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE I - INCOME TAXES (continued)

      Earnings before income taxes for U.S. and international operations consist
      of the following:

                                                2002        2001        2000
                                               ------      ------      ------
                                                       (in thousands)

      U.S.                                    $2,096       $2,395      $7,789
      International                              335        1,242       1,445
                                               -----        -----       -----

                                              $2,431       $3,637      $9,234
                                               =====        =====       =====

      The Company's consolidated income tax provision has differed from the
      amount which would be provided by applying the U.S. Federal statutory
      income tax rate to the Company's earnings before income taxes for the
      following reasons:

                                                 2002         2001       2000
                                                ------       ------     ------
                                                        (in thousands)

      Income tax provision                      $1,846       $  351     $3,269
      Effect of:
        State income taxes, net of Federal
          tax benefit                              (44)         (94)      (128)
        Research and development credit             43           52         22
        Earnings (losses) of the Puerto
          Rico subsidiary, net of Puerto
          Rico Corporate tax and Tollgate
          tax                                      (30)          85        223
        Extraterritorial income exclusion           26
        Earnings of the Foreign Sales
          Corporation                                            11         22
        Tax-exempt portion of investment
          income                                    98          182        111
        Change in valuation allowance              101        1,089         94
        Losses of foreign entities
          generating no current tax
          benefit                               (1,041)        (353)      (445)
        Nondeductible expenses                    (338)        (254)      (187)
        Other                                      166          168        159
                                                 -----        -----      -----

      Income tax provision at statutory
        tax rate of 34%                         $  827       $1,237     $3,140
                                                 =====        =====      =====

      The Company has an agreement with the Commonwealth of Puerto Rico pursuant
      to which its operations in Puerto Rico are subject to a partial tax
      exemption which expires January 23, 2007. Commonwealth taxes are currently
      being provided on earnings of the subsidiary.

      The U.S. Federal income tax returns of the Company through May 31, 1998
      have been closed by the Internal Revenue Service.


                                      -64-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE J - DEBT

      Notes payable consist of the following:

                                                             June 1,     June 2,
                                                              2002        2001
                                                             ------      ------
                                                               (in thousands)

     Japanese bank
        3.425% note (1)                                       $698
        2.875% note (1)                                                    $854
                                                               ---          ---

                                                              $698         $854
                                                               ===          ===

      Long-term debt consists of the following:

                                                           June 1,     June 2,
                                                            2002        2001
                                                           ------      ------
                                                             (in thousands)

      Japanese bank loan, due October 2007,
        3.425% (1)                                          $188         $233
      Japanese bank loan, due November 2004,
        1.80% (1)                                            114          167
      Japanese bank loan, due December 2003,
        2.375% (1)                                            87          153
      Other                                                  117           11
                                                             ---          ---

                                                             506          564
      Less current maturities                                179          156
                                                             ---          ---

                                                            $327         $408
                                                             ===          ===

      (1)   Guaranteed by the Company and collateralized by property, plant and
            equipment having a net carrying value of $756,000 at June 1, 2002.

      The Company's Canadian subsidiary has available $1,309,000 (Canadian
      $2,000,000) under a line of credit with a bank, which is collateralized by
      accounts receivable and inventory and expires on October 31, 2002.

      During 2002, 2001 and 2000, the weighted average interest rates on
      short-term debt were 3.30%, 3.14% and 2.71%, respectively.


                                      -65-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE K - ACCRUED LIABILITIES AND OTHER NONCURRENT LIABILITIES

      Accrued liabilities consist of the following:

                                                          June 1,      June 2,
                                                           2002         2001
                                                          ------       ------
                                                            (in thousands)

      Payroll and related expenses                        $5,877       $3,922
      Accrued sales rebates (1)                                         1,472
      Other                                                1,415        1,935
                                                           -----        -----

                                                          $7,292       $7,329
                                                           =====        =====

      (1)   Effective June 3, 2001, the Company began issuing credits against
            accounts receivable to satisfy rebates due to customers. Prior to
            June 3, 2001, rebates due customers were recorded as an accrued
            liability and paid.

      Other noncurrent liabilities consist of the following:

                                                          June 1,      June 2,
                                                           2002         2001
                                                          ------       ------
                                                            (in thousands)

      Deferred compensation                               $2,073       $1,873
      Deferred taxes                                         604          559
      Other                                                  247          363
                                                           -----        -----

                                                          $2,924       $2,795
                                                           =====        =====

NOTE L - RETIREMENT PLANS

      E-Z-EM, Inc. and its domestic subsidiaries ("E-Z-EM") provide pension
      benefits through three Profit-Sharing Plans, under which E-Z-EM makes
      discretionary contributions to eligible employees, and three companion
      401(k) Plans, under which eligible employees can defer a portion of their
      annual compensation, part of which is matched by E-Z-EM. These plans cover
      all E-Z-EM employees not otherwise covered by collective bargaining
      agreements. In 2002, 2001 and 2000, profit-sharing contributions were
      $651,000, $624,000 and $589,000, respectively, and 401(k) matching
      contributions were $395,000, $377,000 and $355,000, respectively.

      E-Z-EM also contributed $41,000, $36,000 and $34,000 in 2002, 2001 and
      2000, respectively, to a multiemployer pension plan for employees covered
      by a collective bargaining agreement. This plan is not administered by
      E-Z-EM and contributions are determined in accordance with provisions of
      negotiated labor contracts.

      E-Z-EM Canada Inc., a wholly-owned subsidiary of the Company, also
      provides pension benefits to eligible employees through two Defined
      Contribution Plans. In 2002, 2001 and 2000, contributions were $100,000,
      $100,000 and $85,000, respectively.


                                      -66-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE M - COMMITMENTS AND CONTINGENCIES

      The Company is committed under non-cancellable operating leases for
      facilities, automobiles and equipment, including certain facility leases
      with related parties. During 2002, 2001 and 2000, aggregate rental costs
      under all operating leases were approximately $1,816,000, $1,896,000 and
      $1,713,000, respectively, of which approximately $203,000, $209,000 and
      $212,000, respectively, were paid to related parties. Future annual
      operating lease payments in the aggregate, which include escalation
      clauses and real estate taxes, with initial remaining terms of more than
      one year at June 1, 2002, are summarized as follows:

                                                                    Related
                                                          Total      party
                                                         leases     leases
                                                         ------     -------
                                                           (in thousands)

                   2003                                  $1,024         $132
                   2004                                     920          101
                   2005                                     772
                   2006                                     742
                   2007                                     730
                   Thereafter                               928
                                                          -----          ---

                                                         $5,116         $233
                                                          =====          ===

      The Company has an employment contract with an executive officer which is
      cancellable at any time, but provides for severance pay in the event such
      executive is terminated by the Company without cause, as defined in the
      contract. Aggregate minimum compensation commitments under this contract
      at June 1, 2002, and relating to fiscal 2003, is $300,000.

      The Company is presently involved in various claims, legal actions and
      complaints arising in the ordinary course of business. The Company
      believes that any liability that may ultimately result from the resolution
      of these matters will not have a material adverse effect on the Company's
      financial position or results of operations.


                                      -67-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE N - COMMON STOCK

      In 1983, the Company adopted a Stock Option Plan (the "1983 Plan"). The
      1983 Plan provides for the grant to key employees of both nonqualified
      stock options and incentive stock options. A total of 2,617,974 shares of
      the Company's common stock may be issued under the 1983 Plan pursuant to
      the exercise of options. All stock options must have an exercise price of
      not less than the market value of the shares on the date of grant. Options
      will be exercisable over a period of time to be designated by the
      administrators of the 1983 Plan (but not more than 10 years from the date
      of grant) and will be subject to such other terms and conditions as the
      administrators may determine. The 1983 Plan terminates in December 2005.

      In 1984, the Company adopted a second Stock Option Plan (the "1984 Plan").
      The 1984 Plan provides for the grant to members of the Board of Directors
      and consultants of nonqualified stock options. A total of 459,490 shares
      of the Company's common stock may be issued under the 1984 Plan pursuant
      to the exercise of options. All stock options must have an exercise price
      of not less than the market value of the shares on the date of grant.
      Options will be exercisable over a period of time to be designated by the
      administrators of the 1984 Plan (but not more than 10 years from the date
      of grant) and will be subject to such other terms and conditions as the
      administrators may determine. The 1984 Plan terminates in December 2005.

      In 1997, the Company's AngioDynamics subsidiary adopted a Stock Option
      Plan (the "1997 Plan"). The 1997 Plan provides for the grant to key
      employees of both nonqualified stock options and incentive stock options
      and to members of the Board of Directors and consultants of nonqualified
      stock options. A total of 162.79 shares (including 26.43 shares authorized
      in May 2002) of AngioDynamics' Class B common stock may be issued under
      the 1997 Plan pursuant to the exercise of options. All stock options must
      have an exercise price of not less than the market value of the shares on
      the date of grant. Options will be exercisable over a period of time to be
      designated by the administrators of the 1997 Plan (but not more than 10
      years from the date of grant) and will be subject to such other terms and
      conditions as the administrators may determine. The 1997 Plan terminates
      in March 2007. As a result of the 1997 Plan, the Company's equity interest
      in AngioDynamics may become diluted by as much as 14%.

      In accordance with SFAS No. 123, "Accounting for Stock-Based
      Compensation," the Company elected to continue to account for stock-based
      compensation using the "intrinsic value" method under the guidelines of
      APB Opinion No. 25, "Accounting for Stock Issued to Employees" as opposed
      to the "fair value" method contained in SFAS 123. Accordingly, no
      compensation expense has been recognized under these plans concerning
      options granted to key employees and to members of the Board of Directors,
      as such options were granted to Board members in their capacity as
      Directors. Compensation expense of $178,000, $5,000 and $5,000 in 2002,
      2001 and 2000, respectively, was recognized under these plans for options
      granted to consultants.


                                      -68-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE N - COMMON STOCK (continued)

      If the Company had elected to recognize compensation expense based upon
      the fair value at the grant date for options granted under these plans to
      key employees and to members of the Board of Directors, consistent with
      the methodology prescribed by SFAS 123, the Company's pro forma net
      earnings (loss) and earnings (loss) per common share would be as follows:

                                               2002        2001         2000
                                              ------      ------       ------
                                           (in thousands, except per share data)

      Net earnings (loss)
        As reported                           $ 585       $3,286       $5,965
        Pro forma                              (393)       2,336        5,317

      Basic earnings (loss) per common
        share
          As reported                         $ .06         $.33         $.60
          Pro forma                            (.04)         .24          .53

      Diluted earnings (loss) per common
        share
          As reported                         $ .06         $.32         $.58
          Pro forma                            (.04)         .23          .52

      The fair value of options was estimated at the date of grant using the
      Black-Scholes option-pricing model with the following weighted-average
      assumptions for 2002, 2001 and 2000, respectively: dividend yields of zero
      for all years; expected volatility ranging from 43.96% to 50.16% in 2002,
      from 43.87% to 48.47% in 2001 and from 44.59% to 48.65% in 2000; risk-free
      interest rates ranging from 3.69% to 5.53% in 2002, from 5.10% to 6.06% in
      2001 and from 5.99% to 6.89% in 2000; and expected terms ranging from 5 to
      9 1/2 years for all years.


                                      -69-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE N - COMMON STOCK (continued)

      A summary of the status of the Company's stock option plans as of June 1,
      2002, June 2, 2001 and June 3, 2000, and changes for the three years then
      ended, is presented below:

                                   2002            2001              2000
                           ----------------  ----------------  ----------------
                                   Weighted          Weighted          Weighted
                                   -Average          -Average          -Average
                           Shares  Exercise  Shares  Exercise  Shares  Exercise
                           (000)    Price    (000)    Price    (000)    Price
                           ------  --------  ------  --------  ------  --------

      1983 Plan
      ---------
      Outstanding at
        beginning of year    1,269    $5.84   1,289     $5.84     973     $4.99
      Granted                   56    $7.53      25     $5.10     472     $7.45
      Exercised               (127)   $5.23      (9)    $4.50    (144)    $5.42
      Forfeited                (18)   $5.69     (36)    $5.82     (12)    $4.75
      Expired
                             -----            -----             -----
      Outstanding at
        end of year          1,180    $5.99   1,269     $5.84   1,289     $5.84
                             =====            =====             =====

      Options exercisable
        at year-end            907    $5.51     906     $5.22     796     $4.89

      Weighted-average
        fair value of
        options granted
        during the year               $3.61             $2.32             $3.66

      1984 Plan
      ---------
      Outstanding at
        beginning of year      281    $5.41     281     $5.44     301     $5.54
      Granted                    8    $9.00       6     $5.20       6     $6.50
      Exercised                (44)   $4.52                       (12)    $3.75
      Forfeited                                                    (2)    $8.58
      Expired                   (3)   $8.07      (6)    $6.86     (12)    $9.55
                               ---              ---               ---
      Outstanding at
        end of year            242    $5.65     281     $5.41     281     $5.44
                               ===              ===               ===

      Options exercisable
        at year-end            228    $5.55     269     $5.39     275     $5.42

      Weighted-average
        fair value of
        options granted
        during the year               $4.39             $2.41             $3.24


                                      -70-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE N - COMMON STOCK (continued)

<TABLE>
<CAPTION>
                                2002               2001                  2000
                        ------------------   -----------------    -----------------
                                  Weighted            Weighted             Weighted
                                  -Average            -Average             -Average
                        Shares    Exercise   Shares   Exercise    Shares   Exercise
                        (000)      Price     (000)     Price      (000)     Price
                        ------    --------   ------   --------    ------   --------
<S>                      <C>       <C>       <C>       <C>        <C>       <C>
    1997 Plan
    ---------
    Outstanding at
      beginning of year  132.67    $40,000   136.14    $40,000    129.15    $40,000
    Granted                7.21    $51,181     1.65    $40,000      8.18    $40,000
    Forfeited              (.11)   $40,000    (5.12)   $40,000     (1.19)   $40,000
                         ------              ------               ------
    Outstanding at
      end of year        139.77    $40,577   132.67    $40,000    136.14    $40,000
                         ======              ======               ======

    Options exercisable
      at year-end          None                None                 None

    Weighted-average
      fair value of
      options granted
      during the year              $32,702             $25,315              $26,427
</TABLE>

      The following information applies to options outstanding and exercisable
      at June 1, 2002:

                                      Outstanding                Exercisable
                           -------------------------------   -------------------
                                      Weighted-
                            Number     Average   Weighted-   Number    Weighted-
                             Out-     Remaining   Average     Exer-     Average
          Range of         standing    Life in   Exercise    cisable   Exercise
       Exercise Prices      (000)       Years      Price      (000)      Price
       ---------------     --------   ---------  ---------   -------   ---------

         1983 Plan
         ---------
       $3.66 to $5.39           622        2.54     $ 4.41       582      $ 4.37
       $5.63 to $6.00           164        6.97     $ 5.67       116      $ 5.68
      $8.50 to $10.13           394        7.40     $ 8.61       209      $ 8.60
                              -----                              ---

                              1,180                              907
                              =====                              ===

         1984 Plan
         ---------
       $3.66 to $5.49           165        2.90     $ 4.22       159      $ 4.18
       $5.88 to $8.58            52        4.47     $ 7.91        52      $ 7.91
      $9.58 to $12.49            25        6.24     $10.42        17      $11.09
                                ---                              ---

                                242                              228
                                ===                              ===

      On June 1, 2002, there remained 505,470, 110,342 and 23.02 shares
      available for granting of options under the 1983, 1984 and 1997 Plans,
      respectively.

      Options are exercisable into Class B common stock.


                                      -71-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE N - COMMON STOCK (continued)

      In 1985, the Company adopted an Employee Stock Purchase Plan (the
      "Employee Plan"). The Employee Plan provides for the purchase by employees
      of the Company's Class B common stock at a discounted price of 85% of the
      market value of the shares on the date of purchase. A total of 150,000
      shares of the Company's Class B Stock may be purchased under the Employee
      Plan which terminates on September 30, 2002. During 2002, employees
      purchased 1,237 shares, at $4.84 per share. Total proceeds received by the
      Company approximated $6,000.

      In January 1999, the Board of Directors authorized the repurchase of up to
      500,000 shares of the Company's Class B common stock at an aggregate
      purchase price of up to $2,000,000. In October 1999, the Board modified
      the program to include the Company's Class A common stock. In February
      2000, the Board further modified the program to increase the aggregate
      purchase price of Class A and Class B common stock by an additional
      $2,000,000. As of June 1, 2002, the Company had repurchased 52,859 shares
      of Class A common stock and 430,789 shares of Class B common stock for
      approximately $3,409,000.

NOTE O - RELATED PARTIES

      The Company has split dollar life insurance arrangements with the Chairman
      of the Board (including his spouse) and a principal shareholder (the
      "insureds"). On an annual basis, the Company makes advances of
      approximately $100,000 per insured toward the cost of such life insurance
      policies. Through August 2000, such advances were interest bearing and
      payable to the Company annually by the insureds. In August 2000, the
      arrangements were modified, to conform to the Company's other split dollar
      life insurance arrangements, making future advances non-interest bearing.
      In May 2002, the Board of Directors approved a resolution to forgive any
      unpaid interest. Under collateral assignment agreements, the proceeds from
      the policies will first be used to repay all advances made by the Company.
      At June 1, 2002 and June 2, 2001, the cash surrender value of such
      policies aggregated $1,026,000 and $741,000, respectively. At June 1, 2002
      and June 2, 2001, advances of $1,000,000 and $800,000, respectively, are
      recorded in the consolidated balance sheets under the caption "Other
      assets".

      The Company had an unsecured, two-year interest bearing note receivable
      from an executive officer in the principal amount of $320,000.
      Approximately $297,000 of this note receivable was satisfied in October
      1999, while the remaining portion was satisfied during June 2000.

      The Company's employment contract with Howard S. Stern, the Chairman of
      the Company's board, expired on November 30, 2001. Effective January 1,
      2002, the Company entered into an agreement with Mr. Stern, pursuant to
      which Mr. Stern has agreed to provide certain services to the Company
      until December 31, 2004. The Company has agreed to include Mr. Stern in
      its slate of directors for the 2002 annual meeting and to appoint Mr.
      Stern as Chairman of the Board for a one-year term beginning at the annual
      meeting. So long as Mr. Stern remains Chairman of the Company, he is
      entitled to receive twice the regular fees and other compensation
      (including cash, stock and options) paid to directors for service on the
      board. Under the terms of the agreement, Mr. Stern is entitled


                                      -72-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE O - RELATED PARTIES (continued)

      to receive 36 equal monthly payments of $20,833, as well as certain
      bonus opportunities. Mr. Stern also receives other benefits and
      perquisites and, so long as he remains Chairman, an annual sum of up to
      $80,000 for reimbursement of reasonable business expenses. Effective
      January 1, 2002, the Company extended the exercise period of Mr. Stern's
      fully vested, expiring stock options. The Company recorded a compensation
      charge of $173,000 during 2002 in connection with this decision.

      Several other directors provided consulting services to the Company during
      2002, 2001 and 2000. Fees for such services were approximately $156,000,
      $213,000 and $347,000 during 2002, 2001 and 2000, respectively.

NOTE P - OPERATING SEGMENT, GEOGRAPHIC AREA OPERATIONS AND CONCENTRATION OF
         CREDIT RISK

      The Company is engaged in the manufacture and distribution of a wide
      variety of products which are classified into two operating segments:
      E-Z-EM products, formerly called the Diagnostic products operating
      segment, and AngioDynamics products. E-Z-EM products include X-ray
      fluoroscopy products, CT imaging products, virtual colonoscopy products,
      specialty diagnostic tests, and accessory medical products and devices.
      The E-Z-EM segment also includes third-party contract manufacturing of
      diagnostic contrast agents, pharmaceuticals, non-prescription healthcare
      products and defense decontaminants. AngioDynamics products include
      angiographic products and accessories, image-guided vascular access
      products, dialysis products, thrombolytic products, PTA dilation
      catheters, biliary stents, and drainage products used in the
      interventional radiology marketplace. The Company's primary business
      activity is conducted with radiologists and hospitals, located throughout
      the U.S. and abroad, through numerous distributors. The Company's exposure
      to credit risk is dependent, to a certain extent, on the healthcare
      industry. The Company performs ongoing credit evaluations of its customers
      and does not generally require collateral; however, in certain
      circumstances, the Company may require letters of credit from its
      customers.

      In 2002, there was one customer to whom sales of E-Z-EM products
      represented 13% of total sales. In 2001, there were two customers to whom
      sales of E-Z-EM products represented 17% and 12% of total sales,
      respectively. In 2000, there were two customers to whom sales of E-Z-EM
      products represented 18% and 12% of total sales, respectively.
      Approximately 19% and 13% of accounts receivable pertained to the
      aformentioned customer and another customer, respectively, at June 1, 2002
      and approximately 19% and 14% of accounts receivable pertained to these
      customers at June 2, 2001, respectively.

      The Company's chief operating decision maker utilizes operating segment
      net earnings (loss) information in assessing performance and making
      overall operating decisions and resource allocations. The accounting
      policies of the operating segments are the same as those described in the
      summary of significant accounting policies. Information about the
      Company's segments is as follows:


                                      -73-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE P - OPERATING SEGMENT, GEOGRAPHIC AREA OPERATIONS AND CONCENTRATION OF
         CREDIT RISK (continued)

      Operating Segments                        2002         2001        2000
      ------------------                       ------       ------      ------
                                                       (in thousands)

       Net sales to external customers (1)
         E-Z-EM products                      $ 92,288     $ 90,610    $ 93,162
         AngioDynamics products                 29,845       22,676      20,706
                                               -------      -------     -------

       Total net sales to external
         customers                            $122,133     $113,286    $113,868
                                               =======      =======     =======

       Intersegment net sales
         E-Z-EM products                      $     --     $      1    $      2
         AngioDynamics products                  1,045          714       1,063
                                               -------      -------     -------

       Total intersegment net sales           $  1,045     $    715    $  1,065
                                               =======      =======     =======

       Interest income
         E-Z-EM products                      $  1,196     $  1,787    $  1,708
         AngioDynamics products                     45           70          12
         Eliminations                             (863)        (952)     (1,004)
                                               -------      -------     -------

       Total interest income                  $    378     $    905    $    716
                                               =======      =======     =======

       Interest expense
         E-Z-EM products                      $    273     $    290    $    252
         AngioDynamics products                    863          952       1,005
         Eliminations                             (863)        (952)     (1,004)
                                               -------      -------     -------

       Total interest expense                 $    273     $    290    $    253
                                               =======      =======     =======

       Depreciation and amortization
         E-Z-EM products                      $  2,219     $  2,231    $  2,124
         AngioDynamics products                    569          566         679
                                               -------      -------     -------

       Total depreciation and amortization    $  2,788     $  2,797    $  2,803
                                               =======      =======     =======

       Income tax provision (benefit)
         E-Z-EM products                      $  1,285     $  1,864    $  3,566
         AngioDynamics products                    561       (1,513)       (297)
                                               -------      -------     -------

       Total income tax provision             $  1,846     $    351    $  3,269
                                               =======      =======     =======

      (1)   Net sales in 2000 have been retroactively restated to reflect the
            reclassifications of freight billed to customers and related freight
            costs described in Note A.


                                      -74-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE P - OPERATING SEGMENT, GEOGRAPHIC AREA OPERATIONS AND CONCENTRATION OF
         CREDIT RISK (continued)

      Operating Segments (continued)          2002         2001         2000
      ------------------------------         ------       ------       ------
                                                     (in thousands)

       Operating profit (loss)
         E-Z-EM products                    $   (425)    $  3,865     $  9,285
         AngioDynamics products                2,389         (290)        (739)
         Eliminations                            (58)         (50)          53
                                             -------      -------      -------

       Total operating profit               $  1,906     $  3,525     $  8,599
                                             =======      =======      =======

       Net earnings (loss)
         E-Z-EM products                    $   (366)    $  2,993     $  7,328
         AngioDynamics products                1,009          343       (1,416)
         Eliminations                            (58)         (50)          53
                                             -------      -------      -------

       Total net earnings                   $    585     $  3,286     $  5,965
                                             =======      =======      =======

       Other significant non-cash items
         E-Z-EM products
           Impairment of long-lived assets  $  1,312     $  1,016     $     --
         AngioDynamics products
           Loss on sale of subsidiary and
             related assets                       --          872           --
                                             -------      -------      -------

       Total other significant non-cash
         items                              $  1,312     $  1,888     $     --
                                             =======      =======      =======

       Assets
         E-Z-EM products                    $110,421     $108,463     $111,046
         AngioDynamics products               20,046       16,782       17,573
         Eliminations                        (28,186)     (27,790)     (29,534)
                                             -------      -------      -------

       Total assets                         $102,281     $ 97,455     $ 99,085
                                             =======      =======      =======

       Capital expenditures
         E-Z-EM products                    $  2,711     $  2,277     $  2,813
         AngioDynamics products                  682          466          393
                                             -------      -------      -------

       Total capital expenditures           $  3,393     $  2,743     $  3,206
                                             =======      =======      =======


                                      -75-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE P - OPERATING SEGMENT, GEOGRAPHIC AREA OPERATIONS AND CONCENTRATION OF
         CREDIT RISK (continued)

      Net Sales by Major Product Lines
      --------------------------------

      The following table sets forth net sales to external customers by major
      product lines. Other net sales to external customers primarily include
      thrombolytic products, PTA dilation catheters, virtual colonoscopy
      products, image-guided vascular access products, biliary stents, specialty
      diagnostic tests and drainage products.

                                              2002         2001         2000
                                             ------       ------       ------
                                                      (in thousands)

      X-Ray Fluoroscopy Products            $ 42,200     $ 45,959     $ 52,353
      CT Imaging Products                     25,478       21,857       18,682
      Angiographic Products and
        Accessories                           12,542       11,516       11,035
      Contract Manufacturing                  10,196        7,857        7,050
      Accessory Medical Products               8,719        8,437        7,744
      Dialysis Products                        6,225        3,215        3,477
      Other                                   16,773       14,445       13,527
                                             -------      -------      -------

                                            $122,133     $113,286     $113,868
                                             =======      =======      =======

      Geographic Areas
      ----------------

      The following geographic area data includes net sales generated by and
      long- lived assets employed in operations located in each area:

                                              2002         2001         2000
                                             ------       ------       ------
                                                      (in thousands)

      Net sales (1)
        U.S. operations                     $105,224     $ 96,284     $ 95,877
        International operations:
          Canada                              28,464       24,195       23,825
          Other                                8,745        9,907       12,712
        Eliminations                         (20,300)     (17,100)     (18,546)
                                             -------      -------      -------

      Total net sales                       $122,133     $113,286     $113,868
                                             =======      =======      =======

      Long-lived assets
        U.S. operations                     $ 13,290     $ 12,580     $ 13,727
        International operations:
          Canada                               6,764        6,627        6,526
          Other                                1,067        2,248        4,026
                                             -------      -------      -------

      Total long-lived assets               $ 21,121     $ 21,455     $ 24,279
                                             =======      =======      =======

      (1)   Net sales in 2000 have been retroactively restated to reflect the
            reclassifications of freight billed to customers and related freight
            costs described in Note A.


                                      -76-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

                   June 1, 2002, June 2, 2001 and June 3, 2000

NOTE Q - QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

      Quarterly results of operations during 2002 and 2001 were as follows:

                                                        2002
                                       --------------------------------------
                                        First     Second     Third     Fourth
                                       quarter    quarter   quarter    quarter
                                       -------    -------   -------    -------
                                        (in thousands, except per share data)

      Net sales                        $27,641    $30,629   $30,646    $33,217
      Gross profit                      10,670     13,054    12,855     14,706
      Net earnings (loss)                 (112)    (1,167)    1,157        707
      Earnings (loss) per common
        share
          Basic                           (.01)      (.12)      .12        .07
          Diluted (2)                     (.01)      (.12)      .11        .07

                                                        2001
                                       --------------------------------------
                                        First     Second     Third     Fourth
                                       quarter    quarter   quarter    quarter
                                       -------    -------   -------    -------
                                        (in thousands, except per share data)

      Net sales (1)                    $27,733    $26,658   $27,809    $31,086
      Gross profit (1)                  11,469     11,314    10,095     12,814
      Net earnings                       1,842        861       106        477
      Earnings per common share
        Basic (2)                          .19        .09       .01        .05
        Diluted                            .18        .08       .01        .05

      (1)   Net sales and gross profit have been retroactively restated to
            reflect the reclassifications of freight billed to customers and
            related freight costs described in Note A.

      (2)   The sum of the quarters does not equal the fiscal year due to
            rounding and changes in the calculation of weighted average shares.

NOTE R - SUBSEQUENT EVENT

      On July 25, 2002, the Board of Directors approved a previously announced
      plan to combine the Company's two currently outstanding classes of common
      stock - Class A and Class B - into a single class of common stock. The
      Company will submit the proposed transaction to a vote of its stockholders
      at the Company's Annual Meeting of Stockholders currently scheduled for
      October 15, 2002. The Company expects the proposed transaction to be
      tax-free to the Company and the holders of the Company's Class A and Class
      B shares.


                                      -77-
<PAGE>

                          E-Z-EM, Inc. and Subsidiaries

                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                                 (in thousands)

<TABLE>
<CAPTION>
    Column A             Column B          Column C           Column D    Column E
    --------             --------          --------           --------    --------
                                           Additions
                                    ----------------------

                                       (1)         (2)
                          Balance               Charged to                Balance
                            at      Charged to    other                   at end
                         beginning  costs and   accounts-    Deductions-   of
   Description           of period   expenses    describe      describe   period
   -----------           ---------  ----------  ----------   -----------  -------
<S>                       <C>          <C>      <C>            <C>        <C>
Fifty-three weeks
  ended June 3, 2000

Allowance for
  doubtful accounts....   $1,028       $ 37                    $212 (a)   $  853
                           =====        ===                     ===        =====

Fifty-two weeks
  ended June 2, 2001

Allowance for
  doubtful accounts....   $  853       $ 88                    $280 (a)   $  661
                           =====        ===                     ===        =====

Fifty-two weeks
  ended June 1, 2002

Allowance for
  doubtful accounts....   $  661       $221                    $ 34 (a)   $  848
                           =====        ===                     ===        =====
</TABLE>

(a)   Amounts written off as uncollectible.


                                      -78-