<PAGE>

                          SECURITIES AND EXCHANGE COMMISSION

                               Washington, D.C.  20549

                                     FORM 10-Q/A

/X/   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
      EXCHANGE ACT OF 1934 
      For the period ended March, 31, 1996
[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
      EXCHANGE ACT OF 1934 
      For the transition period from __________ to __________


                            MUEHLSTEIN HOLDING CORPORATION
                        (formerly HMC Acquisition Corporation)
                (Exact name of Registrant as specified in its charter)

                          Commission file number:  33-99754

                   Delaware                         06-1436941
(State or other jurisdiction                    (I.R.S. Employer
of incorporation or organization)               Identification No.)

    800 Connecticut Avenue
    Norwalk, Connecticut                       06856
 (Address of principal executive offices)    (Zip Code)


Registrant's telephone number including Area Code:     (203) 855-6000

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

Securities registered pursuant to Section 12(g) of the Act:  NONE

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days:
Yes  X    No   
   -------   ------

The number of shares outstanding of Registrant's Common Stock at March 31, 1996
was 1,999,023.

<PAGE>
                        Muehlstein Holding Corporation

                                 Form 10-Q/A



                                    Index

Part I. Financial Information

Item 1.Financial Statements (Unaudited)-Muehlstein Holding Corporation 
       ("Successor Company)

Consolidated balance sheet-March 31, 1996

Consolidated statement of operations-three months ended March 31, 1996

Consolidated statement of shareholders' equity and redeemable common 
  stock-three months ended March 31, 1996

Consolidated statement of cash flows-for the period February 9, 1996 through 
  March 31, 1996

Notes to consolidated financial statements

Financial Statements (Unaudited)-H. Muehlstein & Co., Inc. ("Predecessor 
  Company")

Combined balance sheet-December 31, 1995

Combined statement of operations-three months ended March 31, 1995

Combined statement of cash flows-three months ended March 31, 1995

Notes to combined financial statements


Item 2. Management's Discussion and Analysis of Financial Condition and 
Results of Operations


Part II. Other Information

Item 6. Exhibits and Reports on Form 8-K


Signatures
<PAGE>
                         Part I: financial Information
                         Item 1: Financial Statements
                        Muehlstein Holding Corporation
                          Consolidated Balance Sheet
                               Successor Company
                                  (Unaudited)

                                March 31, 1996

          (In thousands except per share data and numbers per share)

<TABLE>
<CAPTION>
<S>     
                                                              <C>
Assets
Current Assets
  Cash                                                                $  7,902
  Accounts receivable, net of allowance for doubtful
    accounts of $2,945                                                 126,366
  Other receivables, principally value added taxes                      23,838
  Inventories, net                                                      37,599
  Prepaid expenses and other assets                                      2,500
  Deferred income taxes                                                  2,132
                                                                      --------
Total current assets                                                   200,337

Property, plant and equipment, net of accumulated depreciation           7,482
Deferred financing costs, net of accumulated amortization                3,891
Goodwill, net of accumulated amortization                                3,510
                                                                      --------
Total Assets                                                           215,220
                                                                      ========

Liabilities and Shareholders' Equity
Current Liabilities
  Accounts Payable                                                    $ 86,019
  Notes payable, including current portion of long term debt            61,334
  Accrued Liabilities                                                    7,365
  Income taxes payable                                                   1,139
  Other taxes payable, principally value added taxes                    17,985
                                                                      --------
Total current liabilities                                              173,842

Notes payable - long term                                                6,953
Other long term liabilities                                              3,088

Common stock, par value $.01 per share - authorized shares 2,000,000;
 issued and outstanding 1,941,409 shares in 1996                           19
Preferred stock, par value $.01 per share - authorized shares 1,000,000; 
issued and outstanding 1,000,000 in 1996                                   10
Additional paid in capital                                             28,777
Retained Earning                                                        2,416
Cumulative translation adjustment                                         115
                                                                     --------
Total liabilities and shareholders' equity                           $215,220
                                                                     ========
</TABLE>

                    See notes to consolidated financial statements


<PAGE>

                                 Muehlstein Holding Corporation
                              Consolidated Statement of Operations
                                      Successor Company
                                         (Unaudited)

                              Three months ended March 31, 1996

                   (In thousands, except per share data and number of shares)


Revenues:

Sales and Commissions                        $169,791

Sales to affiliates                               413
                                           ----------

Total revenues                                170,204

Cost of sales                                 146,211
                                           ----------

                                               23,993

Selling, general and administrative 
 expenses                                      19,699
                                           ----------

Income from operations                          4,294

Other expense                                   1,227
                                           ----------

Income before income taxes                      3,067

Provision for income taxes                      2,137
                                           ----------

                                                  930

Losses applicable to pre-acquisition period    (1,486)
                                           ----------

Net income                                      2,416

Preferred stock dividend                          194
                                           ----------

Net income applicable to common 
 shareholders                                  $2,222
                                           ==========

Net income per share applicable to
 common shareholders                            $2.02
                                           ==========

Weighted average number of shares 
 outstanding                                1,100,000
                                           ==========

See notes to consolidated financial statements.



<PAGE>

                                           
                          Muehlstein Holding Corporation
    Consolidated Statement of Shareholders' Equity and Redeemable Common Stock
                                Successor Company
                                   (Unaudited)
                                           
                        Three months ended March 31, 1996
                                           
                                  (In thousands)


<TABLE>

<CAPTION>
                                           


                                            Common Stock      Preferred Stock         Additional                 Cumulative 
                                            ----------------   ------------------         Paid-in     Retained     Translation
                                            Shares    Amount   Shares      Amount         Capital     Earnings     Adjustment
                                            ------    ------   ------      ------         -------     --------     ----------

<S>                                         <C>       <C>      <C>         <C>            <C>         <C>          <C>

Issuance of Common Stock, net 
 of offering costs                          1,941       $19                                $18,787

Issuance of Preferred Stock                                     1,000        $10             9,990

Net income                                                                                              $2,416

Net change in cumulative translation 
 adjustment                                                                                                              $115
                                            -----      -----   -------      ------          --------    -------        -------

Balance as of March 31, 1996                1,941       $19     1,000         $10           $28,777     $2,416           $115
                                            =====      =====    =====       =======         ========    =======        =======

</TABLE>

                  See notes to consolidated financial statements.

<PAGE>

                                   MUEHLSTEIN HOLDING CORPORATION             
                                CONSOLIDATED STATEMENT OF CASH FLOWS   
                                         SUCCESSOR COMPANY
                                            (UNAUDITED)
                       FOR THE PERIOD FEBRUARY 9, 1996 THROUGH MARCH 31, 1996 

                                           (IN THOUSANDS)




Cash flows from operating activities

Net income                                                              $ 2,416
Adjustments to reconcile net income to net cash provided by (used in) 
operating activities:

Depreciation                                                                147
Amortization of goodwill and deferred financing costs                       243
Provision for deferred income taxes                                       1,543
Changes in operating assets and liabilities:
Accounts receivable                                                     (19,579)
Inventories                                                                (886)
Prepaid expenses and other assets                                          (229)
Other receivables                                                         2,090
Accounts payable                                                         20,542
Taxes payable                                                             1,948
                                                                        --------
Net cash provided by operating activities                                 8,235


Cash flows from investing activities
Payments for acquired business                                          (98,925)
Payments for purchase of fixed assets                                      (190)
                                                                        --------
Net Cash (used in) investing activities                                 (99,115)

Cash flows from financing activities

Net borrowing-revolving credit                                           60,287
Borrowing-term loan                                                       8,000
Payments for financing costs                                             (3,653)
Proceeds from issuance of common stock, net of offering costs            18,806
Proceeds from issuance of preferred stock                                10,000
                                                                        --------
Net cash (used in) financing activities                                 (93,440)
Effect of exchange rate changes on cash                                     115
                                                                        --------


Net increase in cash                                                      2,675
Cash at beginning of year                                                 5,227
                                                                        --------
Cash at end of year $                                                   $ 7,902
                                                                        --------
                                                                        --------

See notes to consolidated financial statements.

<PAGE>

                     MUEHLSTEIN HOLDING CORPORATION
              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          SUCCESSOR COMPANY
                             (UNAUDITED)
                                                                              
1. BASIS OF PRESENTATION

The accompanying unaudited 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 footnotes required by generally accepted accounting 
principles for complete financial statements. In the opinion of management, 
all adjustments (consisting of normal recurring accruals) considered 
necessary for a fair presentation have been included. Operating results for 
the three-month period ended March 31, 1996 are not necessarily indicative of 
the results that may be expected for the year ended December 31, 1996. For 
further information, refer to the combined financial statements and footnotes 
thereto included in the Muehlstein Holding Corporation's (formerly HMC 
Acquisition Corporation) (the "Company") Form 10-K for the year ended 
December 31, 1995.

In conjunction with the acquisition, the Company has adopted the FIFO method 
for inventory valuation for all of its inventory.

2. BUSINESS COMBINATION

On September 21, 1995, the Company was incorporated for the purpose of 
acquiring all of the outstanding capital stock of H. Muehlstein & Co., Inc. 
("Muehlstein").

On October 30, 1995, the Company entered into an agreement (the "Stock 
Purchase Agreement") with a wholly owned subsidiary of Mobil Oil Corporation 
(the ultimate parent company of Muehlstein) to purchase 100% of the 
outstanding capital stock of Muehlstein and certain related assets (the 
"Acquisition"). The purchase price was based on capital employed, as defined, 
plus $10 million.

On November 22, 1995, the Company filed a Registration Statement 
("Offering"), which became effective on January 23, 1996, pursuant to which 
it offered shares of its common stock to certain persons who were employees 
of Muehlstein, Mobil Oil Corporation ("Mobil") or their respective 
subsidiaries who would become employees of the Company or its subsidiaries 
following the Acquisition, to certain benefit plans in which such persons 
were or would become participants and to such other parties that the Company 
in its discretion determined. The Company received total proceeds of 
$19,152,130 on February 9, 1996 based upon the sale of 1,915,213 shares of 
its Common Stock ("Common Stock"), par value $.01 per share at $10.00 per 
share. The proceeds of this Offering, net of offering expenses of 
approximately $608,000, were utilized to pay a portion of the purchase price 
of the Acquisition. The Company received additional proceeds of $261,960 upon 
the sale of 26,196 additional shares of its common stock through March 31, 
1996.

Pursuant to the Stock Purchase Agreement, Mobil purchased from the Company on 
February 9, 1996, 1,000,000 shares of Series "A" Preferred Stock, $.01 par 
value per share, at a purchase price of $10.00 per share. The Series "A" 
Preferred Stock pays an annual dividend of $1.20 per share (equal to 12 
percent per annum of the stated value of $10.00 per share). Except for 
certain matters connected with the Series "A" Preferred Stock and other 
matters required by applicable law, holders of Series "A" Preferred 
Stock will have no voting rights. Series "A" Preferred Stock will have no 
preemptive rights and may be redeemed, in whole or in part, at the option of 
the Company, at any time. If the Company redeems the Series "A" Preferred 
Stock, the redemption price for the shares will equal the stated value per 
share ($10.00) plus all accrued and unpaid dividends. In the event of any 
voluntary or involuntary dissolution, liquidation or winding up of the 
Company, the holders of Series "A" Preferred Stock will have preferential 
rights, superior to other shareholders, to distributions out of the assets of 
the Company.

<PAGE>

                     MUEHLSTEIN HOLDING CORPORATION
              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                          SUCCESSOR COMPANY
                             (UNAUDITED)

2. BUSINESS COMBINATION (CONTINUED)

Effective February 9, 1996, Muehlstein entered into a credit agreement with 
Citicorp USA, Inc. and Citicorp Canada ("Credit agreement"), which was 
guaranteed by the Company. Pursuant to this Credit agreement a $125,000,000 
revolving credit facility was provided, the expiration date of which is 
February 9, 2000. The revolving credit facility will bear interest at either 
(1) 100 basis points per annum over the U.S. or certain other foreign 
currency Base Rates or (2) 250 basis points per annum over the U.S. or certain 
other foreign currency LIBOR rates. On the same date, the Company borrowed 
approximately $73,191,000 under this facility. As of March 31, 1996, 
approximately $40,000,000 of the Credit agreement was based on LIBOR and bore 
interest at 7.875%, the balance of the indebtedness was based on Base Rates 
and bore interest at 9.25%.

Effective February 9, 1996, Muehlstein entered into a loan agreement with 
Finova Capital Corporation ("Loan agreement"), which was guaranteed by the 
Company. Pursuant to this Loan agreement total proceeds of $8,000,000 from 
two term loans, Note A and Note B, both maturing March 1, 2000, were 
received. The principal amount of the two term loans are $2,560,000 (Note A) 
and $5,440,000 (Note B), respectively. These notes bear interest at a fixed 
annual rate of interest of 8.20% per annum (Note A) and 9.70% per annum 
(Note B).

The indebtedness under the Credit and Loan agreements is secured by liens on 
substantially all the assets of Muehlstein. The Credit and Loan agreements 
contain various covenants which include, among other things: (a) the 
maintenance of certain financial ratios and compliance with certain financial 
tests and limitations; (b) limitations on investments and capital 
expenditures; and (c) limitations on leases and the sale of assets.

The proceeds from the sale of the Company's common and preferred stock 
aggregating approximately $30,000,000 and borrowings of $81,191,000 under the 
aforementioned facilities were used to finalize the Acquisition and provide 
working capital.

The Acquisition was finalized on February 9, 1996 for a total purchase price 
of approximately $98,925,000 ("Purchase Price"), with fees of approximately 
$957,000 being included. Upon effectiveness of the Acquisition, Muehlstein 
became a wholly-owned subsidiary of the Company, and the Company thereupon 
changed its name to "Muehlstein Holding Company".

The Company's financial statements reflect the application of purchase 
accounting to the acquired operations of Muehlstein. The application of 
purchase accounting resulted in the allocation of the purchase price and 
related acquisition costs based on the fair value of the assets acquired and 
liabilities assumed. As a result, the enclosed predecessor combined financial 
statements are not comparable to the successor company consolidated financial 
statements.

<PAGE>

                               MUEHLSTEIN HOLDING CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                     SUCCESSOR COMPANY
                                        (UNAUDITED)


2. Business Combination (continued)

The condensed consolidated balance sheet on a fair value basis as of February 9,
1996 was as follows:


                                                                         (In
                                                                      thousands)

     Assets

Current assets:

Cash                                                                    $  5,227
Accounts receivable, net                                                 106,787
Other receivables                                                         25,928
Inventories                                                               36,713
Prepaid expenses and other current assets                                  5,893
                                                                        --------
Total current assets                                                     180,548


Property, plant and equipment                                              7,439
Other assets                                                               6,903
                                                                        --------
                                                                        $194,890
                                                                        --------
                                                                        --------


Liabilities and Shareholders' Equity

Current liabilities:

Accounts payable                                                         $65,477
Notes payable to bank                                                     66,315
Accrued and other current liabilities                                     24,541
                                                                        --------
                                                                         156,333


Long-term debt                                                             6,953
Other long-term liabilities                                                3,035
Common and preferred stock                                                28,569
                                                                        --------
                                                                        $194,890
                                                                        --------


3. Common Stock

The Company's common stock is held by certain of the Company's employees, the 
Company's Employee Share Ownership Plan (ESOP) and Citicorp North America, Inc.
("Citicorp"). Shareholders', excluding Citicorp, have a right to put these 
shares to the Company, following termination of their employment, subject to the
limitations imposed under the terms of the Credit, Loan and preferred stock 
agreements. Such provision exists to create a market for the employees' shares.
Citicorp has the right to put their shares to the Company at any time after the
earliest to occur of: (a) three years after the Acquisition closing date or (b) 
certain mergers, consolidations, sale of assets or change of control with 
respect to the Company or its material subsidiaries. Except for certain matters
connected with its shares,

<PAGE>


                               MUEHLSTEIN HOLDING CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                     SUCCESSOR COMPANY
                                        (UNAUDITED)


3. Common Stock (continued)

the shares held by Citicorp will be nonvoting shares. The redemption price for 
any shares will be equal to the most recent appraised fair market value of the 
common stock. If a put is exercised, the Company will have the option to pay for
the repurchased shares either in cash or pursuant to a promissory note. Under 
the terms of the Credit, Loan and preferred stock agreements and given 
management's view of its present employee base, significant activity under the
put provisions is not anticipated presently. However, in accordance with the 
requirements for accounting for common stock with a put provision, the common
stock has been classified between liabilities and preferred stock.

4. Pro Forma Financial Data

The following pro forma unaudited consolidated statements of operations for the
three month periods ended March 31, 1996 and 1995 have been prepared to reflect
the consummation of the offerings of the Company's debt and equity securities, 
the Acquisition and related transactions. The pro forma unaudited effects of 
such transactions have been presented assuming that they occurred as of the 
beginning of the periods presented in the pro forma unaudited consolidated 
statements of operations.

                                                        Three Months Ended

                                                             March 31

                                                         1996    1995

                                                            Pro forma

                                                     -------------------------
                                                       (In thousands, except
                                                          per share data)



Revenues                                              $ 170,204   $ 229,595
Total operational costs                                 166,122     221,218
                                                     -------------------------
Income from operations                                    4,082       8,377


Other income (expense)                                     (295)        177
Interest expense                                         (1,735)     (1,630)
Provision for income taxes                                 (914)     (2,973)
                                                     -------------------------


Net income                                                1,138       3,951
Preferred dividend                                         (300)       (300)
                                                     -------------------------
Net income applicable to common shareholders          $     838   $   3,651
                                                     -------------------------
                                                     -------------------------

     Net income per share applicable to common
       shareholders                                   $     .43   $    l.88
                                                     -------------------------
                                                     -------------------------

Assumed number of common shares outstanding               1,941       1,941
                                                     -------------------------
                                                     -------------------------

<PAGE>

                               MUEHLSTEIN HOLDING CORPORATION
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                     SUCCESSOR COMPANY
                                        (UNAUDITED)


5. Income Taxes

The tax provision for the three month period ended March 31, 1996 was determined
based upon an estimate of the effective tax rates for the year ending 
December 31, 1996. The effective tax rate of 70% for the three month period
ending March 31, 1996 reflects higher foreign taxes for dividend distributions
and changes in the valuation of certain foreign deferred tax assets for the 
period prior to the Acquisition and foreign losses for which the Company did not
have offsetting tax credits.

<PAGE>
                           H. Muehlstein & Co., Inc.
                       Predecessor Combined Balance Sheet
                                     (Note)

                                 December 31, 1995

                                  (In thousands)

<TABLE>
<S>                                                              <C>
Assets

Current assets:

Cash                                                              $   6,326

Accounts receivable, net of allowance for
doubtful accounts of $4,614                                         134,132

Other receivables, principally value added taxes                     21,341

Inventories, net                                                     29,516

Due from affiliates                                                     139

Prepaid expenses and other assets                                     2,120
Deferred income taxes                                                 4,151
                                                                 -------------
Total current assets                                                197,725


Property, plant and equipment, net of accumulated depreciation        7,307

Deferred income taxes                                                   549
                                                                 -------------
Total assets                                                        205,581
                                                                 =============


Liabilities and Parent Company Investments

Current liabilities:

Accounts payable                                                  $  57,412

Accrued liabilities                                                  10,672

Other taxes payable, principally value added taxes                   15,345

Due to affiliates                                                    11,681
                                                                 -------------
Total current liabilities                                            95,110


Other long term liabilities                                           1,832


Parent company investments                                          108,639
                                                                 -------------
Total liabilities and parent company investment                   $ 205,581
                                                                 =============
</TABLE>



Note: The balance sheet at December 31, 1995 has been derived from the
      audited predecessor combined financial statements at that date but does
      not include all of the information and footnotes required by generally
      accepted accounting principles for complete financial statements.

See notes to combined financial statements.

<PAGE>
                           H. Muehlstein & Co., Inc.
                 Predecessor Combined Statement of Operations
                                  (Unaudited)

                        Three months ended March 31, 1995

                                 (In thousands)

<TABLE>
<S>                                                              <C>
Revenues:

Sales and Commissions                                             $ 225,272

Sales to affiliates                                                   4,323
                                                                 -------------
Total revenues                                                      229,595

Cost of sales                                                       200,846
                                                                 -------------
                                                                     28,749

Selling, general and administrative expenses                         20,826
                                                                 -------------
Income from operations                                                7,923

Other income                                                            152
                                                                 -------------
Income before income taxes                                            8,075

Provision for income taxes                                            3,419
                                                                 -------------
Net income                                                        $   4,656
                                                                 =============
</TABLE>




See notes to combined financial statements.

<PAGE>

                   H. Muehlstein & Co., Inc.
           Predecessor Combined Statement of Cash Flows
                        (Unaudited)

              Three months ended March 31, 1995

                       (In thousands)


Cash flows from operating activites

Net income                                                            $ 4,656

Adjustments to reconcile net income to net cash provided by (used in)
operating activities:

Depreciation                                                              214

Provision for deferred income taxes                                       149

Loss on retirement of fixed assets                                         13

Changes in operating assets and liabilities:

Accounts receivable                                                   (35,884)

Inventories                                                           (13,644)

Due from affiliates                                                       (36)

Prepaid expenses and other assets                                        (147)

Other receivables                                                      (7,204)

Accounts payable                                                        8,716

Accrued liabilities                                                    (5,776)

Taxes payable                                                           6,367

Due to affiliates                                                      (4,946)
                                                                     ---------

Net Cash (used in) operating activities                               (47,522)

Cash flows from investing activities

Payments for purchase of fixed assets                                     (62)
                                                                     ---------
Net cash (used in) investing activities                                   (62)

Cash flows from financing activities

Net change in parent company advances                                  46,529
                                                                     --------
Net cash provided by financing activities                              46,529

Net (decrease) in cash                                                 (1,055)

Cash at beginning of year                                               4,763
                                                                     --------
Cash at end of year                                                  $  3,708
                                                                     ========

See notes to combined financial statements.



<PAGE>

                   H. Muehlstein & Co., Inc.
       Notes to Predecessor Combined Financial Statements
                        (Unaudited)


1. Basis of Presentation

The accompanying unaudited combined financial statements present the combined 
assets, liabilitieis, revenues and expenses related to the marketing 
operations of H. Muehlstein & Co., Inc. ("Muehlstein") and affiliated 
entities, exclusive of certain assets and liabilities retained by Mobil Oil 
Corporation ("Mobil"), the ultimate parent company in conjunction with the 
Acquisition (See Note 2 of the Notes to Consolidated Financial Statements -- 
Successor Company). These statements are presented on a historical cost 
basis. All transactions between subsidiaries of Muehlstein and other units of 
Mobil which are included in Muehlstein's operations have been eliminated. 
Parent company investment reflects Mobil's investment in Muehlstein, the 
accumulated earnings of such entity, as well as intercompany balances with 
Mobil and other entities therewith which are not settled on a current basis. 
In addition, the parent company investment includes intercompany accounts 
resulting from the exclusion of various assets or liabilities that were not 
acquired under the Acquisition.

The unaudited combined 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 
footnotes required by generally accepted accounting principles for complete 
financial statements. In the opinion of management, all adjustments 
(consisting of normal recurring accruals) considered necessary for a fair 
presentation have been included. For further information, refer to the 
combined financial statements and footnotes thereto included in Muehlstein 
Holding Corporation's Form 10-K for the year ended December 31, 1995.


<PAGE>

             ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

As discussed in the notes to the financial statements, Muehlstein Holding 
Corporation (formerly HMC Acquisition Corporation) (the "Company") was 
incorporated for the purpose of acquiring all of the outstanding capital 
stock of H. Muehlstein & Co., Inc. ("Muehlstein") and certain related assets. 
The acquisition was finalized on February 9, 1996 for a total purchase price 
with approximately $98,925,000. Accordingly, the quarter ended March 31, 1996 
is the only period of successor company operations and is compared to pro 
forma results of operations for the quarter ended March 31, 1995 for purposes 
of the comparative discussion presented below. The financial information of 
the successor company reflects the application of purchase accounting to the 
operations of Muehlstein subsequent to the Offering by the Company. The 
application of purchase accounting results in the allocation of the purchase 
price and related acquisition costs based on the fair value of the underlying 
assets and liabilities of the predecessor company's operations. As a result 
of the application of purchase accounting, the predecessor combined financial 
information is not comparable to the financial information of the successor 
company. The unaudited proforma results of operations have been prepared for 
comparative purposes only and are not necessarily indicative of the results 
of operations that would have resulted had the Offering and Acquisition been 
effective January 1, 1995, or that may result in the future.

RESULTS OF OPERATIONS

Total revenues decreased 25.9% in the first quarter of 1996 to $170,204,000 
compared to $229,595,000 for the first quarter of 1995. Income from 
operations decreased 51.3% to $4,082,000 for the first quarter of 1996 from 
$8,377,000 for the first quarter of 1995 while net income after tax decreased 
71.2% to $1,138,000 for the first quarter of 1996 from $3,951,000 for the 
first quarter of 1995.

The decrease in revenues was due to lower sales prices worldwide caused by 
increases in the availability of product. The average sales price for plastic 
resin and rubber, combined, decreased 24.1% in the first quarter of 1996 
versus the same period in 1995. Sales volume decreased 0.7% in the first 
quarter of 1996 versus the first quarter of 1995.

Income from operations was unfavorably impacted by lower sales prices during 
the first quarter of 1996 versus the comparative period in 1995. Due to 
changes in market conditions, the average margin on product sales decreased 
to $0.0504 per pound in the first quarter of 1996 from $0.0620 per pound in 
the first quarter of 1995. Partially offsetting the lower margins was a 6.6% 
decrease in selling and administrative expenses to $19,911,000 for the first 
quarter of 1996 from $21,322,000 for the same period in 1995.  The change was 
due to lower bad debt expenses in the U.S. and Latin America.

Non-operating expenses increased $577,000 in the first quarter of 1996 versus 
the first quarter of 1995. The increase was due to higher interest expense 
and amortization of deferred financing costs and goodwill being incurred as a 
result of the financing of the business combination. For further discussion 
of the financing, see "Note 2 of the Notes to Consolidated Financial 
Statements -- Successor Company".

Net income decreased 71.2% to $1,138,000 in the first quarter of 1996 from 
$3,951,000 in the comparative period last year after tax charges of $914,000 
and $2,973,000, respectively. The effective tax rate was 45% in the first 
quarter of 1996 and 43% in the same period in 1995.

LIQUIDITY AND SOURCES OF CAPITAL

Historically,  Muehlstein had been an indirect, wholly owned subsidiary of 
Mobil. As such, cash generated by Muehlstein and its financing requirements 
had been subject to Mobil's cash management procedures and policies.

In connection with the Acquisition, Muehlstein entered into a $125,000,000 
revolving credit facility with Citibank N.A. ("Citibank"). The revolving 
credit facility expires February 9, 2000. The revolving credit facility will 
bear interest at either (i) 100 basis points per annum over the U.S. or 
certain other foreign currency Base Rates of (2) 250 basis points per annum 
over the U.S. or certain other foreign

<PAGE>

currency LIBOR rates. On the day of the Acquisition, the Company borrowed 
approximately $73,191,000 under this facility. As of that date, Muehlstein 
has been subject to Citibank cash management procedures and policies.

At the date of the Acquisition, Muehlstein entered into a loan agreement with 
Finova Capital Corporation ("Finova"). Pursuant to this agreement total 
proceeds of $8,000,000 from two term loans, Note A and Note B, both maturing 
March 1, 2000, were received.  The principal amount of the two term loans is 
$2,560,000 (Note A) and $5,440,000 (Note B), respectively. These notes bear 
interest at a fixed annual rate of interest of 8.20% per annum (Note A) and 
9.70% per annum (Note B).

Pursuant to the Stock Purchase Agreement, Mobil purchased from the Company on 
February 9, 1996, 1,000,000 shares of Series "A" Preferred Stock, $.01 par 
value per share, at a purchase price of $10.00 per share. The Series "A" 
Preferred Stock pays an annual dividend of $1.20 per share (equal to 12 
percent per annum of the stated value of $10.00 per share).

The Company's common stock is held by certain of the Company's employees, the 
Company's Employee Share Ownership Plan (ESOP) and Citicorp North America, 
Inc. ("Citicorp"). Shareholders', excluding Citicorp, have a right to put 
these shares to the Company, following termination of their employment, 
subject to the limitations imposed under the terms of the Credit, Loan and 
preferred stock agreements. Such provision exists to create a market for the 
employees' shares. Citicorp has the right to put their shares to the Company 
at any time after the earliest to occur of: (a) three years after the 
Acquisition closing date or (b) certain mergers, consolidations, sale of 
assets or change of control with respect to the Company or its material 
subsidiaries. The redemption price for any shares will be equal to the most 
recent appraised fair market value of the common stock. If a put is 
exercised, the Company will have the option to pay for the repurchased shares 
either in cash or pursuant to the promissory note. Under the terms of the 
Credit, Loan and preferred stock agreements and given management's view of 
its present employee base, significant activity under the put provisions is 
not anticipated presently. However, in accordance with the requirements for 
accounting for common stock with a put provision, the common stock has been 
classified between liabilities and preferred stock.

Operating activities have historically been a major source or use of cash for 
working capital needs and capital expenditures. Net cash provided by 
operations were $8,235,000 for the three months ended March 31, 1996 as 
compared to a ($47,522,000) use of cash in the first three months of 1995. 
Working capital on a comparative basis decreased $76,120,000 from December 
31, 1995 to March 31, 1996. Current assets increased to 1.3% to $200,337,000 
at March 31, 1996 from $197,725,000 at December 31, 1995. Current liabilities 
increased $78,732,000 mainly due to the addition of $61,334,000 in short term 
borrowing from Citibank and the current portion of the Finova loan. In 
addition, accounts payable increased $28,607,000 mainly due to the addition 
of Mobil as a non-affiliated supplier. The Company expects that available 
cash and existing credit facilities will be sufficient to meet its normal 
operating requirements, including capital expenditures, over the near term.

FOREIGN EXCHANGE

The Company's foreign exchange exposure is limited to its operations in 
Europe, Far East and Canada. All sales and purchases in the United States and 
Latin America, representing approximately 80 percent of the volume, are 
denominated in U.S. dollars. Exposure to foreign exchange fluctuations in 
Europe are managed through a netting of the local assets (primarily accounts 
receivable) and liabilities (accounts payable). Fluctuations in foreign 
currency exchange rates have not had a material financial impact on the 
results of the Predecessor Company or Successor Company.

IMPACT OF INFLATION AND CHANGING PRICES

Market conditions which are influenced by economic and political 
considerations, as well as production capacities and utilization dictate 
pricing and costs. The Company has entered into certain supply agreements 
with Mobil for an initial term of three years. Such agreements provide for 
minimum and maximum limits on the amounts of product supplied. The Company does 
not have any other long-term purchase or sales commitments with its suppliers 
or customers. The Company views this as a marketing advantage that enables it 
to respond quickly to market changes, matching supply with demand. The 
Company capitalizes on opportunities and imbalances in the market place.
                                                                            
<PAGE>


 PART II.     OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K.

    (b)  No reports on Form 8-K were filed during the quarter for which this
         report is filed.



<PAGE>

                                      SIGNATURES

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

                             MUEHLSTEIN HOLDING CORPORATION



Date:  November 14, 1996               By:/S/ J. Kevin Donohue 
                                          ---------------------
                                       J. Kevin Donohue
                                       Chairman of the Board and 
                                       Chief Executive Officer

Date:  November 14, 1996               By:/S/ Ronald J. Restivo 
                                          ----------------------
                                       Ronald J. Restivo
                                       Treasurer and Chief Financial
                                       Officer (Principal Financial and
                                       Accounting Officer)