##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q



| |  |  | [X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
| |  |  | ---------------------------------------------------------------------------------------------

For the quarterly period ended September 30, 2002

OR



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

For the Transition period from _______________ to ________________

Commission File Number
0-20328

AMTROL INC.

---

(Exact Name of Registrant as Specified in its Charter)


|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Rhode
Island                                                   |  | 05-0246955                          
|                                                               |  |                                     
|(State or Other Jurisdiction of
Incorporation or Organization) |  | (I.R.S. Employer Identification No.)

1400 Division Road, West Warwick, RI 02893-1008

---

(Address of principal executive offices)


Registrants telephone number, including area
code: (401) 884-6300

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

Indicate the number of shares outstanding of each of the issuers classes of
common stock, as of the latest practicable date: $.01 Par Value: 100 shares of
Common stock as of November 13, 2002.





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TABLE OF CONTENTS



|                                                                                      |                                                                    |  |  |  |  |  |  | 
|------------------------------------------------------------------------------------- | ------------------------------------------------------------------ |  |  |  |  |  |  | 
|Consolidated Balance Sheets (In Thousands)                                           
|Consolidated Statements of Operations (Unaudited  in Thousands)                     
|Consolidated Statements of Shareholders Equity                                      
|Consolidated Statements of Cash Flows                                                
|NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)                               
|                                                                                      | ITEM 2.                                                           
|MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|                                                                                      | ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|                                                                                      | ITEM 4. CONTROLS AND PROCEDURES                                   
|PART II                                                                              
|                                                                                      | ITEM 1. LEGAL PROCEEDINGS                                         
|                                                                                      | ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS                 
|                                                                                      | ITEM 3. DEFAULTS UPON SENIOR SECURITIES                           
|                                                                                      | ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS       
|                                                                                      | ITEM 5. OTHER INFORMATION                                         
|                                                                                      | ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K                          
|SIGNATURES                                                                           
|CERTIFICATIONS                                                                       
|CERTIFICATIONS                                                                       



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##### Table of Contents



FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2002

INDEX

|        |  |                                                                                                                         |  |     
|------- |  | ----------------------------------------------------------------------------------------------------------------------- |  | ----
|        |  |                                                                                                                         |  | PAGE
|        |  |                                                                                                                         |  |     
|PART I  |  | FINANCIAL INFORMATION                                                                                                   |  |     
|        |  |                                                                                                                         |  |     
|Item 1. |  | Consolidated Balance Sheets 
September 30, 2002 and December 31, 2001                                                  |  | 3   
|        |  |                                                                                                                         |  |     
|        |  | Consolidated Statements of Operations 
For the Quarter and Nine Months Ended September 30,
2002 and September 30, 2001 |  | 4   
|        |  |                                                                                                                         |  |     
|        |  | Consolidated Statements of Shareholders Equity 
For the Nine Months Ended September 30, 2002 and
September 30, 2001   |  | 5   
|        |  |                                                                                                                         |  |     
|        |  | Consolidated Statements of Cash Flows 
For the Nine Months Ended September 30, 2002 and
September 30, 2001             |  | 6   
|        |  |                                                                                                                         |  |     
|        |  | Notes to Consolidated Financial Statements                                                                              |  | 7   
|        |  |                                                                                                                         |  |     
|Item 2. |  | Managements Discussion and Analysis of Financial
Condition and Results of Operations                                   |  | 14  
|        |  |                                                                                                                         |  |     
|Item 3. |  | Quantitative and Qualitative Disclosures About Market
Risk                                                              |  | 19  
|        |  |                                                                                                                         |  |     
|Item 4. |  | Controls and Procedures                                                                                                 |  | 19  
|        |  |                                                                                                                         |  |     
|PART II |  | OTHER INFORMATION                                                                                                       |  |     
|        |  |                                                                                                                         |  |     
|Item 1. |  | Legal Proceedings                                                                                                       |  | 21  
|        |  |                                                                                                                         |  |     
|Item 2. |  | Changes in Securities and Use of Proceeds                                                                               |  | 21  
|        |  |                                                                                                                         |  |     
|Item 3. |  | Defaults Upon Senior Securities                                                                                         |  | 21  
|        |  |                                                                                                                         |  |     
|Item 4. |  | Submission of Matters to a Vote of Security Holders                                                                     |  | 21  
|        |  |                                                                                                                         |  |     
|Item 5. |  | Other Information                                                                                                       |  | 21  
|        |  |                                                                                                                         |  |     
|Item 6. |  | Exhibits and Reports on Form 8-K                                                                                        |  | 21  
|        |  |                                                                                                                         |  |     
|        |  | Signatures                                                                                                              |  | 22  
|        |  |                                                                                                                         |  |     
|        |  | Certifications                                                                                                          |  | 23  

2



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##### Table of Contents



AMTROL INC. AND
SUBSIDIARIES




Consolidated Balance Sheets
(In thousands)


|                                        |                                                                           |                            |         |         |         |                    |         |                   |         |  |  | 
|--------------------------------------- | ------------------------------------------------------------------------- | -------------------------- | ------- | ------- | ------- | ------------------ | ------- | ----------------- | ------- |  |  | 
|                                        |                                                                           |                            |         |         |         | Unaudited          |         | Audited          
|                                        |                                                                           |                            |         |         |         | September 30, 2002 |         | December 31, 2001
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|ASSETS                                  |                                                                           |                            |         |         |         |                   
|Current Assets:                         |                                                                           |                            |         |         |         |                    |         |                  
|                                        | Cash and cash equivalents                                                 |                            | $       |        |         |                    | $       | 983               |        
|                                        | Accounts receivable, less allowance for doubtful accounts                 |                            |         | 30,026  |         |                    |         | 28,456            |        
|                                        | Inventories                                                               |                            |         | 23,435  |         |                    |         | 19,785            |        
|                                        | Deferred income taxes  short-term                                        |                            |         | 1,739   |         |                    |         | 1,739             |        
|                                        | Tax refund receivable                                                     |                            |         | 1,522   |         |                    |         | 1,623             |        
|                                        | Prepaid expenses and other                                                |                            |         | 556     |         |                    |         | 680               |        
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|                                        |                                                                           | Total current assets       |         |         | 57,278  |                    |         |                   | 53,266  | 
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|Property, Plant and Equipment, Net      |                                                                           |                            | 38,340  |         |         |                    | 41,192  |                  
|Other Assets:                           |                                                                           |                            |         |         |         |                    |         |                  
|                                        | Goodwill                                                                  |                            |         | 157,624 |         |                    |         | 157,292           |        
|                                        | Deferred financing costs                                                  |                            |         | 4,521   |         |                    |         | 4,233             |        
|                                        | Deferred income taxes  long-term                                         |                            |         | 7,209   |         |                    |         | 7,209             |        
|                                        | Other                                                                     |                            |         | 1,544   |         |                    |         | 1,263             |        
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|                                        |                                                                           | Total other assets         |         |         | 170,898 |                    |         |                   | 169,997 | 
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|                                        |                                                                           | $                          | 266,516 |         |         | $                  | 264,455 |                  
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|LIABILITIES AND SHAREHOLDERS EQUITY    |                                                                           |                            |         |         |         |                   
|Current Liabilities:                    |                                                                           |                            |         |         |         |                    |         |                  
|                                        | Current maturities of long-term debt                                      |                            | $       | 2,957   |         |                    | $       | 2,218             |        
|                                        | Notes payable to banks                                                    |                            |         | 7,320   |         |                    |         | 7,930             |        
|                                        | Accounts payable                                                          |                            |         | 22,882  |         |                    |         | 20,949            |        
|                                        | Accrued expenses                                                          |                            |         | 11,686  |         |                    |         | 10,856            |        
|                                        | Accrued interest                                                          |                            |         | 3,193   |         |                    |         | 752               |        
|                                        | Accrued income taxes                                                      |                            |         | 2,083   |         |                    |         | 1,959             |        
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|                                        |                                                                           | Total current liabilities  |         |         | 50,121  |                    |         |                   | 44,664  | 
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|Other Noncurrent Liabilities            |                                                                           |                            | 3,831   |         |         |                    | 4,061   |                  
|Long Term Debt, Less Current Maturities |                                                                           |                            | 157,252 |         |         |                    | 157,511 |                  
|Shareholders Equity:                   |                                                                           |                            |         |         |         |                    |         |                  
|                                        | Capital stock $.01 par value  authorized 1,000 shares,
100 shares issued |                            |         |        |         |                    |         |                  |        
|                                        | Additional paid-in capital                                                |                            |         | 99,273  |         |                    |         | 99,273            |        
|                                        | Retained deficit                                                          |                            |         | (40,888 | )       |                    |         | (36,064           | )      
|                                        | Accumulated other comprehensive loss                                      |                            |         | (3,073  | )       |                    |         | (4,990            | )      
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|                                        |                                                                           | Total shareholders equity |         |         | 55,312  |                    |         |                   | 58,219  | 
|                                        |                                                                           |                            |         |         |         |                    |         |                  
|                                        |                                                                           | $                          | 266,516 |         |         | $                  | 264,455 |                  
|                                        |                                                                           |                            |         |         |         |                    |         |                  

The accompanying notes are an
integral part of these consolidated financial statements.

3



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##### Table of Contents



AMTROL INC. AND SUBSIDIARIES




Consolidated Statements of Operations
(Unaudited  in Thousands)


|                                       |  |               |        |                   |  |               |        |               |  |   |         |   |  |   |         |  
|-------------------------------------- |  | ------------- | ------ | ----------------- |  | ------------- | ------ | ------------- |  | - | ------- | - |  | - | ------- | -
|                                       |  | QUARTER ENDED |        | NINE MONTHS ENDED
|                                       |  |               |        |                  
|                                       |  | September 30, |        | September 30,     |  | September 30, |        | September 30,
|                                       |  | 2002          |        | 2001              |  | 2002          |        | 2001         
|                                       |  |               |        |                   |  |               |        |              
|Net sales                              |  | $             | 47,381 |                   |  | $             | 45,417 |               |  | $ | 141,046 |   |  | $ | 140,636 |  
|Cost of goods sold                     |  |               | 35,881 |                   |  |               | 34,418 |               |  |   | 107,967 |   |  |   | 108,770 |  
|                                       |  |               |        |                   |  |               |        |               |  |   |         |   |  |   |         |  
|Gross profit                           |  |               | 11,500 |                   |  |               | 10,999 |               |  |   | 33,079  |   |  |   | 31,866  |  
|Operating expenses:                    |  |               |        |                   |  |               |        |               |  |   |         |   |  |   |         |  
|Selling, general and administrative    |  |               | 7,043  |                   |  |               | 6,715  |               |  |   | 21,077  |   |  |   | 20,391  |  
|Amortization of goodwill               |  |               |       |                   |  |               | 1,112  |               |  |   |        |   |  |   | 3,338   |  
|                                       |  |               |        |                   |  |               |        |               |  |   |         |   |  |   |         |  
|Income from operations                 |  |               | 4,457  |                   |  |               | 3,172  |               |  |   | 12,002  |   |  |   | 8,137   |  
|Other income (expense):                |  |               |        |                   |  |               |        |               |  |   |         |   |  |   |         |  
|Interest expense                       |  |               | (4,983 | )                 |  |               | (4,911 | )             |  |   | (14,906 | ) |  |   | (14,737 | )
|Interest income                        |  |               | 14     |                   |  |               | 22     |               |  |   | 43      |   |  |   | 96      |  
|License and distributorship fees       |  |               |       |                   |  |               | 73     |               |  |   | 40      |   |  |   | 219     |  
|Other, net                             |  |               | 8      |                   |  |               | (255   | )             |  |   | (668    | ) |  |   | 352     |  
|                                       |  |               |        |                   |  |               |        |               |  |   |         |   |  |   |         |  
|Loss before provision for income taxes |  |               | (504   | )                 |  |               | (1,899 | )             |  |   | (3,489  | ) |  |   | (5,933  | )
|Provision (benefit) for income taxes   |  |               | 526    |                   |  |               | (311   | )             |  |   | 1,335   |   |  |   | (595    | )
|                                       |  |               |        |                   |  |               |        |               |  |   |         |   |  |   |         |  
|Net loss                               |  | $             | (1,030 | )                 |  | $             | (1,588 | )             |  | $ | (4,824  | ) |  | $ | (5,338  | )
|                                       |  |               |        |                   |  |               |        |               |  |   |         |   |  |   |         |  

The accompanying notes are an
integral part of these consolidated financial statements.

4



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##### Table of Contents



AMTROL INC. AND
SUBSIDIARIES




Consolidated Statements of
Shareholders Equity


(Unaudited  in
Thousands)


Nine Months Ended September 30, 2002

|                            |                                            |   |              |   |                 |   |            |   |               |   |               |        |               |   |                   |       |   |   |        |        |  
|--------------------------- | ------------------------------------------ | - | ------------ | - | --------------- | - | ---------- | - | ------------- | - | ------------- | ------ | ------------- | - | ----------------- | ----- | - | - | ------ | ------ | -
|                            |                                            |   |              |   |                 |   |            |   |               |   |               |        |               |   | Accumulated Other |       |   |   |       
|                            |                                            |   |              |   |                 |   | Additional |   | Retained      |   | Comprehensive |        | Comprehensive
|                            |                                            |   | Common Stock |   | Paid-in Capital |   | Deficit    |   | Income (Loss) |   | Income (Loss)
|                            |                                            |   |              |   |                 |   |            |   |               |   |              
|Balance, December 31, 2001  |                                            | $ |             |   |                 | $ | 99,273     |   |               | $ | (36,064       | )      |               | $ | (4,990            | )     |   | $ |       |       
|                            | Net loss                                   |   |              |  |                 |   |            |  |               |   |               | (2,040 | )             |   |                   |      |   |   |        | (2,040 | )
|                            | Derivative instrument valuation adjustment |   |              |  |                 |   |            |  |               |   |               |       |               |   |                   | 304   |   |   |        | 304    |  
|                            | Currency translation adjustment            |   |              |  |                 |   |            |  |               |   |               |       |               |   |                   | (262  | ) |   |        | (262   | )
|                            |                                            |   |              |   |                 |   |            |   |               |   |               |        |               |   |                   |       |   |   |        |       
|Balance, March 31, 2002     |                                            |   |             |   |                 |   | 99,273     |   |               |   | (38,104       | )      |               |   | (4,948            | )     |   |   | (1,998 | )     
|                            | Net loss                                   |   |              |  |                 |   |            |  |               |   |               | (1,754 | )             |   |                   |      |   |   |        | (1,754 | )
|                            | Derivative instrument valuation adjustment |   |              |  |                 |   |            |  |               |   |               |       |               |   |                   | 204   |   |   |        | 204    |  
|                            | Currency translation adjustment            |   |              |  |                 |   |            |  |               |   |               |       |               |   |                   | 2,394 |   |   |        | 2,394  |  
|                            |                                            |   |              |   |                 |   |            |   |               |   |               |        |               |   |                   |       |   |   |        |       
|Balance, June 30, 2002      |                                            |   |             |   |                 |   | 99,273     |   |               |   | (39,858       | )      |               |   | (2,350            | )     |   |   | (1,154 | )     
|                            | Net loss                                   |   |              |  |                 |   |            |  |               |   |               | (1,030 | )             |   |                   |      |   |   |        | (1,030 | )
|                            | Derivative instrument valuation adjustment |   |              |  |                 |   |            |  |               |   |               |       |               |   |                   | (407  | ) |   |        | (407   | )
|                            | Currency translation adjustment            |   |              |  |                 |   |            |  |               |   |               |       |               |   |                   | (316  | ) |   |        | (316   | )
|                            |                                            |   |              |   |                 |   |            |   |               |   |               |        |               |   |                   |       |   |   |        |       
|Balance,
September 30, 2002 |                                            | $ |             |   |                 | $ | 99,273     |   |               | $ | (40,888       | )      |               | $ | (3,073            | )     |   | $ | (2,907 | )     
|                            |                                            |   |              |   |                 |   |            |   |               |   |               |        |               |   |                   |       |   |   |        |       

Nine Months Ended September 30, 2001

|                            |                                            |   |              |   |                 |   |            |       |               |   |               |        |               |   |                   |        |   |   |        |        |  
|--------------------------- | ------------------------------------------ | - | ------------ | - | --------------- | - | ---------- | ----- | ------------- | - | ------------- | ------ | ------------- | - | ----------------- | ------ | - | - | ------ | ------ | -
|                            |                                            |   |              |   |                 |   |            |       |               |   |               |        |               |   | Accumulated Other |        |   |   |       
|                            |                                            |   |              |   |                 |   | Additional |       | Retained      |   | Comprehensive |        | Comprehensive
|                            |                                            |   | Common Stock |   | Paid-in Capital |   | Deficit    |       | Income (Loss) |   | Income (Loss)
|                            |                                            |   |              |   |                 |   |            |       |               |   |              
|Balance, December 31, 2000  |                                            | $ |             |   |                 | $ | 89,903     |       |               | $ | (26,649       | )      |               | $ | (3,382            | )      |   | $ |       |       
|                            | Net loss                                   |   |              |  |                 |   |            |      |               |   |               | (2,455 | )             |   |                   |       |   |   |        | (2,455 | )
|                            | Repurchase of options and common stock     |   |              |  |                 |   |            | (141  | )             |   |               |       |               |   |                   |       |   |   |        |       |  
|                            | Derivative instrument valuation adjustment |   |              |  |                 |   |            |      |               |   |               |       |               |   |                   | (372   | ) |   |        | (372   | )
|                            | Currency translation adjustment            |   |              |  |                 |   |            |      |               |   |               |       |               |   |                   | (1,194 | ) |   |        | (1,194 | )
|                            |                                            |   |              |   |                 |   |            |       |               |   |               |        |               |   |                   |        |   |   |        |       
|Balance, March 31, 2001     |                                            |   |             |   |                 |   | 89,762     |       |               |   | (29,104       | )      |               |   | (4,948            | )      |   |   | (4,021 | )     
|                            | Net loss                                   |   |              |  |                 |   |            |      |               |   |               | (1,295 | )             |   |                   |       |   |   |        | (1,295 | )
|                            | Repurchase of common stock                 |   |              |  |                 |   |            | (100  | )             |   |               |       |               |   |                   |       |   |   |        |       |  
|                            | Derivative instrument valuation adjustment |   |              |  |                 |   |            |      |               |   |               |       |               |   |                   | (440   | ) |   |        | (440   | )
|                            | Currency translation adjustment            |   |              |  |                 |   |            |      |               |   |               |       |               |   |                   | 31     |   |   |        | 31     |  
|                            |                                            |   |              |   |                 |   |            |       |               |   |               |        |               |   |                   |        |   |   |        |       
|Balance, June 30, 2001      |                                            |   |             |   |                 |   | 89,662     |       |               |   | (30,399       | )      |               |   | (5,357            | )      |   |   | (5,725 | )     
|                            | Net loss                                   |   |              |  |                 |   |            |      |               |   |               | (1,588 | )             |   |                   |       |   |   |        | (1,588 | )
|                            | Repurchase of common stock                 |   |              |  |                 |   |            | (33   | )             |   |               |       |               |   |                   |       |   |   |        |       |  
|                            | Issuance of common stock                   |   |              |  |                 |   |            | 6,000 |               |   |               |       |               |   |                   |       |   |   |        |       |  
|                            | Derivative instrument valuation adjustment |   |              |  |                 |   |            |      |               |   |               |       |               |   |                   | (265   | ) |   |        | (265   | )
|                            | Currency translation adjustment            |   |              |  |                 |   |            |      |               |   |               |       |               |   |                   | 1,011  |   |   |        | 1,011  |  
|                            |                                            |   |              |   |                 |   |            |       |               |   |               |        |               |   |                   |        |   |   |        |       
|Balance, September 30, 2001 |                                            | $ |             |   |                 | $ | 95,629     |       |               | $ | (31,987       | )      |               | $ | (4,611            | )      |   | $ | (6,567 | )     
|                            |                                            |   |              |   |                 |   |            |       |               |   |               |        |               |   |                   |        |   |   |        |       

The accompanying notes are an
integral part of these consolidated financial statements.

5



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##### Table of Contents



AMTROL INC. AND SUBSIDIARIES




Consolidated Statements of Cash Flows


(Unaudited  in thousands)


|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |         |     |        |  
|------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------- | --------------------------------------------------- | -------- | ----------------- | ------ | ------------- | ------- | --- | ------ | -
|                                                             |                                                                                                                            |                                             |                                                     |          | NINE MONTHS ENDED
|                                                             |                                                                                                                            |                                             |                                                     |          |                  
|                                                             |                                                                                                                            |                                             |                                                     |          | September 30,     |        | September 30,
|                                                             |                                                                                                                            |                                             |                                                     |          | 2002              |        | 2001         
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |              
|Cash Flows Provided by (Used in) Operating Activities:       |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|                                                             | Net loss                                                                                                                   |                                             | $                                                   | (4,824   | )                 |        | $             | (5,338  | )  
|                                                             | Adjustments to reconcile net loss to net cash
provided by (used in) operating activities 
  Depreciation and amortization |                                             |                                                     | 6,622    |                   |        |               | 10,388  |    
|                                                             |                                                                                                                            | Provision for losses on accounts receivable |                                                     |          | 95                |        |               |         | 116 |       
|                                                             |                                                                                                                            |                                             | Changes in operating assets and liabilities         |          |                   | 320    |               |         |     | (8,504 | )
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|                                                             |                                                                                                                            |                                             | Net cash provided by (used in) operating activities |          |                   | 2,213  |               |         |     | (3,338 | )
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|Cash Flows Provided by (Used in) Investing Activities:       |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|                                                             | Proceeds from sale of property, plant & equipment                                                                          |                                             |                                                     |         |                   |        |               | 70      |    
|                                                             | Capital expenditures                                                                                                       |                                             |                                                     | (1,924   | )                 |        |               | (2,767  | )  
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|                                                             |                                                                                                                            |                                             | Net cash (used in) investing activities             |          |                   | (1,924 | )             |         |     | (2,697 | )
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|Cash Flows Provided by (Used in) Financing Activities:       |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|                                                             | Repayment of debt                                                                                                          |                                             |                                                     | (113,505 | )                 |        |               | (54,669 | )  
|                                                             | Issuance of debt                                                                                                           |                                             |                                                     | 112,193  |                   |        |               | 54,452  |    
|                                                             | Proceeds from issuance of common stock                                                                                     |                                             |                                                     |         |                   |        |               | 6,000   |    
|                                                             | Repurchase of options and common stock                                                                                     |                                             |                                                     |         |                   |        |               | (274    | )  
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|                                                             |                                                                                                                            |                                             | Net cash provided by (used in) financing activities |          |                   | (1,312 | )             |         |     | 5,509  |  
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|Net Decrease in Cash and Cash Equivalents                    |                                                                                                                            |                                             | (1,023                                              | )        |                   |        | (526          | )      
|                                                             |                                                                                                                            |                                             |                                                    |          |                   |        |               |        
|Effect of exchange rate changes on cash and cash equivalents |                                                                                                                            |                                             | 40                                                  |          |                   |        | (20           | )      
|                                                             |                                                                                                                            |                                             |                                                    |          |                   |        |               |        
|Cash and Cash Equivalents, beginning of period               |                                                                                                                            |                                             | 983                                                 |          |                   |        | 704           |        
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |        
|Cash and Cash Equivalents, end of period                     |                                                                                                                            | $                                           |                                                    |          |                   | $      | 158           |        
|                                                             |                                                                                                                            |                                             |                                                     |          |                   |        |               |        

The accompanying notes are an
integral part of these consolidated financial statements.

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AMTROL INC. AND SUBSIDIARIES




NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

1.            BASIS OF PRESENTATION



| |  |  | In the opinion of management, the accompanying unaudited condensed
consolidated financial statements contain all adjustments necessary to
present fairly, in accordance with generally accepted accounting
principles and with the instructions to Form 10-Q and Article 10 of
Regulation S-X, the financial position, results of operations and cash
flows of AMTROL Inc. and its subsidiaries (the Company) for the
interim periods presented. Such adjustments consisted of only normal
recurring items. The results of operations for the interim periods
shown in this report are not necessarily indicative of results for any
future interim period or for the entire year. These condensed
consolidated financial statements do not include all disclosures
associated with annual consolidated financial statements and
accordingly should be read in conjunction with the consolidated
financial statements and notes thereto included in the Companys Annual
Report on Form 10-K.
| |  |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2.            USE OF ESTIMATES



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

3.            ADOPTION OF NEW ACCOUNTING STANDARDS



| |  |  | The Company adopted Statement of Financial Accounting Standards
(SFAS) No. 142, Goodwill and Other Intangible Assets on January 1,
2002. This statement addresses financial and reporting for goodwill and
other intangible assets. Prior to January 1, 2002, generally accepted
accounting principles required that goodwill be amortized over its
useful life, not to exceed 40 years. SFAS No. 142 now requires that
goodwill no longer be amortized. Instead, companies are required to
apply a fair market value-based impairment test to its goodwill.                                             
| |  |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Company has completed its fair market value-based impairment
testing in accordance with the first phase impairment testing required
by SFAS No. 142. The results of the impairment testing indicate that
the goodwill on the Companys balance sheet may be impaired and that an
impairment loss may need to be recognized. The second phase of SFAS No.
142 impairment testing, measurement of the impairment loss, is expected
to be completed prior to the Companys fiscal year end. Any resulting
impairment loss will be recognized as the cumulative effect of a change
in accounting principle.
|
| |  |  | In addition, the Company adopted SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets on January 1, 2002. This
statement supersedes SFAS No.                                                                                                                                                                                                                                                                                                                                                                                                                                       

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| |  |  | 121, Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of and APB
No. 30, Reporting the Results of Operations  Reporting the Effects of
Disposal of a Segment of a Business, and Extraordinary, Unusual and
Infrequently Occurring Events and Transactions. SFAS No. 144 amends
accounting and reporting standards for the disposal of segments of a
business and the accounting for the impairment or disposal of
long-lived assets. The adoption of SFAS No. 144 did not impact the
Companys condensed consolidated financial statements.
| |  |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4.        
    SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition



| |  |  | The Company adopted Staff Accounting Bulletin (SAB) No. 101, Revenue
Recognition in Financial Statements, as of January 1, 2001. In
accordance with SAB No. 101, the Company recognizes revenue only when
there is a valid contract or purchase order, which includes a fixed
price; the goods have been delivered in accordance with the shipping
terms; and there is an expectation that the collection of the revenue
is reasonably assured. The cumulative effect of this adoption had no
net effect on the accompanying consolidated statements of operations.
| |  |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Company generally recognizes revenue upon shipment of its products
to customers. The Company classifies shipping/handling fees and costs
to revenue consistent with the presentation required by Emerging Issues
Task Force (EITF) 00-10.                                                                                                                                                                                                                                                                                                                      

Deferred Financing Costs



| |  |  | Deferred financing costs are stated at cost as a component of other
assets and are amortized over the life of the related debt using the
effective interest method. Amortization of deferred financing costs is
included in interest expense.
| |  |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Foreign Currency Translation



| |  |  | Assets and liabilities of non-U.S. operations have been translated into
United States dollars at the quarter-end rate of exchange.
Shareholders equity has been converted using historical rates while
revenues and expenses have been converted at the average exchange rates
prevailing during the three and nine month periods. The cumulative
effect of the resulting translation was reflected as a separate
component of shareholders equity.
| |  |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Recent Accounting Pronouncements



| |  |  | In July 2001, the FASB issued SFAS No. 143, Accounting for Asset
Retirement Obligations. SFAS No. 143 addresses financial accounting and
reporting for obligations associated with the retirement of tangible
long-lived assets and the associated retirement costs. SFAS No. 143
requires that the fair value of a liability for an asset retirement
obligation be recognized in the period in which it is incurred if a
reasonable estimate of fair value can be made. The associated asset
retirement costs are capitalized as part of the carrying amount of the
long-lived asset. SFAS No. 143 is effective for financial statements
issued for fiscal years beginning after June 15, 2002 with early
adoption
| |  |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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| |  |  | permitted. The Company is currently assessing the impact, if any, of
adopting SFAS No. 143 on its consolidated financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | In June 2002, the FASB issued SFAS No. 146, Accounting for Costs
Associated with Exit or Disposal Activities. SFAS No. 146 addresses
financial accounting and reporting for costs associated with exit or
disposal activities and nullifies EITF Issue No. 94-3, Liability
Recognition for Certain Employee Termination Benefits and Other Costs
to Exit an Activity (including Certain Costs Incurred in a
Restructuring). SFAS No. 146 requires that a liability for costs
associated with an exit or disposal activity be recognized when the
liability is incurred rather than when a company commits to such an
activity and also establishes fair value as the objective for initial
measurement of the liability. SFAS No. 146 will be adopted by the
Company for exit or disposal activities that are initiated after
December 31, 2002. The Company anticipates at this time that adoption
of SFAS No. 146 will not have a material impact on the consolidated
financial statements of the Company.

5.        
    Long-Term Debt

Revolving Credit and Term Loans



| |  |  | The Company, on December 26, 2001, completed a refinancing of its
senior secured credit facility. In its place, the Company entered into
two new credit facilities: a $42.5 million senior first-priority
secured credit facility arranged by Foothill Capital Corporation (the
Foothill Facility) and a $25.0 million senior second-priority secured
credit facility with affiliates of The Cypress Group L.L.C. (the
Cypress Facility). Proceeds from the refinancing were used to repay
in full the Companys existing credit facility and to pay fees and
expenses related to the refinancing.                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |  |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Foothill Facility consists of senior term loans (the Term Loans)
and a revolving credit facility (the Revolving Credit Facility) which
are secured by a first priority lien on all the domestic assets of the
Company and a stock pledge of all its subsidiaries. A portion of the
Term Loans (the Term Loan A) had an original principal balance of
$10.2 million and a remaining principal balance of $9.4 million as of
September 30, 2002. The remaining portion of the Term Loans (the Term
Loan B) had an original principal balance of $7.5 million and a
remaining principal balance of $6.9 million as of September 30, 2002.
Aggregate borrowings under the Revolving Credit Facility are limited to
the lesser of (a) $35.0 million less the aggregate outstanding
principal amount of the Term Loan A less letter of credit usage and (b)
the borrowing base less letter of credit usage. At September 30, 2002,
total availability and aggregate borrowings under the Revolving Credit
Facility were $13.4 million and $8.9 million, respectively.
|
| |  |  | Term Loan A has a five-year maturity with quarterly principal payments
of $426,757, which commenced on April 1, 2002. The outstanding unpaid
principal shall be due and payable on the date of termination of the
Foothill Facility, whether by its terms, by prepayment, or by
acceleration and bears interest at LIBOR plus 3.5%, paid monthly. Term
Loan B has a three-year maturity with quarterly principal payments of
$312,500, which commenced on April 1, 2002. The outstanding unpaid
principal shall be due and payable on the date of termination of the
Foothill Facility, whether by its terms, by prepayment, or by
acceleration and bears interest at the greater of the Wells Fargo                                                                                                                                                                                                                                                                                                                                                                       

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| |  |  | Reference Rate (approximates the prime rate) plus 3.5% or 9.25%, paid
monthly. The Revolving Credit Facility has a five-year maturity.
Amounts borrowed under the Revolving Credit Facility may be repaid and
reborrowed at any time during the term of the Foothill Facility and
bear interest at LIBOR plus 2.5% for LIBOR based borrowings and the
Wells Fargo Reference Rate plus 0.5% for non-LIBOR based borrowings.
The Foothill Facility contains certain affirmative and negative
covenants and restrictions. As of September 30, 2002, the Company was
in compliance with the various covenants of the Foothill Facility.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Cypress Facility consists of a single $25.0 million term loan (the
Term Loan C). Term Loan C has a five-year maturity and bears
Pay-In-Kind (PIK) interest fixed at 12% per annum paid quarterly, which
at the lenders option can be paid in common stock of the Company. In
connection with the Cypress Facility, Amtrol Holdings, Inc., which
wholly owns the Company, issued the lenders under the Cypress Facility
60,000 warrants to purchase approximately 5.2% of its common stock on a
fully diluted basis. The 60,000 warrants, which have an exercise price
of $.01, were valued at $3.4 million using the Black-Scholes model.
This amount was recorded as an offset to the Term Loan C debt and
included in the Companys equity section. This discount is being
accreted to the face value of the Term Loan C over the life of the
Cypress Facility. The Company expects that the effective interest rate
associated with the Term Loan C will be greater than 12% given the
additional compensation associated with the issuance of the warrants.
The Cypress Facility contains certain affirmative and negative
covenants and restrictions. As of September 30, 2002, the Company was
in compliance with the various covenants of the Cypress Facility.

Senior Subordinated Notes



| |  |  | The Company issued $115.0 million of Senior Subordinated Notes due 2006
(the Notes). The Notes are unsecured obligations of the Company. The
Notes bear interest at a rate of 10.625% per annum that is payable
semi-annually on each June 30 and December 31.                                                                                                                                                                                                                
| |  |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Notes became redeemable at the option of the Company on December
31, 2001. The Notes are subject to redemption, in whole or in part, at
various redemption prices, declining from 105.313% of the principal
amount to par on December 31, 2003. Upon a Change of Control (as
defined in the Indenture), each Note holder has the right to require
the Company to repurchase such holders Notes at a purchase price of
101% of the principal amount plus accrued interest.
|
| |  |  | The Notes Indenture contains certain affirmative and negative covenants
and restrictions. As of September 30, 2002, the Company was in
compliance with the various covenants.                                                                                                                                                                                                                                                                                                   
|
| |  |  | The Company and/or affiliates of the Company, including entities
related to Cypress may, from time to time, purchase the Notes
previously issued by the Company in the open market or by other means.                                                                                                                                                                                                                                                                           

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6.       
     Inventories



| |  |  | Inventories are stated at the lower of cost or market and were as
follows (in thousands):
| |  |  | -----------------------------------------------------------------------------------------

|                                  |  |               |        |              |  |   |        | 
|--------------------------------- |  | ------------- | ------ | ------------ |  | - | ------ | 
|                                  |  | SEPTEMBER 30, |        | DECEMBER 31,
|                                  |  | 2002          |        | 2001        
|                                  |  |               |        |             
|Raw materials and work in process |  | $             | 13,197 |              |  | $ | 11,120 | 
|Finished goods                    |  |               | 10,238 |              |  |   | 8,665  | 
|                                  |  |               |        |              |  |   |        | 
|                                  |  | $             | 23,435 |              |  | $ | 19,785 | 
|                                  |  |               |        |              |  |   |        | 

7.       
     Accounting for Derivative Instruments and Hedging Activities



| |  |  | Effective January 1, 2001, the Company adopted SFAS No. 133 Accounting
for Derivative Instruments and Hedging Activities, SFAS No. 137
Accounting for Derivative Instruments and Hedging Activities  Deferral
of the Effective Date of FASB Statement No. 133  an Amendment of FASB
Statement No. 133 and SFAS No. 138 Accounting for Certain Derivative
Instruments and Certain Hedging Activities  an Amendment of FASB
Statement No. 133 (collectively SFAS No. 133 as amended). SFAS No. 133
as amended is required to be adopted no later than the beginning of the
first fiscal year beginning on or after June 15, 2000. These standards
are to be adopted as a change in accounting principle and cannot be
applied retroactively to financial statements of prior periods.                                                                                                                                                                                                                                                               
| |  |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Company has one derivative contract consisting of an interest rate
swap contract and an interest rate cap (the Contract) outstanding as
of September 30, 2002, with an initial notional amount of $15 million.
Under this arrangement, which will mature on June 30, 2004, the Company
receives the 90-day LIBOR rate and pays a fixed rate of 4.60% for the
period from March 31, 2002 through maturity, unless LIBOR increases to
7.1%. If LIBOR increases to 7.1%, then the Company continues to receive
the 90-day LIBOR rate but now pays the 90-day LIBOR rate for all
subsequent periods capped at a maximum of 7.1%. The LIBOR rate has not
exceeded 7.1% since inception of the Contract and it was treated, prior
to adoption of SFAS No. 133, as a hedge agreement and accounted for as
such. As a result of the refinancing of its senior debt with the
Foothill Facility, the Contract was redesignated as a cash flow hedge
of variable future cash flows associated with the Foothill Facility
Term Loan A and Term Loan B Debt.
|
| |  |  | As of September 30, 2002, the fair value of the instrument ($0.4
million) was recorded in other noncurrent liabilities with a
corresponding entry to accumulated other comprehensive loss. Subsequent
changes in the fair value of the swap will be recorded through
accumulated other comprehensive loss (except for changes related to
ineffectiveness, which will be recorded through net income). The
Company did not realize any material ineffectiveness during the current
quarter and does not anticipate any material ineffectiveness under the
hedge for the remainder of 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                            

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8.       
     PROVISION FOR INCOME TAXES



| |  |  | The effective income tax rates used in the interim condensed financial
statements are estimates of the full years rates. The provision for
income taxes recorded in the financial statements differs from the
statutory rate principally due to managements decision to discontinue
the recognition of tax benefits associated with losses generated by the
US operations. Net deferred tax assets recognized on the Companys
balance sheet continue to require managements evaluation as to their
realization. Although realization is not assured, management believes
it is more likely than not that the net deferred tax assets will be
realized. The amount realized is based upon estimates derived from tax
planning strategies which the Company believes is currently prudent and
feasible. Additions to the valuation allowance may be required in the
event that estimates are changed.
| |  |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

9.       
     BUSINESS SEGMENT INFORMATION



| |  |  | The Company adopted SFAS No. 131, Disclosure about Segments of an
Enterprise and Related Information, in 1998. The Companys reportable
segments are delineated geographically. In addition to the geographic
delineation, the segments are managed separately because of their
different product offerings, markets served and cost structures.                                                                                                                                                       
| |  |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Companys North American segment operates manufacturing facilities
in Rhode Island, Kentucky, Maryland and Ohio, and operates a
distribution facility in Ontario, Canada. This segment manufactures and
markets products used principally in flow control, storage, heating and
other treatment of fluids in the water system and HVAC markets. These
products are marketed throughout the world but primarily in North
America, Western Europe, Asia and Mexico.                                  
|
| |  |  | The Companys European segment includes the Companys facilities in
Guimaraes, Portugal, Donaueschingen, Germany and Swarzedz, Poland. The
Guimaraes facility manufactures returnable and non-returnable steel gas
cylinders for storing cooking, heating and refrigerant gases that are
marketed worldwide. The Donaueschingen facility manufactures
residential and commercial water heaters marketed primarily in
Switzerland, Austria and Germany. The Swarzedz facility refurbishes gas
cylinders.

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| |  |  | The primary criteria by which financial performance is evaluated and
resources are allocated include net sales and EBITDA. The following is
a summary of key financial data by segment:
| |  |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |        |        | 
|------------------------------- | ------------- | ------------- | ------ | ------------- | ----- | ----------------- | ------ | ------------- | ----- | ------------- | ------- | ------ | ------ | - | ------- | ------ | ------ | 
|                                |               |               |        | Quarter Ended |       | Nine Months Ended
|                                |               |               |        |               |       |                  
|                                |               |               |        | September 30, |       | September 30,     |        | September 30, |       | September 30,
|                                |               |               |        | 2002          |       | 2001              |        | 2002          |       | 2001         
|                                |               |               |        |               |       |                   |        |               |       |              
|NET SALES TO EXTERNAL CUSTOMERS |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|North America                   |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|                                | US            |               | $      | 30,315        |       |                   | $      | 30,488        |       |               | $       | 90,318 |        |   | $       | 91,101 |       
|                                | Other         |               |        | 1,451         |       |                   |        | 1,448         |       |               |         | 4,026  |        |   |         | 4,153  |       
|Europe                          |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|                                | Portugal      |               |        | 13,084        |       |                   |        | 11,019        |       |               |         | 39,946 |        |   |         | 37,274 |       
|                                | Other         |               |        | 2,531         |       |                   |        | 2,462         |       |               |         | 6,756  |        |   |         | 8,108  |       
|                                |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|Consolidated                    |               | $             | 47,381 |               |       | $                 | 45,417 |               |       | $             | 141,046 |        |        | $ | 140,636 |       
|                                |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|INCOME FROM OPERATIONS          |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|                                | North America |               | $      | 3,310         |       |                   | $      | 2,319         |       |               | $       | 8,724  |        |   | $       | 5,051  |       
|                                | Europe        |               |        | 1,147         |       |                   |        | 853           |       |               |         | 3,278  |        |   |         | 3,086  |       
|                                |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|                                | Consolidated  |               | $      | 4,457         |       |                   | $      | 3,172         |       |               | $       | 12,002 |        |   | $       | 8,137  |       
|                                |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|EBITDA                          |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|                                |               | North America |        | $             | 4,528 |                   |        | $             | 4,845 |               |         | $      | 12,497 |   |         | $      | 12,715 | 
|                                |               | Europe        |        |               | 1,895 |                   |        |               | 1,290 |               |         |        | 4,864  |   |         |        | 5,620  | 
|                                |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       
|                                |               | Consolidated  |        | $             | 6,423 |                   |        | $             | 6,135 |               |         | $      | 17,361 |   |         | $      | 18,335 | 
|                                |               |               |        |               |       |                   |        |               |       |               |         |        |        |   |         |       

|                  |          |  |  |  |  |  |  |  |  |   |               |         |              |   |         |         | 
|----------------- | -------- |  |  |  |  |  |  |  |  | - | ------------- | ------- | ------------ | - | ------- | ------- | 
|                  |          |  |  |  |  |  |  |  |  |   | September 30, |         | December 31,
|                  |          |  |  |  |  |  |  |  |  |   | 2002          |         | 2001        
|                  |          |  |  |  |  |  |  |  |  |   |               |         |             
|LONG-LIVED ASSETS |          |  |  |  |  |  |  |  |  |   |               |         |              |   |         |        
|North America     |          |  |  |  |  |  |  |  |  |   |               |         |              |   |         |        
|                  | US       |  |  |  |  |  |  |  |  |   | $             | 154,583 |              |   | $       | 156,998 | 
|                  | Other    |  |  |  |  |  |  |  |  |   |               | 6       |              |   |         | 9       | 
|Europe            |          |  |  |  |  |  |  |  |  |   |               |         |              |   |         |        
|                  | Portugal |  |  |  |  |  |  |  |  |   |               | 31,866  |              |   |         | 32,304  | 
|                  | Other    |  |  |  |  |  |  |  |  |   |               | 9,509   |              |   |         | 9,173   | 
|                  |          |  |  |  |  |  |  |  |  |   |               |         |              |   |         |        
|Consolidated      |          |  |  |  |  |  |  |  |  | $ | 195,964       |         |              | $ | 198,484 |        
|                  |          |  |  |  |  |  |  |  |  |   |               |         |              |   |         |        



| |  |  | Income from operations for the North America business segment above is
reduced by goodwill amortization for 2001. EBITDA is earnings (net
income/loss) before interest, taxes, depreciation and amortization. The
method of calculating EBITDA is consistent with the definition
contained in the Foothill Facility, Cypress Facility and the Notes.
Readers of financial statements frequently consider EBITDA a useful
tool in evaluating a companys performance. Therefore, the Company
believes that inclusion of EBITDA is useful supplemental information.
However, EBITDA is not a measure of true cash flow since it does not
incorporate changes of other assets or liabilities that may generate or
require cash. EBITDA is not a generally accepted accounting measure.
Long-Lived assets include property, plant and equipment and goodwill.
| |  |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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10.     
     Commitments and Contingencies



| |  |  | At September 30, 2002, the Foothill Facility contained a sublimit to
support the issuance of letters of credit in the amount of $3.0
million. At September 30, 2002, letters of credit outstanding amounted
to $0.7 million.
| |  |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | The Company is involved in various legal proceedings that, in the
opinion of management, will not result in a material adverse effect on
its financial condition or results of operations.                                  

AMTROL INC. AND SUBSIDIARIES




Item 2.




MANAGEMENTS DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

This section should be read in conjunction with the condensed Consolidated
Financial Statements of the Company included elsewhere herein and the Companys
Form 10-K for 2001.

The Company and its subsidiaries and their representatives may from time to
time make written or oral statements, including statements contained in the
Companys filings with the Securities and Exchange Commission (SEC) and in its
reporting to customers, which constitute or contain forward-looking statements
as that term is defined in the Private Securities Litigation Reform Act of 1995
or the SEC in its rules, regulations and releases.

All statements other than statements of historical fact included in this Form
10-Q and elsewhere relating to the Companys financial position, strategic
initiatives and statements addressing industry developments are forward-looking
statements. When incorporated in this discussion, the words expect(s),
feel(s), believe(s), anticipate(s) and similar expressions are intended to
identify some of these forward-looking statements. Forward-looking statements
include those containing these phrases but also any other statements that are
not references to historical fact. Although the Company believes that the
expectations reflected in such forward-looking statements are expressed in good
faith and are believed to have a reasonable basis, there can be no assurance
that such expectations or beliefs will result or be achieved or accomplished.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof. The following are some of
the important factors that can vary or change or involve substantial risk and
cause actual results to differ materially from such expectations: the Companys
ability to successfully implement its business strategy; the availability and
cost of raw materials; changes in domestic or foreign government regulation or
enforcement policies, particularly related to refrigerant gases or cylinders and
building and energy efficiency requirements or restrictions or limitations or
general reduction in the use of domestic wells; significant weather conditions
adverse to the Companys business; development of competing technologies;
acceptance of the Companys existing and planned new products in

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international markets; competition in the Companys markets, particularly price
competition; the rate of growth of developing economies and demand for the
Companys products; the ultimate cost of future warranty and other claims
relating to the Companys products and business; whether the Company succeeds in
acquiring new businesses; availability of capital; foreign exchange rates;
increases in interest rates; the business abilities and judgment of personnel;
general economic, financial and business conditions, both domestically and
internationally; and acts of war and terrorist activities.

Results of Operations

The following table sets forth, for the periods indicated, the percentages of
the Companys net sales represented by certain income and expense items in the
Companys Consolidated Statements of Operations.

|                                             |  |               |       |                   |  |               |       |               |  |  |       |    |  |  |       |   
|-------------------------------------------- |  | ------------- | ----- | ----------------- |  | ------------- | ----- | ------------- |  |  | ----- | -- |  |  | ----- | --
|                                             |  | QUARTER ENDED |       | NINE MONTHS ENDED
|                                             |  |               |       |                  
|                                             |  | September 30, |       | September 30,     |  | September 30, |       | September 30,
|                                             |  | 2002          |       | 2001              |  | 2002          |       | 2001         
|                                             |  |               |       |                   |  |               |       |              
|Net sales                                    |  |               | 100.0 | %                 |  |               | 100.0 | %             |  |  | 100.0 | %  |  |  | 100.0 | % 
|Cost of goods sold                           |  |               | 75.7  |                   |  |               | 75.8  |               |  |  | 76.5  |    |  |  | 77.3  |   
|                                             |  |               |       |                   |  |               |       |               |  |  |       |    |  |  |       |   
|Gross profit                                 |  |               | 24.3  |                   |  |               | 24.2  |               |  |  | 23.5  |    |  |  | 22.7  |   
|Selling, general and
administrative expenses |  |               | 14.9  |                   |  |               | 14.8  |               |  |  | 14.9  |    |  |  | 14.5  |   
|Amortization of goodwill                     |  |               |      |                   |  |               | 2.4   |               |  |  |      |    |  |  | 2.4   |   
|                                             |  |               |       |                   |  |               |       |               |  |  |       |    |  |  |       |   
|Income from operations                       |  |               | 9.4   |                   |  |               | 7.0   |               |  |  | 8.6   |    |  |  | 5.8   |   
|Interest expense                             |  |               | (10.5 | )                 |  |               | (10.8 | )             |  |  | (10.6 | )  |  |  | (10.5 | ) 
|Interest income                              |  |               |      |                   |  |               |      |               |  |  |      |    |  |  | 0.1   |   
|Other income (expense), net                  |  |               |      |                   |  |               | (0.4  | )             |  |  | (0.4  | )  |  |  | 0.4   |   
|                                             |  |               |       |                   |  |               |       |               |  |  |       |    |  |  |       |   
|Loss before provision
for income taxes       |  |               | (1.1  | )                 |  |               | (4.2  | )             |  |  | (2.4  | )  |  |  | (4.2  | ) 
|Provision (benefit) for income taxes         |  |               | 1.1   |                   |  |               | (0.7  | )             |  |  | 1.0   |    |  |  | (0.4  | ) 
|                                             |  |               |       |                   |  |               |       |               |  |  |       |    |  |  |       |   
|Net loss                                     |  |               | (2.2  | )%                |  |               | (3.5  | )%            |  |  | (3.4  | )% |  |  | (3.8  | )%
|                                             |  |               |       |                   |  |               |       |               |  |  |       |    |  |  |       |   

Three Months Ended September 30, 2002

Net sales for the current quarter increased $2.0 million or 4.3% compared to the
third quarter of 2001, reflecting sales growth in Europe, as well as the impact
of the strengthening Euro on the translation of results at the Companys
European operations.

In North America, net sales in the third quarter of 2002 were comparable to
third quarter net sales of 2001. Net sales from the Companys European operations increased $2.1 million or 15.8%
in the third quarter of 2002 compared to the third quarter last year due
primarily to the strengthening of the

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Euro versus the U.S. dollar and the
addition of a major new customer. The strengthening of the Euro contributed approximately $1.6 million to the increase in net sales.

In order to mitigate any impact on its North
America net sales from domestic steel industry capacity shortfalls
and imposition of tariffs on imported steel by the U.S. government in
March of 2002, the Company implemented an expanded resourcing program
to safeguard its supply of steel. The Company believes that this
resourcing program has been successful.

Gross profit for the third quarter of 2002 increased $0.5 million or 4.6%
compared to the third quarter of 2001, due principally to increased volumes in
the Companys European operations. As a percentage of net sales, gross profit
increased to 24.3% in the third quarter of 2002 versus 24.2% in the same period
last year.

Selling, General and Administrative expenses for the current quarter of 2002 of
$7.0 million increased $0.3 million or 4.9% compared to the third quarter of
2001. The increase is principally the result of increased European selling
expenses associated with the increase in sales.

Income taxes during the current quarter of 2002 increased $0.8 million as
compared to 2001. The increase was the result of managements decision to
discontinue the recognition of tax benefits associated with pre-tax losses from
its U.S. operations.

Other income, net increased $0.3 million when compared to 2001. During 2001,
currency exchange losses of $0.3 million were recorded by the Companys European
operations as a result of the strengthening of the Euro versus the U.S. dollar.

The net loss for the current quarter of 2002 of $1.0 million compares favorably
to a net loss in the third quarter of 2001 of $1.6 million, an absolute change
of $0.6 million.

Earnings before interest expense, taxes, depreciation and amortization (EBITDA)
for the third quarter of 2002 increased $0.3 million to $6.4 million from $6.1
million in the third quarter of 2001 principally as a result of currency
exchange losses incurred by the Companys European operations during 2001.

Nine Months Ended September 30, 2002

Net sales for the first nine months of 2002 increased $0.4 million or 0.3% as
compared to the first nine months of 2001. In North America, net sales declined
$0.9 million or 1.0% due to weaker first quarter results in comparison to 2001,
offset by improved sales performance in the second quarter. Net sales in Europe
increased $1.3 million or 2.9% compared to the first nine months of 2001 due to
weaker first quarter results in comparison to 2001, offset by stronger sales
performance in the second and third quarters and a strengthening Euro.

Gross profit for the first nine months of 2002 increased by $1.2 million or 3.8%
as compared to the same period in 2001. Gross profit as a percentage to net
sales increased to 23.5% in 2002 from 22.7% in 2001. Manufacturing efficiency
improvements, lower energy costs and lower commodity costs contributed to the
increase in gross profit and gross profit percentage.

Selling, General and Administrative expenses for the first nine months of 2002
of $21.1 million increased by $0.7 million or 3.4% compared to the first nine
months of 2001. The increase is principally attributable to one-time
compensation costs incurred during the second quarter of 2002.

Other income, net decreased $1.0 million in comparison to 2001. Currency
exchange losses of $0.7 million were recorded by the Companys European
operations as a result of the

16



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strengthening of the Euro during 2002. In contrast, during the first nine months
of 2001, the Company recorded currency exchange gains of $0.1 million.

Income taxes during the first nine months of 2002 increased $1.9 million as
compared to 2001. The increase was the result of managements decision to
discontinue the recognition of tax benefits associated with pre-tax losses from
its U.S. operations.

The net loss for the first nine months of 2002 of $4.8 million compares
favorably to a net loss for the first nine months of 2001 of $5.3 million, an
absolute change of $0.5 million.

Earnings before interest expense, taxes, depreciation and amortization (EBITDA)
for the first nine months of 2002 decreased $0.9 million to $17.4 million,
compared to $18.3 million for the first nine months of 2001 principally as a
result of currency exchange losses and one-time compensation costs offset by
manufacturing efficiency improvements and higher European gross profit.

Liquidity and Capital Resources

The Companys operating working capital (defined as accounts receivable and
inventory, less accounts payable) increased $3.3 million from $27.3 million at
December 31, 2001 to $30.6 million at September 30, 2002. Accounts receivable
and inventories increased $1.6 million and $3.6 million, respectively while
accounts payable increased $1.9 million, all consistent with seasonal operating
requirements of the Companys water systems and plumbing/heating product lines.

For the first nine months of 2002, net cash provided by operating activities of
$2.2 million was $5.6 million higher than the first nine months of 2001 due
principally to an improved working capital position and lower cash interest
expense. Capital expenditures of $1.9 million in the first nine months of 2002
were $0.8 million lower than in 2001. The Company funded these requirements
principally by utilizing its credit facilities including the Revolving Credit
Facility described below. As a result of the net cash provided by operating
activities, the Company was able to pay down its debt by $1.3 million during
2002.

The Company, on December 26, 2001 completed a refinancing of its senior secured
credit facility. In its place, the Company entered into two new credit
facilities: a $42.5 million senior first-priority secured credit facility
arranged by Foothill Capital Corporation (the Foothill Facility) and a $25.0
million senior second-priority secured credit facility with affiliates of The
Cypress Group L.L.C. (the Cypress Facility). Proceeds from the refinancing
were used to repay in full the Companys existing credit facility and to pay
fees and expenses related to the refinancing.

The Foothill Facility consists of senior term loans (the Term Loans) and a
revolving credit facility (the Revolving Credit Facility) which are secured by
a first priority lien on all of the domestic assets of the Company and a stock
pledge of all of its subsidiaries. A portion of the Term Loans (the Term Loan
A) had an original principal balance of $10.2 million and a remaining principal
balance of $9.4 million as of September 30, 2002. The remaining portion of the
Term Loans (the Term Loan B) had an original principal balance of $7.5 million
and a remaining principal balance of $6.9 million as of September 30, 2002.
Aggregate borrowings under the Revolving Credit Facility are limited to the
lesser of (a) $35.0 million less the

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aggregate outstanding principal amount of the Term Loan A less letter of credit
usage, and (b) the borrowing base less letter of credit usage. At September 30,
2002, total availability and aggregate borrowings under the Revolving Credit
Facility were $13.4 million and $8.9 million, respectively.

Term Loan A has a five-year maturity with quarterly principal payments of
$426,757 that commenced on April 1, 2002. The outstanding unpaid principal shall
be due and payable on the date of termination of the Foothill Facility, whether
by its terms, by prepayment, or by acceleration and bears interest at LIBOR plus
3.5%, paid monthly. Term Loan B has a three-year maturity with quarterly
principal payments of $312,500 that commenced on April 1, 2002. The outstanding
unpaid principal shall be due and payable on the date of termination of the
Foothill Facility, whether by its terms, by prepayment, or by acceleration and
bears interest at the greater of the Wells Fargo Reference Rate (approximates
the prime rate) plus 3.5% or 9.25%, paid monthly. The Revolving Credit Facility
has a five-year maturity. Amounts borrowed under the Revolving Credit Facility
may be repaid and reborrowed at any time during the term of the Foothill
Facility and bear interest at LIBOR plus 2.5% for LIBOR based borrowings and the
Wells Fargo Reference Rate plus 0.5% for non-LIBOR based borrowings. The
Foothill Facility contains certain affirmative and negative covenants and
restrictions. As of September 30, 2002, the Company was in compliance with the
various covenants of the Foothill Facility.

The Cypress Facility consists of a single $25.0 million term loan (the Term
Loan C). Term Loan C has a five-year maturity and bears Pay-In-Kind (PIK)
interest fixed at 12% per annum paid quarterly, which at the lenders option can
be paid in common stock of the Company. In connection with the Cypress Facility,
Amtrol Holdings, Inc., which wholly owns the Company, issued the lenders under
the Cypress Facility 60,000 warrants to purchase approximately 5.2% of its
common stock on a fully diluted basis. The 60,000 warrants, which have an
exercise price of $.01, were valued at $3.4 million using the Black-Scholes
model. This amount was recorded as an offset to the Term Loan C debt and
included in the Companys equity section. This discount is being accreted to the
face value of the Term Loan C over the life of the agreement. The Company
expects that the effective interest rate associated with the Term Loan C will be
greater than 12% given the additional compensation associated with the issuance
of the warrants. The Cypress Facility contains certain affirmative and negative
covenants and restrictions. As of September 30, 2002, the Company was in
compliance with the various covenants of the Cypress Facility.

In November 1996, the Company issued, under an Indenture, $115.0 million of
Senior Subordinated Notes due 2006 (the Notes). The Notes are unsecured
obligations of the Company. The Notes bear interest at the rate of 10.625% per
annum payable semi-annually on each June 30 and December 31 commencing on June
30, 1997. The Notes became redeemable at the option of the Company on December
31, 2001. From and after December 31, 2001, the Notes are subject to redemption
at the option of the Company, in whole or in part, at various redemption prices,
declining from 105.313% of the principal amount to par on December 31, 2003.
Upon a Change of Control (as defined in the Indenture), each Note holder has
the right to require the Company to repurchase such holders Notes at a purchase
price of 101% of the principal amount plus accrued interest. The Notes Indenture
contains certain affirmative and negative covenants and restrictions. As of
September 30, 2002, the Company is in compliance with the various covenants.

The Company intends to fund its future working capital, capital expenditures and
debt service requirements through cash flows generated from operations and
borrowings under the Revolving

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Credit Facility. Management believes that cash generated from operations,
together with borrowings available under the Revolving Credit Facility, will be
sufficient to meet the Companys working capital and capital expenditure needs
in the foreseeable future. The Company may consider other options available to
it in connection with funding future working capital and capital expenditure
needs, including the issuance of additional debt and equity securities.

The Company and/or affiliates of the Company, including entities related to
Cypress may, from time to time, depending on market conditions, purchase the
Senior Subordinated Notes previously issued by the Company in the open market or
by other means.

The Company will continue to selectively pursue strategic acquisitions, such as
the acquisitions of AMTROL ALFA and AMTROL NOVA. The Company believes that
strategic acquisitions, both domestic and international, provide an effective
means of increasing or establishing a market presence in targeted markets and a
means of identifying and introducing new products and technologies in markets
where it already has a strong presence. The Company also believes that
establishing local manufacturing and distribution facilities in international
markets significantly enhances its ability to build strong customer
relationships, understand local product preferences and be price competitive.

Inflation

The Company believes that anticipated inflation rates would not have a
materially adverse effect on its results of operations or its financial
condition in 2002. However, there can be no assurance that sharply increasing
raw material or fuel costs will not adversely affect the Companys financial
condition or results of operations.




Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes in information relating to market risk since
the Companys disclosure included in Item 7A of SEC Form 10-K as filed with the
SEC on March 29, 2002.




Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Within the 90 day period prior to the filing date of this Quarterly Report on
Form 10-Q, the Company, under the supervision and with the participation of its
management, including its principal executive officer and principal financial
officer, performed an evaluation of the Companys disclosure controls and
procedures, as required by Securities Exchange Act Rule 13a-15. Based on that
evaluation, the Companys principal executive officer and principal financial
officer concluded that such disclosure controls and procedures are effective to
ensure that material information relating to the Company, including its
consolidated subsidiaries, is made known to them, particularly during the period
for which the periodic reports are being prepared.

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Changes in Internal Controls

No significant changes were made in the Companys internal controls or in other
factors that could significantly affect these controls subsequent to the date of
the evaluation performed pursuant to Securities Exchange Act Rule 13a-15.

20



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##### Table of Contents



AMTROL INC. AND SUBSIDIARIES




PART II




Item 1. Legal Proceedings



| |  |  | No material legal proceedings were terminated or filed against
the Company during the period covered by this report.
| |  |  | --------------------------------------------------------------------------------------------------------------------




Item 2. Changes in Securities and Use of Proceeds

None.




Item 3. Defaults Upon Senior Securities

None.




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

None.




Item 5. Other Information

None.




Item 6. Exhibits and Reports on Form 8-K

Exhibits

None.

Reports on Form 8-K



| | On August 14, 2002, the Company filed a Current Report on a
Form 8-K reporting under Item 9  Regulation FD Disclosure, in
connection with required certifications by its Chief Executive
and Chief Financial Officers pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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##### Table of Contents



AMTROL INC. AND SUBSIDIARIES




Signatures

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

|                        |  |                                                                                             
|----------------------- |  | --------------------------------------------------------------------------------------------
|                        |  | AMTROL INC.                                                                                 
|                        |  |                                                                                             
|Date: November 13, 2002 |  | By: /s/ Albert D. Indelicato                                                                
|                        |  |                                                                                             
|                        |  | Albert D. Indelicato,
President, Chairman of the Board,
Chief Executive Officer and Director
|                        |  |                                                                                             
|Date: November 13, 2002 |  | By: /s/ Larry T. Guillemette                                                                
|                        |  |                                                                                             
|                        |  | Larry T. Guillemette,
Executive Vice President,
Chief Financial Officer and
Treasurer       

22



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##### Table of Contents






CERTIFICATIONS

I, Albert D. Indelicato, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of AMTROL Inc;                                                                                                                                                                                                                                                             
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the Registrant as of, and for, the periods presented in
this quarterly report;                   
|  
|4. |  | The Registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and
we have:                                                                                                     



| | a. |  | Designed such disclosure controls and procedures to ensure
that material information relating to the Registrant,
including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the
period in which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b. |  | Evaluated the effectiveness of the Registrants disclosure
controls and procedures as of a date within 90 days prior to
the filing date of this quarterly report (the Evaluation
Date); and                                                                                                  
|
| | c. |  | Presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based
on our evaluation as of the Evaluation Date;                                                                                                                        



|5. |  | The Registrants other certifying officers and I have disclosed, based
on our most recent evaluation, to the Registrants auditors and the
audit committee of the Registrants board of directors (or persons
performing the equivalent function):
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a. |  | All significant deficiencies in the design or operation of
internals controls which could adversely affect the
Registrants ability to record, process, summarize and report
financial data and have identified for the Registrants
auditors any material weaknesses in internal controls; and
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b. |  | Any fraud, whether or not material, that involves management
or other employees who have a significant role in the
Registrants internal controls; and                                                                                                                                         



|6. |  | The Registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant
deficiencies and material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                        |  |                                                                                           
|----------------------- |  | ------------------------------------------------------------------------------------------
|Date: November 13, 2002 |  | By: /s/ Albert D. Indelicato                                                              
|                        |  |                                                                                           
|                        |  | Albert D. Indelicato
President, Chairman of the Board
Chief Executive Officer and
Director

23



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##### Table of Contents






CERTIFICATIONS

I, Larry T. Guillemette, certify that:



|1. |  | I have reviewed this quarterly report on Form 10-Q of AMTROL Inc;                                                                                                                                                                                                                                                             
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|2. |  | Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;
|  
|3. |  | Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and
cash flows of the Registrant as of, and for, the periods presented in
this quarterly report;                   
|  
|4. |  | The Registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and
we have:                                                                                                     



| | a. |  | Designed such disclosure controls and procedures to ensure
that material information relating to the Registrant,
including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the
period in which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b. |  | Evaluated the effectiveness of the Registrants disclosure
controls and procedures as of a date within 90 days prior to
the filing date of this quarterly report (the Evaluation
Date); and                                                                                                  
|
| | c. |  | Presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures
based on our evaluation as of the Evaluation Date;                                                                                                                        



|5. |  | The Registrants other certifying officers and I have disclosed, based
on our most recent evaluation, to the Registrants auditors and the audit
committee of the Registrants board of directors (or persons performing the
equivalent function):
|-- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a. |  | All significant deficiencies in the design or operation of
internals controls which could adversely affect the
Registrants ability to record, process, summarize and
report financial data and have identified for the Registrants
auditors any material weaknesses in internal controls; and
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b. |  | Any fraud, whether or not material, that involves management
or other employees who have a significant role in the
Registrants internal controls; and                                                                                                                                         



|6. |  | The Registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly
affect internal controls subsequent to the date of our most recent
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                        |  |                                                                                     
|----------------------- |  | ------------------------------------------------------------------------------------
|Date: November 13, 2002 |  | By: /s/ Larry T. Guillemette                                                        
|                        |  |                                                                                     
|                        |  | Larry T. Guillemette
Executive Vice President,
Chief Financial Officer and Treasurer

24