|SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549                                                                                                                                                                                                                                                                                                      
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|FORM 10Q                                                                                                                                                                                                                                                                                                                                                       
|QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934                                                                                                                                                                                                                                                                              
|For the Period Ended May 31, 2002                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                               
|Spectrum Control, Inc.                                                                                                                                                                                                                                                                                                                                         
|Exact name of registrant as specified in its charter                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                               
|Pennsylvania                                                                                                                                                                                                                                                                                                                                                   
|(State of other jurisdiction ofincorporation or organization)                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                               
|8031 Avonia Road; Fairview, Pennsylvania                                                                                                                                                                                                                                                                                                                       
|(Address)                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                               
|Registrant's telephone number, including area code:                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                               
|Former name, former address and former fiscal year, if changed since last report                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                               
|Indicate by check mark wheter 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 the filing requirements for at least the past 90 days.
|                                                                                                                                                                                                                                                                                                                                                               
|Yes  
X    
No                                                                                                                                                                                                                                                                                                                                                 
|Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practical date.                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                               
|Class                                                                                                                                                                                                                                                                                                                                                          
|Common, no par value                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                               

|                                       
|---------------------------------------
|SPECTRUM CONTROL, INC. AND SUBSIDIARIES
|                                       
|INDEX                                  
|                                       
|PART I                                 
|                                       
|Item 1.                                
|                                       
|                                       
|                                       
|                                       
|                                       
|                                       
|                                       
|                                       
|                                       
|Item 2.                                
|                                       
|Item 3.                                
|                                       
|PART II                                
|                                       
|Item 4.                                
|                                       
|Item 6.                                
|                                       
|                                       
|                                       

Top of Report

SPECTRUM CONTROL, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited)

|( Dollar Amounts in Thousands )                                          | May 31,                                   |                                            | November 30,   
|------------------------------------------------------------------------ | ----------------------------------------- | ------------------------------------------ | ---------------
|                                                                         | 2002                                      |                                            | 2001           
|Assets                                                                  
|Current Assets                                                          
|                                                                         | Cash and cash equivalents                 | $        19,325                            |                
|                                                                         | Accounts receivable, net of allowances    | 9,454                                      |                
|                                                                         | Inventories                               | 15,833                                     |                
|                                                                         | Deferred income taxes                     | 1,802                                      |                
|                                                                         | Income tax refund receivable              | 1,150                                      |                
|                                                                         | Prepaid expenses and other current assets | 1,513                                      |                
|                                                                         |                                           | Total current assets                       | 49,077         
|                                                                        
|Property, Plant And Equipment, at cost                                  
|                                                                         | less accumulated depreciation of $ 27,822
|                                                                         | in 2002 and $ 25,534 in 2001              | 17,924                                     |                
|                                                                        
|Other Assets                                                            
|                                                                         | Goodwill, net                             | 14,243                                     |                
|                                                                         | Other noncurrent assets                   | 456                                        |                
|                                                                         |                                           | Total other assets                         | 14,699         
|                                                                        
|                                                                         |                                           | Total Assets                               | $        81,700
|                                                                        
|Liabilities And Stockholders' Equity                                    
|Current Liabilities                                                     
|                                                                         | Accounts payable                          | $          2,662                           |                
|                                                                         | Income taxes payable                      | -                                          |                
|                                                                         | Accrued liabilities                       | 1,852                                      |                
|                                                                         | Current portion of long-term debt         | 285                                        |                
|                                                                         |                                           | Total current liabilities                  | 4,799          
|                                                                        
|Long-Term Debt                                                           | 2,412                                     |                                            | 2,676          
|Deferred Income Taxes                                                    | 3,304                                     |                                            | 3,434          
|                                                                        
|Stockholders' Equity                                                    
|                                                                         | Common stock, no par value, authorized   
|                                                                         |                                           | 25,000,000 shares, issued 13,604,977      
|
|                                                                         |                                           | shares in 2002 and 13,548,513 in 2001      | 43,752         
|                                                                         | Retained earnings                         | 30,891                                     |                
|                                                                         | Treasury stock, 455,700 shares in 2002   
|                                                                         |                                           | and 452,700 shares in 2001, at cost        | (2,535)        
|                                                                         | Accumulated other comprehensive loss      | (923)                                      |                
|                                                                         |                                           | Total stockholders' equity                 | 71,185         
|                                                                        
|                                                                         |                                           | Total Liabilities And Stockholders' Equity | $        81,700
|                                                                        
|The accompanying notes are an integral part of the financial statements.

Top of Report

SPECTRUM CONTROL, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited)

|                                                                         | ( Amounts in Thousands Except Per Share Data )
|------------------------------------------------------------------------ | ----------------------------------------------
|                                                                        
|                                                                         | Three Months Ended                            
|                                                                         | May 31,                                       
|                                                                         | 2002                                          
|                                                                        
|Net sales                                                                | $ 14,353                                      
|                                                                        
|Cost of products sold                                                    | 11,780                                        
|                                                                        
|Gross margin                                                             | 2,573                                         
|                                                                        
|Selling, general and                                                    
|                                                                         | administrative expense                        
|                                                                        
|Income ( loss ) from operations                                          | (553)                                         
|                                                                        
|Other income ( expense )                                                
|                                                                         | Interest expense                              
|                                                                         | Other income and expense, net                 
|                                                                         | 850                                           
|                                                                        
|Income ( loss ) before provision                                        
|                                                                         | for income taxes                              
|                                                                        
|Provision for income taxes ( benefit )                                   | 115                                           
|                                                                        
|Net income ( loss )                                                      | $ 182                                         
|                                                                        
|Earnings ( loss ) per common share :                                    
|                                                                         | Basic                                         
|                                                                         | Diluted                                       
|                                                                        
|Average number of common shares                                         
|                                                                         | outstanding :                                 
|                                                                         |                                               
|                                                                         |                                               
|                                                                        
|The accompanying notes are an integral part of the financial statements.

Top of Report

SPECTRUM CONTROL, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows(Unaudited)

|                                                                        
|------------------------------------------------------------------------
|( Dollar Amounts in Thousands )                                         
|                                                                        
|                                                                        
|Cash Flows From Operating Activities :                                  
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Cash Flows From Investing Activities :                                  
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Cash Flows From Financing Activities :                                  
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|                                                                        
|Effect of exchange rate changes on cash                                 
|                                                                        
|Net increase in cash and cash equivalents                               
|                                                                        
|Cash and cash equivalents, beginning of period                          
|                                                                        
|Cash and cash equivalents, end of period                                
|                                                                        
|Cash paid during the period for :                                       
|                                                                        
|                                                                        
|                                                                        
|The accompanying notes are an integral part of the financial statements.

Top of Report

**SPECTRUM CONTROL,
INC. AND SUBSIDIARIESNOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTSMay 31, 2002**Note 1 - Basis of
Presentation

|The accompanying unaudited condensed consolidated financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information and with the instructions
to Form 10-Q and Article 10 of Regulation S-X. Accordingly,
they do not include all of the information and notes
required by generally accepted accounting principles for complete financial statements. In the opinion
of management, the accompanying financial statements include all adjustments which are normal, recurring
and necessary to present fairly the results for the interim periods. Operating results for
interim periods are not necessarily indicative of the results that may be expected for
the year.The condensed consolidated financial statements
include the accounts of Spectrum Control, Inc. and its Subsidiaries ("the
Company"). To facilitate timely reporting, the fiscal quarters of the Company's
German subsidiary, Spectrum Control GmbH, are based upon a fiscal year which
ends October 31. All significant intercompany accounts are eliminated upon
consolidation.The balance sheet at November 30, 2001 has been
derived from the audited financial statements at that date but does not include
all of the information and notes required by generally accepted accounting
principles for complete financial statements.For further information, refer to the
consolidated financial statements and notes thereto included in the Spectrum
Control, Inc. and Subsidiaries annual report on Form 10-K for the fiscal year
ended November 30, 2001.Certain prior year amounts have been
reclassified to conform with the current year presentation.Note 2 - Nature of
OperationsThe Company designs and manufactures electronic
control components and systems and has operations in the United States, Mexico
and Germany. The Company offers a broad line of signal and power products which
are used to condition, regulate, transmit, receive, or govern electronic
performance. Although its products are used in many industries worldwide, the
Company's largest markets are telecommunications equipment and
military/aerospace.Note 3 - Adoption of New Accounting
PronouncementIn June 2001, the Financial Accounting
Standards Board issued Statement of Financial Accounting Standards No. 142,
"Goodwill and Other Intangible Assets" ("SFAS No. 142"). Under SFAS No. 142,
goodwill and intangible assets deemed to have indefinite lives are no longer
amortized, but are instead subject to a periodic impairment test at least
annually. Other intangible assets continue to be amortized over their useful
lives.Effective December 1, 2001, the Company adopted
SFAS No. 142. Accordingly, no amortization of goodwill was recognized in the
accompanying consolidated statements of operations for the periods ended May 31,
2002, compared to $205,000 for the three months ended May 31, 2001 and $405,000
for the six months ended May 31, 2001. In accordance with the provisions of SFAS
No. 142, the Company has performed the required transitional impairment test of
goodwill and has determined that no impairment loss need be recognized in the
periods ended May 31, 2002. For purposes of performing the required transitional
impairment test, goodwill was assigned to the Company's operating segments as
follows (in thousands):
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|         | SignalProducts | PowerProducts | Total  
|-------- | -------------- | ------------- | -------
|         |                |               |        
|Goodwill | $10,557        | $3,686        | $14,243



|As required by SFAS No. 142, the results for
the prior year periods have not been restated. A reconciliation of the
previously reported net income and earnings per share, as if SFAS No. 142 had
been adopted as of December 1, 2000, is as follows (in thousands except per
share data):
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                  | Three Months Ended                 |                    | Six Months Ended
|--------------------------------- | ---------------------------------- | ------------------ | ----------------
|                                  | May 31,                            |                    | May 31,         
|                                 
|                                  |                                    | 2002               |                 
|Reported net income (loss)        | $                                  | 182                |                 
|Add back:                         | Goodwill amortization,             |                   
|                                  | net of related tax effect          |                    | --              
|Adjusted net income (loss)        | $                                  | 182                |                 
|                                 
|Earnings (loss) per common share:
|                                 
|                                  | Basic earnings (loss) per share,   |                   
|                                  |                                    | as reported        | $               
|                                  | Impact of goodwill amortization    |                    | --              
|                                  | Adjusted basic earnings (loss) per |                   
|                                  |                                    | share              | $               
|                                  | Diluted earnings (loss) per        |                   
|                                  |                                    | share, as reported | $               
|                                  | Impact of goodwill amortization    |                    | --              
|                                  | Adjusted diluted earnings (loss)   |                   
|                                  |                                    | per share          | $               

Note 4 - Inventories

|Inventories by major classification are as follows (in thousands):
|------------------------------------------------------------------
|                                                                  
|                                                                  
|                                                                  
|                                                                  
|Finished goods                                                    
|Work-in-process                                                   
|Raw materials                                                     
|                                                                  

Note 5 - Other Noncurrent Assets

|Other noncurrent assets by major classification are as follows (in thousands):
|------------------------------------------------------------------------------
|                                                                              
|                                                                              
|                                                                              
|Intangible assets:                                                            
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|Other assets:                                                                 
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|                                                                              
|                                                                              

|Amortization of intangible assets, for each of the next five years,
is not expected to be material to the Company's consolidated financial statements.Note 6 - Debt AgreementThe Company maintains an unsecured line of credit with its
principal lending institution (the "Bank"), with interest rates on borrowings at or below the
prevailing prime rate.  During the periods ended May 31, 2002 and 2001, no borrowings were
outstanding under this line of credit arrangement.  The line of credit agreement contains
certain covenants, the most restrictive of which require the Company to maintain designated
minimum levels of net worth and profitability and impose certain restrictions on the Company
regarding additional indebtedness.  In February, 2002, certain of these covenants were amended
or waived by the Bank.  At May 31, 2002, the Company was in compliance with all debt covenants,
as amended.  Maximum borrowings under the amended agreement may not exceed $6,000,000.
The amended line of credit agreement expires April 30, 2003.Note 7 - Derivatives and Hedging ActivitiesFrom time to time, the Company enters into forward currency
exchange contracts in the regular course of business to manage its exposure against foreign
currency fluctuations on sales denominated in foreign currencies.  The terms of these contracts
are generally six months or less.At May 31, 2002, the Company had forward contracts with aggregate
notional amounts of $880,000, maturing at varying dates over a six-month period.
The estimated fair value of the forward currency exchange contracts was a net receivable of
$34,000 at May 31, 2002.Note 8 - Earnings (Loss) Per Common ShareThe following table sets forth the computation of basic and
diluted earnings (loss) per common share for the periods indicated:
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                 | Three Months Ended           |                    | Six Months Ended
|-------------------------------- | ---------------------------- | ------------------ | ----------------
|                                 | May 31,                      |                    | May 31,         
|                                
|                                 |                              | 2002               |                 
|Numerator for basic and         
|                                 | diluted earnings (loss) per  |                   
|                                 | common share (in thousands): |                   
|                                
|                                 |                              | Net income (loss)  | $               
|Denominator for basic           
|                                 | earnings (loss) per common   |                   
|                                 | share (in thousands):        |                   
|                                
|                                 |                              | Weighted average   |                 
|                                 |                              | shares outstanding |                 
|Denominator for diluted         
|                                 | earnings (loss) per common   |                   
|                                 | share (in thousands):        |                   
|                                
|                                 |                              | Weighted average   |                 
|                                 |                              | shares outstanding |                 
|                                 |                              | Effect of dilutive |                 
|                                 |                              | securities:        |                 
|                                 |                              | Stock options      |                 
|                                 |                              | Stock warrants     |                 
|                                
|                                 |                              |                    |                 
|                                
|Earning (loss) per common share:
|                                
|                                 | Basic                        | $                  | 0.01            
|                                 | Diluted                      | $                  | 0.01            

|Options and warrants to purchase 953,633 shares of Common Stock,
at a weighted average exercise price of $7.19 per share, were outstanding at May 31, 2002, but
were not included in the computation of diluted earnings (loss) per share for the six months
ended May 31, 2002, because their inclusion would be anti-dilutive.Note 9 - Comprehensive Income (Loss)
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The components of comprehensive (loss) are as follows (in thousands):
|---------------------------------------------------------------------
|                                                                     
|                                                                     
|                                                                     
|                                                                     
|Net income (loss)                                                    
|                                                                     
|Foreign currency translation                                         
|                                                                     
|Change in fair value of derivatives                                  
|                                                                     
|Comprehensive income (loss)                                          

The components of accumulated other comprehensive loss are as
follows(in thousands):

|                                        
|----------------------------------------
|                                        
|                                        
|                                        
|Foreign currency translation adjustments
|Derivative financial instruments gain   
|                                        
|Accumulated other comprehensive loss    

|Note 10 - Operating SegmentsThe Company was founded as a solutions - oriented company, designing and manufacturing products to suppress or eliminate electromagnetic interference ("EMI").  In recent years, the Company has broadened its focus and product lines to become a control products and systems company, providing a wide range of components and systems used to condition, regulate, transmit, receive, or govern electronic performance.The Company's current operations are conducted in two reportable segments:  signal products and power products.  The Company's Signal Products Group manufactures a broad range of low pass EMI filters, filtered arrays, filtered connectors, wireless products (coaxial ceramic resonators, patch antennas, bandpass filters, and duplexers), and specialty ceramic capacitors.  The Power Technologies Group manufactures various power management and conditioning products including power distribution units, power line filters, and power entry devices.  In addition, the Company recently developed and introduced an advanced systems product offering to become a provider of more complex power management systems, including a line of digital radio-frequency control equipment for remote and automatic electronic systems management.  For operating segment reporting purposes, these advanced systems are included in the Power Technologies Group.  The reportable segments are each managed separately because they manufacture and sell distinct products with different production processes.The Company evaluates performance and allocates resources to its operating segments based upon numerous factors, including segment income or loss before income taxes.  The accounting policies of the reportable segments are the same as those utilized in the preparation of the Company's consolidated financial statements.  However, substantially all of the Company's selling expenses, general and administrative expenses, and nonoperating expenses are not allocated to the Company's reportable operating segments and, accordingly, these expenses are not deducted in arriving at segment income or loss.For each period presented, the accounting policies and procedures used to determine segment income (loss) have been consistently applied.  Reportable segment information for the periods ended May 31, 2002 and 2001 is as follows (in thousands):
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Three Months Ended May 31: |                                     | SignalProducts |        | PowerProducts |        | Total
|-------------------------- | ----------------------------------- | -------------- | ------ | ------------- | ------ | -----
|                          
|                           | 2002                               
|                          
|                           | Revenue from unaffiliated customers | $              | 11,613 | $             | 2,740  | $    
|                           | Segment income (loss)               |                | 2,508  |               | (299)  |      
|                          
|                           | 2001                               
|                          
|                           | Revenue from unaffiliated customers |                | 18,444 |               | 6,836  |      
|                           | Segment income (loss)               |                | 3,838  |               | 1,395  |      
|                          
|Six Months Ended May 31:   |                                     |                |        |               |        |      
|                          
|                           | 2002                               
|                          
|                           | Revenue from unaffiliated customers |                | 20,839 |               | 5,007  |      
|                           | Segment income (loss)               |                | 3,704  |               | (803)  |      
|                          
|                           | 2001                               
|                          
|                           | Revenue from unaffiliated customers |                | 43,914 |               | 12,178 |      
|                           | Segment income (loss)               |                | 11,192 |               | 1,920  |      

|A reconciliation of total reportable segment income (loss)
to consolidated income (loss) before provision for income taxes for the periods ended
May 31, 2002 and 2001 is as follows (in thousands):
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                  | Three Months Ended         |      | Six Months Ended
|--------------------------------- | -------------------------- | ---- | ----------------
|                                  | May 31,                    |      | May 31,         
|                                 
|                                  |                            | 2002 |                 
|Total income for reportable      
|                                  | segments                   | $    | 2,209           
|                                 
|Unallocated amounts:             
|                                 
|                                  | Selling, general and       |      |                 
|                                  | administrative expense     |      | (2,762)         
|                                 
|                                  | Interest expense           |      | (35)            
|                                 
|                                  | Other income               |      | 885             
|                                 
|Consolidated income (loss) before
|                                  | provision for income taxes | $    | 297             

|Note 11 - New Accounting PronouncementsIn August 2001, the Financial Accounting Standards Board
("FASB") issued Statement of Financial Accounting Standards No. 143, "Accounting for Asset
Retirement Obligations" ("SFAS No. 143").  SFAS No. 143 addresses financial accounting and
reporting for obligations associated with the retirement of tangible long-lived assets and
the associated asset retirement costs.  SFAS No. 143 is effective for fiscal years beginning
after June 15, 2002.  The Company does not expect the adoption of SFAS No. 143 to have a
material impact on its financial position or results of operations.In October 2001, the FASB issued Statement of Financial
Accounting Standards No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets"
("SFAS No. 144").  SFAS No. 144 establishes one accounting model for long-lived assets to be
disposed of by sale, requiring those assets be measured at the lower of carrying amount or
fair value less cost to sell.  This accounting model applies to all long-lived assets,
including those associated with discontinued operations, and replaces certain prior
pronouncements and guidance.  The provisions of SFAS No. 144 are generally effective for
fiscal years beginning after December 15, 2001.  The Company does not expect the adoption of
SFAS No. 144 to have a material impact on its financial position or results of operations.In April 2002, the FASB issued Statement of Financial Accounting
Standards No. 145, "Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement
No. 13, and Technical Corrections" ("SFAS No. 145").  Among other items, SFAS No. 145 updates
and clarifies existing accounting pronouncements related to gains and losses from the
extinguishment of debt and certain lease modifications that have economic effects similar to
sale-leaseback transactions.  The provisions of SFAS No. 145 are generally effective as of
May 15, 2002.  The adoption of SFAS No. 145 did not have a material impact on the Company's
financial position or results of operations.Top of Report
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Management's Discussion and Analysis of Financial Condition and Results of OperationsThe following discussion and analysis may be understood more fully by reference to the
consolidated financial statements, notes to the consolidated financial statements, and
management's discussion and analysis contained in the Spectrum Control, Inc. and Subsidiaries
annual report on Form 10-K for the fiscal year ended November 30, 2001.  All references to
"we", "us", "our", or the "Company" in the following discussion and analysis mean
Spectrum Control, Inc. and its Subsidiaries.OverviewWe were founded as a solutions-oriented company, designing and manufacturing products to
suppress or eliminate electromagnetic interference ("EMI").  In recent years, we broadened
our focus and product lines to become a control products and systems company, providing a
wide range of components and systems used to condition, regulate, transmit, receive, or govern
electronic performance.  Although our components and systems are used in many industries
worldwide, our largest markets are telecommunications equipment and military/aerospace which
represented 52.0% and 28.0%, respectively, of our fiscal 2001 sales.  In telecommunications,
our products are used in numerous systems including wireless base stations, fiber optic
networks and broadband switching equipment, Internet servers, and global positioning systems.
Military/aerospace applications for our products include missile defense systems,
smart weapons and munitions, simulation equipment, and avionic upgrades.
Our other markets include medical instrumentation, industrial equipment, computer, and
automotive.Our operations are primarily conducted in two reportable business segments:  signal products
and power products.  Our Signal Products Group manufactures a broad line of discrete
EMI filters, filtered arrays, filtered connectors, wireless products (coaxial ceramic
resonators, patch antennas, bandpass filters, and duplexers), and specialty ceramic capacitors
(single layer, temperature compensating, high voltage, and switch mode).
Our Power Technologies Group currently manufactures various power management and conditioning
products including power distribution units, power line filters, and power entry devices.
Recently, we developed and introduced an advanced systems product offering to become a
provider of more complex power management systems, including a line of digital radio-frequency
control equipment for remote and automatic electronic systems management.  For operating
segment reporting purposes, these advanced systems are included in our Power Technologies Group.In June 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting
Standards No. 142, "Goodwill and Other Intangible Assets" ("SFAS No. 142").  Under SFAS No. 142,
goodwill and intangible assets deemed to have indefinite lives are no longer amortized, but are
instead subject to a periodic impairment test at least annually.  Other intangible assets
continue to be amortized over their useful lives.Effective December 1, 2001, the Company adopted SFAS No. 142.  Accordingly, no amortization
of goodwill was recognized in the accompanying consolidated statements of operations for the
periods ended May 31, 2002.  In the comparable periods of 2001, goodwill amortization of
$205,000 for the three months ended May 31, 2001 and $405,000 for the six months ended
May 31, 2001 was recognized and included in selling, general and administrative expense.
As required by SFAS No. 142, the results for the periods ended May 31, 2001 have not been
restated.  If the Company had discontinued amortization of goodwill at the beginning of
fiscal year 2001, net income for the three month and six month periods ended May 31, 2001
would have increased $127,000 and $251,000, respectively.  Basic and diluted earnings per
share would have each increased by $0.01 for the three month period ended May 31, 2001 and
$0.02 for the six month period ended May 31, 2001.In accordance with the provisions of SFAS No. 142, the Company has performed the required
transitional impairment test of goodwill and has determined that no impairment loss need be
recognized in the periods ended May 31, 2002.Forward-Looking InformationThe following discussion includes certain "forward-looking statements" within the meaning
of the federal securities laws, including statements regarding:  (1) our belief as to future
market conditions, (2) our anticipated capital expenditures, and (3) our expected future
operating requirements and financing needs.  The words "believe", "expect", "anticipate" and
similar expressions identify forward-looking statements.  These forward-looking statements are
subject to certain risks and uncertainties which could cause actual results to differ
materially from historical results or those anticipated.  Factors that could cause or
contribute to such differences include those discussed in "Risk Factors That May Affect
Future Results", as well as those discussed elsewhere herein.  Readers are cautioned not to
place undue reliance on these forward-looking statements.Results of OperationsThe following table sets forth certain financial data, as a percentage of net sales, for the
three months and six months ended May 31, 2002 and 2001:
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                               | Three Months Ended            |       | Six Months Ended
|------------------------------ | ----------------------------- | ----- | ----------------
|                               | May 31,                       |       | May 31,         
|                              
|Net sales                      | 100.0                         | %     |                 
|Cost of products sold          | 82.1                          |       |                 
|Gross margin                   | 17.9                          |       |                 
|Selling, general and           |                               |       |                 
|                               | administrative expense        | 21.8  |                 
|Income (loss) from operations  | (3.9)                         |       |                 
|Other income (expense)         |                               |       |                 
|                               | Interest expense              | (0.2) |                 
|                               | Other income and expense, net | 6.2   |                 
|Income (loss) before provision |                               |       |                 
|                               | for income taxes              | 2.1   |                 
|Provision for income taxes     |                               |       |                 
|                               | (benefit)                     | 0.8   |                 
|Net income (loss)              | 1.3                           | %     |                 

|SecondQuarter2002VersusSecondQuarter2001Net SalesThroughout the second quarter of fiscal 2002, our sales continued to be negatively impacted
by the industry-wide slowdown in capital spending by major telecommunications carriers.
Overall, our net sales decreased by $10.9 million during the period, with consolidated net
sales of $14.4 million in the second quarter of fiscal 2002 and $25.3 million in the comparable
quarter of 2001.  This decrease reflects reduced shipment volume for substantially all of our
product lines.  Sales of signal products amounted to $11.6 million in the current quarter,
compared to $18.4 million in the second quarter of last year.  Sales of power products,
including advanced systems, decreased by $4.1 million during the period, from $6.9 million in
the second quarter of fiscal 2001 to $2.8 million in the current quarter.  As a result of
competitive pressures, average selling prices declined slightly in 2002 throughout most of our
product lines.  Customer orders received in the second quarter of fiscal 2002 amounted to
$14.6 million, compared to $17.7 million in the same period last year.  At May 31, 2002, our
sales order backlog was approximately $24.2 million, up $1.4 million from the end of last
fiscal year.For over a year and a half, the telecommunications equipment market has experienced a severe
industry-wide downturn.  This downturn has been driven by several factors, including:
(1) the collapse of numerous start-up, competitive service providers and dot coms resulting
in excess component inventories, unsold telecom systems, and a secondary market of used
equipment throughout the telecommunications industry and (2) reduced spending for infrastructure
and network equipment by incumbent telephone service providers as competitive pressures from
start-up service providers have eased and certain technological advances have stalled.
During the second quarter of 2002, we believe these very poor market conditions continued to
demonstrate some signs of stabilizing.  Customer order cancellations and delivery date pushouts,
which were prevalent throughout fiscal 2001, have significantly diminished in fiscal 2002.
For the second consecutive period, customer orders received in the current quarter were greater
than those received in the immediately preceding quarter.  Although we believe the prolonged
market downturn may have finally bottomed-out in fiscal 2002, the timing and extent of the
market's recovery remain uncertain.  We cannot forecast with any degree of certainty when a
full recovery in capital spending may be expected, nor can we forecast what normal customer
spending levels may be once this structural market correction is completed.Gross MarginFor the second quarter of fiscal 2002, gross margin was $2.6 million or 17.9% of sales.
In the second quarter of last year, gross margin was $5.9 million or 23.2% of sales.
With the severe slowdown in the global telecommunications equipment market, our sales
in the second quarter of fiscal 2002 were significantly below previous planned levels.
As a result, gross margin in the current quarter was negatively impacted by labor
inefficiencies and lower absorption of fixed manufacturing overhead.  At May 31, 2002,
we had a total workforce of 856 employees, a reduction of 202 or 19.1% from a year ago.
In light of the current business conditions, we will continue to review our organization
and cost structure to further reduce operating expenses and improve efficiencies.Selling, General and Administrative ExpenseIn the second quarter of fiscal 2002, selling expense amounted to $1.8 million or 12.3% of sales,
compared to $3.0 million or 12.0% of sales in the same quarter of 2001.
The increase in selling expense, as a percentage of sales, principally reflects fixed selling
expenses being absorbed over lower sales volume.  General and administrative expense was
approximately $1.3 million in the second quarter of 2002, compared to $1.9 million in the
comparable quarter of 2001.  The decrease in general and administrative expense primarily
reflects lower personnel costs and the reduction of certain variable administrative expenses.
In addition, $205,000 of goodwill amortization was recorded and included in general and
administrative expense in the second quarter of 2001.  With the adoption of SFAS No. 142,
no goodwill amortization was recorded during the current period.Other Income and ExpenseWe hold numerous United States and foreign patents relating to polymer multilayer ("PML")
technology.  We realized license fee income of $850,000 in the second quarter of fiscal 2002
upon the granting of PML technology licenses.  Although these licenses, as well as other
PML licenses that we have previously granted, require certain royalties to be paid to us
upon the sale of products utilizing PML technology, it is not known what future commercial
value, if any, these patents and related licenses may have.SixMonths2002VersusSixMonths2001Net SalesFor the first half of fiscal 2002, net sales decreased by nearly $30.3 million or 53.9%,
with consolidated sales of $25.8 million in 2002 and $56.1 million in 2001.  This decrease,
which was reflected throughout all of our major product lines, was primarily driven by the
unprecedented slowdown in the telecommunications equipment industry and sluggish overall
economic conditions in the United States and Europe.  Sales of signal products amounted to
$20.8 million in the first half of fiscal 2002, compared to $43.9 million in the same period
last year.  Sales of power products decreased by $7.2 million during the period, from $12.2
million in the first six months of fiscal 2001 to $5.0 million in the comparable period of 2002.
Power product sales included shipments of $746,000 in 2002 and $1.9 million in 2001 of our
recently introduced advanced systems product offering.  Although we believe the long-term market
potential for these advanced systems remains strong, their initial market introduction and
penetration has been severely hampered by the current telecom market conditions.  Overall,
total customer orders received in the first six months of fiscal 2002 amounted to $27.7 million,
a decrease of $13.5 million or 32.8% from the same period last year.  Average selling prices
declined slightly throughout most of our product offerings due to competitive and market
pressures.Gross MarginFor the first six months of fiscal 2002, gross margin was $3.5 million or 13.6% of sales.
In the comparable period of last year, gross margin was $14.1 million or 25.1% of sales.
The decline in gross margin primarily reflects lower sales volume and manufacturing
inefficiencies caused by the abrupt downturn in product demand by our telecommunications
customers.Selling, General and Administrative ExpenseDuring the first half of fiscal 2002, selling expense amounted to $3.4 million or 13.3% of
sales, compared to $6.3 million or 11.3% of sales for the same period last year.
The increase in selling expense, as a percentage of sales, reflects the impact of lower sales
volume and certain fixed selling expenses.  This impact has been partially offset by lower
effective sales commission rates and reduced advertising expenses.  General and administrative
expense was $2.6 million in the first half of 2002, compared to $3.9 million in the comparable
period of 2001.  The decrease in general and administrative expense primarily reflects
lower personnel costs and the reduction of certain variable charges and expenditures for
professional services.  In addition, $405,000 of goodwill amortization was recorded and
included in general and administrative expense in the first half of fiscal 2001.
With the adoption of SFAS No. 142, no goodwill amortization has been recorded in the current
year.Other Income and ExpenseWith reduced bank indebtedness and lower average interest rates, interest expense decreased
slightly during the period.  For the first six months of fiscal 2002, interest expense was
$77,000 compared to $116,000 for the same period last year.Patent license fee income was $850,000 in the first half of fiscal 2002, compared to $29,000
in the first half of fiscal 2001.  Investment income of $120,000 in 2002 and $211,000 in 2001
was realized from temporary cash investments.Income TaxesOur effective income tax rate was 37.7% in 2002 and 38.0% in 2001, compared to an applicable
statutory federal and state income tax rate of approximately 40.0%.  Differences between the
effective tax rate and statutory income tax rate principally arise from state tax provisions
and foreign income tax rates.Risk Factors That May Affect Future ResultsIn fiscal year 2001, approximately 52.0% of our sales were to customers in the
telecommunications industry.  Our three largest customers, original equipment manufacturers
of telecommunications equipment, represented an aggregate 24.0% of our total consolidated net
sales in 2001.  Throughout 2001 and the first half of 2002, the telecommunications industry
has experienced a severe slowdown.  If this slowdown continues or intensifies, it will have a
material negative impact on our future operating performance.  In addition, our results of
operations may be negatively affected in the future by a variety of other factors including:
competitive pricing pressures, new technologies which decrease the demand for our products,
new product offerings by our competitors, product cost changes, changes in the overall economic
climate, availability of raw materials, and changes in product mix.Liquidity, Capital Resources and Financial ConditionWe maintain a line of credit with our principal lending institution, PNC Bank, N.A. of Erie,
Pennsylvania (the "Bank").  This revolving credit line is unsecured, with interest rates on
borrowings at or below the prevailing prime rate.  At May 31, 2002, no borrowings were outstanding
under the line of credit.  The line of credit agreement contains certain covenants, the most
restrictive of which require us to maintain designated minimum levels of net worth and
profitability and impose certain restrictions on us regarding additional indebtedness.
In February 2002, certain of these covenants were amended or waived by the Bank.
At May 31, 2002, we were in compliance with all debt covenants, as amended.
Maximum borrowings under the amended agreement may not exceed $6.0 million.  Our ability
to borrow in the future under this credit facility is dependent on our ongoing compliance
with the restrictive covenants.  Whether we continue to comply with these covenants is
largely dependent on our ability to attain certain levels of operating performance and
profitability in the future, for which there can be no assurance.  The amended line of
credit agreement expires April 30, 2003.Our wholly-owned German subsidiary maintains unsecured Euro lines of credit with two German
financial institutions aggregating $1.8 million (Euro 2.0 million).  At May 31, 2002, no
borrowings were outstanding under these lines of credit.  Future borrowings, if any, will
bear interest at rates below the prevailing prime rate and will be payable upon demand.At May 31, 2002, we had net working capital of $44.3 million, compared to $42.1 million at
November 30, 2001.  Our current ratio remained very strong throughout the first six months of fiscal
2002.  At May 31, 2002, current assets were 10.23 times current liabilities, compared to 9.17
at the end of fiscal 2001.With the significant reduction in our sales volume and production requirements caused by
the severe slowdown in the telecommunications industry, we currently have excess manufacturing
capacity.  Accordingly, our capital expenditures in 2002 for new equipment have been minimal.
During the first half of fiscal 2002, our capital expenditures for property, plant and equipment
amounted to $169,000.  These capital expenditures were primarily for manufacturing equipment
and tooling to enhance operating efficiencies for our new advanced systems product offerings.
At May 31, 2002, we had not entered into any material commitments for capital expenditures.During fiscal 2001, in response to the poor overall business climate, we adopted and
substantially implemented a plan to consolidate certain manufacturing facilities and dispose
of excess property and equipment.  As part of this plan, we closed two operating facilities
in Elizabethtown, Pennsylvania.  Manufacturing in these facilities had consisted of certain
wireless products, specialty ceramic capacitors, and other signal products.  These operations
were consolidated into our manufacturing facilities in Juarez, Mexico and New Orleans, Louisiana.
In March 2002, the two Elizabethtown facilities and related excess equipment were sold.
Net proceeds realized from the sale amounted to $1.0 million, which approximated the net carrying
value of the underlying assets.  Accordingly, no gain or loss was recognized on the sale of the
property and equipment.We have adopted a stock repurchase program.  Under this program, we may repurchase up to $6.0
million of the Company's outstanding Common Stock.  Acquired shares are to be purchased in the
open market or through privately negotiated transactions at prevailing market prices.  Funding
for these repurchases is expected to come from available cash reserves and borrowings under our
revolving line of credit facility.  The amount and timing of the shares repurchased are based on
our ongoing assessment of the Company's capital structure, liquidity, and the market price of
the Company's Common Stock.  The repurchased shares are held as treasury stock.  During the
first six months of fiscal 2002, 3,000 shares were repurchased at an aggregate cost of $15,000.
Since the adoption of the stock repurchase program, 455,700 shares have been repurchased at a
total cost of $2.5 million.Current financial resources, including working capital and existing lines of credit, and
anticipated funds from operations are expected to be sufficient to meet operating cash
requirements throughout fiscal year 2002, including scheduled long-term debt repayment,
planned capital equipment expenditures and possible stock repurchases.  There can be no
assurance, however, that unplanned capital replacement or other future events will not
require us to seek additional debt or equity financing and, if so required, that it will be
available on terms acceptable to us.Despite current year-to-date operating losses, our overall cash flow remains strong.
Net cash generated by operating activities amounted to $6.3 million during the first six
months of fiscal 2002, compared to $5.6 million in the same period of 2001.  Operating
cash flow in 2002 was positively impacted by the refund of $2.2 million of prepaid federal
income taxes.  In addition, as a result of lower sales volume and production requirements,
accounts receivable and inventories decreased by $2.2 million and $1.3 million, respectively,
during the first six months of fiscal 2002.At May 31, 2002, goodwill represented 17.4% of total assets and 20.0% of stockholders' equity.
A majority of this goodwill was recognized in 1999 in connection with our acquisition of
substantially all of the assets of the Signal Conditioning Products Division of AMP
Incorporated.  With the adoption of SFAS No. 142, effective December 1, 2001, we performed the
required transitional impairment test of goodwill and determined that no impairment loss need be
recognized in the current periods.New Accounting PronouncementsIn August 2001, the Financial Accounting Standards Board ("FASB") issued Statement of
Financial Accounting Standards No. 143, "Accounting for Asset Retirement Obligations"
("SFAS No. 143").  SFAS No. 143 addresses financial accounting and reporting for obligations
associated with the retirement of tangible long-lived assets and the associated asset
retirement costs.  SFAS No. 143 is effective for fiscal years beginning after June 15, 2002.
We do not expect the adoption of SFAS No. 143 to have a material impact on our financial position
or results of operations.In October 2001, the FASB issued Statement of Financial Accounting Standards No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS No. 144").
SFAS No. 144 establishes one accounting model for long-lived assets to be disposed of by sale,
requiring those assets be measured at the lower of carrying amount or fair value less cost to
sell.  This accounting model applies to all long-lived assets, including those associated with
discontinued operations, and replaces certain prior pronouncements and guidance.
The provisions of SFAS No. 144 are generally effective for fiscal years beginning after December
15, 2001.  We do not expect the adoption of SFAS No. 144 to have a material impact on our
financial position or results of operations.In April 2002, the FASB issued Statement of Financial Accounting Standards No. 145,
"Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and
Technical Corrections" ("SFAS No. 145").  Among other items, SFAS No. 145 updates and
clarifies existing accounting pronouncements related to reporting gains and losses from the
extinguishment of debt and certain lease modifications that have economic effects similar to
sale-leaseback transactions.  The provisions of SFAS No. 145 are generally effective as of
May 15, 2002.  The adoption of SFAS No. 145 did not have a material impact on the Company's
financial position or results of operations.Critical Accounting PoliciesWe believe our most critical accounting policies relate to the valuation and carrying amounts
of accounts receivable, inventories, and long-lived assets.  We evaluate the collectibility of
our accounts receivable based on a combination of factors including an assessment of the
customer's financial condition and the length of time a receivable is past due.  At
May 31, 2002, our allowance for doubtful accounts was $823,000, or approximately 8.0% of our
aggregate accounts receivable.  In determining the adequacy of this allowance, we have
assumed that the current severe downturn in the telecommunications industry will stabilize
sometime in fiscal 2002.  If this stabilization does not occur, or if market conditions
deteriorate further, our customers may not be able to meet their financial obligations to us.
Accordingly, our estimate of the recoverability of amounts due us could be reduced by a material
amount.At May 31, 2002, we had recorded inventory reserves in the aggregate amount of $3.5 million
for excess and slow-moving items.  In determining the adequacy of these reserves, we considered
numerous factors including current customer forecasts and estimated usage.  Should these
forecasts and estimates change due to market, technological or other factors, the net realizable
value of our inventories may be materially less than our current carrying values.With the adoption of SFAS No. 142, we review goodwill for possible impairment at least annually.
Impairment losses are recognized when the implied fair value of goodwill is less than its
carrying value.  The implied fair value of goodwill is contingent upon many factors, including
estimates of future discounted operating cash flows.  Long-lived assets other than goodwill are
reviewed for impairment whenever indicators of possible impairment exist.  Impairments are
recognized when the expected future operating cash flows derived from such assets are less than
their carrying values.  No impairment losses have been recognized in any of the periods
presented herein.  However, our future cash flow expectations assume that the current poor
market conditions throughout the telecommunications industry will not continue beyond 2002.
If long-term market conditions do not improve, our long-lived assets may become materially
impaired.Top of ReportQuantitative and Qualitative Disclosures About Market RiskForeign CurrencyCertain of our European sales and related selling expenses are denominated in Euros,
British Pounds Sterling, and other local currencies.  In addition, certain of our operating
expenses are denominated in Mexican Pesos.  As a result, fluctuations in currency exchange
rates may affect our operating results and cash flows.  To manage our exposure to the Euro
and British Pound Sterling, we occasionally enter into forward currency exchange contracts.
At May 31, 2002, we had forward currency exchange contracts with aggregate notional amounts of
$880,000 expiring at various dates over a six-month period.  The estimated fair value of these
contracts at May 31, 2002, was a net receivable of $34,000.  For each of the periods presented
herein, currency exchange rate gains and losses were not material.Euro ConversionAs of June 15, 2002, 12 of the 15 member countries of the European Union
(the "participating countries") have adopted the Euro as their common currency.
Under the required transition period from their previous sovereign currencies to the Euro,
all non-cash transactions of the participating countries must be denominated in Euros as of
January 1, 2002.  Euro currency began being issued in January 2002 and will continue to be
phased-in through June 30, 2002, when all sovereign currencies of the participating countries
will become obsolete.  We have implemented all the necessary enhancements to our sales order,
banking arrangements and operational procedures to ensure Euro compliance.  We are able to
process orders, invoice customers and accept payments in Euros throughout Europe.
We have also modified our hedging policies to take the Euro conversion into account.
To date, the introduction of the Euro has not had any material adverse impact upon us.Top of ReportSubmission of Matters to a Vote of Security HoldersThe Annual Meeting of Shareholders of the Company was held on April 8, 2002, at the
Clarion Hotel (formerly known as the Bel-Aire Hotel), 2800 West Eighth Street, Erie,
Pennsylvania at 9:00 a.m.  All proposals as described in the Company's Proxy Statement dated
March 1, 2002 were approved.  Below are details of the matters voted upon at the meeting:Proposal 1 - Election of DirectorsElections were held for two (2) directors to serve until the 2005 Annual Meeting of Shareholders.
The results of the votes are as follows:
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| | Name              | Votes For  | Votes Against
| | ----------------- | ---------- | -------------
| | Edwin R. Bindseil | 11,539,694 | 619,841      
| | John P. Freeman   | 11,554,036 | 605,499      

|The terms of the following directors extend beyond the Annual Meeting date:  J. Thomas Gruenwald,
Melvin Kutchin, John M. Petersen, Gerald A. Ryan, Richard A. Southworth, and James F. Toohey.Proposal 2 - Appointment of AuditorsUpon recommendation of the Audit Committee, the Board of Directors resolved to appoint
Ernst & Young LLP as the Company's auditors for the fiscal year ending November 30, 2002,
subject only to ratification by the shareholders.  The results of the votes are as follows:
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Votes For  | Votes Against | Abstentions
| | ---------- | ------------- | -----------
| | 12,116,949 | 21,699        | 20,886     

|Top of ReportExhibits and Reports on Form 8-K(b)		Reports on Form 8-KNo reports on Form 8-K were filed during the quarter for which this report is filed.Top of Report
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Signature                                                                                                                                                                                
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                         
|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.
|                                                                                                                                                                                         
|                                                                                                                                                                                         
|
|                                                                                                                                                                                         
|Date:
June 28, 2002                                                                                                                                                                      
|                                                                                                                                                                                         
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