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<B><U><FONT FACE="Times" SIZE=5><P ALIGN="CENTER">FORM 10-Q</P>
</U></FONT><FONT FACE="Times"><P ALIGN="CENTER">SECURITIES AND EXCHANGE COMMISSION<BR>
Washington, D.C. 20549</P>
</B><P>(Mark One)</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=678>
<TR><TD WIDTH="6%" VALIGN="TOP" HEIGHT=22>
<P ALIGN="JUSTIFY"><B><FONT FACE="Times">[X]</B></FONT></TD>
<TD WIDTH="94%" VALIGN="TOP" HEIGHT=22>
<B><FONT FACE="Times"><P ALIGN="JUSTIFY">QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</B></FONT></TD>
</TR>
</TABLE>

<B><FONT FACE="Times"><P ALIGN="CENTER">For the Quarter Ended June 30, 1999<BR>
<BR>
OR</P></B></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=679>
<TR><TD WIDTH="6%" VALIGN="TOP" HEIGHT=22>
<P ALIGN="JUSTIFY"><B><FONT FACE="Times">[   ]</B></FONT></TD>
<TD WIDTH="94%" VALIGN="TOP" HEIGHT=22>
<B><FONT FACE="Times"><P ALIGN="JUSTIFY">TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</B></FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P ALIGN="CENTER">For the transition period from <U>                        </U> to <U>   
                     </P>
</U><P ALIGN="CENTER"><BR>
<B>Commission File No. 0-9600<BR>
</B><BR>
</FONT><B><FONT FACE="Times" SIZE=5>CPAC, INC.<BR>
</B></FONT><FONT FACE="Times">(Exact name of Registrant as Specified in its Charter)</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=685>
<TR><TD WIDTH="52%" VALIGN="TOP" HEIGHT=26>
<P ALIGN="CENTER"><B><FONT FACE="Times">New York</B></FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=26><P></P></TD>
<TD WIDTH="44%" VALIGN="TOP" HEIGHT=26>
<B><FONT FACE="Times"><P ALIGN="CENTER">16-0961040</B></FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">(State or Other Jurisdiction of Incorporation or Organization)</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="44%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">(IRS Employer Identification Number)</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP" HEIGHT=26>
<B><FONT FACE="Times"><P ALIGN="CENTER">2364 Leicester Rd., Leicester, New York</B></FONT></TD>
<TD WIDTH="4%" VALIGN="TOP" HEIGHT=26><P></P></TD>
<TD WIDTH="44%" VALIGN="TOP" HEIGHT=26>
<B><FONT FACE="Times"><P ALIGN="CENTER">14481</B></FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">(Address of Principal Executive Offices)</FONT></TD>
<TD WIDTH="4%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="44%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">(ZIP Code)</FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P ALIGN="CENTER"><BR>
Registrant's telephone number, including area code: (716) 382-3223</P>
<P>Securities registered under Sec. 12(g) of the Act:</P>
<B><P ALIGN="CENTER">$.01 Par Value Common Stock<BR>
</B>(Title of Class)</P>
<P ALIGN="JUSTIFY">The Registrant 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 and has been subject to such filing requirements for the past 90 days.  
                     Yes [ X ]          No [    ]</P>
<P ALIGN="JUSTIFY">As of June 30, 1999, there were outstanding 6,210,563 shares of the Company's Common Stock, $.01 Par Value. Options for 849,495 shares of the Company's Common Stock are outstanding but have not yet been exercised. Shares to cover
the options will not be issued until they are exercised.</P>
<P ALIGN="JUSTIFY"> <PAGE 1></P>
<B><U><P ALIGN="CENTER">CPAC, INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">INDEX</P></B></U></FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=665>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="79%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="12%" VALIGN="TOP">
<B><FONT FACE="Times"><P ALIGN="CENTER">Page No.</B></FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=29><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=29>
<B><FONT FACE="Times"><P ALIGN="CENTER">PART I -- FINANCIAL INFORMATION</B></FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=29><P></P></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 1.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="JUSTIFY">Financial Statements</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="JUSTIFY">CPAC, Inc. and Subsidiaries Consolidated Balance Sheets -- June 30, 1999 (Unaudited), and March 31, 1999</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER"> 3</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="JUSTIFY">CPAC, Inc. and Subsidiaries Consolidated Statements of Operations and Comprehensive Income -- Three Months Ended June 30, 1999, and June 30, 1998 (Unaudited)</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER"> 4</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="JUSTIFY">CPAC, Inc. and Subsidiaries Consolidated Statements of Cash Flows -- Three Months Ended June 30, 1999, and June 30, 1998 (Unaudited)</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER"> 5</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="JUSTIFY">Notes to Consolidated Financial Statements</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER"> 6</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 2.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="JUSTIFY">Management's Discussion and Analysis of Financial Condition and Results of Operations</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER"> 8</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 3.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="JUSTIFY">Quantitative and Qualitative Disclosures about Market Risk</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">13</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=6><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=6><P></P></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=6><P></P></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<B><FONT FACE="Times"><P ALIGN="CENTER">PART II -- OTHER INFORMATION</B></FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 1.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P>Legal Proceedings</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">14</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 2.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P>Changes in Securities</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">14</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 3.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P>Defaults Upon Senior Securities</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">14</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 4.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P>Submission of Matters to a Vote of Security Holders</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">14</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 5.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P>Other Information</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">14</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">Item 6.</FONT></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P>Exhibits and Reports on Form 8-K</FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">14</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<B><FONT FACE="Times"><P>SIGNATURE PAGE</B></FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">16</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="MIDDLE" HEIGHT=28><P></P></TD>
<TD WIDTH="79%" VALIGN="MIDDLE" HEIGHT=28>
<B><FONT FACE="Times"><P>EXHIBIT INDEX</B></FONT></TD>
<TD WIDTH="12%" VALIGN="MIDDLE" HEIGHT=28>
<FONT FACE="Times"><P ALIGN="CENTER">17</FONT></TD>
</TR>
</TABLE>
</CENTER></P>

<FONT FACE="Times"><P ALIGN="CENTER"> </P>
<P> <PAGE 2> </P>
<B><U><P ALIGN="CENTER">CPAC, INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">CONSOLIDATED BALANCE SHEETS</P>
</B></U><P> </P></FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=646>
<TR><TD WIDTH="60%" VALIGN="TOP" HEIGHT=5>
<P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=5>
<B><U><FONT FACE="Times"><P ALIGN="CENTER">June 30, 1999</P>
</B></U><P ALIGN="CENTER">(Unaudited)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=5>
<B><U><FONT FACE="Times"><P ALIGN="CENTER">March 31, 1999</P>
</B></U><P ALIGN="CENTER">(Note)</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="TOP" HEIGHT=5>
<B><U><FONT FACE="Times"><P ALIGN="CENTER">ASSETS</B></U></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=5><P></P></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Current assets:</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Cash and cash equivalents</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">$   1,131,702</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">$      412,123</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=5>
<FONT FACE="Times"><P>   Accounts receivable (net of allowance for doubtful accounts of $806,000 and $811,000, respectively)</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=5>
<FONT FACE="Times"><P ALIGN="RIGHT">15,801,299</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=5>
<FONT FACE="Times"><P ALIGN="RIGHT">17,558,251</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Inventory</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">20,524,673</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">20,423,101</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Prepaid expenses and other current assets</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">    2,554,935</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     2,603,447</U></FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Total current assets</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">40,012,609</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">40,996,922</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Property, plant and equipment, net</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">20,736,570</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">20,363,338</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=5>
<FONT FACE="Times"><P>Goodwill and intangible assets (net of amortization of $2,023,909 and $1,883,216, respectively</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=5>
<FONT FACE="Times"><P ALIGN="RIGHT">13,295,450</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=5>
<FONT FACE="Times"><P ALIGN="RIGHT">13,434,709</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=5>
<FONT FACE="Times"><P>Other assets</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=5>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     2,060,261</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=5>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     2,106,698</U></FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=5><P></P></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=5>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 76,104,890</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=5>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 76,901,667</U></FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="TOP" HEIGHT=5>
<B><U><FONT FACE="Times"><P ALIGN="CENTER">LIABILITIES AND SHAREHOLDERS' EQUITY</B></U></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=5><P></P></TD>
<TD WIDTH="19%" VALIGN="TOP" HEIGHT=5><P></P></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Current liabilities:</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Current portion of long-term debt</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">$    484,094</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">$     542,303</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Accounts payable</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">5,489,362</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">5,537,743</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Accrued payroll and related expenses</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">1,793,732</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">1,867,699</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Accrued income taxes payable</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">1,170,979</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">531,755</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Other accrued expenses and liabilities</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">    2,171,911</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">    2,755,162</U></FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Total current liabilities</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">11,110,078</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">11,234,662</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Long-term debt, net of current portion</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">7,583,818</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">7,636,552</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Other long-term liabilities</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">4,101,080</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">4,048,533</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Shareholders' equity:</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM">
<FONT FACE="Times"><P>   Common stock, par value $0.01 per share;</P>
<P>     Authorized 20,000,000 shares;</P>
<P>     Issued 6,295,870 shares and 6,464,533 shares, respectively</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="RIGHT">62,959</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="19%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="RIGHT">64,645</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Additional paid-in capital</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">18,500,748</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">19,762,851</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Retained earnings</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">36,004,233</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">35,279,720</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Accumulated other comprehensive income</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     (667,838</U>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     (535,108</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">53,900,102</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">54,572,108</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Less: Treasury stock, at cost, 85,307 shares</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     (590,188</U>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     (590,188</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Total shareholders' equity</FONT></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">   53,309,914</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">   53,981,920</U></FONT></TD>
</TR>
<TR><TD WIDTH="60%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 76,104,890</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="19%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 76,901,667</U></FONT></TD>
</TR>
</TABLE>
</CENTER></P>

<FONT FACE="Times" SIZE=2><P ALIGN="CENTER">Note: The balance sheet at March 31, 1999 has been taken from the audited financial statements of that date.</P>
</FONT><FONT FACE="Times"><P ALIGN="CENTER">The accompanying notes are an integral part of the financial statements.</P>
<P>  <PAGE 3></P>
<B><U><P ALIGN="CENTER">CPAC, INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME</P>
<P ALIGN="CENTER">FOR THE THREE MONTHS ENDED</P>
<P ALIGN="CENTER">JUNE 30, 1999 AND JUNE 30, 1998</P>
<P ALIGN="CENTER">UNAUDITED</P>
</B></U><P> </P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=655>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<P></TD>
<TD WIDTH="17%" VALIGN="MIDDLE" HEIGHT=17>
<B><FONT FACE="Times"><P ALIGN="CENTER">    <U>1999</B></U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT FACE="Times"><P ALIGN="CENTER">    <U>1998</B></U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Net sales</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 26,479,554</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 27,006,710</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Costs and expenses:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Cost of sales</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">15,079,212</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">15,111,596</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Selling, administrative and engineering expenses</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">9,088,242</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">9,409,650</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Research and development expense</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">192,302</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">180,380</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Interest expense, net</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">        200,228</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">       183,075</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">   24,559,984</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">   24,884,701</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Income before income tax expense</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">1,919,570</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">2,122,009</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Provision for income tax expense</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">       784,000</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">       863,000</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Net income</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$  1,135,570</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$  1,259,009</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Income per common share:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Basic</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$           0.18</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$           0.18</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Diluted</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$           0.18</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$           0.18</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Average common shares outstanding:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Basic</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">    6,253,972</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">    6,912,321</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Diluted</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">    6,284,819</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">    6,980,328</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Comprehensive income:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Net income</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">$   1,135,570</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">$   1,259,009</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Other comprehensive income (loss)</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     (132,730</U>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">        458,510</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Comprehensive income</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$   1,002,840</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$   1,717,519</U></FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P> </P>
<P ALIGN="CENTER">The accompanying notes are an integral part of the financial statements.</P>
<P ALIGN="CENTER"> </P>
<P>  <PAGE 4></P>
<B><U><P ALIGN="CENTER">CPAC, INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">CONSOLIDATED STATEMENTS OF CASH FLOWS</P>
<P ALIGN="CENTER">FOR THE THREE MONTHS ENDED</P>
<P ALIGN="CENTER">JUNE 30, 1999 AND JUNE 30, 1998</P>
<P ALIGN="CENTER">UNAUDITED</P>
</B></U><P> </P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=655>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT FACE="Times"><P ALIGN="CENTER">     <U>1999</B></U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<B><FONT FACE="Times"><P ALIGN="CENTER">    <U>1998</B></U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Cash flows from operating activities:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Net income</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$   1,135,570</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$   1,259,009</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Adjustments to reconcile net income to net cash provided by (used in) operating activities:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Depreciation and amortization</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">671,958</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">625,836</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Amortization of intangible assets</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">145,561</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">132,957</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Changes in assets and liabilities, net of effects of business acquisitions:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Accounts receivable</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">1,749,392</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">846,995</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Inventory</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(111,392)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">1,895,592</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Accounts payable</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(51,007)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(374,654)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Accrued expenses & liabilities</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(19,891)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(85,697)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Other changes, net</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">        132,624</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">        301,584</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>         Total adjustments</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     2,517,245</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     3,342,613</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>            Net cash provided by operating activities</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     3,652,815</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     4,601,622</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Cash flows from investing activities:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Purchase of property, plant, and equipment, net</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(1,055,111)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(861,999)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Business acquisition, net of cash acquired</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">                     </U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     (312,563</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Net cash used in investing activities</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">  (1,055,111</U>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">  (1,174,562</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Cash flows from financing activities:</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Common stock repurchase</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(1,288,227)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(274,138)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Issuance of common stock</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">24,438</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">84,078</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Repayment of long-term borrowings</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(203,207)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(3,344,762)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Payment of cash dividends</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     (411,057</U>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">                    </U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Net cash used in financing activities</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">  (1,878,053</U>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">  (3,534,822</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>   Effect of exchange rate changes on cash</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">              (72</U>)</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">            9,009</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>      Net increase (decrease) in cash and cash equivalents</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">719,579</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P ALIGN="RIGHT">(98,753)</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Cash and cash equivalents -- beginning of period</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">        412,123</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">     5,226,128</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="BOTTOM" HEIGHT=17>
<FONT FACE="Times"><P>Cash and cash equivalents -- end of period</FONT></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$   1,131,702</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="17%" VALIGN="BOTTOM" HEIGHT=17>
<U><FONT FACE="Times"><P ALIGN="RIGHT">$   5,127,375</U></FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P> </P>
<P ALIGN="CENTER">The accompanying notes are an integral part of the financial statements.</P>
<P> <PAGE 5> </P>
<B><U><P ALIGN="CENTER">CPAC, INC. AND SUBSIDIARIES</P>
<P ALIGN="CENTER">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</P>
<P ALIGN="CENTER">UNAUDITED</P>
</B></U><P> </P>
<B><P ALIGN="JUSTIFY">1 -- <U>CONSOLIDATED FINANCIAL STATEMENTS</P>
</B></U><P ALIGN="JUSTIFY">	The consolidated balance sheets, the consolidated statements of operations and comprehensive income, and the consolidated statements of cash flows for the three-month period ended June 30, 1999 and June 30, 1998
have been prepared by the Company without audit. In the opinion of management, all adjustments necessary to present fairly the financial position, results of operations, and changes in cash flows at June 30, 1999 (which include only normal recurring
adjustments), have been made. </P>
<P ALIGN="JUSTIFY">	Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these consolidated
financial statements be read in conjunction with the financial statements and notes thereto included in the Company's March 31, 1999, annual report to shareholders. The results of operations for the three months ended June 30, 1999, are not
necessarily indicative of the operating results for the full year. </P>
<P ALIGN="JUSTIFY"> </P>
<B><P ALIGN="JUSTIFY">2 -- <U>INVENTORY</P>
</B></U><P ALIGN="JUSTIFY">	Inventory is summarized as follows:</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=618>
<TR><TD WIDTH="51%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="24%" VALIGN="TOP">
<B><U><FONT FACE="Times"><P ALIGN="RIGHT">June 30, 1999</B></U></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="20%" VALIGN="TOP">
<B><U><FONT FACE="Times"><P ALIGN="RIGHT">March 31, 1999</B></U></FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">         Raw materials and purchased parts</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">$   7,432,485</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">$   7,773,946</FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">         Work-in-process</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">1,488,351</FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">1,396,775</FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">         Finished goods</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">   11,603,837</U></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="20%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">   11,252,380</U></FONT></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="24%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 20,524,673</U></FONT></TD>
<TD WIDTH="5%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="20%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 20,423,101</U></FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> </P>
<B><P ALIGN="JUSTIFY">3 -- <U>EARNINGS PER SHARE</P>
</B></U><P ALIGN="JUSTIFY">	Basic earnings per share are based upon the weighted-average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted-average common shares outstanding during the
period plus the dilutive effect of shares issuable through stock options and warrants. The shares used in calculating basic and diluted earnings per share are reconciled as follows:</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=624>
<TR><TD WIDTH="63%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="37%" VALIGN="TOP" COLSPAN=3>
<B><FONT FACE="Times"><P ALIGN="CENTER">Three Months Ended June 30,</B></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="18%" VALIGN="TOP">
<B><FONT FACE="Times"><P ALIGN="CENTER">    <U>1999</B></U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="15%" VALIGN="TOP">
<B><FONT FACE="Times"><P ALIGN="CENTER">   <U>1998</B></U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="TOP">
<FONT FACE="Times"><P>         Basic weighted average number of shares outstanding</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">6,253,972</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="15%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">6,912,321</FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="TOP">
<FONT FACE="Times"><P>         Effect of dilutive stock options</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">      30,847</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="15%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">      68,007</U></FONT></TD>
</TR>
<TR><TD WIDTH="63%" VALIGN="TOP">
<FONT FACE="Times"><P>         Dilutive shares outstanding</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT"> 6,284,819</U></FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="15%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT"> 6,980,328</U></FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY">	Unexercised stock options to purchase 648,968 and 691,597 shares of the Company's common stock as of June 30, 1999 and 1998, respectively, were not included in the computations of diluted EPS because the options' exercise
prices were greater then the average market price of the Company's common stock during the respective periods. These options, issued at various dates from 1994 to 1999, are still outstanding at the end of the period.</P>
<P ALIGN="JUSTIFY">  <PAGE 6></P>
<B><P ALIGN="JUSTIFY">4 -- <U>COMPREHENSIVE INCOME</P>
</B></U><P ALIGN="JUSTIFY">	Other comprehensive income (loss) includes foreign currency translation adjustments. </P>
<P ALIGN="JUSTIFY"> </P>
<B><P ALIGN="JUSTIFY">5 -- <U>SEGMENT INFORMATION</P>
</B></U><P ALIGN="JUSTIFY">	For purposes of financial reporting, the Company operates in two industry segments: the Fuller Brands segment and the Imaging segment. Information concerning the Company's business segments for the quarters ended June 
30, 1999 and 1998 are as follows:</P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=610>
<TR><TD WIDTH="58%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="23%" VALIGN="TOP">
<B><FONT FACE="Times"><P ALIGN="CENTER">    <U>1999</B></U></FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<B><FONT FACE="Times"><P ALIGN="CENTER">   <U>1998</B></U></FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>Net sales to customers:</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="19%" VALIGN="TOP">
<P> </TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>   Fuller Brands</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">$ 16,163,449</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">$ 17,160,131</FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>   Imaging</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">   10,316,105</U></FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">     9,846,579</U></FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>      Total net sales to customers</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 26,479,554</U></FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 27,006,710</U></FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>Operating income:</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="19%" VALIGN="TOP">
<P> </TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>   Fuller Brands</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">1,319,788</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">1,470,293</FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>   Imaging</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">       859,828</U></FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">      726,375</U></FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">2,179,616</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">2,196,668</FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>   Corporate income (loss)</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">(59,818)</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">108,416</FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>   Interest expense, net</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">     (200,228</U>)</FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">    (183,075</U>)</FONT></TD>
</TR>
<TR><TD WIDTH="58%" VALIGN="TOP"><DIR>
<DIR>
<DIR>
<DIR>

<FONT FACE="Times"><P>      Consolidated pretax income</DIR>
</DIR>
</DIR>
</DIR>
</FONT></TD>
<TD WIDTH="23%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">$  1,919,570</U></FONT></TD>
<TD WIDTH="19%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="RIGHT">$ 2,122,009</U></FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P ALIGN="JUSTIFY">	Sales between segments are not material.</P>
<P ALIGN="JUSTIFY"> </P>
<B><P ALIGN="JUSTIFY">6 -- <U>SHAREHOLDERS' EQUITY</P>
</B></U><P ALIGN="JUSTIFY">	<U>Cash Dividends</P>
</U><P ALIGN="JUSTIFY">	On June 2, 1999 the Company's Board of Directors declared a $.065 a common share cash dividend, which was paid on June 29, 1999.</P>
<P ALIGN="JUSTIFY">	<U>Stock Repurchase</P>
</U><P ALIGN="JUSTIFY">	For the quarters ended June 30, 1999 and 1998, respectively, the Company repurchased 172,569 and 26,975 shares of its common stock at an average cost of $7.47 and $10.16 per share, for a total cost of approximately
$1,288,000 and $274,000 as part of previously announced Board of Directors' authorized stock buyback plans.</P>
<P ALIGN="JUSTIFY"> </P>
<B><P ALIGN="JUSTIFY">7 -- <U>LITIGATION</P>
</B></U><P ALIGN="JUSTIFY">	No material litigation is pending to which the Company and/or its subsidiaries are a party, or which property of the Company and/or its subsidiaries is the subject.</P>
<P ALIGN="JUSTIFY">  <PAGE 7></P>
<B><P>Item 2.        <U>MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL</B> <B>CONDITION AND RESULTS OF OPERATIONS</P>
<P ALIGN="CENTER">LIQUIDITY AND CAPITAL RESOURCES</P>
</B></U><P ALIGN="JUSTIFY">	The Company continued to generate positive operating cash flows during the first three months of fiscal 2000, allowing it to fund various strategic opportunities. During the quarter, the Company spent approximately
$1,288,000 in repurchasing its own common stock, $1,055,000 in various capital projects including the continued construction of the CPAC Asian manufacturing facility and the Fuller Brands North American distribution center, and $411,000 for payment of
dividends on its common stock. It is expected that capital expenditures for the CPAC Asia facility will approximate $300,000 - $400,000 during the next quarter, which will substantially complete the project. The Company also expects additional
capital expenditures for the Imaging and Fuller Brands segments to be reduced from their present levels over the last 9 months of fiscal 2000.</P>
<P ALIGN="JUSTIFY">	The Company maintains a line of credit facility with BankAmerica Corp. (formerly NationsBank), with a borrowing capacity of $20,000,000. At June 30, 1999, the Company had approximately $181,000 outstanding on the line. The
interest rate is the lower of prime or the 30-day LIBOR rate plus .75%. The line of credit facility matures on October 31, 2000 and requires meeting certain financial covenants, with which the Company was in compliance at June 30, 1999, or
appropriate waivers were obtained.</P>
<P ALIGN="JUSTIFY">	CPAC Asia LTD. has a line of credit with an international bank amounting to 15,760,000 baht (approximately $420,000 based on the first quarter ended conversion rate in Thailand), with interest at prime plus 1% (Thailand prime was
9.25%) and collateralized by a standby letter of credit (LOC) guaranteed by CPAC, Inc. CPAC Asia LTD. had no outstanding borrowings against the line at the end of its first quarter. The Company is currently involved in discussions with an international
bank to replace existing short term borrowings used to finance the purchase of the property, construction of the facility, and fund certain start up expenses with longer term financing. It is expected that this financing will be completed by
September 30, 1999.</P>
<P ALIGN="JUSTIFY">	The working capital ratios at June 30, 1999, March 31, 1999, and June 30,1998 were 3.60 to 1; 3.65 to 1; and 3.71 to 1. Net working capital decreased over this quarter and the previous year's
comparable quarter, due to the use of operating cash to fund programs and activities described above.</P>
<P ALIGN="JUSTIFY">	Management believes that its existing available lines of credit and cash flows from operations should be adequate to meet normal working capital needs, based on operations as of June 30, 1999. It is expected that additional
financing may be necessary to allow the Company to pursue future acquisitions.</P>
<B><U><P ALIGN="JUSTIFY">Asset Turnover Ratios</P></B></U></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=678>
<TR><TD WIDTH="36%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="21%" VALIGN="TOP">
<B><U><FONT FACE="Times"><P ALIGN="CENTER">June 30, 1999</B></U></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<B><U><FONT FACE="Times"><P ALIGN="CENTER">March 31, 1999</B></U></FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<B><U><FONT FACE="Times"><P ALIGN="CENTER">June 30, 1998</B></U></FONT></TD>
</TR>
<TR><TD WIDTH="36%" VALIGN="TOP">
<FONT FACE="Times"><P>   (1) Receivables-days outstanding</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">57.3 days</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">55.0 days</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">54.1 days</FONT></TD>
</TR>
<TR><TD WIDTH="36%" VALIGN="TOP">
<FONT FACE="Times"><P>   (2) Annual inventory turns</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">2.9 times</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">3.1 times</FONT></TD>
<TD WIDTH="21%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">3.0 times</FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P ALIGN="JUSTIFY">	The increase in receivable days outstanding as compared to the previous periods reflects a slight increase in Fuller Brand's days outstanding, as well as a lengthening in the Imaging segment's foreign operation's
days outstanding. The blended days' sales outstanding is not expected to waiver far from this level for the remainder of the year.</P>
<P ALIGN="JUSTIFY">	Inventory turns for the quarter ended June 30, 1999 compared to March 31, 1999 and the quarter ended June 30, 1999 are slightly less due to a buildup in inventory levels to meet expected sales demand, which did not
happen during the quarter. The Company is continuing to evaluate inventory levels based on forecasted sales and believes it can reduce inventory amounts over the next six to nine months without negatively impacting the Fuller Brands or Imaging
manufacturing operations or sacrificing customer service. </P>
<P ALIGN="JUSTIFY">  <PAGE 8></P>
<B><U><P ALIGN="CENTER">RESULTS OF OPERATIONS</P>
</B></U><P ALIGN="JUSTIFY">	For purposes of financial reporting, the Company operates in two industry segments: the Fuller Brands segment, which includes the manufacture and sale of specialty chemical cleaning products and related accessories (brushes,
brooms, mops) for commercial, janitorial, and consumer use, as well as personal care products such as soaps, shampoos, and skin care items, and the Imaging segment which includes the manufacture and sale of prepackaged chemical formulations, supplies, and
equipment systems to the imaging industry. The products of each segment are manufactured and marketed both in the U.S. and in other parts of the world. Sales between segments are not material.</P>
<P ALIGN="JUSTIFY">	Sales for the quarter ended June 30, 1999 decreased 2% over the quarter ended June 30, 1998. Sales for the quarter in the Fuller Brands segment decreased 5.8% compared with the quarter ended June 30, 1998. The
decrease was caused by a decrease in Cleaning Technologies Group wholesale distribution sales, as well as lower contract consumer sales for Fuller Brush. For the Imaging segment, overall sales increased 4.8%, due to increases in domestic photochemical and
medical imaging sales.</P>
<P ALIGN="JUSTIFY">	Gross margins were 43% for this quarter versus 43% for the year ended March 31, 1999 and 44% for the same quarter last year. Gross margins in the Fuller Brands segment were 47.3%, 46.8%, and 47% for the quarter ended June 
30, 1999, the year ended March 31, 1999, and the quarter ended June 30, 1998, respectively. Consistency in margins over these periods is a function of product mix sold (higher margins for Fuller and Stanley products, versus lower margins for CTG
products). Gross margins in the Imaging segment were 36.3%, as compared to 37.4% for the year ended March 31, 1999 and 38.9% for the same quarter last year. Although sales increased in the Imaging segment, continued pressures in the color and black
and white imaging markets continue to decrease gross margins. The Company continues to pursue manufacturing efficiencies in the Great Bend Fuller Brands' operation. While the Company believes these efficiencies will begin to be earned in the late second
or early third quarter periods, it may not be reflected in the blended margin for Fuller Brands, if CTG sales increase. This "masking" of margin improvement is due to CTG margins being closer to 33%, as opposed to the consumer side of Fuller's business
where margins are higher.</P>
<P ALIGN="JUSTIFY">	Selling, administrative, and engineering costs this quarter were 34.3%, versus 33.4% for the year ended March 31, 1999, versus 34.8% for the same quarter last year. In the Fuller Brands segment, selling, administrative, and
engineering costs for this quarter increased to 38.4% from 36.7% for the year ended March 31, 1999, and 37.7% for the same quarter last year. The increase is partially attributable to freight increases, as well as continued higher selling expenses in
the CTG market, in an effort to increase sales in the commercial cleaning and janitorial market. In the Imaging segment, selling, administrative, and engineering costs were 27.4% versus 29% for the year ended March 31, 1999, versus 30.9% for the same
quarter last year. The decrease is attributable to cost reduction efforts including personnel reductions in several of the imaging operations.</P>
<P ALIGN="JUSTIFY">	Net interest expense for the quarter ended June 30, 1999 versus the comparable quarter last year is higher due to a reduction in cash on hand and increased borrowings used to support the Company's property, plant, and equipment
expenditures at CPAC Asia and Fuller Brands, as well as fund the stock buy-back program.</P>
<P ALIGN="JUSTIFY">	The provision for income taxes as a percentage of pretax income for the quarter was 40.8% versus 41.2% for the year ended March 31, 1999, and versus 40.7% for the quarter ended June 30, 1998. The slight decrease from
March 31 is due to lower foreign income with resulting lower taxes. It is expected that the effective rate will remain in the 40% to 41% range for the remainder of the year.</P>
<P ALIGN="JUSTIFY"> <PAGE 9></P>
<P ALIGN="JUSTIFY">	Net income for the quarter ended June 30, 1999 decreased 9.8% over the comparable quarter largely due to the shortfall in profits in the Fuller Brands segment, as a result of lagging sales in the Cleaning Technologies Group's
business.</P>
<B><U><P ALIGN="JUSTIFY">Foreign Operations</P>
</B></U><P ALIGN="JUSTIFY">	Combined foreign sales for CPAC Europe, CPAC Italia, and CPAC Africa were up approximately 9% for the year, primarily due to Africa (CPAC Africa was acquired during fiscal 1999 and began consolidating their results during
the second quarter of fiscal 1999). CPAC Asia was not operational during the first quarter of fiscal 2000. Pretax profits, excluding CPAC Asia, declined 45% due partly to lower margin business replacing higher margin business due to the competitive market
conditions in the photochemical markets now invading much of Western and Eastern Europe. In addition, CPAC Asia during the quarter was not operational and incurred various start up expenses, negatively impacting profits. It is expected that CPAC Asia will
be operational during the Company's third fiscal quarter, and will provide income from operations. The rest of the Company's European operations are not expected to provide significant increases in revenue and income during the next quarter, due to a
slowdown in tourism and picture taking, as a result of the conflict in Kosovo and the weakness of the Euro. Africa is expected to have modest growth for the remainder of the year.</P>
<P ALIGN="JUSTIFY">	The Company has exposure to currency fluctuations and from time to time has utilized hedging programs (primarily forward foreign currency exchange contracts), to help minimize the impact of these fluctuations on results of
operations. At June 30, 1999 no forward foreign currency exchange contracts were outstanding. The Company does not hold or issue derivatives for trading purposes and is not a party to leveraged derivatives transactions. On a consolidated basis,
foreign currency exchange losses are included in income or expense as incurred and are not material to the results of operations.</P>
<B><U><P ALIGN="JUSTIFY">Year 2000 Issue</P>
</B></U><P ALIGN="JUSTIFY">	The Year 2000 issue is the result of computer software programs that were written using two digits rather than four to define the applicable year. Any computer programs or hardware that have date-sensitive software or
embedded chips may recognize a date using "00" as the year 1900 rather then the year 2000. This could result in a system failure or miscalculations causing disruptions of operations, including, among other things, a temporary inability to process
transactions, generate invoices, or engage in similar normal business activities. The Company is continuing work on its program to ensure that all of its significant date-sensitive computer software and hardware systems and other equipment utilized in its
various manufacturing, distribution and administration activities will be Year 2000 compliant and operational on a timely basis. The program addresses three distinct areas: Year 2000 readiness with internal hardware and software; internal embedded systems;
 and the readiness of external business partners, suppliers, vendors, banks, human resources and other service providers. The progress of the program is monitored and reported to management and the Board of Directors. </P>
<P ALIGN="JUSTIFY">	<U>Internal Hardware and Software</P>
</U><P ALIGN="JUSTIFY">	At the present time, approximately 95% of the Company's primary operating systems and related software have been reviewed and in most cases, have now been upgraded and certification of compliance from the respective
manufacturers or software companies has been reviewed. The largest system still in process is a production/MRP system in the Fuller Brands segment. The internal software programming of this system to ensure Year 2000 compliance is in process and working
toward completion in October 1999. </P>
<P ALIGN="JUSTIFY">	The Company is 95% complete in compiling a final listing of computer hardware for all locations, showing the individual items remaining to be updated and an estimate of the time needed to complete the process. Due to acquisition
related growth over the last several years, the </P>
<P ALIGN="JUSTIFY"> <PAGE 10></P>
<P ALIGN="JUSTIFY">Company has been routinely upgrading its computer hardware, most of which is already Year 2000 compliant. The Imaging segment is comprised of smaller stand alone operations run as decentralized units, that have not utilized large
mainframe environments but rather pre-packaged software under annual license arrangements that include all upgrades. At the domestic locations, this software has already been converted to a compliant status by the manufacturers. At the foreign operations,
the upgrade of software has now been completed and is in the process of final testing. The focus over the last four years for the remainder of our Imaging segment software systems has been a process of routine upgrade toward networks, primarily in a
Windows environment. In the Fuller Brands segment, systems were larger in size and developed over time with customized software applications, which have been upgraded as the business continues to grow. The Company relies on a number of third party
entities for core business and information packages and these third parties are working to correct all of the core programs, while the Company works to update the customized portions. </P>
<P ALIGN="JUSTIFY">	<U>Internal Embedded Systems</P>
</U><P ALIGN="JUSTIFY">	The Company also has a plan to address and track Year 2000 compliance with its infrastructure such as heating and cooling facilities, telephones and switchboards, security and fire systems, etc., which is approximately 85%
complete. Based on the project status to date, the Company does not expect to incur material additional costs to ensure that its internal embedded systems are Year 2000 compliant. </P>
<P ALIGN="JUSTIFY">	<U>Estimated Cost</P>
</U><P ALIGN="JUSTIFY">	The Company estimates that the total cost of ensuring Year 2000 compliance for internal hardware and software and embedded systems, including redeployed internal resources, will be approximately $500,000. Of this amount,
approximately $400,000 was expended over the three years ended March 31, 1999 with approximately 60% capitalized. The Company estimates that no more than $100,000 will be expended during the current fiscal year with approximately 25% capitalized.
Such amounts have been and are expected to be funded through operating cash flows. </P>
<P ALIGN="JUSTIFY">	<U>External Sources</P>
</U><P ALIGN="JUSTIFY">	The Company is performing a due-diligence process to determine the ability of our significant service providers, customers, and vendors to be Year 2000 compliant. Included in this process is an initial inventory of these
external sources, and a letter/confirmation campaign to understand the status of their own Y2K readiness, in order to assess any potential impact to our own systems and business operations. To date, the Company has not become aware of any specific
problems from these sources that would materially impact the Company's operations. However, the Company has no means of ensuring that these suppliers and customers (and in turn their suppliers and customers) will be Year 2000 ready. The inability of these
parties to complete the Year 2000 resolution process in a timely fashion, could have a material adverse effect on the Company. In addition, Year 2000 disruption in the general economic or governmental framework in the markets in which the Company
operates, could have a material adverse effect on the Company. Therefore, the Company's program includes the development of contingency plans for continuing operations in the event such problems arise. This stage of the Year 2000 program should be
completed during the summer of 1999 and will include, but not be limited to, development of backup procedures, identification of alternate product or service providers, and possible increases in safety levels of inventory. However, there can be no
assurance that such contingency plans will be sufficient to handle all problems that may arise. </P>
<P ALIGN="JUSTIFY">	The Company's plan to complete its Year 2000 modifications is based on management's best estimates, which were derived utilizing numerous assumptions of future events, availability of certain resources, and other factors. Management
does not believe that the cost of achieving Year 2000 compliance will significantly impact the results of the Company's operations or its financial position. However, there can be no guarantee that these estimates will be achieved and actual results could
differ materially from these plans. Specific factors that might cause material differences include, but are not limited to, the availability and cost of personnel trained in this area, the ability to locate and correct all relevant computer code, the
ability of significant suppliers, customers, and service providers to properly resolve their own Year 2000 issues, and other similar uncertainties. If factors occur that change these estimates or assumptions, the Year </P>
<P ALIGN="JUSTIFY"> <PAGE 11></P>
<P ALIGN="JUSTIFY">2000 issue could have a material adverse effect on the Company's results of operations, cash flows and financial condition. </P>
<B><U><P ALIGN="JUSTIFY">Euro Conversion</P>
</B></U><P ALIGN="JUSTIFY">	On January 1, 1999, the Euro became the common currency of eleven of the fifteen member states of the European Union. After the introduction of the Euro, the national currencies will remain legal tender in the
participating countries until mid-calendar-year 2002. During the dual currency phase, businesses must be capable of conducting commercial transactions in either the Euro or the national currency. After the dual currency phase, all businesses in
participating countries must conduct all transactions in the Euro and must convert their financial records and reports to be Euro-based. The Company expects that all its facilities will be capable of complying with the Euro conversion timetable and with
customer requirements for quoting and billing in Euro dollars. The Company's information technology systems are currently meeting the dual currency phase requirements, and it is anticipated that the final phase of the Euro conversion will not have a
negative effect on the Company.</P>
<B><U><P ALIGN="JUSTIFY">Forward-Looking Information</P>
</B></U><P ALIGN="JUSTIFY">	This Form 10-Q contains forward-looking statements, including statements covering the Year 2000 issue, that are based on current expectations, estimates and projections about the industries in which the Company operates, as
well as management's beliefs and assumptions. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," variations of such words and similar expressions are intended to identify such forward-looking statements. These
statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("Future Factors") which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or
forecasted in such forward-looking statements. The Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except for the Year 2000 issue, which will be
updated in accordance with the SEC rules and regulations.</P>
<P ALIGN="JUSTIFY">	The Future Factors that may affect the operations, performance and results of the Company's business include the following:</P></FONT>
<P ALIGN="RIGHT"><TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=636>
<TR><TD WIDTH="6%" VALIGN="TOP">
<P ALIGN="JUSTIFY"><FONT FACE="Times">a.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">general economic and competitive conditions in the markets and countries in which the Company operates, and the risks inherent in international operations;</FONT></TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">b.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">the timely resolution of the Year 2000 issue by the Company, its customers, suppliers, freight and distribution companies, and governmental authorities, in the markets in which the Company operates;</FONT></TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">c.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">the Company's ability to continue to control and reduce its costs of production;</FONT></TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">d.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">the level of demand for the Company's Imaging products and impact of digital imaging;</FONT></TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">e.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">the level of competition and consolidation within the imaging industry;</FONT></TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">f.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">the effect of changes in the distribution channels for Fuller Brands;</FONT></TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">g.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">the level of demand for Fuller Brands' contract manufactured products; </FONT></TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">h.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">the level of competition and consolidation within the commercial cleaning supply industry; and </FONT></TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">i.</FONT></TD>
<TD WIDTH="94%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">the strength of the U.S. dollar against currencies of other countries where the Company operates, as well as cross-currencies between the Company's operations outside of the U.S. and other countries with whom they
transact business.</FONT></TD>
</TR>
</TABLE>
</P>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> <PAGE 12></P>
<P ALIGN="JUSTIFY">	Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in the forward-looking statements. The Company does not intend
to update forward-looking statements.</P>
<P ALIGN="JUSTIFY"> </P>
<B><P>Item 3. 	<U>QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</P>
</B></U><P ALIGN="JUSTIFY">	The information called for by this item is provided under the caption Foreign Operations under Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. Also see Item 7A.
Quantitative and Qualitative Disclosures about Market Risk in the Company's Form 10-K for the year ended March 31, 1999.</P>
<P> <PAGE 13> </P>
<B><U><P ALIGN="CENTER">PART II</P>
<P ALIGN="CENTER">OTHER INFORMATION</P></B></U></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=660>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P ALIGN="JUSTIFY"><FONT FACE="Times">Item 1.</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">Legal Proceedings</U></FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">None</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Item 2.</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">Changes in Securities</U></FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">None</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Item 3.</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">Defaults Upon Senior Securities</U></FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">None</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Item 4.</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">Submission of Matters to a Vote of Security Holders</U></FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">None</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Item 5.</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">Other Information</U></FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">None</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Item 6.</FONT></TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">Exhibits and Reports on Form 8-K</U></FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">a.   Exhibits</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">The following Exhibits, as applicable, are attached to this Quarterly Report (Form 10-Q). The Exhibit Index is found on the page immediately succeeding the signature page and the Exhibits follow on the pages
immediately succeeding the Exhibit Index.</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(2)   Plan of acquisition, reorganization, arrangement, liquidation, or succession</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(3)   Articles of incorporation, By-laws</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP"><DIR>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> 3.1   Certificate of Incorporation, as amended September 11, 1996, incorporated herein by reference to Form 10-Q, filed for the period ended September 30, 1996</DIR>
</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP"><DIR>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> 3.2    By-laws, as amended, incorporated herein by reference to Form 10-Q, filed for the period ended September 30, 1998</DIR>
</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(4)   Instruments defining the rights of security holders, including indentures</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP"><DIR>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> 4.1    Loan Agreement dated February 9, 1994, and Letter of Commitment dated December 16, 1993, incorporated herein by reference to Form 10-K filed for period ended March 31,
1994, as amended by Exhibits 99.1 to 99.3 filed as Exhibits to the Form 10-Q for the quarter ended December 31, 1994, and amended by Letter of extension and increase dated October 29, 1996, filed as Exhibit 99.1 to Form 10-Q for the quarter
ended September 30, 1996, and further amended by First Amendment to Second Amended and Restated Loan Agreement dated October 31, 1996, filed as Exhibit 4.1 to Form 10-Q for the quarter ended December 31, 1996, and further amended by
Agreement dated September 12, 1997 filed as Exhibit 99.1 to Form 10-Q for the quarter ended September 30, 1997, and further amended by Second Amendment to Second Amended and Restated Loan Agreement dated July 10, 1998, filed as Exhibit 
4.1 to Form 10Q for the quarter ended June 30, 1998</DIR>
</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(10)  Material contracts</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP"><DIR>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> 10.1   Employment Agreement between Thomas N. Hendrickson and CPAC, Inc. dated September 30, 1995, incorporated herein by reference to Form 10-Q for the period ended September 30, 1995, and
further amended by Extension of Employment Agreement dated July 20, 1998, incorporated herein by reference to Form 10-K for the period ended March 31, 1999</DIR>
</FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P> <PAGE 14></FONT>	</P>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=660>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP"><DIR>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> 10.2   CPAC, Inc. Executive Long-Term Stock Investment Plan, incorporated herein by reference to Amendment No. 1 to Form S-8 Registration Statement filed October 3, 1996</DIR>
</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP"><DIR>

<FONT FACE="Times"><P ALIGN="JUSTIFY">10.3   CPAC, Inc. 1996 Nonemployee Directors Stock Option Plan, incorporated herein by reference to Form S-8 Registration Statement filed October 3, 1996</DIR>
</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP"><DIR>

<FONT FACE="Times"><P ALIGN="JUSTIFY">10.4   Deferred Compensation Arrangement between Thomas N. Hendrickson and CPAC, Inc. dated October 13, 1992, incorporated herein by reference to Form 10-Q for the period ended December 31, 1992, and
amended by Amendment to Deferred Compensation Arrangement dated July 20, 1998, incorporated herein by reference to Form 10-K for the period ended March 31, 1999</DIR>
</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(11)  Statement re computation of per share earnings (loss)</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(15)  Letter re unaudited interim financial information</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(18)  Letter re change in accounting principles</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(19)  Report furnished to security holders</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(22)  Published report regarding matters submitted to vote of security holders</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(23)  Consents of experts and counsel</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(24)  Power of attorney</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(27)  Financial data schedule</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">(99)  Additional exhibits</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">        Not applicable</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">b.    Reports Filed on Form 8-K</FONT></TD>
</TR>
<TR><TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="3%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="88%" VALIGN="TOP"><DIR>

<FONT FACE="Times"><P ALIGN="JUSTIFY">1.       On April 28, 1999, the Company filed a Current Report (Form 8-K) with respect to the April 20, 1999 appointment of David P. Biehn by the Registrant to its Board of
Directors, increasing the Board's size to six members.</DIR>
</FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY"> </P>
<P ALIGN="JUSTIFY">  <PAGE 15></P>
<B><U><P ALIGN="CENTER">SIGNATURES</P>
</B></U><P ALIGN="JUSTIFY">	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.</P>
<P ALIGN="JUSTIFY"> </P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=683>
<TR><TD WIDTH="40%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="51%" VALIGN="TOP">
<B><FONT FACE="Times"><P ALIGN="CENTER">CPAC, INC.</B></FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="51%" VALIGN="TOP">
<P> </TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">Date  <U>             August 12, 1999              </U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">By</FONT></TD>
<TD WIDTH="51%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">/s/ Thomas N. Hendrickson                             
      </U></FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="51%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Thomas N. Hendrickson,</P>
<P ALIGN="JUSTIFY">President, Chief Executive Officer, Treasurer</FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="51%" VALIGN="TOP">
<P> </TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">Date  <U>             August 12, 1999              </U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">By</FONT></TD>
<TD WIDTH="51%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">/s/ Thomas J. Weldgen                             
              </U></FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="51%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Thomas J. Weldgen,</P>
<P ALIGN="JUSTIFY">Vice President Finance and Chief Financial Officer</FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="51%" VALIGN="TOP">
<P> </TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">Date  <U>             August 12, 1999              </U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="RIGHT">By</FONT></TD>
<TD WIDTH="51%" VALIGN="TOP">
<U><FONT FACE="Times"><P ALIGN="JUSTIFY">/s/ James W. Pembroke                               
            </U></FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="9%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="51%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">James W. Pembroke,</P>
<P ALIGN="JUSTIFY">Chief Accounting Officer</FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P> <PAGE 16></P>
<B><U><P ALIGN="CENTER">EXHIBIT INDEX</P></B></U></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=672>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P ALIGN="CENTER"><B><U><FONT FACE="Times">Exhibit</B></U></FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="10%" VALIGN="TOP">
<B><U><FONT FACE="Times"><P ALIGN="CENTER">Page</B></U></FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER"> 2.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Plan of acquisition, reorganization, arrangement, liquidation, or succession</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER"> 3.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Articles of incorporation, By-laws</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<P> </TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY"> 3.1    Certificate of Incorporation, as amended September 11, 1996, incorporated herein by reference to Form 10-Q, filed for the period ended September 30, 1996</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY"> 3.2    By-laws, as amended, incorporated herein by reference to Form 10-Q, filed for the period ended September 30, 1998</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER"> 4.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Instruments defining the rights of security holders, including indentures</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<P> </TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY"> 4.1    Loan Agreement dated February 9, 1994, and Letter of Commitment dated December 16, 1993, incorporated herein by reference to Form 10-K filed for period ended March 31,
1994, as amended by Exhibits 99.1 to 99.3 filed as Exhibits to the Form 10-Q for the quarter ended December 31, 1994, and amended by Letter of extension and increase dated October 29, 1996, filed as Exhibit 99.1 to Form 10-Q for the quarter
ended September 30, 1996, and further amended by First Amendment to Second Amended and Restated Loan Agreement dated October 31, 1996, filed as Exhibit 4.1 to Form 10-Q for the quarter ended December 31, 1996, and further amended by
Agreement dated September 12, 1997 filed as Exhibit 99.1 to Form 10-Q for the quarter ended September 30, 1997, and further amended by Second Amendment to Second Amended and Restated Loan Agreement dated July 10, 1998, filed as Exhibit 
4.1 to Form 10Q for the quarter ended June 30, 1998</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">10.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Material contracts</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">10.1   Employment Agreement between Thomas N. Hendrickson and CPAC, Inc. dated September 30, 1995, incorporated herein by reference to Form 10-Q for the period ended September 30, 1995, and further
amended by Extension of Employment Agreement dated July 20, 1998, incorporated herein by reference to Form 10-K for the period ended March 31, 1999</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">10.2   CPAC, Inc. Executive Long-Term Stock Investment Plan, incorporated herein by reference to Amendment No. 1 to Form S-8 Registration Statement filed October 3, 1996</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">10.3   CPAC, Inc. 1996 Nonemployee Directors Stock Option Plan, incorporated herein by reference to Form S-8 Registration Statement filed October 3, 1996</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P> </TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">10.4   Deferred Compensation Arrangement between Thomas N. Hendrickson and CPAC, Inc. dated October 13, 1992, incorporated herein by reference to Form 10-Q for the period ended December 31, 1992, and
amended by Amendment to Deferred Compensation Arrangement dated July 20, 1998, incorporated herein by reference to Form 10-K for the period ended March 31, 1999</FONT></TD>
<TD WIDTH="10%" VALIGN="BOTTOM">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">11.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Statement re computation of per share earnings (loss)</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P> <PAGE 17></P></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=672>
<TR><TD WIDTH="10%" VALIGN="TOP">
<P ALIGN="CENTER"><FONT FACE="Times">15.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Letter re unaudited interim financial information</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">18.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Letter re change in accounting principles</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">19.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Report furnished to security holders</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">22.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Published report regarding matters submitted to vote of security holders</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">23.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Consents of experts and counsel</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">24.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Power of attorney</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">27.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Financial data schedule</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">19</FONT></TD>
</TR>
<TR><TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">99.</FONT></TD>
<TD WIDTH="80%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="JUSTIFY">Additional exhibits</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP">
<FONT FACE="Times"><P ALIGN="CENTER">N/A</FONT></TD>
</TR>
</TABLE>

<FONT FACE="Times"><P ALIGN="JUSTIFY"> <PAGE 18></P></FONT></BODY>
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