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                                    FORM 10-K

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549




 (Mark One)

[ X ]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934
                   for the fiscal year ended April 3, 1999 or

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

                        Commission File Number: 333-33085



                     ROLLER BEARING COMPANY OF AMERICA, INC.
             (Exact name of registrant as specified in its charter)

            DELAWARE                                       13-3426227
(State or other jurisdiction of incorporation) (IRS Employer Identification No.)

60 Round Hill Road, Fairfield, CT                         06430
(Address of principal executive offices)               (Zip code)
Registrant's Telephone Number:  (203) 255-1511



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

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

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and, (2) has been subject to such
filing requirements for the past 90 days:

Yes    X                   No
      -------                   --------

         Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ X ]

         As of June 20, 1999, there were 100 shares of the registrant's Common
Stock outstanding, all of which were held by Roller Bearing Holding Company,
Inc., a Delaware corporation. There is no public market for the registrant's
Common Stock.

Documents Incorporated by Reference:  None


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         THIS ANNUAL REPORT OF ROLLER BEARING COMPANY OF AMERICA, INC. (THE
"COMPANY") ON FORM 10-K CONTAINS VARIOUS FORWARD-LOOKING STATEMENTS, AS
CONTEMPLATED BY THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.
FORWARD-LOOKING STATEMENTS MAY BE IDENTIFIED BY THE USE OF FORWARD-LOOKING
TERMINOLOGY SUCH AS "MAY," "WILL," "SHOULD," "EXPECT," "INTEND," "ESTIMATE" OR
"CONTINUE" OR THE NEGATIVE THEREOF OR COMPARABLE TERMINOLOGY AND MAY INCLUDE,
AMONG OTHER THINGS, EXPECTED GROWTH, BUSINESS STRATEGIES, FUTURE REVENUES,
FUTURE SALES, FUTURE OPERATING PERFORMANCE, PLANS, OBJECTIVES, GOALS AND
STRATEGIES OF THE COMPANY. SUCH FORWARD-LOOKING STATEMENTS ARE BASED UPON
INFORMATION CURRENTLY AVAILABLE IN WHICH THE COMPANY'S MANAGEMENT SHARES ITS
KNOWLEDGE AND JUDGMENT ABOUT FACTORS THAT IT BELIEVES MAY MATERIALLY AFFECT THE
COMPANY'S PERFORMANCE. THE FORWARD-LOOKING STATEMENTS ARE MADE IN GOOD FAITH BY
THE COMPANY AND ARE BELIEVED BY THE COMPANY TO HAVE A REASONABLE BASIS. HOWEVER,
SUCH STATEMENTS ARE SPECULATIVE, SPEAK ONLY AS OF THE DATE MADE AND ARE SUBJECT
TO CERTAIN RISKS, UNCERTAINTIES AND ASSUMPTIONS. SHOULD ONE OR MORE OF THESE
RISKS OR UNCERTAINTIES MATERIALIZE, OR SHOULD UNDERLYING ASSUMPTIONS PROVE
INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE ANTICIPATED, ESTIMATED
OR EXPECTED. FACTORS THAT MIGHT CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM
THOSE IN SUCH FORWARD-LOOKING STATEMENTS INCLUDE, BUT ARE NOT LIMITED TO, THE
EFFECT OF ECONOMIC AND MARKET CONDITIONS AND COMPETITION, THE CYCLICAL NATURE OF
THE COMPANY'S TARGET MARKETS, PARTICULARLY, THE AEROSPACE INDUSTRY, THE COST OF
RAW MATERIALS AND THE COMPANY'S ABILITY TO PASS COST INCREASES TO ITS CUSTOMERS,
THE ABILITY OF THE COMPANY TO EXPAND INTO NEW MARKETS, THE ABILITY OF THE
COMPANY TO INTEGRATE ACQUISITIONS, AND OTHER FACTORS DISCUSSED IN ITEM 7.
"MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS", AS WELL AS OTHER FACTORS DISCUSSED FROM TIME TO TIME IN THE REPORTS
FILED BY THE COMPANY WITH THE SECURITIES AND EXCHANGE COMMISSION.

         READERS ARE URGED TO CAREFULLY REVIEW AND CONSIDER DISCLOSURES MADE BY
THE COMPANY IN THIS AND OTHER REPORTS THAT DISCUSS FACTORS GERMANE TO THE
COMPANY'S BUSINESS.


PART I


ITEM 1.  BUSINESS

OVERVIEW

         The Company is a manufacturer and distributor of highly engineered
precision roller, ball and plain bearings in the United States. Bearings, which
are integral to the manufacture and operation of most machines and mechanical
systems, reduce wear to moving parts, facilitate proper power transmission and
reduce damage and energy loss caused by friction. While the Company manufactures
products in all major bearing categories, the Company focuses primarily on
highly technical or regulated bearing products for niche markets. The Company
targets the higher end of the domestic bearing market where it believes its
value added manufacturing and engineering capabilities enable it to
differentiate itself from its competitors and to enhance profitability. The
Company believes that it is the leading supplier to many of its targeted markets
and maintains secondary positions in other product niches where it believes
market share gains can be achieved.

         The Company conducts and operates its business through three divisions:
the RBC division; the Heim Bearings ("Heim") division; the Transport Dynamics
Corporation ("TDC") division, and six wholly-owned subsidiaries: RBC Nice
Bearings, Inc. ("Nice"); RBC Linear


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Precision Products, Inc. ("LPP"); Bremen Bearings, Inc. ("Bremen"); Industrial
Tectonics Bearings Corporation ("ITB"); Miller Bearing Company, Inc. ("Miller")
and Tyson Bearing Company, Inc. ("Tyson"). The Company also has a wholly owned
foreign sales subsidiary, Roller Bearing Company FSC, Inc. ("FSC").

FORMATION; CORPORATE STRUCTURE; ACQUISITIONS

         The Company was incorporated in Delaware in 1987. In July 1991, the
Company's Chairman, President and Chief Executive Officer, Dr. Michael J.
Hartnett, teamed up with affiliates of Aurora Capital Partners, L.P. ("Aurora")
to implement a plan to acquire a series of small to medium size domestic
companies in the roller and ball bearing industry. In March 1992, the Company's
capital stock was acquired for $52 million by RBC Acquisition Company (which was
incorporated in March, 1992 as a Delaware corporation), which was subsequently
merged into the Company and the Company became a wholly-owned subsidiary of
Roller Bearing Holding Company, Inc. ("Holdings"). Since 1992, the Company has
acquired TDC, a manufacturer of plain bearings, for $5.8 million, Heim, a
leading producer of rod end and ball bearings, for $6.8 million, LPP, a pioneer
in grinding techniques for precision ball bearing screws, for $5.5 million,
Nice, the oldest active brand name in the domestic bearing industry, for $7.5
million, and Bremen and Miller, manufacturers of rollers and needle bearings,
for approximately $5.3 million and $11.1 million, respectively.

         The Company has historically acquired complementary bearing companies
and integrated them effectively into its existing operations. Following an
acquisition, management typically rationalizes operations, reduces overhead
costs, develops additional cross-selling opportunities and establishes new
customer relationships.

         The Company believes that there will continue to be consolidation
opportunities within the bearing industry. The Company is currently in
discussion with several companies that meet its strategic goals. Priority will
be given to acquiring bearing companies with sales of between $15 million and
$50 million. Additionally, the Company will seek smaller "fold-in" acquisitions,
businesses whose products can be manufactured at the Company's existing
facilities.

         While the Company believes that it has greatly benefited from the
consolidation opportunities in the bearing industry and the acquisitions that
the Company has pursued, there can be no assurance that such opportunities will
continue to materialize or that the Company will be able to successfully
capitalize on any such opportunities in the future.

RECENT DEVELOPMENTS

         RECAPITALIZATION

         On June 23, 1997, pursuant to a Redemption and Warrant Purchase
Agreement (the "Recapitalization Agreement") dated May 20, 1997, Holdings
effected a recapitalization of its outstanding capital stock, including the
financing and other transactions consummated by Holdings, the Company and its
subsidiaries in connection therewith (the "Recapitalization"). In connection
with the Recapitalization, all of the outstanding preferred stock of Holdings
("Preferred Stock") was redeemed by Holdings and substantially all of the
outstanding common stock of Holdings ("Holdings Common Stock") and warrants to
purchase Holdings Common Stock


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("Holdings Warrants") held by non-management stockholders of Holdings were
redeemed or purchased by Holdings, or certain current stockholders or
warrantholders of Holdings (including certain affiliates of Credit Suisse First
Boston ("CSFB") and one of the purchasers of the Discount Debentures (as defined
herein)).

         The Recapitalization was financed with the proceeds from the issuance
by the Company of $110 million of 9 5/8% Senior Subordinated Notes Due 2007 (the
"Notes"), the incurrence by the Company of $16 million of term loans (the "Term
Loans"), the issuance by Holdings of approximately $74.8 million in Senior
Secured Discount Debentures (the "Discount Debentures") and warrants (the
"Discount Warrants") to purchase 6,731 shares of Class A Common Stock, par value
$.01 per share, of Holdings ("Class A Common Stock") for an aggregate gross
consideration of $40 million. The Term Loans are a part of the senior credit
facilities (the "Senior Credit Facilities") of the Company with a group of
lenders, which also include a $54 million revolving credit facility (the
"Revolving Credit Facility").

         On January 22, 1998, the Company consummated an exchange of all of the
outstanding Notes for substantially identical Notes that were registered under
the Securities Act of 1933, as amended. Such exchange was undertaken pursuant to
obligations of the Company under the indenture governing the Notes (the
"Indenture") and certain other agreements entered into by the Company in
connection with the Recapitalization.

         Additionally, in connection with the Recapitalization, (i) the Company
paid a dividend to Holdings in the amount of approximately $56.9 million (the
"Dividend") to finance the Recapitalization, (ii) Holdings used the proceeds of
the Dividend and the proceeds from the sale of the Discount Debentures and the
Discount Warrants, to redeem Holdings Common Stock and Preferred Stock and to
purchase Holdings Warrants for aggregate consideration of approximately $92.2
million, (iii) Holdings assigned its rights to purchase certain shares of
Holdings Common Stock and Holdings Warrants under the Recapitalization Agreement
to Dr. Michael J. Hartnett, certain affiliates of CSFB, OCM Principal
Opportunities Fund, L.P. (the "Oaktree Fund"), Kirk Morrison, The Sommers Family
Trust and Mitchell Quain, (iv) Holdings repurchased (the "Hartnett Repurchase")
1,250 Holdings Warrants from Dr. Hartnett for an amount per share of Holdings
Common Stock underlying such Holdings Warrants equal to $514 less the
approximately $77 exercise price of such warrants (an aggregate of approximately
$550,000), (v) Holdings issued warrants exercisable for 1,250 shares of Class B
Supervoting Common Stock, par value $.01 per share, of Holdings ("Class B Common
Stock") at an exercise price of $514 per share to Dr. Hartnett, (vi) Holdings
loaned $500,000 to Dr. Hartnett (the "Hartnett Loan") to finance a portion of
his purchase of Holdings Common Stock and Holdings Warrants referred to in
clause (iii) above, (vii) Holdings paid to Dr. Hartnett a fee of $1 million (the
"Hartnett Fee"), (viii) Holdings converted all of Dr. Hartnett's shares of
Holdings Common Stock into shares of Class B Common Stock, and amended all
Holdings Warrants held by Dr. Hartnett to provide that they be exercisable for
shares of Class B Common Stock, (ix) the Company repaid outstanding indebtedness
of approximately $52.1 million on its revolving credit facility (the "Existing
Revolving Credit Facility") and its term loan (the "Existing Term Loan") both
with Heller Financial, Inc., ("Heller") and (x) the Company and Holdings paid
certain other fees and expenses, in the approximate aggregate amount of $10.4
million, payable in connection with the foregoing.

         Dr. Hartnett, the Chairman, President and Chief Executive Officer of
the Company, currently owns approximately 40% (approximately 39% on a fully
diluted basis) of the


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outstanding capital stock of Holdings, and, through the operation of provisions
of Holdings' certificate of incorporation, he has the power to control a
majority of the voting rights of all capital stock of Holdings. See "Item 12.
Security Ownership of Certain Beneficial Owners and Management" and "Item 13.
Certain Relationships and Related Transactions."

         As discussed herein, the Company incurred indebtedness in connection
with the Recapitalization and is leveraged. The degree to which the Company is
leveraged could have important consequences for the Company, including but not
limited to, (i) impairing the ability of the Company to obtain additional
financing for working capital, capital expenditures, acquisitions, debt service
requirements or other purposes, (ii) impacting the portion of cash flow from
operations available for general corporate needs (the "obligations"), (iii)
impacting the Company's ability to compete against its less leveraged
competitors and (iv) increasing the Company's vulnerability in the event of a
downturn in any industry to which the Company markets its products or a downturn
in the economy in general. Although the Company believes it will be able to pay
its obligations as they come due, there can be no assurance that it will
generate earnings in any future period sufficient to cover its fixed charges.

         BREMEN ACQUISITION

         On August 8, 1997, Bremen, a wholly owned subsidiary of the Company,
completed the acquisition of Bremen Bearings Division of SKF USA, Inc., a
manufacturer of needle bearings with facilities in Bremen, Indiana. The purchase
was effective as of July 1, 1997. The Company paid approximately $5.6 million,
of which approximately $3.6 million was paid at the closing. The purchase price
for Bremen was financed by borrowings under the Term Loans.

         MILLER ACQUISITION

         On June 3, 1998, Miller, a wholly owned subsidiary of the Company,
completed the acquisition of Miller Bearing Company, Inc. ("MBC"), a
manufacturer of pins, rollers and screw machine products with facilities in
Bremen, Indiana. The aggregate purchase price for the acquisition, which was
effective as of March 1, 1998, was approximately $11.1 million which included
the assumption of certain liabilities of MBC. Miller discharged an aggregate of
approximately $1.7 million of such assumed liabilities at closing, representing
all notes payable assumed in the transaction. The acquisition was financed from
proceeds from the sale of the Notes. Operations of Miller for March, 1998 were
not material to the consolidated financial results of the Company.

         TYSON ACQUISITION

         On June 11, 1999, Tyson, a wholly owned subsidiary of the Company,
completed the acquisition of the taper roller bearing operations of SKF USA,
Inc., with facilities in Glasgow, Kentucky. The purchase was effective as of
April 1, 1999. The Company paid approximately $10.2 million.






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GENERAL

         The Company is a manufacturer and distributor of highly engineered
precision roller, ball and plain bearings in the United States. Bearings, which
are integral to the manufacture and operation of most machines and mechanical
systems, reduce wear to moving parts, facilitate proper power transmission and
reduce damage and energy loss caused by friction. Many of the Company's products
are custom designed or highly engineered for specific applications to meet
demanding specifications. While the Company manufactures products in all major
bearing categories, the Company focuses primarily on highly technical or
regulated bearing products for niche markets.

         The Company targets the higher end of the domestic bearing market where
it believes its value added manufacturing and engineering capabilities enable it
to differentiate itself from its competitors and to enhance profitability. The
Company believes that it is the leading supplier to many of its targeted markets
and maintains secondary positions in other product niches where it believes
market share gains can be achieved. In fiscal 1999 (which commenced on March 29,
1998 and ended on April 3, 1999), the Company had sales to more than 2,500
customers with no single customer amounting to more than 6% of net sales. The
Company believes its rapid turnaround on orders, custom designed engineering and
strict adherence to quality and reliability provide it with significant
competitive advantages. The Company's key customers include Caterpillar, John
Deere, Boeing, Pratt & Whitney, General Electric, Bell Helicopter and Motion
Industries.

         The Company sells primarily to domestic Original Equipment
Manufacturers ("OEMs") and distributors in three markets: industrial, aerospace
and government. Many of the Company's product offerings are in markets (market
sizes between $30 million and $150 million) which require high service levels,
extensive technical engineering support, short lead times and small production
runs. In combination with the Company's efficient production processes,
targeting such markets has allowed the Company to achieve its plan.
Additionally, in an effort to generate more stable revenues, the Company has
increased sales to the replacement market. Management estimates that currently
over 60% of the Company's products are sold directly or indirectly for use in
the replacement market.

         Although the Company operates as one manufacturing and operational
segment, it sells products to various customer markets. As it relates to
geographical data; during fiscal year 1999, the Company maintained no overseas
manufacturing facilities but had foreign sales of $9.5 million or 6.4% of the
Company's total sales.

         Approximately 64% of the Company's fiscal 1999 net sales were to the
industrial market. The Company believes opportunities exist to increase sales in
this market as a result of (i) increasing demand for industrial machinery in
both the domestic and international markets, which is expected to expand
existing OEM selling opportunities, (ii) growth in aftermarket demand as the
installed base continues to expand and (iii) the increased emphasis being placed
on maintenance and repair of capital goods given the increasing cost of such
items.

         Approximately 31% of the Company's fiscal 1999 net sales were to the
aerospace market for applications in commercial and military aviation. According
to Boeing, worldwide air travel is expected to grow 75% between 1996 and 2006
and the world commercial aircraft fleet is expected


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to double by 2016. The Company provides bearings for virtually every model of
commercial aircraft in production, as well as many military applications, and
its customers include all major aerospace manufacturers. Sales to the aerospace
market have been increasing as a percentage of total sales, a trend which the
Company expects will continue.

         Approximately 5% of the Company's fiscal 1999 net sales were to the
government. The Company expects sales to this market to remain stable in the
foreseeable future due to (i) increased emphasis on repair and maintenance of
existing military platforms, (ii) sole source supplier relationships and
replacement part sales for existing programs and (iii) long product lives of
existing programs, which should ensure steady sales relating to such programs
for several years.

BUSINESS STRATEGY

         The Company has developed a business strategy that focuses on good
profitability while growing, both internally and through acquisitions.

         Management believes that the Company's business strategy makes it well
positioned to achieve continued growth and market share gains through (i)
increasing sales to the aftermarket, (ii) continuing its focus on high margin
niche markets where the Company believes it has a sustainable competitive
advantage, (iii) penetrating new markets with innovative products, (iv)
expanding international OEM and distributor sales and (v) acquiring other
manufacturers which have complementary products, similar distribution channels
or provide significant potential for margin enhancement.

COMPETITIVE STRENGTHS

         The Company believes that it has significant competitive strengths,
including a strong management team with extensive managerial experience in the
bearing industry, excellent design and manufacturing capabilities, long-term
customer relationships, the Company's focus on niches of the bearing market, the
Company's proprietary manufacturing processes, its low cost operations and the
Company's commitment to service.

BEARING INDUSTRY

         Bearings are integral to the manufacture and operation of machines and
mechanical systems. Bearings serve to reduce the wear to moving parts, ensure
proper power transmission and reduce damage and energy loss caused by friction.
Demand for bearings generally follows the market for products in which bearings
are incorporated and the general economy as a whole. Purchasers of bearings
include (i) automotive manufacturers, (ii) industrial equipment and machinery
manufacturers, (iii) producers of commercial and military aerospace equipment,
(iv) agricultural machinery manufacturers and (v) construction and specialized
equipment manufacturers. The Company estimates that approximately one-third of
all bearings manufactured are for use in the automobile industry, a market in
which the Company has recently begun to participate in strategic areas.

         The domestic bearing market is comprised of three primary product
categories: ball bearings, roller bearings and plain bearings. Ball bearings are
used for high-speed applications;


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roller bearings for lower speed, heavily loaded applications; and plain bearings
for sliding action and misalignment applications.

         The domestic market for standard bearings is dominated by three major
international competitors: The Timken Company ("Timken"), Torrington Company
("Torrington") and SKF USA, Inc. ("SKF"). The balance of the domestic market,
consisting primarily of specialty and custom engineered bearings, is more
fragmented. Due to the shorter production runs and significant post-sale
technical support associated with these products, the Company believes they are
not the primary focus of the larger bearing manufacturers. A group of smaller
companies (including the Company) frequently establish leading positions, in
market share and reputation, in certain of these niche product lines.
Furthermore, competition in these niche markets is based on lead times and
reliability of product and service, and these markets are generally not as price
sensitive as the markets for standard bearings.

CUSTOMERS AND MARKETS

         The Company supplies bearings to OEMs and distributors in the
industrial, aerospace and government markets. The industrial OEM market
continues to be the largest market for the Company, accounting for 46% of the
Company's fiscal 1999 net sales. While the Company's sales in its target markets
have historically been concentrated on OEMs, the Company has recently shifted
its focus in the aerospace and industrial markets towards replacement part
sales. The Company believes this generates more stable revenues. The Company's
top ten customers were responsible for generating 22% of the Company's fiscal
1999 net sales and no single customer was responsible for generating more than
6% of fiscal 1999 net sales. Five of the Company's top ten customers are
distributors and the remaining five are OEMs.

         The Company does not believe that it is dependent upon a single
customer or a few customers. However, the loss of the Company's major customers
or a substantial decrease in such customers' purchases from the Company could
have a material adverse effect on the financial condition and results of
operations of the Company.

         The aerospace, heavy equipment and other industries to which the
Company sells its products are, to varying degrees, cyclical and have
experienced periodic downturns, which have often had a negative effect on demand
for the Company's products. Although the Company believes that by concentrating
on products with a strong aftermarket demand it has reduced its exposure to such
business downturns, any future material weakness in demand in any of these
industries could have a material adverse effect on the financial condition and
results of operations of the Company.

         INDUSTRIAL

         Industrial bearings are used in a wide range of industries such as
heavy equipment, machine tools, agricultural equipment, pumps and packaging.
Nearly all mechanical devices and machinery require bearings to relieve friction
where one part moves relative to another. The Company's products target existing
market applications in which the Company's engineering and manufacturing
capabilities provide it with a competitive advantage in the marketplace.



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         The Company manufactures a wide range of roller, ball and plain
bearings for industrial uses by customers including Caterpillar, John Deere,
Euclid Hitachi, Motion Industries, Applied Industrial Technologies, and Kaman.
See "Products." Sales to the industrial market accounted for 64% of the
Company's fiscal 1999 net sales. Approximately 72% of such sales were to OEMs
while 28% were to distributors. Within the industrial market, the Company sells
to the construction and mining equipment, material handling, machine tools and
energy and natural resources markets. The Company believes that the
diversification of its sales among the various markets of the industrial
bearings market reduces its exposure to downturns in any individual market.

         AEROSPACE

         Bearings are used in numerous applications within airplanes,
helicopters and aircraft engines. The aerospace market utilizes spherical plain
bearings, rod ends, journal bearings and thin section ball bearings. Bearings
are regularly replaced on aircraft in conjunction with routine maintenance
procedures and include such items as high precision ball and roller bearings and
metal-to-metal and self-lubricating plain bearings. Commercial aerospace
customers generally require precision products, often of special materials, made
to unique designs and specifications.

         The Company's penetration of the commercial aerospace market expanded
through the acquisitions of TDC and Heim. Sales to the aerospace market
accounted for 31% of the Company's fiscal 1999 net sales. Of this total, 59%
reflected sales to OEMs and the remaining 41% were to distributors. Management
estimates that over 75% of commercial aerospace net sales are actually used as
replacement parts since a portion of OEM sales also are ultimately intended for
replacement market use. Sales of products for use in the aftermarket helped the
Company's sales over the past five years. The Company supplies bearings for
commercial aircraft, commercial aircraft engines and private aircraft
manufacturers, as well as to various military contractors for airplanes,
helicopters and missile systems. Aerospace customers include Boeing,
Lockheed-Martin, Bell Helicopter, General Electric, Pratt & Whitney, Allied
Signal, Aviation Sales and WS Wilson.

         Essential to servicing the aerospace market is the ability to obtain
product approvals. The Company has in excess of 20,000 product approvals, which
enable it to provide products used in virtually all domestic aircraft platforms
presently in production or operation. Product approvals are typically issued by
the Federal Aviation Administration ("FAA") designated OEMs who are Production
Approval Holders ("PAHs") of FAA approved aircraft. These PAHs provide quality
control oversight and generally limit the number of suppliers directly servicing
the commercial aerospace aftermarket. Recent regulatory changes enacted by the
FAA provide for an independent process (the PMA process), which enables
suppliers who currently sell their products to the PAH, to sell products to the
aftermarket. The Company has submitted over 6,100 PMA applications and has
received over 1,000 approvals to date. There is no assurance that the Company
will receive approvals on all or any of its submissions. To the extent that such
approvals do not materialize, the Company's ability to service the aerospace
market could be adversely affected.

         GOVERNMENT

         The Company manufactures high precision ball and roller bearings,
commercial ball bearings and metal-to-metal and self-lubricating plain bearings
for all branches of the United


<PAGE>

States military, and certain foreign military forces. In addition to products
that meet military specifications, these customers often require precision
products made of specialized materials to custom designs and specifications. The
Company manufactures an extensive line of standard products that conform to many
domestic military application requirements, as well as customized products
designed for unique applications. Product approval for use on military equipment
is often a lengthy process ranging from six months to three years, and
represents a significant barrier to new entrants.

         Government sales accounted for 5% of the Company's fiscal 1999 net
sales, consisting primarily of replacement bearings on programs for which the
Company is the sole source supplier. Despite cutbacks in the overall defense
budget during the 1990s, appropriations for maintenance and repairs for product
platforms serviced by the Company have remained stable. Military programs for
which the Company supplies component products include airplanes, helicopters,
turbine engines and armored vehicles.

         While a significant portion of the Company's sales are directly or
indirectly to the government, related military or other government projects, no
significant portion of such sales are subject to renegotiation of profits or
termination of contracts at the election of the government. However, compliance
with various government regulations may be required. Violations of such
regulations could result in termination of the Company's contracts, which may
have material adverse effects on the Company's operations. In addition, the
consolidation and combination of defense manufacturers may eliminate customers
from the industry and/or put downward pricing pressures on sales of component
parts sold by the Company. Such factors could result in a material adverse
effect on the Company.

PRODUCTS

         The Company's products and services include five broad categories:
plain bearings, roller bearings, ball bearings, linear precision products and
refurbishment, each of which includes both standard and highly specialized and
customized products. Within the five major categories that encompass the
Company's product offerings, its major bearing products include heavy duty
needle roller bearings, cam follower bearings, metal-to-metal, ball bearing and
self-lubricating rod ends and spherical bearings, high precision ball and roller
bearings, precision ball screws and semi-precision unground ball bearings.
Bearings are employed to fulfill several functions including reduction of
friction, transfer of motion and carriage of loads.

         PLAIN BEARINGS

         Plain bearings accounted for approximately 31% of the Company's fiscal
1999 net sales. In general, plain bearings are produced with either
self-lubricating or metal-to-metal designs and consist of several sub-classes,
including rod end bearings, spherical plain bearings and journal bearings.
Unlike ball bearings, which are used in high-speed rotational applications,
plain bearings are primarily used to rectify inevitable misalignments in various
mechanical components. Such misalignments are either due to machining
inaccuracies or result when components change position relative to each other.
Spherical plain bearings are designed for heavy equipment applications.
Spherical plain bearings and rod end bearings are used in the aerospace market
in the same applications as airframe control ball bearings. Heim and TDC produce
Teflon(R) fabric lined sleeves for the aerospace market.


<PAGE>

         ROLLER BEARINGS

         Roller bearings are anti-friction bearings that use rollers instead of
balls. The Company manufactures three basic types of roller bearings: heavy duty
needle roller bearings with inner rings, track rollers and aircraft roller
bearings. The sale of roller bearings accounted for 37% of the Company's fiscal
1999 net sales. Track rollers have widespread use in heavy industrial machinery
applications. The Company is a leading producer of roller bearings for use in
helicopters. The Company offers several needle roller bearing designs produced
at the Bremen and Miller facilities. Needle bearings are used in various
industrial applications and in certain U.S. military aircraft platform bearing
applications that require high load carrying capability in a confined space. The
product is also used as a shaft for another type of bearing or to support
rotating components in mechanical or electromechanical devices. The Company
produces this product in bearing quality steel but also has the capability to
produce this product from various grades of low carbon, stainless or tool steel.


         BALL BEARINGS

         The Company manufactures four basic types of ball bearings: high
precision aerospace, airframe control, thin section and commercial ball
bearings. Ball bearings accounted for 29% of the Company's fiscal 1999 net
sales. High precision aerospace bearings are primarily sold to customers in
government or the defense industry that require more technically sophisticated
bearing products providing higher degrees of fault tolerance given the
criticality of the applications in which they are used. Airframe control ball
bearings are precision ball bearings that are plated to resist corrosion and are
qualified under a military specification. Thin section ball bearings are
specialized bearings which use extremely thin cross sections and give
specialized machinery manufacturers many advantages. The Company is also
involved in two niche markets: unground ball bearings and specialty inch and
metric ball bearings.

         LINEAR PRECISION PRODUCTS

         LPP produces precision ground ball bearing screws that offer repeatable
positioning accuracy in machine tools, transfer lines, robotic handling and
semiconductor equipment. Linear precision products accounted for approximately
2% of the Company's fiscal 1999 net sales. LPP's products are primarily used in
the machine tool industry where the Company believes significant opportunities
to cross-sell the Company's other products exist. LPP also serves many new,
replacement and repair markets through an agreement with Warner Electric, a
division of Dana Corporation.

         BEARING REFURBISHMENT PROGRAM

         ITB has developed a bearing refurbishment center. Management estimates
this to be a $60 million market which historically has not been well served.
Bearing refurbishment accounts for approximately 1% of the Company's fiscal 1999
net sales. The Company believes that, as an OEM manufacturer of bearing
components, it is well positioned to serve this industry. Refurbished bearings
offer the end user a significant savings and provide the equivalent service
level. As material costs are minimal and most primary machining and grinding
operations are not


<PAGE>

required to operate in this market, the opportunity exists for higher margins.
The Company believes bearing refurbishment will continue to be a growing market,
but does not currently expect this program to have a material impact upon its
results of operations or liquidity for at least the next three to five years.

         The RBC Linear Precision Products facility has upgraded their precision
ball screw repair facility to allow them to focus on this growing market.
Management estimates this to be a $60 million market which has been fragmented
in the past among many small companies. The Company believes that LPP, as an OEM
manufacturer of precision ball screws, it is well positioned to service this
industry. As this is a service-oriented business, the opportunity exists for
higher margins. The Company does not currently expect this program to have a
material impact upon its results of operations or liquidity for at least the
next three to five years.

NEW PRODUCTS

         The Company develops and acquires new products and determines new
applications for existing products. Some of the Company's recent new product
introductions in the industrial market include: the RBC self-lubricated,
fibrinoid lined spherical plain bearing, designed to meet an increasing demand
for products that are not lubricated and totally maintenance free; the NBC heavy
duty needle roller bearing series; a commercial thin section ball bearing, which
the Company developed by capitalizing on ITB's expertise in the aerospace
industry and adapted for industrial use; and the Spherco self-lubricated
fiberglide rod end, a maintenance-free rod end with reduced radial play.

         In the aerospace and defense markets, the Company's new products
include the ITB swashplate thin section ball bearings and Heim ball bearing rod
ends. The Company is also concurrently working with Boeing to develop weight
saving products. The Company has submitted samples and test data to the
Department of the Navy for military approval, which is required for the sale of
the Company's aircraft cam follower product line to the aerospace industry.

MANUFACTURING AND OPERATIONS

         The Company's production processes are designed to reduce costs and
improve overall profitability. Using its operating strategy, the Company
endeavors to design its manufacturing process so that machine and labor
utilization are optimized and total costs are reduced. Cost savings are
generated through management of monthly product line profit and loss. On a
monthly basis, gross margins of every product line within each product group are
reviewed. The Company monitors the progress of its efficiency efforts on an
ongoing basis, both monthly and quarterly, and reacts quickly to resolve
problems or capitalize on unanticipated opportunities.

         Custom products are sold at a premium based on factors such as lot size
and availability. Management believes it has a thorough understanding of the
products and customers in the markets it serves, allowing the Company to utilize
aggressive and competitive pricing practices.

         CAPACITY

         The Company's plants currently run on a single shift and a light second
shift at selected locations to meet the demands of its customers. Management
believes that current capacity levels,


<PAGE>

with annual capital expenditures equal to approximately 5% of sales in turning
and grinding equipment in the future, will permit the Company to effectively
meet demand levels through at least 2002. Management also believes that as it
continues to invest in bearing professionals, the ability to increase capacity
and move to full second shifts, if required, could be accomplished without
compromising product quality or involving significant additional capital
expenditure.

         INVENTORY MANAGEMENT

         The Company's increasing emphasis on the distributor/aftermarket has
required it to maintain greater inventories of a broader range of products than
the OEM market historically demanded. As a result, the Company has implemented
an inventory management program designed to balance customer delivery
requirements with economically optimal inventory levels. In this program, each
product is categorized based on characteristics including order frequency,
number of customers and sales volume. Using this classification system,
management's primary goal is to maintain a sufficient supply of standard items
while minimizing warehousing costs. In addition, production cost savings are
achieved by optimizing plant scheduling around inventory levels and customer
delivery requirements. This leads to more efficient utilization of manufacturing
facilities and minimized plant production changes while maintaining sufficient
inventories to service customer needs.

         INTEGRATION OF ACQUISITIONS

         The Company has demonstrated an ability to institute programs which
improve the performance of acquired companies. The process involves applying the
Company's operating strategy, rationalizing the product offerings and
appropriately capitalizing the acquisition.

MARKETING

         The Company's marketing strategy is aimed at increasing sales within
its three primary market sectors and targeting specific profitable niche
products. To effect this strategy, the Company seeks to expand into geographic
areas not previously served by it and continues to capitalize on new markets and
industries for existing and new products. The Company employs a technically
proficient sales force and also utilizes marketing managers, product managers,
customer service representatives and product application engineers in its
selling efforts.

         Despite the difficulties inherent in the development of a quality,
technically astute, sales force in the bearing industry, the Company has been
able to accelerate the growth of its sales force through the hiring of sales
personnel with prior bearing industry experience, complemented by an in-house
training program, implemented in 1995, which has graduated 19 professionals. The
Company will continue to hire and develop expert sales professionals and
strategically locate them to implement its expansion strategy. Today, the
Company employs strategically located sales professionals nationwide in its
sales and marketing effort.

         The Company has placed an emphasis on increasing sales to distributors
serving the spare parts aftermarket in the Company's key industry markets. Sales
to this market tend to be less cyclical as they arise out of end users' needs
for replacement bearings on existing equipment. See "Customers and Markets."
Management estimates that sales to the replacement market exceeded


<PAGE>

60% of the Company's fiscal 1999 net sales. Management intends to continue to
focus on building distributor sales volume.

         With regard to its OEM customers, the Company has and continues to
focus on establishing and maintaining relationships with OEMs that produce
products with strong aftermarket demand characteristics for the Company's
products. The Company's OEM relationships also provide it with extensive
cross-selling opportunities, as many OEM products utilize several types of
bearings manufactured by the Company.

COMPETITION

         Competition in the bearing industry is based on a number of factors,
including price, product line offering, technical service and timeliness of
supply. The Company believes that it is well positioned to compete with regard
to each of these factors in each of the markets in which it operates.

         For large run bearing products, price is a very important factor.
Larger manufacturers generally are relative low cost producers in the more
standard bearing product lines and are thus able to attain extensive market
shares. However, with niche product lines, when the production runs are smaller,
larger manufacturers are often unable to achieve the economies of scale needed
to maintain their low-cost producer status. As a result, while the Company
competes with the larger bearing manufacturers in some of the more standard
bearing product markets, its primary competition includes smaller niche
companies such as Kaydon Corporation, New Hampshire Ball Bearings and McGill
Manufacturing Company, Inc. Competitors to the Company's ballscrew product line
are 20th Century and Thompson.

         Bearings manufacturers operating in the more specialized market compete
by maintaining a broad product line and adequate inventories to service the
aftermarket. This enables such manufacturers to exploit the trend of OEMs
towards sourcing a broader range of products from a small number of suppliers.
Additionally, in certain industries and groups, purchasers require product
approval on an industry or company specific level for their component parts.

         Other factors in the more specialized bearing market include strong
distribution channels, quality product, strong technical product service,
customer support and long-term customer relationships.

         While the Company believes that it has significant strengths over
several of its competitors, many of its competitors are more diversified than
the Company, have greater resources than the Company and possess greater market
share in certain markets of the bearing industry. In addition, the Company
relies on certain of its competitors for its own raw materials and in certain
circumstances, produces products for and sells products to its competitors for
resale under such competitors' names. See "Suppliers and Raw Materials."

BACKLOG

         As of April 3, 1999, the Company had a backlog of $69.1 million as
compared to a backlog of $78.2 million as of March 28, 1998. The decrease at
fiscal year end 1999 can be attributed to three factors; a strategic decision to
exit low margin product segments, the completion of fiscal 1999 shipments
against multi-year aerospace orders which were placed in fiscal 1999, and



<PAGE>

orderbook decreases in the agriculture, oilfield and mining industries due to
lower overall demand from these three industries. The Company has historically
maintained a strong backlog of orders. The Company sells many of its products
pursuant to contractual agreements, single source relationships or long-term
purchase orders, each of which may permit early termination by the customer.
However, due to the nature of many of the products supplied by the Company and
the lack of availability of alternative suppliers to meet the demands of such
customers' orders in a timely manner, the Company believes that it is not
practical or prudent for most customers, including many of the Company's largest
customers, to shift their bearing business to other suppliers.

EMPLOYEES

         The Company had approximately 1,275 employees at April 3, 1999.

         Currently, collective bargaining agreements with the United Auto
Workers (UAW) cover substantially all the hourly employees at the Company's West
Trenton, New Jersey, Fairfield, Connecticut and Bremen, Indiana plants, and a
collective bargaining agreement with the United Steelworkers (USWA) covers
substantially all the hourly employees at the Company's Kulpsville, Pennsylvania
plant. The West Trenton agreement expires on July 1, 2001; the Fairfield
Agreement expires on January 31, 2002; the Bremen agreement expires on July 16,
1999 and the Kulpsville agreement expires on October 23, 1999. All other hourly
employees are non-unionized.

         The Company considers its relations with its employees to be
satisfactory and has not experienced a significant work stoppage in over
thirteen years. However, there can be no assurance that additional employees who
are not represented by unions will not elect to be so represented in the future
or that any of the collective bargaining agreements will be renewed when they
expire or that the Company will not experience strikes, work stoppages or other
situations.

         In addition, the Company business is managed by a small number of key
executive officers. Accordingly, the loss of services of certain of these
executives, including Dr. Hartnett, could have a material adverse impact on the
financial condition and results of operations of the Company. There can be no
assurance that the services of such personnel will continue to be made
available.

SUPPLIERS AND RAW MATERIALS

         The Company obtains raw materials, component parts and supplies from a
variety of sources and generally from more than one supplier. The Company's
principal raw material is steel. The Company's suppliers and sources of raw
materials are based in the United States. The Company believes that its sources
are adequate for its needs in the foreseeable future, that there exist
alternative suppliers for its raw materials and that in most cases readily
available alternative materials can be used for most of its raw materials. The
Company does not believe that the loss of any one supplier would have a material
adverse effect on the financial condition or results of operations of the
Company.

         Notwithstanding the foregoing, the Company relies on certain of its
competitors for its own raw materials. There is no assurance that such
competitors will continue to supply raw materials to the Company in the future.





<PAGE>

INTELLECTUAL PROPERTY

         The Company's policy is to file patent applications to protect its
technology, inventions and improvements that are important to the development of
its business, and to seek trademark protection with respect to its product
titles that have achieved brand name recognition. The Company also relies upon
trade secrets, know-how and continuing technological innovation to develop and
maintain its competitive position. The Company holds six United States patents
(including those covering the RBC Roller(TM) cam follower and Quadlube(TM)
spherical plain bearing) and has three additional United States patent
applications pending. The Company has registered twelve trademarks in the United
States. There can be no assurance that such rights will not be infringed upon,
that additional patents will be issued as a result of the Company's applications
and that the Company's trade secrets will not otherwise become known to or
independently developed by competitors. The Company believes that it would have
adequate remedies for any such infringement or use or that claims allowed under
such patents or any existing patents will not be challenged or invalidated or
would be of adequate scope to protect the Company's technology. The Company does
not believe that any individual item of intellectual property is material to its
business.

ENVIRONMENTAL COMPLIANCE

         The Company is subject to various federal, state and local
environmental laws, ordinances and regulations, including those governing
discharges of pollutants into the air and water, the storage, handling and
disposal of solid wastes, hazardous wastes and hazardous substances and the
health and safety of employees ("Environmental Laws"). Agencies responsible for
enforcing Environmental Laws have authority to impose significant civil or
criminal penalties for non-compliance. The Company believes it is currently in
material compliance with all applicable requirements of Environmental Laws, but
there can be no assurance that some future non-compliance will not result in the
imposition of significant liabilities.

         The Company also may be liable under Environmental Laws, including the
Comprehensive Environmental Response, Compensation, and Liability Act
("CERCLA"), state analogs to CERCLA and certain state property transfer laws,
for the costs of investigation and remediation of contamination at facilities
owned or operated by the Company, or at other facilities at which the Company
has disposed of hazardous substances. In connection with such contamination, the
Company may also be liable for natural resource damages, government penalties
and claims by third parties for personal injury and property damage.

         State agencies are currently overseeing investigation, remediation
and/or monitoring activities at the Company's facilities in Fairfield,
Connecticut, West Trenton, New Jersey, Santa Ana, California, Rancho Dominguez,
California and Hartsville, South Carolina and the prior property owner has
conducted limited remediation at the Company's Kulpsville, Pennsylvania
facility. The former owners of these facilities have agreed to indemnify the
Company for liabilities arising from environmental conditions that existed prior
to the date of purchase of such facilities by the Company, which has covered
most of the costs of ongoing activities to date,


<PAGE>

although the Company has relinquished the indemnity for the Fairfield,
Connecticut facility. Moreover, there can be no assurance that the indemnities
relating to the other facilities, all of which contain negotiated dollar limits,
will be adequate to resolve any remaining cleanup liabilities or that the
indemnifying parties will continue to perform their indemnification obligations.

         In March 1996, the Company entered into a stipulated settlement
agreement with the New Jersey Attorney General settling its liability for an
unpermitted release of pollutants in July 1994 from its West Trenton, New Jersey
facility resulting in a fish kill in a tributary to the Delaware River. Under
the terms of the agreement, the Company paid a $150,000 civil penalty to the
State of New Jersey and made a $50,000 donation to a local conservation group.
The Company does not believe that any further liability will result from this
event.

         At the Company's two facilities located in California and its facility
in New Jersey, the previous owners of the assets purchased by the Company
indemnified the Company for liabilities arising from environmental conditions
that existed prior to the date of the Company's purchase of such assets, subject
to certain thresholds, limitations and caps, and are undertaking cleanup in
fulfillment of those indemnification obligations. With respect to the Rancho
Dominguez, California facility, the Company has contributed a total of
approximately $100,000 toward the cost of the on-going cleanup. Under the
acquisition agreement, the previous facility owner is responsible for all
further costs to cleanup conditions existing at the time of the transfer of the
facility, up to a maximum of the full purchase price. The previous owner is
continuing to undertake cleanup activities at this facility. To the Company's
knowledge, cleanup costs are not expected to approach the indemnification cap
limit.

         Cleanup has been completed at the Company's Santa Ana, California
facility, although standard monitoring continues as required by the regional
regulatory authority. Currently, the previous owner is working with this
regulatory authority to obtain final approval and closure of the now-concluded
cleanup activities at this facility. The Company did not contribute toward the
costs of cleanup, and has not contributed toward the ongoing monitoring costs.
To the Company's knowledge, cleanup and monitoring costs have not approached the
$4.5 million limit on the previous owner's liability under the acquisition
agreement for this facility.

         At the West Trenton, New Jersey facility, the previous facility owner
has been investigating and remediating the land where the facility is located
since the mid-1980s. The previous owner both indemnified the Company with
respect to its cleanup obligations and is performing the cleanup pursuant to a
consent order with the New Jersey Department of Environmental Protection. The
Company has not contributed to the costs of remediation at this facility, and
does not expect to do so with respect to conditions existing at the time the
Company acquired the facility.

         Finally, limited environmental activities have been conducted at the
Company's Kulpsville, Pennsylvania and Hartsville, South Carolina facilities.
The prior owner of the Kulpsville facility is undertaking limited remediation at
that facility in fulfillment of its indemnification obligations. Also, at the
request of the state regulatory agency, the Company is monitoring trace level
contamination at its Hartsville, South Carolina facility. This contamination
resulted from operations prior to the Company's acquisition of the facility.
Because the contamination has been detected at very low levels which are
decreasing, the state has not required


<PAGE>

cleanup activities beyond monitoring. Monitoring costs have remained minimal and
are being paid by the Company. However, if the state regulatory agency were to
require cleanup activities in the future, the cost of that cleanup would be
covered by an indemnity with the prior facility owner. There can be no assurance
that the cost of such a cleanup, if required, would not exceed the limits of the
prior owner's indemnification obligation to the Company.

         Certain types of property transactions in Connecticut and New Jersey
may trigger investigation and cleanup obligations under the Connecticut Transfer
Act (the "CTA") or the New Jersey Industrial Site Recovery Act (the "ISRA"),
respectively. In connection with the purchase of its Fairfield, Connecticut
facility in 1996, the company was required by the CTA to submit an investigation
and rededication plan for known environmental contamination at that facility.
Although this known contamination had been the result of operations conducted by
the facility's prior owner, the Company agreed to assume responsibility for
completing cleanup efforts previously initiated by that owner. In 1996, the
Company submitted and obtained regulatory approval for its investigation and
remediation plan as required by the CTA. The results of this investigation
revealed the continued presence of certain low level soil and groundwater
contamination, the remediation of which had been commence by the previous owner
of the facility. In March 1998, the Company submitted these findings to
Connecticut Department of Environmental Protection ("CTDEP"). In April of 1999,
CTDEP responded to this submission and requested that the Company develop a
workplan for additional investigation, analysis and possible remediation to
address the isolated, low level residual contamination at this facility. While
the Company believes that its total investigation and cleanup costs will not
exceed $200,000, Connecticut regulators may require additional cleanup or
monitoring of the residual contamination at this facility. If such activities
are required, there can be no assurance that the Company's total investigation
and remediation costs will not exceed its $200,000 estimate.

         The Company's Recapitalization in 1997 also triggered ISRA obligations
at its West Trenton facility, obligating the Company to investigate all possible
past hazardous substances releases, and to cleanup any resulting contamination,
at that facility. Under ISRA, investigation requirements for facilities that are
currently being remediated pursuant to an earlier ISRA-triggering transaction
may be merged into that ongoing ISRA investigation. In this case, the West
Trenton facility has been the subject of an ongoing ISRA (and its predecessor
statute) groundwater investigation and remediation by the facility's prior owner
since the Company's acquisition of the facility in 1987. Accordingly, the New
Jersey regulatory authorities have informed the Company that its ISRA
obligations triggered by the 1997 Recapitalization are being satisfied by the
prior owner's ongoing ISRA investigation and remediation. That investigation has
not found any additional contamination that would require remediation beyond
that which continues to be performed by the facility's prior owner.

         Prior to, and in connection with, the acquisition of a facility or
business, the Company endeavors to obtain indemnification from parties whom the
Company believes to be able to support such indemnities. Further, the Company
takes such actions as it deems warranted to establish the scope of any
environmental issues that exist as of such purchase, as well as to assess what
potential environmental liabilities exist. Such actions include investigations
by members of management of the Company of the records and facilities relating
to the plant or business to be acquired, analysis of existing investigations,
analyses and compliance work done by the sellers and commissioning its own
studies, investigations or analyses.


<PAGE>

         The Company monitors its various facilities and operations for
compliance with Environmental Laws and exposure to environmental claims,
including, where deemed necessary, the hiring of outside consultants to conduct
surveys and tests. When presented with a potential violation or claim, the
manager of the facility in question will, in coordination and consultation with
management of the Company, endeavor to establish the scope and nature of the
issue, and, if possible, resolve the issue without resort to litigation or
formal proceedings. The Company also undertakes an analysis of the various
indemnification obligations owed to it to ascertain which, if any, would apply,
and the procedures to be followed to perfect its rights with respect to
potential recoveries. Several members of management of the Company have
experience in dealing with such issues and take a leading role in resolving
issues that arise.

         Future events, such as new releases of hazardous substances, new
information concerning past releases of hazardous substances, changes in
existing Environmental Laws or their interpretation, and more rigorous
enforcement by regulatory authorities, may give rise to additional expenditures,
compliance requirements or liabilities that could have a material adverse effect
on the financial condition and results of the operations of the Company. See
"Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations."



<PAGE>


ITEM 2.  PROPERTIES

         The principal executive offices of the Company are comprised of 13,728
square feet of owned office space located at the Heim division in Fairfield,
Connecticut which it owns. The Company conducts manufacturing in approximately
80,000 square feet at such facility where it manufactures plain bearing product,
both Teflon(R) lined and metal to metal and commercial ball bearings. The
Company also owns: (i) a facility in Hartsville, South Carolina, consisting of
approximately 104,000 square feet of manufacturing space, occupied by the RBC
division, at which facility the Company manufacturers the smaller end of all of
the RBC division's product lines, and performs the initial machining operations
for a large percentage of the product manufactured in the West Trenton, New
Jersey facility; (ii) a facility in Kulpsville, Pennsylvania, consisting of
approximately 130,000 square feet of manufacturing space, occupied by Nice, at
which facility the Company manufactures commercial ground and unground ball
bearings; (iii) a facility in Rancho Dominguez, California, consisting of
approximately 69,100 square feet of manufacturing space, occupied by ITB, at
which facility the Company manufactures high precision ball and roller bearings
for the aerospace industry, thin section ball bearings and large diameter cam
followers; (iv) a facility in Santa Ana, California consisting of approximately
80,000 square feet of manufacturing space, occupied by the TDC division, at
which facility the Company manufactures journal bearings and spherical plain
bearings; (v) a facility in Walterboro, South Carolina, consisting of
approximately 40,000 square feet of manufacturing space, occupied by LPP, at
which facility the Company manufactures ball screws, ball spline and ball screw
actuator product lines and (vi) 48,000 square feet of manufacturing space in
Bremen, Indiana, occupied by Miller, at which facility the Company produces
needle bearings. Additionally the Company leases: (i) 55,000 square feet of
manufacturing space in West Trenton, New Jersey, occupied by the RBC division,
at which facility the Company manufactures heavy duty needle roller bearings for
the aerospace industry as well as the RBC division's larger diameter heavy duty
needle roller bearings and single fracture spherical plain bearings; (ii) 22,000
square feet of space in Waterbury, Connecticut (iii) a facility in Bremen,
Indiana consisting of approximately 64,000 square feet of manufacturing space,
occupied by Bremen, at which facility the Company manufacturers needle roller
bearings and (iv) approximately 240,000 square feet of manufacturing space in
Glasgow, Kentucky, at which facility the Company manufacturers tapered roller
bearings.

         The lease for the West Trenton, New Jersey facility expires on February
28, 2009, the lease for the Waterbury, Connecticut facility expires on March 31,
2001, a portion of the lease for the Bremen, Indiana facility expires on July
16, 2002 and the lease for the Glasgow, Kentucky facility expires on June 30,
2005.

         At the Company's facility in Waterbury, Connecticut, its Engineered
Components Division ("ECD"), has recently come on line as a Computer Numerically
Controlled Turning center. The mission of ECD is to be a manufacturer of turned
rings for the other operating units of the Company. The operation currently has
22 employees and approximately $2.4 million in equipment.




<PAGE>


ITEM 3.  LEGAL PROCEEDINGS

         There are various claims and legal proceedings against the Company
relating to its operations in the normal course of business, none of which the
Company believes to be material. The Company currently maintains insurance
coverage for product liability claims. There can be no assurance that
indemnification from its customers and coverage under insurance policies will be
adequate to cover any future product liability claims against the Company.





<PAGE>


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None.


<PAGE>


PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED
         STOCKHOLDER MATTERS

MARKET INFORMATION

         As of April 3, 1999, there were 100 shares of common stock, par value
$.01 per share, of the Company ("Company Common Stock") outstanding, all of
which were held by Holdings. There is no established public trading market for
the Company Common Stock.

         As of April 3, 1999, there were 6,075 shares of Holdings Class A Common
Stock outstanding, held by 22 holders and 3,748 shares of Holdings Class B
Common Stock outstanding held by Michael J. Hartnett. In fiscal year 1999, Dr.
Hartnett converted 200 shares of Class B supervoting stock to Class A. These
shares were sold to Mrs. Kristen Larsen and to a trust for the benefit of Mr.
Larsen. In addition, as of April 3, 1999, there were outstanding warrants and
options to purchase up to an additional 16,200.5 shares of Holdings Class A
Common Stock and 10,077 shares of Holdings Class B Common Stock.

DIVIDENDS

         The Company, as a wholly owned subsidiary of Holdings, from time to
time will pay dividends (and has paid the Dividend in connection with the
Recapitalization) to Holdings from funds legally available therefore to fund
Holdings' operations. No cash dividends have been declared by Holdings on the
Common Stock in the last three (3) years. Holdings intends to retain earnings to
finance the development and growth of its business. Accordingly, Holdings does
not anticipate that any dividends will be declared on the Holdings Common Stock
for the foreseeable future. Future payments of cash dividends, if any, will
depend on the financial condition, results of operations, business conditions,
capital requirements, restrictions contained in agreements, future prospects and
other factors deemed relevant by the Board of Directors of the Company and
Holdings. Further, the Company's ability to declare and pay dividends on the
Company Common Stock is restricted by certain covenants in the credit agreement
relating to the Senior Credit Facilities (the "Credit Agreement") and the
Indenture. Holdings' ability to pay and declare dividends is restricted by
certain covenants in the indenture related to the Discount Debentures (the
"Discount Indenture").

UNREGISTERED SALES OF STOCK

         In connection with the Recapitalization, Holdings assigned its right
under the Recapitalization Agreement to purchase certain shares of Holding's
Common Stock and Holdings Warrants to Dr. Hartnett, certain affiliates of CSFB,
the Oaktree Fund, Kirk Morrison, The Sommers Family Trust and Mitchell Quain. In
addition, in connection with the Recapitalization, Holdings issued warrants to
purchase 1,250 shares of Class B Common Stock to Dr. Hartnett and issued the
Discount Warrants to the Oaktree Fund and Northstar (as defined herein). See
"Item 1. Business -- Recent Developments--Recapitalization."

         Pursuant to the Stock Option Plan (as defined herein), Holdings has
issued options to purchase 1,728 shares of Holdings Class A Common Stock in
fiscal year 1998 and 410 shares of

<PAGE>

Holdings Class A Common Stock in fiscal year 1999, and as a result thereof was
obligated to issue additional warrants to purchase 407.5 shares of Holdings
Class A Common Stock to the Oaktree Fund and Northstar pursuant to certain
anti-dilution provisions of the Discount Warrants.


<PAGE>

ITEM 6.  SELECTED FINANCIAL DATA



The selected financial data presented below for the both of the fiscal years in
the two-year period ended April 3, 1999 has been derived from the Consolidated
Financial Statements of the Company which have been audited by Arthur Andersen
LLP, and the selected financial data presented below for each of the fiscal
years in the three-year period ended March 29, 1997 has been derived from the
Consolidated Financial Statements of the Company, which have been audited by
Ernst & Young, LLP. The information presented below should be read in
conjunction with "Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations" and the Consolidated Financial Statements
and Notes to Consolidated Financial Statements contained elsewhere in this Form
10-K.

<TABLE>
<CAPTION>
                                                                    FISCAL YEAR ENDED

                                                        April 1    March 30       March 29    March 28     April 3,
                                                         1995        1996           1997(a)    1998(b)     1999(c)
                                                       ----------------------------------------------------------
                                                                         (dollars in thousands)
Statement of Operations Data:

<S>                                                 <C>         <C>            <C>         <C>          <C>
Net Sales                                           $  73,904   $  82,233      $  93,427   $ 136,009    $ 147,932
Operating Income                                    $   6,656   $   9,687      $  13,202   $  10,600    $  21,073
Extraordinary Charge, Net                           $      --   $     995      $      --   $     625    $      --
Net Income (Loss)                                   $     101   $     827      $   4,640   $  (1,917)   $   3,895


Balance Sheet Data:

Total Assets                                        $ 106,136   $ 110,182      $ 124,513   $ 156,405    $ 164,819
Total Debt                                          $  60,816   $  56,079      $  62,815   $ 136,200    $ 145,075
Cash Dividends                                      $      --   $      --      $      --   $  56,977    $      --
Stockholder's Equity(Deficit)                       $  22,187   $  35,785      $  37,372   $ (14,922)   $ (11,027)
                                                       ----------------------------------------------------------
</TABLE>


---------------------
(a)  Includes the results of operations for LPP and Nice following their
     respective effective dates of acquisition in October 1996 and February
     1997.
(b)  Includes the results of operations for Bremen following the effective date
     of its acquisition in July 1997.
(c)  Includes the results of operations for Miller for the full fiscal year


<PAGE>

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

FISCAL 1999 COMPARED TO FISCAL 1998

     NET SALES

         The Company's net sales increased by approximately 8.8%, or $11.9
million, to $147.9 million for fiscal 1999 from $136.0 million for fiscal 1998.
Net sales growth in fiscal 1999 occurred both through internal growth in the
Company's existing businesses and through acquisitions. Net sales for fiscal
1999 included $8.5 million related to the Miller acquisition which was effective
March 1998. Net sales for the Company excluding the Miller acquisition increased
by $3.4 million or 2.5% from fiscal 1998.

     GROSS MARGIN

         Gross margin increased by approximately 15.4%, or $6.0 million, to
$44.8 million for fiscal 1999 from $38.8 million for fiscal 1998. Gross margin
as a percentage of sales increased from 28.5% to 30.3%. These increases are
primarily the result of strategic pricing increases, better operational
performance through Kaizen management techniques, the elimination of certain
unprofitable product lines and machine tool capital enhancements.

    OPERATING EXPENSES

         SG&A expenses increased by approximately 18.0%, or $3.5 million, to
$23.0 million for fiscal 1999 from $19.5 million in fiscal 1998. SG&A expenses
as a percentage of net sales increased from approximately 14.3% in fiscal 1998
to approximately 15.6% in fiscal 1999. The increase was primarily attributable
to increased fixed infrastructure costs necessary to support the expanded
business. Key additions to operating management were directly related to the
margin improvement experienced in fiscal 1999. A full year of expenses by the
newly acquired Miller also contributed to the higher level of expenses. Other
operating expenses decreased to $0.7 million in fiscal 1999 from a total of $8.7
million in the prior year primarily due to one time charges of $7.8 million in
fiscal 1998 for expenses related to the extension of warrants and the
Recapitalization.

     OPERATING INCOME

         Operating income increased by approximately 98.8%, or $10.5 million, to
$21.1 million for fiscal 1999 from $10.6 million for fiscal 1998. Excluding the
$7.8 million in fiscal 1998 one time other expenses, operating income increased
by $2.7 million, or approximately 14.7% for the current year primarily due to
higher gross margin partially offset by higher SG&A expenses


     INTEREST EXPENSE

         Interest expense for the fiscal year was $14.5 million compared to
$11.8 million for the prior year. The increase of $2.7 million is primarily
related to higher debt incurred in connection with the Recapitalization and the
Miller acquisition.


<PAGE>

INCOME BEFORE TAXES AND EXTRAORDINARY CHARGE

         Income before taxes and extraordinary items increased by $7.8 million
to $6.6 million for fiscal 1999 compared to a loss of $1.2 million in fiscal
1998. The increase is primarily due to higher operating income of $10.5 million
partially offset by higher interest expense of $2.7 million.

     NET INCOME

         Net income for fiscal 1999 reflects a tax provision of $2.7 million
compared to a benefit of $0.1 million for fiscal 1998. Net income increased
by $5.8 million to $3.9 million in the current year compared to a loss of
$1.9 million for fiscal 1998. Fiscal 1998 results include an extraordinary
charge related to the write-off of unamortized deferred financing costs in
connection with the Company's early extinguishment of debt. The extraordinary
charge was $1.0 million and is reflected net of the related income tax
benefit of $0.4 million.

FISCAL 1998 COMPARED TO FISCAL 1997

     NET SALES

         The Company's net sales increased by approximately 45.6%, or $42.6
million, to $136.0 million in fiscal 1998 from $93.4 million in fiscal 1997. Net
sales growth in fiscal 1998 occurred both through internal growth in base
business and through acquisitions. The increase includes net sales from
acquisitions totaling approximately $35.5 million from LPP, Nice and Bremen,
which included full year results for LPP and Nice and nine months for Bremen.
Net sales increased approximately $13.2 million or 15.1% without LPP, Nice and
Bremen sales. Fiscal 1997 net sales included $6.1 million for LPP and Nice,
whose results of operations were included for six months and two months,
respectively. The primary reason for the internal growth was due to strong
performance, particularly in the aerospace, airframe and construction and mining
areas.

     GROSS MARGIN

         Gross margin increased by approximately 32.5% or $9.5 million, to $38.7
million for fiscal 1998 from $29.2 million for fiscal 1997. Gross margin as a
percentage of net sales decreased by 2.8 percentage points to 28.5% for fiscal
1998 from approximately 31.3% for fiscal 1997, primarily due to changes in the
Company's product mix. This was primarily due to the lower gross profit margins
realized on sales from LPP, Nice and Bremen which are by their nature lower
margin businesses. Gross margins as a percentage of net sales, excluding sales
by these acquired companies was 30.4% for fiscal 1998.

     OPERATING EXPENSES

         Selling, general and administrative ("SG&A") expenses increased by
approximately 34.5%, or $5.0 million, to $19.5 million in fiscal 1998 from $14.5
million in fiscal 1997. The increase is primarily due to the additional expenses
incurred relating to the acquired companies and infrastructure costs to support
the expanded business. SG&A as a percentage of net sales decreased to 14.3% for
fiscal 1998 from 15.5% last year. The improvement of 1.2 percentage points is
primarily due to the fixed nature of certain SG&A costs compared to the higher
sales level.

         The Company took a charge to operations of $7.1 million for
compensation expenses relating to the exercise of warrants in connection with
the Recapitalization of $0.5 million and the extension of the


<PAGE>

term of a number of warrants of $6.6 million. This extension was deemed to
constitute the issuance of new warrants, with a resulting charge to earnings.
Other operating expenses increased to $1.5 million in fiscal 1998 from $1.4
million for fiscal 1997.


 OPERATING INCOME


         Operating income decreased by approximately 19.7%, or $2.6 million, to
$10.6 million for the current year versus $13.2 million for fiscal 1997.
Excluding a $7.1 million compensation charge, operating income increased by $4.5
million, or approximately 34.3%, to $17.7 million for the current year compared
to $13.2 million for last year. The increase is primarily related to the higher
gross margin resulting from higher sales volume, partially offset by higher SG&A
expenses.

    INTEREST EXPENSE

         Interest expense for fiscal 1998 was $11.8 million as compared to $5.3
million for fiscal 1997. The increase of $6.5 million is primarily related to
the debt incurred in connection with the Recapitalization.


    INCOME (LOSS) BEFORE TAXES AND EXTRAORDINARY CHARGE

         The Company had a loss before taxes and extraordinary charge of $1.2
million in fiscal 1998 as compared to income of $7.8 million in fiscal 1997.
This decrease of $9.0 million is primarily due to higher interest expense of
$6.5 million and the $7.1 million compensation charge partially offset by the
$4.5 million increase in operating income.

    EXTRAORDINARY CHARGE

         The Company took an extraordinary charge for the year ended March 28,
1998 related to the write off of unamortized deferred financing costs due to the
Company's early extinguishment of debt in connection with the Recapitalization.
The extraordinary charge was $1.0 million and is reflected net of the related
tax benefit of $0.4 million.

    NET INCOME (LOSS)

         The Company had a net loss of $1.9 million for fiscal 1998 compared to
net income of $4.6 million for the prior year. The $6.5 million decrease between
fiscal 1998 and fiscal 1997 is the result of the $9.0 million decrease in income
before taxes and extraordinary charge less the tax expense deduction of $3.1
million plus the extraordinary charge of $0.6 million related to the write-off
of deferred finance fees associated to debt retired as part of the
Recapitalization.

LIQUIDITY AND CAPITAL RESOURCES

         Net cash provided by operating activities was approximately $3.7
million for fiscal 1999, versus $12.8 million in fiscal 1998. The decrease of
$9.1 million is primarily the result of an inventory build of $5.1 million to
enable the company to be more competitive in the industrial marketplace and
higher disbursement levels of $3.6 million relating to year end cutoffs and all
other of $0.4 million.

         Cash used in investing activities increased by $11.1 million to $21.6
million in fiscal 1999 from $10.5 million in fiscal 1998 primarily related to
higher acquisition and capital expenditure costs of $7.2 million and $2.9
million, respectively, and all other of $1.0 million.


<PAGE>

         The Company had net cash inflows from financing activities of $7.6
million primarily due to draw downs on our revolving credit facility of $7.5
million, proceeds from Industrial Revenue Bonds of $3.0 million, less principal
payments on bank loans and capital lease obligations of $2.9 million.

         Principal and interest payments under the Senior Credit Facilities,
interest payments on the Notes, and the funding of acquisitions, represent
significant liquidity requirements for the Company. With respect to the Term
Loans, the Company began to make its required quarterly scheduled principal
payments in September 1997. The Term Loans bear interest at a floating rate
based upon the interest rate option elected by the Company. As a result of the
indebtedness incurred in connection with the Recapitalization, the Company's
post-Recapitalization interest expense will be higher and will have a greater
proportionate impact on net income in comparison to pre-Recapitalization
periods.

         The Company believes that borrowings available under the Revolving
Credit Facility, cash flow from operations and cash on hand will provide
adequate funds for ongoing operations, planned capital expenditures and debt
service payments for the foreseeable future. The Company's ability to incur
indebtedness is limited by the terms of the Credit Agreement, the Indenture and
the Discount Debentures.

YEAR 2000

         The Company has made a comprehensive assessment of its computer
operations, including trading partner compliance and embedded chips, to identify
systems that could be affected by the change in the millennium. The Company has
developed a detailed Year 2000 compliance plan, which was substantially
completed by March, 1999, utilizing both internal and external resources to
ensure Year 2000 compliance. The Company expects the final phases of its Year
2000 conversion to be fully completed by July, 1999, but has also formulated
contingency plans, which, in the event the Company's plans are delayed, may be
implemented to minimize the risks of interruptions of the Company's business.

         Costs related to this conversion to date are approximately $0.2
million, and are not expected to exceed $0.3 million in total. However, there
can be no assurance that the systems of other companies on which the Company's
system relies will also be converted on a timely basis. A failure to convert by
another company could have an adverse effect on the Company's systems.

ENVIRONMENTAL COMPLIANCE

         The Company is subject to various federal, state and local
environmental laws, ordinances and regulations, including those governing
discharges of pollutants into the air and water, the storage, handling and
disposal of solid wastes, hazardous wastes and hazardous substances and the
health and safety of employees. Agencies responsible for enforcing Environmental
Laws have authority to impose significant civil or criminal penalties for
non-compliance. The Company believes it is currently in material compliance with
all applicable requirements of Environmental Laws, but there can be no assurance
that some future non-compliance will not result in the imposition of significant
liabilities.

         Additionally, capital expenditures and operating costs associated with
the Company's compliance with Environmental Laws may increase in the future if
environmental laws become more stringent, are enforced more rigorously, or if
the Company's operations were to change.

         Prior to, and in connection with, the acquisition of a facility or
business, the Company endeavors to obtain indemnification from parties whom the
Company believes to be able to support such indemnities. Further, the Company
takes such actions as it deems warranted to establish the scope of any
environmental issues that exist as of such purchase, as well as to project what
potential environmental liabilities exist. Such actions include investigations
by members of management of the Company of the records and


<PAGE>

facilities relating to the facility or business to be acquired, analysis of
existing investigations, analyses and compliance work done by the sellers and
commissioning its own studies, investigations or analyses.

         The Company monitors its various facilities and operations for
compliance with Environmental Laws and exposure to environmental claims,
including, where deemed necessary, the hiring of outside consultants to conduct
surveys and tests. When presented with a potential violation or claim, the
manager of the facility in question will, in coordination and consultation with
management of the Company, endeavor to establish the scope and nature of the
issue, and, if possible, resolve the issue without resort to litigation or
formal proceedings. The Company also undertakes an analysis of the various
indemnification obligations owed to it to ascertain which, if any, would apply,
and the procedures to be followed to perfect its rights with respect to
potential recoveries. Several members of management of the Company have
experience in dealing with such issues and take a leading role in resolving
issues that arise.



<PAGE>





ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                     ROLLER BEARING COMPANY OF AMERICA, INC.

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED FINANCIAL STATEMENTS AS OF APRIL 3, 1999 AND MARCH 28, 1998 AND FOR
                               EACH OF THE THREE
                 FISCAL YEARS IN THE PERIOD ENDED APRIL 3, 1999


<TABLE>
<CAPTION>
<S>                                                                                     <C>
Report of Independent Public Accountants - Arthur Andersen LLP                          F - 2

Report of Independent Auditors - Ernst & Young LLP                                      F - 3

Consolidated Statements of Operations                                                   F - 4

Consolidated Balance Sheets                                                             F - 5

Consolidated Statements of Cash Flows                                                   F - 6

Consolidated Statements of  Stockholder's Equity (Deficit)                              F - 7

Notes to Consolidated Financial Statements                                              F - 8 to F - 22
</TABLE>


















                                       F-1


<PAGE>






                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholder
of Roller Bearing Company of America, Inc.

We have audited the accompanying consolidated balance sheets of Roller Bearing
Company of America, Inc. (a wholly owned subsidiary of Roller Bearing Holding
Company, Inc.) as of April 3, 1999 and March 28, 1998, and the related
consolidated statements of operations, stockholder's equity (deficit) and cash
flows for the two fiscal years in the period ended April 3, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Roller Bearing Company of
America, Inc. as of April 3, 1999 and March 28, 1999, and the results of its
operations and its cash flows for the two fiscal years in the period ended
April 3, 1999 in conformity with generally accepted accounting principles.

                                      /s/ ARTHUR ANDERSEN LLP

Stamford, Connecticut
May 27, 1999,
(except with respect
to the matter disclosed
in Note 14, as to which the
date is June 11, 1999).










                                       F-2
<PAGE>


                         REPORT OF INDEPENDENT AUDITORS


The Board of Directors and Stockholder
Roller Bearing Company of America, Inc.

We have audited the accompanying consolidated statements of operations,
stockholder's equity (deficit) and cash flows of Roller Bearing Company of
America, Inc. (a wholly-owned subsidiary of Roller Bearing Holding Company,
Inc.) for the year ended March 29, 1997. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the consolidated results of operations and cash flows of
Roller Bearing Company of America, Inc. for the year ended March 29, 1997, in
conformity with generally accepted accounting principles.

                              /S/ ERNST & YOUNG LLP

White Plains, New York
May 9, 1997




















                                       F-3



<PAGE>





                     ROLLER BEARING COMPANY OF AMERICA, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                  FISCAL YEAR ENDED
                                                                  ---------------------------------------------------
                                                                      APRIL 3,            MARCH 28,    MARCH 29,
                                                                        1999             1998             1997
                                                                  ---------------------------------------------------


<S>                                                               <C>                    <C>           <C>
Net sales                                                                $ 147,932        $ 136,009        $  93,427

Cost of sales                                                              103,165           97,223           64,215
                                                                  ---------------------------------------------------

Gross margin                                                                44,767           38,786           29,212

Operating expenses:
     Selling, general and administrative                                    23,008           19,492           14,537
     Other expense, net of other income                                        686            1,547            1,473

     Compensation related to warrants                                           -             7,147              -
                                                                  ---------------------------------------------------
                                                                            23,694           28,186           16,010

Operating income                                                            21,073           10,600           13,202

Interest expense, net                                                       14,465           11,761            5,338
                                                                  ---------------------------------------------------

Income (loss) before taxes and extraordinary charge                          6,608          (1,161)            7,864

Income tax expense                                                           2,713             131             3,224
                                                                  ---------------------------------------------------

Income (loss) before extraordinary charge                                    3,895          (1,292)            4,640

Extraordinary charge, net
                                                                                 -              625                -
                                                                  ---------------------------------------------------

Net income (loss)                                                         $  3,895       $  (1,917)         $  4,640
                                                                  ---------------------------------------------------
                                                                  ---------------------------------------------------
</TABLE>

                 See notes to consolidated financial statements.

                                       F-4



<PAGE>



                     ROLLER BEARING COMPANY OF AMERICA, INC.
                           CONSOLIDATED BALANCE SHEETS
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                        APRIL 3,          MARCH 28,
                                                                                          1999              1998
                                                                                     ---------------    --------------
<S>                                                                                  <C>                <C>
ASSETS

       Current assets:
            Cash                                                                           $    291         $  10,625
            Accounts receivable, net                                                         26,693            26,859
            Inventories                                                                      44,939            38,563
            Prepaid expenses and other current assets                                         2,098             1,996
                                                                                     ---------------    --------------
                 Total current assets                                                        74,021            78,043
                                                                                     ---------------    --------------

       Property, plant and equipment, net of accumulated depreciation of
            $33,718 at April 3, 1999 and $25,815 at March 28, 1998                           49,309            45,237
       Restricted marketable securities                                                       5,118             4,005
       Excess of cost over net assets acquired, net of accumulated amortization
            of $4,221 at April 3, 1999 and $3,420 at March 28, 1998                          27,553            19,334
       Deferred financing costs, net of accumulated amortization of $1,735 at
            April 3, 1999, and $766 at March 28, 1998                                         6,344             7,147
       Other assets                                                                           2,474             2,639
                                                                                     ---------------    --------------
                 Total assets                                                            $  164,819         $ 156,405
                                                                                     ---------------    --------------
                                                                                     ---------------    --------------

LIABILITIES AND STOCKHOLDER'S DEFICIT

       Current liabilities:
            Accounts payable                                                             $   11,214         $  12,925
            Accrued expenses and other current liabilities                                   13,655            14,827
            Current portion of long-term debt                                                10,500             1,490
            Obligations under capital leases, current portion                                 1,208             1,585
                                                                                     ---------------    --------------
                 Total current liabilities                                                   36,577            30,827

       Long term debt                                                                       134,575           134,710

       Capital lease obligations, less current portion                                        1,635             2,115

       Other noncurrent liabilities                                                           3,059             3,675
                                                                                     ---------------    --------------
                 Total liabilities                                                          175,846           171,327
                                                                                     ---------------    --------------

       Stockholder's deficit:
            Common stock - $.01 par value; 1,000 shares authorized; 100 shares
                 issued and outstanding
                 at April 3, 1999, and at March 28, 1998                                          -                 -
            Stock Warrants                                                                    6,600             6,600
            Retained (deficit) earnings                                                     (17,627)          (21,522)
                                                                                     ---------------    --------------
                 Total stockholder's deficit                                                (11,027)          (14,922)
                                                                                     ---------------    --------------
                 Total liabilities and stockholder's deficit                             $  164,819         $ 156,405
                                                                                     ---------------    --------------
                                                                                     ---------------    --------------
</TABLE>




                 See notes to consolidated financial statements.

                                      F - 5


<PAGE>

                     ROLLER BEARING COMPANY OF AMERICA, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
                                                                                                        FISCAL YEAR ENDED
                                                                                              -----------------------------------
                                                                                               APRIL 3,    MARCH 28,    MARCH 29,
                                                                                                1999          1998         1997
                                                                                              ---------    ---------    ---------
<S>                                                                                           <C>         <C>          <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income (loss)                                                                         $   3,895    $  (1,917)   $   4,640
    Adjustments to reconcile net income (loss) to net cash
        provided by operating activities:
        Depreciation                                                                              8,175        7,137        5,348
        Deferred income taxes                                                                       562       (1,987)         934
        Amortization of excess of cost over net assets acquired                                     801          577          578
        Amortization of deferred financing costs                                                    969          766          215
        Compensation related to warrants                                                             --        6,600           --
        Extraordinary charge, net                                                                    --          625           --
        Changes in working capital, net of acquisition:
             (Increase) decrease in accounts receivable                                           1,107       (6,622)      (1,219)
             (Increase) in inventories                                                           (5,112)         (46)      (1,118)
             (Increase) decrease in prepaid expenses & other current assets                         (70)        (433)         416
             (Increase) decrease in other non current assets                                       (777)         (38)         102
             Increase (decrease) in accounts payable                                             (2,336)       1,163        3,014
             Increase (decrease) in accrued expenses & other current liabilities                 (2,839)       6,617          148
             Increase (decrease) in other non-current liabilities                                  (670)         420         (358)
                                                                                              ---------    ---------     ---------

        Net cash provided by operating activities                                                 3,705       12,862       12,700

CASH FLOWS FROM INVESTING ACTIVITIES:
    Acquisition of subsidiaries                                                                 (11,088)      (3,937)     (12,121)
    Purchase of property, plant & equipment, net                                                 (9,434)      (6,510)      (5,819)
    (Purchase) sale of restricted marketable securities, net                                     (1,113)        (104)         263
                                                                                              ---------    ---------     ---------
        Net cash used in investing activities                                                   (21,635)     (10,551)     (17,677)

CASH FLOWS FROM FINANCING ACTIVITIES:

    Net (decrease) increase in revolving credit facility                                          7,500      (24,627)       8,236
    Proceeds from long-term debt                                                                  3,000      126,000           --
    Payments of long-term debt                                                                       --      (27,488)          --
    Payments of bank term loan                                                                   (1,625)        (500)      (1,500)
    Principal payments on capital lease obligations                                              (1,279)      (1,348)      (1,266)
    Dividend paid to parent company                                                                  --      (56,977)          --
    Financing fees paid in connection with the Recapitalization                                      --       (7,605)          --
                                                                                              ---------    ---------     ---------

        Net cash provided by financing activities                                                 7,596        7,455        5,470

        Net (decrease) increase in cash                                                         (10,334)       9,766          493

Cash, at beginning of year                                                                       10,625          859          366
                                                                                              ---------    ---------     ---------
Cash, at end of year                                                                          $     291    $  10,625    $     859
                                                                                              ---------    ---------     ---------
                                                                                              ---------    ---------     ---------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
    Cash paid during the period for:
         Interest                                                                             $  13,213    $   7,826    $   5,378
                                                                                              ---------    ---------     ---------
                                                                                              ---------    ---------     ---------
         Income taxes                                                                         $     587    $   1,107    $     425
                                                                                              ---------    ---------     ---------
                                                                                              ---------    ---------     ---------

</TABLE>

                 See notes to consolidated financial statements.

                                      F - 6

<PAGE>

                     ROLLER BEARING COMPANY OF AMERICA, INC.
            CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY (DEFICIT)
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                         RETAINED
                                                          ADDITIONAL    EARNINGS/
                                                COMMON     PAID-IN    ACCUMULATED
                                                STOCK      CAPITAL      (DEFICIT)        TOTAL
                                              -----------------------------------------------------

<S>                                           <C>         <C>         <C>                <C>
Balance at March 30, 1996                          $   -     $ 35,831     $  (3,099)     $ 32,732
   Net income                                          -            -         4,640         4,640
                                              -----------------------------------------------------
Balance at March 29, 1997                              -       35,831         1,541        37,372
   Dividend paid to Parent                             -      (35,831)      (21,146)      (56,977)
   Warrant grant                                       -        6,600             -         6,600
   Net loss                                            -                     (1,917)       (1,917)
                                              -----------------------------------------------------
Balance at March 28, 1998                              -        6,600       (21,522)      (14,922)
  Net income                                           -            -         3,895         3,895
                                              -----------------------------------------------------
Balance at April 3, 1999                           $   -     $  6,600    $  (17,627)    $ (11,027)
                                              -----------------------------------------------------
                                              -----------------------------------------------------
</TABLE>



                 See notes to consolidated financial statements.


                                       F-7

<PAGE>




                     ROLLER BEARING COMPANY OF AMERICA, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                             (DOLLARS IN THOUSANDS)

1.  ORGANIZATION AND BUSINESS

Roller Bearing Company of America, Inc., ("RBC" or the "Company") is a wholly
owned subsidiary of Roller Bearing Holding Company, Inc. ("Holdings"). On March
31, 1992, Holdings acquired all of the outstanding shares of RBC pursuant to an
Agreement and Plan of Reorganization. The acquisition was accounted for under
the purchase method of accounting. The excess of the purchase price ($20,100)
over the fair market value of the tangible net assets acquired by Holdings has
been pushed down and recorded as excess of cost over net assets acquired by the
Company.

The Company operates in one business segment in which it manufactures roller
bearing components and assembled parts and designs and manufactures
high-precision roller and ball bearings. The Company sells to a wide variety of
original equipment manufacturers ("OEMs") and distributors who are primarily
domestic but widely dispersed geographically.

On June 23, 1997, pursuant to a Redemption and Warrant Purchase dated May 20,
1997, Holdings effected a recapitalization of its outstanding capital stock
(including the financing and other transactions consummated by Holdings, the
Company and its subsidiaries in connection therewith, the "Recapitalization").
In connection with the Recapitalization, the Company issued the Senior
Subordinated Notes and incurred the Term Loans described in Note 5. The proceeds
therefrom were utilized to pay a dividend to Holdings to finance the redemption
of a substantial portion of its common stock, all of its preferred stock and
certain outstanding warrants to purchase common stock, and to pay certain
Recapitalization fees and expenses. This transaction was further financed from
the proceeds of certain debt issued directly by Holdings. In addition, a new
group of investors (who were not previously stockholders of Holdings) purchased
shares of common stock and warrants to purchase common stock of Holdings,
directly from certain stockholders of Holdings. The redemption of shares and
warrants was treated by Holdings as a recapitalization transaction.

Stockholders of Holdings owning approximately 7% of the outstanding voting
shares prior to the effective date of the Recapitalization, owned approximately
71% of the outstanding voting shares immediately following the Recapitalization.
The new group of investors referred to above owned the remaining 29% of the
voting shares at such time and thus are not controlling stockholders of either
Holdings or the Company. As a result, the transaction did not result in the
establishment of new bases in Holdings' or the Company's assets and liabilities.
Funds disbursed by Holdings and the Company were charged against their capital
accounts to the extent permitted by law.

2.  ACQUISITION OF WHOLLY OWNED SUBSIDIARIES

In October 1996, Linear Precision Products ("LPP"), a wholly owned subsidiary of
the Company, purchased substantially all of the assets and assumed certain
liabilities of a corporation that manufactures precision and ball bearings. The
acquisition was accounted for under the purchase method of accounting. The
purchase price (approximately $5,500) has been allocated to the assets acquired
and liabilities assumed based upon their respective estimated fair values.

In February 1997, RBC Nice Bearings, Inc. ("Nice"), a wholly owned subsidiary of
the Company, purchased substantially all of the assets and assumed certain
liabilities of a corporation that manufactures ground or semi-ground specialty
and ball bearings. The acquisition was accounted for under the purchase method
of accounting. The purchase price (approximately $7,500) has been allocated to
the assets acquired and liabilities assumed based upon their respective
estimated fair values.

In August 1997, Bremen Bearings, Inc. ("Bremen"), a wholly-owned subsidiary of
the Company, completed the acquisition of the Bremen Bearings Division of SKF
USA, Inc., a manufacturer of needle bearings with facilities in Bremen, Indiana.
The purchase was effective as of July 1, 1997. The acquisition was accounted for
under the purchase method of accounting. The total cost through April 3, 1999 of
$5,632 was subject to certain adjustments and subsequent conditions. Thus, the
$3,937 investment in subsidiary consists of $3,640 paid at closing and $297 paid
to date for post-closing related expenses. A deferred payment of $473, which was
paid in December 1997 for the installation of certain equipment, has been
classified as the purchase of property, plant and equipment. Additionally, a
deferred payment of $749 was paid in August 1998 for inventory. The purchase
price has been allocated to the assets acquired and liabilities assumed based
upon their respective estimated fair values.

                                       F-8

<PAGE>

On June 3, 1998, Miller Bearings, Inc. ("Miller"), a wholly owned subsidiary of
the Company, completed the acquisition of the assets of Miller Bearing Company,
Inc., a manufacturer of pins, rollers and screw machine products with facilities
in Bremen, Indiana. The aggregate purchase price for the acquisition, which was
effective as of March 1, 1998, was approximately $11,088. The acquisition was
accounted for under the purchase method of accounting, resulting in
approximately $2,139 allocable to tangible assets and $8,949 of excess of
purchase price over net assets acquired allocable to goodwill.

The results of operations of LPP, Nice, Bremen and Miller subsequent to the
effective dates of acquisition are included in the results of operations of the
Company. Therefore, the results of the Company for the year ended April 3, 1999
include LPP, Nice, Bremen and Miller for the entire fiscal year. Pro forma
consolidated results of operations of the Company, based upon pre-acquisition
unaudited historical information provided by the former owners for the years
ended March 28, 1998 and March 29, 1997, as if the acquisitions took place on
April 1, 1996, are as follows (unaudited):


<TABLE>
<CAPTION>
                                                MARCH 28, 1998         MARCH 29, 1997
                                                --------------         --------------
<S>                                             <C>                    <C>
Net sales                                            $148,882             $ 133,975

Income before extraordinary charge                   $    176             $   7,758

Net income                                           $   (449)            $   7,758
</TABLE>



3.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

GENERAL

The consolidated financial statements include the accounts of RBC, and its
wholly owned subsidiaries, Industrial Tectonics Bearings Corporation ("ITB"),
LPP, Nice, Bremen, Miller and Roller Bearing FSC, Inc. ("FSC"), as well as
its Transport Dynamics ("TDC") and Heim ("Heim") divisions. All material
intercompany balances and transactions have been eliminated in consolidation.

The Company has a fiscal year consisting of 52 or 53 weeks, ending on the
Saturday closest to March 31. Based on this policy, the fiscal 1999 reporting
year contained 53 weeks.

INVENTORY

Inventories are stated at the lower of cost or market, using the first-in,
first-out method, and are summarized as follows:

<TABLE>
<CAPTION>
                                                      APRIL 3, 1999             MARCH 28, 1998
                                                      -------------             --------------

<S>                                                   <C>                       <C>
Raw material                                          $  2,521                   $  2,139

Work in process                                         14,287                     16,482

Finished goods                                          28,131                     19,942
                                                      --------                   ---------

Total inventories                                     $ 44,939                    $38,563
                                                      --------                   ---------
                                                      --------                   ---------
</TABLE>



PROPERTY, PLANT, AND EQUIPMENT AND DEPRECIATION

Property, plant, and equipment are recorded at cost. Depreciation of plant and
equipment, including equipment under capital leases, is provided for by the
straight-line method over the estimated useful lives (3 to 31 years) of the
respective assets or the lease term, if shorter. Amortization of assets under
capital leases is reported with depreciation. The cost of equipment under
capital leases is equal to the lower of the net present value of the minimum
lease payments or the fair market value of the leased equipment at the inception
of the lease.











                                       F-9



<PAGE>


Property, plant and equipment are summarized as follows:

<TABLE>
<CAPTION>
                                                       APRIL 3, 1999                     MARCH 28, 1998
                                                       -------------                     --------------
<S>                                                    <C>                               <C>
Land                                                      $ 7,579                             $ 7,537

Buildings                                                  11,697                                8,987

Machinery & equipment                                      63,751                              54,528
                                                          -------                              ------

Total property, plant & equipment                          83,027                              71,052

Less:  accumulated depreciation                           (33,718)                            (25,815)
                                                          -------                              ------

Property, plant and equipment, net                        $49,309                             $45,237
                                                          -------                              ------
                                                          -------                              ------
</TABLE>



REVENUE RECOGNITION AND CONCENTRATION OF CREDIT RISK

Revenue is recognized upon shipment of products. The Company sells to a large
number of OEMs and distributors who service the aftermarket. The Company's
credit risk associated with accounts receivable is minimized due to its customer
base and wide geographic dispersion. The Company performs ongoing credit
evaluations of its customers financial condition, and bad debt losses have
historically been within the Company's expectations.

INTANGIBLE ASSETS

The excess of purchase price over the fair market value of tangible net assets
acquired is being amortized by the straight-line method over a 40-year period.

Deferred financing costs and related expenses are amortized by the effective
interest method over the lives of the related credit agreements (5 to 23 years).

INCOME TAXES

The Company is included in the consolidated tax return of Holdings and
calculates its provision for income taxes on a separate entity basis.

Income taxes are recognized during the year in which transactions occur and
enter into the determination of financial statement income, with deferred taxes
being provided for temporary differences between amounts of assets and
liabilities for financial reporting purposes and such amounts for tax purposes.
The differences relate primarily to the timing of deductions for depreciation,
goodwill amortization relating to the acquisition of operating divisions, basis
differences arising from acquisition accounting, pension and retirement
benefits, and various accrued and prepaid expenses. Deferred tax assets and
liabilities are recorded at the rates expected to be in effect when the
temporary differences reverse.

USE OF ESTIMATES

The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.


IMPAIRMENT

The Company follows Statement of Financial Accounting Standard ("SFAS") No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be Disposed of". The Company periodically assesses the net realizable value of
its long-lived assets and evaluates such assets for impairment whenever events
or changes in circumstances indicate the carrying amount of an asset may not be
recoverable. For assets to be held, impairment is determined to exist if
estimated undiscounted future cash flows are less than the carrying amount. For
assets to be disposed of, impairment is determined to exist if the estimated net
realizable value is less than the carrying amount.



RECENTLY ISSUED ACCOUNTING STANDARDS
During the year the Company adopted SFAS No. 131, "Disclosures about Segments of
an Enterprise and Related Information". No detailed segment data is required to
be disclosed under this pronouncement as the Company operates in a single
reportable segment; the manufacture and distribution of various types of bearing
products. As it relates to geographical data; during fiscal year 1999, the
Company maintained no overseas manufacturing facilities but had foreign sales of
$9,534 or 6.4% of the Company's total sales.


                                      F-10



<PAGE>

In June 1998, SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities" was issued. This Statement, which became effective June 15, 1999,
establishes accounting and reporting standards for derivative instruments and
for hedging activities. It requires that an entity recognize all derivatives as
either assets or liabilities in the statement of financial position and measure
those instruments at fair value. The Company does not anticipate the adoption of
this standard will have a material effect on the financial statements.



4.  RESTRICTED MARKETABLE SECURITIES

Restricted marketable securities, which are classified as available for sale,
consist of short-term investments of $5,118 and $4,005 at April 3, 1999 and
March 28, 1998, respectively, which were purchased with proceeds from industrial
development revenue bonds issued by the Company during fiscal 1999 and 1995. The
use of these investments is restricted primarily for capital expenditure
requirements in accordance with the applicable loan agreement and, accordingly,
are classified as long-term. These investments consist of highly liquid
investments with insignificant interest rate risk and original maturities of
three months or less, and are carried at market value, which approximates cost.
Fixed maturities consist of U.S. Treasury Notes and are stated at amortized
cost, which approximates market.

5.  DEBT

In connection with the financing of the Recapitalization disclosed in Note 1,
the Company issued $110,000 aggregate principal amount of 9 5/8% Senior
Subordinated Notes Due 2007 (the "Notes"). The Notes pay interest semi-annually
and mature on June 15, 2007, but may be redeemed at the Company's option
beginning on June 15, 2002, as well as, earlier under certain conditions
specified in the indenture (the "Indenture") pursuant to which the Notes were
issued. The Notes are unsecured and subordinate to all existing and future
Senior Indebtedness (as defined in the Indenture) of the Company. The Notes are
fully, unconditionally and irrevocably guaranteed jointly and severally, on a
senior subordinated basis by each of the wholly-owned subsidiaries of the
Company.

The separate financial statements of the subsidiary guarantors have not been
presented because management has determined that they would not be material to
investors. However, the summarized combined financial information of the
subsidiary guarantors are as follows:

<TABLE>
<CAPTION>
                                                APRIL 3,1999              MARCH 28,1998
                                                ------------              -------------

<S>                                             <C>                       <C>
Balance Sheet Data
     Total current assets                       $ 27,475                    $ 22,985
     Noncurrent assets                            34,825                      21,061
                                                ------------              -------------
          Total assets                            62,300                      44,046

     Total current liabilities                    42,129                      34,805
     Noncurrent liabilities                        4,207                         694
                                                ------------              -------------
          Total liabilities                       46,336                      35,499
Stockholder's equity                            $ 15,964                    $  8,547
                                                ------------              -------------
                                                ------------              -------------
</TABLE>


<TABLE>
<CAPTION>

                                                APRIL 3,1999              MARCH 28, 1998            MARCH 29, 1997
                                                ------------              --------------            --------------
<S>                                             <C>                       <C>                       <C>
Operating Results
     Net sales                                  $63,851                   $54,935                   $23,858
                                                --------                  --------                  --------
                                                --------                  --------                  --------
     Gross margin                               $15,255                   $13,142                   $ 6,065
                                                --------                  --------                  --------
                                                --------                  --------                  --------
     Income before extraordinary charge         $ 6,007                   $ 5,582                   $ 2,539
                                                --------                  --------                  --------
                                                --------                  --------                  --------
     Net income                                 $ 6,007                   $ 5,582                   $ 2,539
                                                --------                  --------                  --------
                                                --------                  --------                  --------
</TABLE>

Total current liabilities shown above of the subsidiary guarantors includes
intercompany liabilities of $26,717 and $22,816 as of April 3, 1999 and
March 28, 1998, respectively. Income before extraordinary charge includes a
provision for income taxes of $4,174, $3,879 and $1,764 in fiscal years 1999,
1998 and 1997, respectively. Intercompany allocations have been eliminated in
each fiscal year.

                                      F-11

<PAGE>

In addition, in connection with the Recapitalization, the Company entered
into bank credit facilities (the "Senior Credit Facilities") with a group of
lenders providing for $16,000 of term loans (the "Term Loans") and up to
$54,000 of revolving credit loans and letters of credit (the "Revolving
Credit Facility"). The interest rate on the Term Loan is based on LIBOR plus
2.5%. The applicable interest rate margin is determined on the first day of
each fiscal period based on the Company's leverage ratio, as defined. The
rate in effect at April 3, 1999 was 7.5%.

At April 3, 1999, $13,899 of the Revolving Credit Facility was being utilized to
provide letters of credit to secure the Company's obligations relating to
certain Industrial Development Revenue Bonds, described below. A letter of
credit fee of 2.5% per annum payable quarterly in arrears is required on the
outstanding amount of the letter of credit. As of April 3, 1999 the Company had
the ability to borrow up to an additional $32,601 under the Revolving Credit
Facility. Borrowings outstanding under this facility as of April 3, 1999 were
$7,500. A commitment fee of 0.5% per annum payable quarterly in arrears is
required on the unused portion of the Revolving Credit Facility.

The Senior Credit Facilities are secured by substantially all of the Company's
assets. Under the terms of the Senior Credit Facility, the Company is required
to comply with various operational and financial covenants, including minimum
EBITDA, minimum fixed charge coverage, total interest coverage and maximum
leverage ratio.

In addition, the Senior Credit Facility places limitations on the Company's
capital expenditures in any fiscal year, restricts its ability to pay dividends,
requires the Company to obtain the lenders consent to certain acquisitions and
contains mandatory prepayment provisions which include prepayments from the sale
of the Company's stock and 50% of excess cash flow, as defined. The Company
incurred approximately $7,605 of fees primarily related to costs associated with
the issuance of the Notes as well as the Senior Credit Facilities. These costs
have been capitalized as deferred financing costs and are being amortized over
the terms of the Notes and Term Loans.

Proceeds from these borrowings were used to repay certain existing indebtedness
as well as to pay a dividend to Holdings in order to consummate the
Recapitalization described in Note 1.

During fiscal 1995, the Company entered into a loan agreement with the South
Carolina Jobs Economic Development Authority ("SC JEDA") which provides for
borrowings up to $10,700 under two industrial development revenue bonds and
during fiscal 1999 the Company entered into an additional loan agreement with
the SC JEDA which provides for borrowings up to $3,000 under an industrial
development revenue bond (the "Bonds" or "IRBs"). The proceeds from the Bonds
are restricted for working capital requirements and capital expenditure
purposes. As of April 3, 1999, $9,591 of the proceeds have been expended, and
the remaining $5,118 (including accumulated interest of $1,009) is invested by
the trustee in marketable securities. The SC JEDA Bonds are secured by an
irrevocable direct-pay letter of credit issued by one of the Company's lenders.
The letter of credit is equal to the aggregate principal amounts of the Bonds
plus not less than thirty-five days' interest thereon, calculated at 15% per
annum ($13,899). The Company's obligation to its lender is secured pursuant to
the provisions of the Credit Facility.

                                      F-12


<PAGE>


The balances payable under all borrowing facilities are as follows:

<TABLE>
<CAPTION>
                                                                                    APRIL 3, 1999                MARCH 28, 1998
                                                                                    -------------                --------------

<S>                                                                                 <C>                          <C>
SENIOR SUBORDINATED NOTES PAYABLE                                                        $110,000                      $110,000

CREDIT FACILITY
Term Loan, payable in quarterly installments of $250,
commencing September 30, 1997, increasing annually
thereafter to $1,375 from September 20, 2001 with final payment due
June 30, 2002; bears interest at variable rates, payable monthly
and quarterly for prime and LIBOR-based elections, respectively                            13,875                        15,500

Revolving Credit Facility borrowings outstanding                                            7,500                            --

INDUSTRIAL DEVELOPMENT REVENUE BONDS
Series 1994 A due in annual installments of $180 beginning September 1, 2006,
graduating to $815 on September 1, 2014 with final payment due on September 1,
2017; bears interest at a variable rate, payable monthly through December 2017.             7,700                         7,700

Series  1994;  bears  interest  at a  variable  rate,  payable  monthly
through December 2017.                                                                      3,000                         3,000

Series 1998 tax-exempt industrial development bonds; bears interest at
variable rates, payable monthly through December 2021                                       3,000                            --
                                                                                    -------------                --------------

TOTAL DEBT                                                                                145,075                       136,200

LESS:  CURRENT PORTION                                                                     10,500                         1,490
                                                                                    -------------                --------------

LONG TERM DEBT                                                                           $134,575                      $134,710
                                                                                    -------------                --------------
                                                                                    -------------                --------------
</TABLE>


The current portion of long term debt for the year ended April 3, 1999 includes
$7,500 borrowing on the Revolving Credit Facility, which is borrowed on and paid
down periodically throughout the year.

Maturities of long-term debt during each of the following five fiscal years and
thereafter are as follows:


<TABLE>
<CAPTION>
      <S>                                           <C>
      2000                                          $ 10,500
      2001                                             4,250
      2002                                             3,875
      2003                                             2,750
      2004                                                 0
      Thereafter                                     123,700
                                                     -------
      Total                                         $145,075
                                                     -------
                                                     -------
</TABLE>


The estimated fair value of the Company's debt approximates the book value as of
April 3, 1999 and March 28, 1998.


                                      F-13


<PAGE>


6.  OBLIGATIONS UNDER CAPITAL LEASES

Machinery and equipment additions under capital leases amounted to $422, $582
and $804 in fiscal 1999, 1998 and 1997, respectively. The average imputed rate
of interest on these leases is 7.2%, 8.4% and 8.7% in fiscal year 1999, 1998 and
1997, respectively. The aggregate present value of future minimum lease payments
under these leases at April 3, 1999 are as follows:

<TABLE>
<CAPTION>
     <S>                                  <C>
     2000                                    $   933
     2001                                        685
     2002                                        527
     2003                                        583
     2004                                        115
                                          -----------
     Total                                   $ 2,843
                                          -----------
                                          -----------
</TABLE>

7.  PENSION PLANS

At April 3, 1999, the Company has noncontributory defined benefit pension plans
covering union employees in its Heim division plant in Fairfield, Connecticut,
its Nice subsidiary plant in Kulpsville, Pennsylvania and its Bremen subsidiary
plant in Bremen, Indiana. Additionally, during 1998, the Company terminated a
noncontributory defined benefit pension plan covering union employees in its RBC
plant in West Trenton, New Jersey, effective May 31, 1997. The anticipated
distribution of plan assets was $5.0 million, of which $4.8 million had been
distributed through April 3, 1999. The remaining $0.2 million is currently
considered sufficient to fund any final expenses.

Pension expense has been determined in accordance with the principles of SFAS
No. 87, "Employers' Accounting for Pensions" which requires use of the
"projected unit credit" method for financial reporting. The Company's policy is
to fund pension plans in accordance with the requirements of the Employee
Retirement Income Security Act. In 1998, the company adopted SFAS No. 132
"Employers' Disclosures about Pensions and Other Postretirement Benefits" which
mandated changes in disclosure for pension plans.

Plan assets are comprised primarily of U.S. government securities, corporate
bonds, and stocks. The plans provide benefits of stated amounts based on a
combination of an employee's age and years of service.

The following tables set forth net periodic benefit cost of the Company's
plans, and total pension benefit expense for the three fiscal years in the
period ended April 3, 1999:

<TABLE>
<CAPTION>
Components  of net periodic benefit cost:                            1999                1998                 1997
                                                                    -------             ------              --------
<S>                                                                 <C>                 <C>                 <C>
    Service Cost                                                    $ 361                $ 277               $ 291
    Interest Cost                                                     621                  507                 680
    Actual return on plan assets                                     (869)                (638)               (757)
    Amortization of prior service cost and deferrals                  (75)                 (45)                 41
    Amortization of (gains) losses                                     --                   (6)                 --
                                                                    -------             ------              --------
    Net periodic benefit cost of the Company's plans                 $ 38                $  95               $ 255
                                                                    -------             ------              --------
                                                                    -------             ------              --------
</TABLE>


The following tables set forth the funded status of the Company's pension
benefit plans, the amount recognized in the balance sheets of the Company at
April 3, 1999 and March 29, 1998 and the principal weighted-average assumption
inherent in their determination:




                                      F-14


<PAGE>



<TABLE>
<CAPTION>
Change in benefit obligation:                                 1999        1998
<S>                                                       <C>         <C>
         Benefit obligation at beginning of year          $  9,042    $  8,062
         Service cost                                          286         207
         Interest cost                                         621         507
         Actuarial (gain) loss                                  --         618
         Benefits paid                                        (364)       (352)
                                                          --------    --------
         Benefit obligation at end of year                   9,585       9,042
                                                          --------    --------

Change in plan assets:
         Fair value of plan assets at beginning of year      9,866       9,182
         Actual return on plan assets                        1,394       1,104
         Employer contributions                                264          --
         Benefits paid                                        (363)       (352)
         Administrative expense                                (74)        (68)
                                                          --------    --------
         Fair value of plan assets at end of year           11,087       9,866
                                                          --------    --------

Reconciliation of funded status at end of year:
         Funded status                                       1,502         825
         Unrecognized prior service cost                      (823)       (410)
         Unrecognized actuarial net (gain) loss               (935)       (897)
                                                          --------    --------
         Prepaid (accrued) benefit cost                   $   (256)   $   (482)
                                                          --------    --------
                                                          --------    --------
</TABLE>



Benefits under the union plans are not a function of employees' salaries; thus,
the accumulated benefit obligation equals the projected benefit obligation.

The assumptions used in determining the funded status information were as
follows:

<TABLE>
<CAPTION>
                                                                      1999               1998                1997
                                                               ----------------------------------------------------------
<S>                                                                   <C>                <C>                 <C>
Discount rate                                                         7.0%               7.0%                7.5%
Expected long-term rate of return on plan assets                      9.0%               8.5%                8.5%
</TABLE>

The Company recognized a minimum pension liability of $0 and $18 at April 3,
1999 and March 28, 1998 respectively, for the union pension plans, which
represents the excess of the accumulated benefit obligations over plan assets. A
corresponding amount is recognized as an intangible asset to the extent of
previously unrecognized prior service cost ($0 and $18, at April 3, 1999 and
March 28, 1998, respectively).

In addition, the Company has a defined contribution plan under Section 401(k) of
the Internal Revenue Code for all of its employees not covered by a collective
bargaining agreement. The plan is funded by participants through employee
contributions and by Company contributions equal to a percentage of eligible
employee compensation. Employer contributions under this plan amounted to
$1,439, $627 and $386 in fiscal 1999, 1998 and 1997, respectively.

Effective September 1, 1996 the Company adopted a non-qualified supplemental
retirement plan ("SERP") for a select group of highly compensated management
employees designated by the Board of Directors of the Company. The SERP allows
eligible employees to elect to defer until termination of their employment the
receipt of up to 25% of their current salary. The Company makes contributions
equal to the lesser of 50% of the deferrals or 3.5% of the employees' annual
salary, which vest in full after three years of service following the effective
date of the SERP. Expenses in connection with the SERP were not material during
1999 or 1998.

                                      F-15

<PAGE>

8.  POSTRETIREMENT HEALTH CARE AND LIFE INSURANCE BENEFITS

The Company offers certain postretirement health care and life insurance
benefits to employees covered by collective bargaining contracts who retire
after attaining specific age and length of service requirements. The Company
adopted SFAS No. 106, "Employers Accounting for Postretirement Benefits Other
Than Pensions" in fiscal 1996 but had previously recorded the contractual
liability in purchase accounting and as part of its decision to restructure
certain operations; thus, the adoption of SFAS No. 106 had an immaterial effect
on the Company's financial statements. SFAS No. 106 requires that the projected
future cost of providing postretirement benefits be recognized as an expense
when employees render service instead of when benefits are paid. In 1998, the
Company adopted SFAS No 132 "Employers' Disclosures about Pensions and Other
Postretirement Benefits" which mandated changes in disclosure for retiree
healthcare plans.

The Company, for the benefit of employees at its Heim, West Trenton, Nice and
Bremen facilities, sponsors contributory defined benefit health care plans that
provide postretirement medical benefits to union employees who have attained
certain age and/or service requirements while employed by the Company. The plans
are unfunded and costs are paid as incurred. Postretirement benefit obligations
are included in "Other noncurrent liabilities" within the Consolidated Balance
Sheets.

<TABLE>
<CAPTION>

                                                                      FISCAL YEAR  FISCAL YEAR
                                                                           1999       1998
                                                                      ------------ -----------

<S>                                                                       <C>        <C>
Accrued Benefit Cost at Beginning of Year                                 $ 2,576    $ 1,979
Net Periodic Benefit Cost                                                     114         70
Actual Benefit Payments                                                      (133)      (111)
Adjustment for Settlements                                                     --        638
                                                                          --------   -------
Accrued Benefit Cost at Year End                                          $ 2,557    $ 2,576
                                                                          --------   -------
                                                                          --------   -------
</TABLE>


The net periodic postretirement benefit cost for the fiscal years ended, are as
follows:

<TABLE>
<CAPTION>

                                                                       FISCAL YEAR ENDED
                                                      --------------------------------------------------
                                                         APRIL 3,           MARCH 28,        MARCH 29,
                                                           1999               1998             1997
                                                      --------------       ----------     --------------
    <S>                                               <C>                  <C>            <C>
    Service cost                                             $  70             $ 60            $ 15
    Interest cost                                              179              165              127
    Prior service cost amortization                           (135)            (155)            (108)
                                                      --------------       ----------     --------------
                                                             $ 114             $ 70            $  34
                                                      --------------       ----------     --------------
                                                      --------------       ----------     --------------
</TABLE>


The Company has contractually capped its liability for certain groups of future
retirees. As a result, there is no health care trend associated with these
groups. The effect of a 1% annual increase in the assumed cost trend rate would
increase the accumulated postretirement benefit obligation by approximately 1.2%
for these plans; the annual service and interest cost components in the
aggregate would not be materially affected. The discount rate used in
determining the accumulated postretirement benefit obligation for the plans was
7% for fiscal years 1999 and 1998 and 7.5% for fiscal year 1997.

9.  INCOME TAXES

The Company's effective income tax rate is reconciled to the U.S. Federal
statutory tax rate as follows:



                                      F-16



<PAGE>



<TABLE>
<CAPTION>

                                                                                  FISCAL YEAR ENDED
                                                               -----------------------------------------------------
                                                                     APRIL 3,       MARCH 28,    MARCH 29,
                                                                      1999            1998        1997
                                                               -----------------------------------------------------

<S>                                                            <C>                  <C>          <C>
            Federal statutory tax rate                               34.0%           (34.0%)     34.0%
            State income taxes -- net of federal tax benefit          5.5%            23.7%       5.0%
            Amortization of goodwill                                  3.0%            16.0%       1.5%
            Other non-deductible items                               (1.5)%            5.6%       0.5%
                                                               -----------------------------------------------------
                   Effective tax rate                                41.0%            11.3%      41.0%
                                                               -----------------------------------------------------
                                                               -----------------------------------------------------
</TABLE>



The income tax provision, excluding the tax benefit on extraordinary charges
consisted of:

<TABLE>
<CAPTION>
                                                     FISCAL YEAR ENDED
                                    ----------------------------------------------
                                         APRIL 3,     MARCH 28,   MARCH 29,
                                          1999         1998        1997
                                    ----------------------------------------------
<S>                                     <C>             <C>            <C>
Current:
     Federal                            $ 1,654         $ 2,429        $1,351
     State                                  540             579           939
                                    ----------------------------------------------
                                          2,194           3,008         2,290
Deferred                                    519          (2,877)          934
                                    ----------------------------------------------
Total                                   $ 2,713         $   131        $3,224
                                    ----------------------------------------------
                                    ----------------------------------------------
</TABLE>


The net deferred tax asset consists of the following:

<TABLE>
<CAPTION>
                                                        APRIL 3,       MARCH 28,
                                                          1999          1998
                                                    -----------------------------------

<S>                                                 <C>               <C>
Alternative minimum tax carryforward                      $1,852           $1,984
Postretirement benefits                                    1,250            1,131
Employee compensation accruals                             3,047            3,223
Property, plant and equipment                             (2,651)          (2,624)
Amortizable excess purchase price                           (336)            (362)
Other, net                                                   549               22
                                                    -----------------------------------
Net deferred tax asset                                   $3,711            $3,374
                                                    -----------------------------------
                                                    -----------------------------------
</TABLE>

In both 1999 and 1998, a component of the increase in deferred tax assets was
related to the recording of certain liabilities in connection with purchase
accounting.

10.  STOCKHOLDER'S EQUITY

The Company has 100 shares of Common Stock par value $.01 per share outstanding,
all of which is owned by Holdings.

All issuances and redemptions of equity by Holdings are shown on the financial
statements of the Company as dividends paid to and capital contributions from
Holdings.






                                      F-17



<PAGE>





A summary of the status of the Company's warrants and stock options outstanding
as of April 3, 1999, March 28, 1998 and March 29, 1997, (including activity
other than related to compensation) and changes during the years ending on those
dates is presented below:


<TABLE>
<CAPTION>

                                                          NUMBER OF CLASS A COMMON
                                                           SHARE WARRANTS/OPTIONS

<S>                                                               <C>
Outstanding, March 30, 1996                                       19,652

Awarded fiscal 1997                                                  150

Redeemed 1997                                                       (350)
                                                                --------

Outstanding, March 29, 1997                                       19,452

Awarded Warrants fiscal 1998                                         200

Awarded Options fiscal 1998                                        1,728

Issued in connection with the Recapitalization                   7,076.5

Redeemed fiscal 1998                                             (2,088.)

Repurchased by Holdings in fiscal 1998                            (1,713)

Exchanged for Class B Warrants in fiscal 1998                     (8,827)
                                                                --------

Outstanding, March 28, 1998                                     15,828.5

Awarded fiscal 1999                                                  472

Warrants cancelled                                                  (100)
                                                                --------

Outstanding, April 3, 1999                                      16,200.5
                                                                --------
                                                                --------


                                                        NUMBER OF SUPERVOTING CLASS B
                                                            COMMON SHARE WARRANTS

Outstanding, March 29, 1997                                          --

Awarded in exchange for Class A Warrants                          8,827

Awarded in fiscal 1998                                            1,250
                                                                -------

Outstanding, March 28, 1998                                      10,077

Awarded in fiscal 1999                                               --
                                                                -------


Outstanding, April 3, 1999                                       10,077
                                                                -------
                                                                -------
</TABLE>




In connection with the Recapitalization, as described in Note 1, Holdings issued
warrants to purchase 1,250 shares of Class B Common Stock, par value $.01 per
share, of Holdings at an exercise price of $514 per share to the Company's
Chairman. In addition, a new group of investors (who were not previously
stockholders of Holdings) were issued 6,731 warrants to purchase Class A Common
Stock of Holdings. In fiscal 1998 and fiscal 1999, an additional 345.5 and 62
warrants were issued, respectively, to this new group of investors in respect of
an anti-dilution protection pursuant to issuance of options under the stock
option plan.

Stock Based Compensation

Management participates in Holdings' stock compensation plan. Holdings has
issued warrants to purchase shares of Class B Supervoting Common Stock to Dr.
Hartnett. All other warrants and options are to purchase Class A common stock.
Warrants and options issued to the Company's management as compensation become
vested and are exercisable in one-third annual increments commencing on the date
of award.



                                      F-18

<PAGE>

In June 1997, the terms of certain warrants held by the Company's management
were altered. A total of 7,024 options to purchase Class A Common Stock, which
would otherwise have expired in 2002, were extended to expire on June 23, 2007.
Additionally, 8,827 warrants to purchase Class A Common Stock held by Dr.
Hartnett were converted into 8,827 warrants to purchase Class B Common Stock.
These Class B Common Stock Warrants were extended to expire on June 23, 2007. In
connection with these transactions, compensation cost of $6.6 million arose
which has been recorded as operating expense.

On February 9, 1998, the Company issued 1,728 options to acquire Class A Common
Stock to management and Board members. The term of the options are 10 years and
they are exercisable at $514 per share, the estimated fair market at the time of
grant. Additionally, a member of management departed without exercising the
vested portion of his 100 options.

In fiscal 1999, the Company issued 410 options to acquire Class A Common Stock
to management. The term of the options are 10 years and they are exercisable at
$514 per share, the estimated fair market at the time of grant.

The following table summarizes information about compensation related stock
option and warrants outstanding at April 3, 1999:

<TABLE>
<CAPTION>
                          OPTIONS OUTSTANDING                                          OPTIONS EXERCISABLE
------------------------------------------------------------------------------------------------------------------------

     EXERCISE PRICE        OPTIONS OUTSTANDING       WEIGHTED AVERAGE      OPTIONS EXERCISABLE      WEIGHTED AVERAGE

                                                     CONTRACTUAL LIFE                                EXERCISE PRICE
------------------------- ----------------------- ----------------------- ---------------------- -----------------------


<S>                       <C>                     <C>                     <C>                    <C>
CLASS A

          $100                    7,024                  10 years                6,840.0                  $100

          $514                    9,176                  10 years                7,831.5                  $514

CLASS B

       $77 - $100                 8,827                  10 years                8,827.0                  $ 77

          $514                    1,250                  10 years                1,250.0                  $514
</TABLE>



During 1997, the Company adopted the disclosure provision for SFAS No. 123,
"Accounting for Stock Based Compensation." SFAS No. 123 establishes a fair value
method of accounting and reporting standards for stock based compensation plans.
The fair value for the Holdings warrants was estimated at the date of grant
using a Black-Scholes warrant pricing model with the following weighted-average
assumptions: risk free interest rate used 6.2% for fiscal 1999, 1998 and 1997;
dividend yields of 0%, volatility factors of expected market price of Holdings
common stock of .44% and a weighted-average expected life of the warrants of
three years.

The Black-Scholes warrant valuation model was developed for use in estimating
the fair value of traded warrants which have no vesting restrictions and are
fully transferable. In addition, warrant valuation models require the input of
highly subjective assumptions including the expected stock price volatility.
Because the Holdings warrants have characteristics significantly different from
those of traded warrants, and because changes in the subjective input
assumptions can materially affect the fair value, estimate, in management's
opinion, the existing models do not necessarily provide a reliable single
measure of the fair value of its warrants.

The pro forma effect on the Company's fiscal 1999, 1998 and 1997 operations is
as follows:

<TABLE>
<CAPTION>
                                                                      NET INCOME
                                ----------------------------------------------------------------------------------------

                                            1999                         1998                          1997
                                ----------------------------- ---------------------------- -----------------------------

<S>                             <C>                           <C>                          <C>
As Reported                                $3,895                      $(1,917)                       $4,640

Pro Forma                                  $3,834                      $(2,147)                       $4,554
</TABLE>


11.  COMMITMENTS AND CONTINGENCIES

The Company leases factory facilities under non-cancelable operating leases,
which expire on various dates through February, 2009 with rental expense
aggregating $508, $561 and $500 in fiscal 1999, 1998 and 1997, respectively. The
Company purchased one of these facilities in March 1996 for approximately
$2,500. In May 1996, the Company purchased another of the formerly leased
factory facilities for $2,100.

                                      F-19

<PAGE>

The Company also has non-cancelable operating leases for transportation,
computer and office equipment, which expire at various dates through March 2002.
Rental expense for 1999, 1998 and 1997 aggregated $481, $395 and $652,
respectively.

The aggregate future minimum lease payments under leases are as follows:


<TABLE>
               <S>                                      <C>
               2000                                       $856
               2001                                        752
               2002                                        485
               2003                                        414
               Thereafter                                2,240
                                                        ------
               Total                                    $4,747
                                                        ------
                                                        ------
</TABLE>

The Company enters into government contracts and subcontracts that are subject
to audit by the government. In the opinion of the Company's management, the
results of such audits, if any, are not expected to have a material impact on
the financial statements of the Company.

Certain types of property transactions in Connecticut and New Jersey may trigger
investigation and cleanup obligations under the Connecticut Transfer Act (the
"CTA") or the New Jersey Industrial Site Recovery Act (the "ISRA"),
respectively. In connection with the purchase of its Fairfield, Connecticut
facility in 1996, the company was required by the CTA to submit an investigation
and rededication plan for known environmental contamination at that facility.
Although this known contamination had been the result of operations conducted by
the facility's prior owner, the Company agreed to assume responsibility for
completing cleanup efforts previously initiated by that owner. In 1996, the
Company submitted and obtained regulatory approval for its investigation and
remediation plan as required by the CTA The results of this investigation
revealed the continued presence of certain low level soil and groundwater
contamination, the remediation of which had been commence by the previous owner
of the facility. In March 1998, the Company submitted these findings to
Connecticut Department of Environmental Protection ("CTDEP"). In April of 1999,
CTDEP responded to this submission and requested that the Company develop a
workplan for additional investigation, analysis and possible remediation to
address the isolated, low level residual contamination at this facility. While
the Company believes that its total investigation and cleanup costs will not
exceed $200,000, Connecticut regulators may require additional cleanup or
monitoring of the residual contamination at this facility. If such activities
are required, there can be no assurance that the Company's total investigation
and remediation costs will not exceed its $200,000 estimate.

The Company's Recapitalization in 1997 also triggered ISRA obligations at its
West Trenton facility, obligating the Company to investigate all possible past
hazardous substances releases, and to cleanup any resulting contamination, at
that facility. Under ISRA, investigation requirements for facilities that are
currently being remediated pursuant to an earlier ISRA-triggering transaction
may be merged into that ongoing ISRA investigation. In this case, the West
Trenton facility has been the subject of an ongoing ISRA (and its predecessor
statute) groundwater investigation and remediation by the facility's prior owner
since the Company's acquisition of the facility in 1987. Accordingly, the New
Jersey regulatory authorities have informed the Company that its ISRA
obligations triggered by the 1997 Recapitalization are being satisfied by the
prior owner's ongoing ISRA investigation and remediation. That investigation has
not found any additional contamination that would require remediation beyond
that which continues to be performed by the facility's prior owner.

There are various claims and legal proceedings against the Company relating to
its operations in the normal course of business, none of which the Company
believes is material. The Company currently maintains insurance coverage for
product liability claims. The Company is subject to various federal, state and
local environmental laws, ordinances and regulations. State agencies are
currently overseeing investigation and/or remediation activities at various
Company facilities. In addition, the previous owners of certain facilities are
undertaking cleanup and limited remediation in each case in fulfillment of
certain indemnification obligations. The Company believes it is currently in
substantial compliance with all applicable requirements of environmental laws.

                                      F-20



<PAGE>


12.  OTHER EXPENSE, NET OF OTHER INCOME

Other expense, net of other income is comprised of the following:

<TABLE>
<CAPTION>
                                                                               FISCAL YEAR ENDED
                                                         ----------------- --------------- -----------------
                                                             APRIL 3,          MARCH 28,        MARCH 29,
                                                               1999              1998              1997
                                                         ----------------- --------------- -----------------
<S>                                                      <C>               <C>             <C>
Additional compensation expense
  related to the Recapitalization                            $  --             $ 652            $ --
Amortization of goodwill and
  certain intangible assets                                    801               577             578
Management consulting fees                                      --               108             429
Royalty income                                                 (99)              (85)            (83)
Legal settlements                                               --               295              --
Other expense/(income)                                         (16)               --              49
Pension termination                                             --                --             500
                                                         ----------------- --------------- -----------------
                                                              $686            $1,547         $ 1,473
                                                         ----------------- --------------- -----------------
                                                         ----------------- --------------- -----------------
</TABLE>




13.  EXTRAORDINARY CHARGE

The extraordinary charge for the year ended March 28, 1998 resulted from the
write off of unamortized deferred financing costs due to the Company's early
extinguishment of debt in connection with the Recapitalization. The
extraordinary charge was $1,059 and is reflected net of the related tax benefit
of $434.





14.  SUBSEQUENT EVENT


On June 11, 1999, Tyson Bearings, Inc. ("Tyson"), a wholly-owned subsidiary of
the Company, completed the acquisition of certain selected assets of SKF USA,
Inc.'s taper roller bearing operations ("the Operations") whose principal
operations are located in Glasgow, Kentucky. In addition to the assumption of
certain selected liabilities, Tyson paid $10.2 million. The acquisition will be
accounted for as a purchase.

Summary financial information, provided by the previous owner, for the three
years ended April 3, 1999 is as follows (unaudited):

<TABLE>
<CAPTION>

                                                                            FOR THE YEAR ENDED
                                                    ------------------------------------------------------------------
                                                    APRIL 3, 1999             MARCH 28, 1998            MARCH 29, 1997
<S>                                            <C>                            <C>                       <C>
Net Transfers                                          $50,954                   $50,410                   $48,438
                                                       -------                   -------                   -------
                                                       -------                   -------                   -------
Gross Margin                                           $ 6,546                   $ 4,406                   $ 1,072
                                                       -------                   -------                   -------
                                                       -------                   -------                   -------
Operating Income                                       $ 4,414                    $ 724                   $ (3,253)
                                                       -------                   -------                   -------
                                                       -------                   -------                   -------
Corporate allocations included above                   $ 3,833                   $ 3,760                   $ 4,282
                                                       -------                   -------                   -------
                                                       -------                   -------                   -------
</TABLE>

The above information reflects the historical results of Tyson and is not
intended to reflect Tyson's operating performance under the Company's ownership.
Corporate allocations refer to the allocation by the former parent, SKF USA,
Inc. of operating and other expenses, and are not indicative of any future
allocations by the Company. Transfers represent shipments to affiliates of the
previous owner at amounts consistent with various policies of its parent company
which are principally less than the sale of the product to an independent
customer.





                                      F-21


<PAGE>




                     ROLLER BEARING COMPANY OF AMERICA, INC.
                   QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

Year Ended April 3, 1999:

<TABLE>
<CAPTION>
<S>                               <C>                <C>               <C>               <C>               <C>
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
                                  Q1                 Q2                Q3                Q4                FISCAL 1999
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------

--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
Net Sales                         $ 37,480           $ 36,001          $ 34,063          $ 40,388          $147,932
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
Operating income                  $  5,379           $  4,912          $  4,368          $  6,414          $ 21,073
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
Net income                        $  1,143           $    686          $    416          $  1,650          $  3,895
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
</TABLE>


Year Ended March 28, 1998:

<TABLE>
<CAPTION>

<S>                               <C>                <C>               <C>               <C>               <C>
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
                                  Q1                 Q2                Q3                Q4                FISCAL 1998
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------

--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
Net Sales                         $28,662            $32,309           $34,282           $40,756           $136,009
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
Operating income                  $ 3,458            $ 4,689           $ 4,437           $(1,984)          $ 10,600
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
Income before extraordinary
charge                            $ 1,106            $   813           $   584           $(3,795)          $ (1,292)
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
Net income (loss)                 $   481            $   813           $   584           $(3,795)          $ (1,917)
--------------------------------- ------------------ ----------------- ----------------- ----------------- --------------------
</TABLE>

                                      F-22

<PAGE>

ITEM  9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS

         none



<PAGE>


                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

         The following table sets forth certain information concerning the
directors and executive officers of Holdings, the Company and the Company's
subsidiaries. Each director is elected for a one year term or until such
person's successor is duly elected and qualified.


Dr. Michael Hartnett    53          Chairman, President and Chief Executive
                                    Officer of Holdings and the Company,
                                    Chairman and President of ITB, President of
                                    Nice and LLP, Director of the Company, ITB,
                                    Nice, LLP, Bremen and Miller

Anthony S. Cavalieri    52          Vice President and Chief Financial Officer
                                    of Holdings and the Company, Chief Financial
                                    Officer of ITB, Nice, LLP, Bremen and Miller

Michael S. Gostomski    48          Executive Vice President, Mergers and
                                    Acquisitions of Holdings, the Company, ITB,
                                    Nice and LLP, Executive Vice President of
                                    Bremen, Secretary of Nice, LLP, Bremen
                                    and Miller

Frederick L. Morlok     58          Executive Vice President, Marketing of
                                    Holdings and the Company

Richard J. Edwards      43          Vice President of Holdings and the
                                    Company, General Manager of the RBC division

Christopher  Thomas     44          Vice President, Business Development of
                                    Holdings and the Company

Edward J. Trainer       57          Secretary of Holdings, the Company and ITB

Kurt B. Larsen          35          Director of Holdings and the Company

Robert Anderson         79          Director of Holdings and the Company

William E. Myers, Jr.   39          Director of Holdings and the Company


Stephen A. Kaplan       39          Director of Holdings and the Company

Richard R. Crowell      44          Director of Holdings and the Company


Mitchell T. Quain       47          Director of Holdings and the Company





<PAGE>



DR. MICHAEL J. HARTNETT has been president and Chief Executive Officer of the
Company since April 1992 and Chairman since June 1993. Prior to that, Dr.
Hartnett served as Vice President and General Manager of ITB from 1990,
following eighteen years at Torrington Company, one of the three largest
bearings manufacturers in the United States. While at Torrington, Dr. Hartnett
held the position of Vice President and General Manager of the Aerospace
Business Unit and was, prior to that, Vice President of the Research and
Development Division. Dr. Hartnett holds an undergraduate degree from University
of New Haven, a Masters degree from Worcester Polytechnic Institute, and a Ph.D.
in Applied Mechanics from the University of Connecticut. Dr. Hartnett has also
developed numerous patents, authored more than two dozen technical papers and is
well known for his contributions to the field of Tribology (the study of
friction). Dr. Hartnett currently serves as a director of Aftermarket Technology
Company, a publicly held company in the business of re-manufacturing aftermarket
components for automobiles.

ANTHONY S. CAVALIERI joined the Company in July 1996 as its Vice President
and Chief Financial Officer. From August 1990 to November 1995 he was Vice
President and Chief Financial Officer of Duro-Test Corporation, a medium
sized lighting products manufacturer. From December 1995 through June 1996,
Mr. Cavalieri provided management and financial consulting services to
various entities. Prior to that he was a controller at the Mennen Company and
before that on the audit staff of Price Waterhouse, LLP. Mr. Cavalieri holds
a B.S. in Accounting from St. John's University and a M.B.A. from Fordham
University. He is also a certified public accountant (CPA) as well as a
certified management accountant (CMA), certified internal auditor (CIA),
certified in financial management (CFM) and certified in production and
inventory management (CPIM).

MICHAEL S. GOSTOMSKI, the Company's Executive Vice President, Mergers and
Acquisitions, joined the Company in September 1993. In July of 1996, he was
named Executive Vice President, Mergers and Acquisitions. From January 1991
through August 1993, he served as President and Chief Executive Officer for
Transnational Industries, a publicly held manufacturer of components for
commercial and military aircraft. Mr. Gostomski holds a B.S. in Accounting
and a M.B.A. in Finance from the University of Connecticut. He is also a
certified public accountant (CPA). Mr. Gostomski currently serves as director
of a number of publicly held companies, including Transnational Industries,
Seatek, a publicly held manufacturer of small tools for the electronics
industry, Protopak Corporation, a packaging equipment manufacturer and New
Jersey Steel, a specialty steel manufacturer.

FREDERICK L. MORLOK, the Company's Executive Vice President, Marketing,
joined the Company in 1987. Prior to that he spent twenty-four years at
Torrington where he served in various sales and marketing positions including
District Sales Manager, Product Manager of Machined Race Products and
Business Manager, Strategic Technology Unit. He holds a B.S. in Management
Engineering, Mechanical Engineering Option and a M.B.A. from Rensselaer
Polytechnic Institute.

RICHARD J. EDWARDS joined the Company as Manufacturing Manager in the
Hartsville, South Carolina facility in 1990 and was named Vice President and
General Manager of the RBC division in 1998. Prior to joining the Company, he
spent six years with Torrington as Material Manager and Plant Superintendent in
their Tyger River plant.

CHRISTOPHER THOMAS joined the Company in October 1997 as Vice President,
Business Development. From March 1997 through October 1997, he served as
Business Manager of the Needle Bearing Division of Torrington, a manufacturer of
needle bearings. Mr. Thomas served as a Managing Director of NASTECH Europe,
Ltd., located in Coventry, England, a joint


<PAGE>

venture between Torrington and NSK Ltd., a Japanese bearing and automotive
component manufacturer from April 1995 until March 1997. Prior to that, Mr.
Thomas was the Chairman of the Joint Task Force for the formation of NASTECH
Europe Ltd from June 1994 until March 1995. From May 1990 through June 1994, Mr.
Thomas served as the Business Manager of Precision Components, a division of
Torrington. Mr. Thomas received a B.S. degree in Mechanical Engineering from
Worcester Polytechnic Institute and a M.B.A. from the University of Michigan.

EDWARD J. TRAINER has been employed by the Company since 1967. He served from
1987 to January 1995 as Vice President of Human Resources and has served as
Director of International Sales since January 1995. Mr. Trainer was named
Secretary of the Company in 1993.

KURT B. LARSEN joined the Company in March 1992 and served as Vice President and
Secretary until January 1997. He served as a Director of the Company from March
1992 to January 1997 and from June 1997 to the present. From February 1990 to
January 1997, he served as a principal of Aurora, a leveraged buy-out firm,
where he oversaw and executed investments in several companies. He also serves
as Chairman of Enrich International, Inc., a privately held company which
manufactures and distributes nutritional supplements, and has been a principal
investor and partner in Hunter Capital, an investment bank, since February 1997.

WILLIAM E. MYERS, JR. served as a Director of the Company from March 1992 to May
1997 and from June 1997 to the present. From November 1989 through April 1998 he
was the Chairman and Chief Executive Officer of W.E. Myers & Company, a merchant
bank which specialized in industry consolidations. Mr. Myers has been employed
as the Chairman and Chief Executive Officer of Consolidation Partners, Inc.,
which is engaged in consolidating various manufacturers of components
industries.

MITCHELL I. QUAIN joined the Company as a Director in June 1997. Since May 1997
he has served as an Executive Vice President and member of the Board of
Directors of ING Baring Furman Selz, LLC, an investment banking and brokerage
company. From June 1975 to May 1997 he served as a Managing Director of
Schroeder Wertheim & Company, an investment banking company. He also serves on
the Board of Directors of a number of publicly-held companies, including Allied
Products Corporation, a diversified manufacturing company, Mechanical Dynamics,
Inc., a software company, Strategic Distribution, Inc., a company in the
business of industrial distribution, and Titan International, manufacturer of
off-highway components. He chairs the Board of Overseers of the School of
Engineering at the University of Pennsylvania as well as serving on the Board of
Trustees of Penn.

RICHARD R. CROWELL is President and a Managing General Partner of Aurora Capital
Group, a private equity investment firm. Prior to establishing Aurora in 1991,
Mr. Crowell was a Managing Partner of Acadia Partners, a New York-based
investment fund formed with The Robert M. Bass Group. From 1983 to 1987, he was
a Managing Director, Corporate Finance for Drexel Burnham Lambert. He serves on
the Board of Directors for Aftermarket Technology Corp.; Impaxx, Inc.; Western
Nonwovens, Inc.; Tartan Textile Services, Inc.; ADCO Global, Inc.; and Quality
Distribution Service Partners, Inc. Mr. Crowell earned a BA in English
Literature from the University of California, Santa Cruz, and an MBA from the
Anderson School of the University of California, Los Angeles.

ROBERT ANDERSON has served as Chairman Emeritus of Rockwell Corporation since
February 1990. He also serves as a director of a number of publicly held
companies, including Gulfstream Aerospace Corp., Aftermarket Technology Corp.,
and Motor cargo Industries.


<PAGE>

STEPHEN A. KAPLAN joined the Company as a Director in June 1997. He is also a
Principal of Oaktree Capital Management, LLC ("Oaktree"), the general partner of
the Oaktree Fund. Prior to joining Oaktree in June 1995, he was a managing
director of Trust Company of the West ("TCW"). Prior to joining TCW in 1993, he
was a partner in the law firm of Gibson, Dunn & Crutcher. He serves as a
director of a number of publicly-held companies, including KinderCare Learning
Centers, Inc., which provides child care and pre-school educational services,
Acorn Products, Inc., a manufacturer of lawn and garden tools, Collagenix, Inc.,
a specialty pharmaceutical company and Geo Logistics Corporation, one of the
largest non-asset based global logistics providers headquartered in North
America.

         The Boards of Directors of Holdings and the Company currently
consist of Dr. Hartnett and Messrs. Kaplan, Larsen, Myers, Quain, Anderson
and Crowell. Dr. Hartnett is the sole director of ITB, Nice and LPP. Pursuant
to the Stockholders Agreement (as defined herein), the Oaktree Fund has the
right to designate one member of the board of directors of Holdings and the
Company. Mr. Kaplan is the designee of the Oaktree Fund. See "Certain
Relationships and Related Transactions."

         Members of the Boards of Directors of Holdings and the Company
currently do not receive any compensation for their service as directors but are
reimbursed by the Company for any expenses incurred in attending meetings of the
Boards or otherwise performing their duties for the Company and Holdings.

<PAGE>


ITEM 11. EXECUTIVE COMPENSATION

The following table sets forth the cash and other compensation paid by the
Company in fiscal years 1997, 1998 and 1999 to Dr. Hartnett, its Chairman,
President and Chief Executive Officer, and the next four highly paid executive
officers of the Company (the "Named Executive Officers").

                                    SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                ANNUAL COMPENSATION                              LONG TERM              ALL OTHER
                                                                                                 COMPENSATION           COMPENSATION

NAMES & PRINCIPAL POSITION           FISCAL  SALARY               BONUS         OTHER ANNUAL     SECURITIES
                                     YEAR                                       COMPENSATION     UNDERLYING OPTIONS
<S>                                  <C>     <C>                  <C>           <C>              <C>                    <C>
DR. MICHAEL J. HARTNETT,
CHAIRMAN, PRESIDENT AND
CHIEF EXECUTIVE OFFICER              1999    $375,000(a)(b)(e)    $736,058(c)   $   686,071 (d)       92.5(bb)
                                     1998    $461,250(a)(b)(e)    $     --      $ 1,545,117 (f)    1,250 0(g)           $546,787 (h)
                                     1997    $305,000(a)(b)(e)    $287,167(i)   $    39,466 (j)

MICHAEL S. GOSTOMSKI,
EXECUTIVE VICE PRESIDENT,
MERGERS & ACQUISITIONS               1999    $159,500 (a)         $ 50,000(k)   $    15,017 (l)
                                     1998    $159,500 (a)         $100,000(m)   $    13,256 (n)                          $0 (ee)
                                     1997    $159,500 (a)         $150,000(o)   $     6,840 (p)

ANTHONY S. CAVALIERI,
VICE PRESIDENT AND CHIEF
FINANCIAL OFFICER                    1999    $147,000 (a) (b)     $ 50,000(k)   $    18,185 (q)
                                     1998    $141,750 (a) (b)     $ 70,000(m)   $    16,371 (r)   250 (s)
                                     1997    $ 95,268 (a) (b)     $         --  $     4,762 (t)

FREDERICK MORLOK,
EXECUTIVE VICE PRESIDENT,
MARKETING                            1999    $168,333 (a) (b)     $  55,000(k)  $    17,687 (u)   100 (cc)
                                     1998    $165,000 (a) (b)     $  45,000(k)  $    13,820 (v)                          $0 (ee)
                                     1997    $165,000 (a) (b)     $  50,000(m)  $    14,102 (w)

RICHARD J. EDWARDS,
VICE PRESIDENT AND GENERAL
MANAGER,   RBC DIVISION              1999    $136,750 (a) (b)     $  50,000(k)  $    19,763 (x)   100 (dd)
                                     1998    $130,378 (a) (b)     $  50,000(m)  $    13,291 (y)   100 (aa)
                                     1997    $120,333 (a) (b)     $  30,000(o)  $   124,031 (z)
</TABLE>


(a)  Includes amounts deferred by the executive pursuant to the Company's 401(k)
     Plan (as defined herein).

(b)  Includes amounts deferred by the executive pursuant to the Company's SERP
     (as defined herein).

(c)  Includes (i) bonus of $361,058 earned in fiscal 1997 and paid in fiscal
     1999, and (ii) bonus of $375,000 earned in fiscal 1998 and paid in fiscal
     1999.

(d)  Consists of (i) $11,356 paid by the Company to lease a car for Dr.
     Hartnett's use and (ii) $5,000 contributed by the Company to Dr. Hartnett's
     401(k) Plan account and (iii) $9,626 contributed by the Company to Dr.
     Hartnett's SERP account and (iv) includes $651,000 paid to Dr. Hartnett in
     reimbursement of tax liabilities resulting

<PAGE>

     from certain payments made to Dr. Hartnett, and the repurchase by the
     Company of certain warrants to purchase Common Stock of the Company from
     Dr. Hartnett, in each case in connection with the Recapitalization.

(e)  Includes $30,000 and $30,000 of compensation deferred by Dr. Hartnett in
     fiscal year 1997 and 1996 respectively.

(f)  Consists of the $1 million Hartnett Fee and to $500,000 Hartnett Loan, paid
     and advanced in connection with the Recapitalization. Also includes (i)
     $4,587 contributed by the Company to Dr. Hartnett's 401(k) Plan account,
     (ii) $28,542 contributed by the Company to Dr. Hartnett's SERP account and
     (iii) $11,988 paid by the Company to lease a car for Dr. Hartnett's use.

(g)  Consists of warrants to purchase Class B Common Stock issued in connection
     with the Recapitalization. Does not include the amendment of warrants owned
     by Dr. Hartnett to provide that they become exercisable for shares of Class
     B Common Stock or the restating of warrants to, among other things, extend
     the exercise period thereof to June 2007.

(h)  Amounts paid to Dr. Hartnett in connection with the redemption by Holdings
     of warrants to purchase 1,250 shares of Class A Common Stock at an exercise
     price of $76.77 per share. Such warrants were purchased for $437.23 (the
     fair market value of the Class A Common Stock as of the date of purchase
     ($514) less the exercise price thereof) per share underlying such warrants.
     Holdings subsequently issued to Dr. Hartnett, warrants to purchase 1,250
     shares of Class B Common Stock at an exercise price of $514 per share. Does
     not include $172,290.03 paid by Holdings to Dr. Hartnett for redemption of
     certain shares of Preferred Stock in connection with the Recapitalization.

(i)  Bonus earned in fiscal 1996 and paid in fiscal 1997.

(j)  Consists of (i) $5,313 contributed by the Company to Dr. Hartnett's 401(k)
     Plan account, (ii) $28,104 contributed by the Company to Dr. Hartnett's
     SERP account and (iii) $6,049 paid by the Company to lease a car for Dr.
     Hartnett's use.

(k)  Bonus earned in fiscal 1998 and paid in fiscal 1999. Bonus for fiscal 1999
     will be paid in fiscal 2000.

(l)  Consists of (i) $10,970 contributed by the Company to lease a car for Mr.
     Gostomski's use and (ii) $4,047 contributed by the Company to Mr.
     Gostomski's 401(k) plan.

(m)  Bonus earned in fiscal 1997 and paid in fiscal 1998. Bonus for fiscal 1998
     is reflected in fiscal 1999.

(n)  Consists of (i) $5,016 contributed by the Company to Mr. Gostomski's 401(k)
     Plan account and (ii) $8,240 paid by the Company to lease a car for Mr.
     Gostomski's use.

(o)  Bonus earned in fiscal 1996 and paid in fiscal 1997. Bonus for fiscal 1997
     is reflected in fiscal 1998.

(p)  Consists of (i) $3,627 contributed by the Company to Mr. Gostomski's 401(k)
     plan account and (ii) $3,213 paid by the Company to lease a car for Mr.
     Gostomski's use.

(q)  Consists of (i) $6,270 paid by the Company to lease a car for Mr.
     Cavalieri's use and (ii) $5,000 contributed by the Company to Mr.
     Cavalieri's 401(k) plan account and (iii) $6,915 contributed by the Company
     to Mr. Cavalieri's SERP account.

(r)  Consists of (i) $4,444 contributed by the Company to Mr. Cavalieri's 401(k)
     Plan account (ii) $7,391 contributed by the Company to Mr. Cavalieri's SERP
     account and (iii) $4,536 paid by the Company to lease a car for Mr.
     Cavalieri.

(s)  Options granted under the Stock Option Plan (as defined herein). Options
     with respect to 100 of such shares are exercisable as of the date hereof.



<PAGE>

(t)  Consists of (i) $350 contributed by the Company to Mr. Cavalieri's 401(k)
     plan account (ii) $817 contributed by the Company to Mr. Cavalieri's SERP
     account (iii) $3,595 paid by the Company to lease a car for Mr. Cavalieri's
     use.

(u)  Consists of (i) $9,894 paid by the Company to lease a car for Mr. Morlok's
     use (ii) $5,062 contributed by the Company to Mr. Morlok's 401(k) plan
     account (iii) $2,731 contributed by the Company to Mr. Morlok's SERP
     account.

(v)  Consists of (i) $4,838 contributed by the Company to Mr. Morlok's 401(k)
     Plan account (ii) $4,725 contributed by the Company to Mr. Morlok's SERP
     account and (iii) $4,257 paid by the Company to lease a car for Mr.
     Morlok's use.

(w)  Consists of (i) $2,813 contributed by the Company to Mr. Morlok's 401(k)
     Plan account, (ii) $2,987 contributed by the Company to Mr. Morlok's SERP
     account and (iii) $8,302 paid by the Company to lease a car for Mr.
     Morlok's use.

(x)  Consists of (i) $10,411 paid by the Company to lease a car for Mr.
     Edwards's use, (ii) $4,727 contributed by the Company to Mr. Edwards'
     (401(k) plan account, and (iii) $4,625 contributed by the Company to Mr.
     Edwards' SERP account.

(y)  Consists of (i) $4,422 contributed by the Company to Mr. Edwards' 401(k)
     plan account, (ii) $3,225 contributed by the Company to Mr. Edwards' SERP
     account, and (iii) $5,644 paid by the Company to lease a car for Mr.
     Edwards' use.

(z)  Consists of (i) $119,700 realized upon the exercise of 350 warrants to
     purchase Class A Common Stock at $100 per share, which shares were
     immediately purchased by Holdings for $442 per share, (ii) $2,255
     contributed by the Company to Mr. Edwards' 401(k) Plan account and (iii)
     $2,076 contributed by the Company to Mr. Edwards' SERP account.

(aa) Options granted under the Stock Option Plan. Options with respect to 66.7
     of such shares are exercisable as of the date hereof.

(bb) Options granted as a member of the Board of Directors. Options with respect
     to 30.8 of such shares are exercisable as of the date hereof.

(cc) Options granted under the Stock Option Plan. Options with respect to 33.3
     of such shares are exercisable as of the date hereof.

(dd) Options granted under the Stock Option Plan. Options with respect to 33.3
     of such shares are exercisable as of the date hereof.

(ee) Does not include $423,751 and $48,804 paid by Holdings to Mr. Morlok and
     Mr. Gostomski, respectively for redemption of certain shares of Preferred
     Stock in connection with the Recapitalization.


<PAGE>


OPTION GRANTS IN FISCAL 1999

         The following information is furnished for the fiscal year ended April
3, 1999 with respect to the Named Executive Officers of the Company for stock
options granted during such fiscal year.

<TABLE>
<CAPTION>

                      OPTION GRANTS IN LAST FISCAL YEAR (a)
                                INDIVIDUAL GRANTS




                                                                                                            POTENTIAL REALIZABLE
                                                   % OF TOTAL                                            VALUE AT ASSUMED ANNUAL
                                NUMBER OF            OPTIONS                                                RATES OF STOCK PRICE
                                SECURITIES          GRANTED TO         EXERCISE                           APPRECIATION FOR OPTION
                                UNDERLYING     EMPLOYEES IN FISCAL       PRICE                                      TERM
           NAME              OPTIONS GRANTED           YEAR            ($/SHARE)      EXPIRATION DATE       5%($)         10%($)
---------------------------- ----------------- --------------------- -------------- -------------------- ------------- -------------
<S>                          <C>               <C>                   <C>            <C>                  <C>           <C>
Dr. Michael J. Hartnett             92.5(b)           22.5%              $514       February 18, 2008     $28,057.10    $70,168.65
Anthony S. Cavalieri                100(c)            24.3%              $514       July 1, 2008          $32,325.00    $81,918.00
Fred Morlok                         100(d)            24.3%              $514       February 18, 2008     $30,332.00    $75,858.00
</TABLE>

(a)  All options granted in Fiscal Year 1999 were for the purchase of Class A
     Common Stock
(b)  Options with respect to 62 of such shares are not exercisable as of the
     date hereof.
(c)  Options with respect to 100 such shares are not exercisable as of the date
     hereof.
(d)  Options with respect to 67 of such shares are not exercisable as of the
     date hereof.

         The following information is furnished for the fiscal year ended April
3, 1999 with respect to the Named Executive Officers of the Company for
unexercised stock options and warrants at April 3, 1999.


<TABLE>
<CAPTION>
                                   FISCAL YEAR-END OPTION AND WARRANT VALUES




                                NUMBER OF SECURITIES
                               UNDERLYING UNEXERCISED       VALUE OF UNEXERCISED
                                WARRANTS AT APRIL 3,        IN-THE-MONEY WARRANTS
                                  1999 EXERCISABLE/           AT APRIL 3, 1999
            NAME                    UNEXERCISABLE       EXERCISABLE/UNEXERCISABLE (A)
------------------------------ ------------------------ -----------------------------
<S>                            <C>                       <C>
Dr. Michael J. Hartnett              10,107.9/62             $3,857,281/0
Michael S. Gostomski                     0/0                     $0/0
Frederick L. Morlok                     33/67                    $0/0
Anthony S. Cavalieri                   100/150                   $0/0
Richard J. Edwards                    1,133/67                $455,400/0
</TABLE>

(a) Based upon a per share price of $514.00.

EMPLOYMENT AGREEMENT

         Concurrently with the closing of the Recapitalization, Dr. Hartnett
entered into a five-year employment agreement ("Employment Agreement") with the
Company. The Employment Agreement provides for Dr. Hartnett to serve as the
President, Chief Executive Officer and Chairman of the Board of Directors of the
Company and requires that Dr. Hartnett devote his full business time and
attention to the affairs of the Company. The Employment Agreement contains
covenants regarding the treatment and disclosure of confidential information and
a covenant prohibiting Dr. Hartnett from competing with the


<PAGE>

Company during the term of the Employment Agreement and for two years after its
expiration. The Employment Agreement provides for a salary of $31,250 per month
with annual increases linked to the increase in the All-Items Consumer Price
Index for All Urban Consumers, subject to a minimum increase, plus a bonus
linked to the achievement by the Company of milestones set forth in its
Operating Plan (subject to limited discretion of the Board of Directors of the
Company). The Employment Agreement is terminable (i) upon the death or Total
Disability of Dr. Hartnett, (ii) by the Company for Cause, (iii) by the Company
upon 60 days prior notice and (iv) by Dr. Hartnett for Good Reason (as all such
terms are defined in the Employment Agreement) or upon 120 days prior notice. If
the Employment Agreement is terminated due to death or disability, by the
Company without Cause or by Dr. Hartnett for Good Reason, Dr. Hartnett shall be
entitled to receive his base salary through the end of the original term of the
Employment Agreement plus a pro rata portion of his bonus in the year in which
the termination occurred.

STOCK OPTION PLAN

         Effective, February 18, 1998, Holdings adopted the Roller Bearing
Holding Company, Inc. Stock Option Plan (the "Stock Option Plan"). The terms of
the Stock Option Plan provide for the grant of options to purchase up to
3,569.346 shares of Class A Common Stock to officers and employees of, and
consultants (including members of the board of directors) to, Holdings and its
subsidiaries. Options granted may be either incentive stock options (under
Section 422 of the Internal Revenue Code) or non-qualified stock options. The
Stock Option Plan, which expires on December 31, 2008, is to be governed by the
board of directors of Holdings (the "Holdings Board"), or a committee to which
the Board delegates its responsibilities.

         The purpose of the Stock Option Plan is to provide incentives which
will attract and retain highly competent persons as officers, employees and
directors of, and consultants to, Holdings and its subsidiaries, by providing
them opportunities to acquire shares of Class A Common Stock.

         The exercise price of options granted under the Stock Option Plan shall
be determined by the Board, but in no event less than 100% of the Fair Market
Value (as defined in the Stock Option Plan) of the Class A Common Stock on the
date of grant.

         Options granted under the Stock Option Plan may be exercised during the
period set forth in the agreement pursuant to which the options are granted, but
in no event more than ten (10) years following grant.

         Incentive stock options granted under the Stock Option Plan may only be
granted to employees of Holdings and subject to further limitations set forth in
the Stock Option Plan.

         The number of shares of Class A Common Stock for which options may be
granted under the Stock Option Plan shall be increased, and the number of shares
for which outstanding options shall be exercisable, and the exercise price
thereof, shall be adjusted upon the happening of stock dividends, stock splits,
recapitalizations and certain other capital events regarding Holdings or the
Class A Common Stock. Upon any merger, consolidation or combination of Holdings
where shares of Class A Common Stock are converted into cash securities or other
property, outstanding options shall be converted into the right to receive upon
exercise the consideration as would have been payable in exchange for the shares
of Class A Common Stock underlying such options had such options been exercised
prior to such event.

         Options granted under the Stock Option Plan are not transferable by the
holders thereof except by the laws of descent and distribution.

<PAGE>

         The Holdings Board shall have the right to establish such rules and
regulations concerning the Stock Option Plan, and to make such determinations
and interpretations of the terms thereof as it deems necessary or advisable.

         As of June 7, 1999, there were outstanding options to purchase 2,037.5
shares of Class A Common Stock granted under the Stock Option Plan, of which
options to purchase 489.535 shares were exercisable as of such date.

401(K) PLAN

         The Company maintains the Roller Bearing Company of America 401(k)
Retirement Plan (the "401(k) Plan"), a plan established pursuant to Section
401(k) of the Internal Revenue Code, for the benefit of its non-union employees.
All non-union employees who have completed six months of service with the
Company are entitled to participate. Subject to various limits, employees are
entitled to defer up to 15% of their annual salary on a pre-tax basis and up to
an additional 10% of their annual salary on an after tax basis. The Company
matches 50% of an employee's pre-tax contribution up to 10% of annual salary.
The Company may also make discretionary contributions that are allocated among
eligible accounts pro rata based upon salary. Employees vest in the Company's
contributions ratably over three years.

SUPPLEMENTAL RETIREMENT PLAN

         Effective September 1, 1996, the Company adopted a non-qualified
supplemental retirement plan ("SERP") for a select group of highly compensated
and management employees designated by the Board of Directors of the Company.
The SERP allows eligible employees to elect to defer until termination of their
employment the receipt of up to 25% of their current salary. The Company makes
contributions equal to the lesser of 50% of the deferrals or 3.5% of the
employee's annual salary, which vest in full after three years of service
following the effective date of the SERP. Accounts are paid, either in a lump
sum or installments, upon retirement, death or termination of employment.
Accounts are generally payable from the general assets of the Company although
it is intended that the Company set aside in a "rabbi trust" invested in annuity
contracts amounts necessary to pay benefits. Employees' rights to receive
payments are subject to the rights of the creditors of the Company.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

         In fiscal 1999, there was no compensation committee of the Board of
Directors of Holdings (the "Board"). No member of the Board was involved in an
interlocking relationship or insider participation with respect to the
compensation committee of any other entity.



<PAGE>




ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
         MANAGEMENT

         As of April 3, 1999, there were 100 shares of common stock, par value
$.01 per share, of the Company outstanding, all of which were owned by Holdings
and pledged by Holdings to the holders of the Discount Debentures. The following
table lists, as of April 3, 1999, all shares of Class A Common Stock and Class B
Common Stock of Holdings beneficially owned by (i) each director of the Company,
(ii) the Named Executive Officers, (iii) each person known by the Company to
beneficially own more than 5% of the outstanding shares of any class of common
stock of Holdings at such date and (iv) all directors and executive officers of
Holdings and the Company as a group (22 persons). As of April 3, 1999, there
were 6,075.2 shares of Class A Common Stock and 3,748 shares of Class B Common
Stock outstanding. Additionally, as of such date, there were outstanding
warrants and options to purchase up to an additional 14,163 shares of Class A
Common Stock and 10,077 shares of Class B Common Stock and options granted under
the Stock Option Plan to purchase an additional 2,037.5 shares of Class A Common
Stock.


<TABLE>
<CAPTION>

                     STOCKHOLDER (a)                          NUMBER OF SHARES (a)       PERCENTAGE OF CLASS
                     ---------------                          --------------------       -------------------
         <S>                                                  <C>                        <C>
         Dr. Michael J. Hartnett                                       13,887.8(b)                69.57%(c)

         Michael S. Gostomski                                               1                     *

         Frederick L. Morlok                                              592(d)                   9.62%

         Anthony S. Cavalieri                                             183(e)                   2.92%

         Christopher J. Sommers                                           918(f)                  15.12%

         Richard J. Edwards                                             1,167(g)                  16.11%

         William E. Myers
         Two North Lake Avenue
         Pasadena, California 91101                                     2,275(h)                  27.24%

         Kurt Larsen
         P.O. Box 692547
         Park City, Utah 84068                                            262(i)                   4.27%
</TABLE>



<PAGE>


<TABLE>
<CAPTION>
         <S>                                                  <C>                        <C>

         Stephen Kaplan
         550 South Hope Street
         Los Angeles, California 90071                                  8,584.1(j)               64.74%

         Mitchell Quain
         230 Park Avenue
         New York, New York 10020                                         462(k)                  7.13%

         Oaktree Capital Management, LLC
         550 South Hope Street
         Los Angeles, California 90071                                  8,522.1(m)               64.57%

         OCM Principal Opportunities Fund, L.P.
         550 South Hope Street
         Los Angeles, California 90071                                  8,522.1(n)               64.57%

         Bruce Karsh
         550 South Hope Street
         Los Angeles, California 90071                                  8,522.1(n)               64.57%

         Howard Marks
         550 South Hope Street
         Los Angeles, California 90071                                  8,522.1(l)               64.57%

         Northstar High Total Return Fund
         300 First Stamford Place
         Stamford, Connecticut 06902                                    1,338.4(o)               18.05%

         Northstar Investment Management Corp.
         300 First Stamford Place
         Stamford, Connecticut 06902                                    1,338.4(o)               18.05%

         Merban Equity (p)(q)
         c/o Credit Suisse First Boston
         Bleichistrasse 8
         P.O. Box 4263
         CH-6304 Zug, Switzerland                                       1,399.8 (r)(s)           23.04%
</TABLE>

<PAGE>

<TABLE>
<CAPTION>
         <S>                                                  <C>                        <C>

         Credit Suisse First Boston Corporation (t)
         11 Madison Avenue
         New York, New York 10010                                      2,840.8 (u)               46.57%

         Credit Suisse Group (p)(v)
         Uetlibergstrasse 231
         Ch-8045
         Zurich, Switzerland                                           2,840.8 (r)(u)            46.76%

         Mark Kennelley(w)
         c/o Credit Suisse First Boston
         11 Madison Avenue
         New York, New York 10010                                        490(r)                   8.06%

         Richard Gallant (w)
         c/o Credit Suisse First Boston
         11 Madison Avenue
         New York, New York 10010                                        431(r)                   7.09%

         Brian Sanderson                                                 362(h)                   5.62%

         Ronald E. Lemansky                                              483(x)                   7.84%

         Phil Beausoleil                                                 383(y)                   6.42%

         Robert Anderson                                                  62(z)                   1.01%

         All members of management as a group (22
         persons)                                                     30,502.1(aa)               90.24%
</TABLE>


        *Less than 1%

(a)  Except where otherwise indicated, (i) shares of common stock are of Class A
     Common Stock (ii) warrants are to purchase shares of Class A Common Stock
     and (iii) the address for each stockholder is c/o the Company at 60 Round
     Hill Road, P.O. Box 430, Fairfield, Connecticut 06430.
(b)  Consists of 3,748.4 shares of Class B Common Stock and warrants to purchase
     up to 10,077.4 shares of Class B Common Stock and options granted under the
     Stock Option Plan to purchase up to 62 shares of Class A Common Stock. Does
     not include options to purchase and additional 30.5 shares of Class A
     Common Stock granted under the Stock Option Plan not exercisable as of the
     date hereof.
(c)  Represents 100% of the outstanding shares of Class B Common Stock and
     69.57% of all outstanding shares of common stock of any class. Shares of
     Class B Common Stock are convertible into shares of Class A Common Stock
     one a one-for-one basis. Through the ownership of Class B Common Stock, Dr.
     Hartnett has the power to

<PAGE>

     control a majority of the voting power of all voting securities of
     Holdings even if he were to own less than 50% of the outstanding common
     stock. See "Item 13. Certain Relationships and Related Transactions."
(d)  Includes options to purchase 66 shares of Class A common Stock granted
     under the Stock Option Plan. Does not include options to purchase an
     additional 34 shares of Class A common Stock granted under the Stock Option
     Plan not exercisable as of the date hereof.
(e)  Consists of options granted under the Stock Option Plan. Does not include
     additional options to purchase 67 shares of Class A Common Stock issued
     under the Stock Option Plan not convertible as of the date hereof.
(f)  Such shares are held of record by The Sommers Family Trust. Mr. Sommers
     beneficially owns such shares.
(g)  Consists of warrants to purchase 1,100 shares of Class A Common Stock and
     options to purchase 67 shares of Class A Common Stock granted under the
     Stock Option Plan. Does not include options to purchase 33 share of Class A
     Common Stock granted under the Stock Option Plan not exercisable as of the
     date hereof.
(h)  Consists of warrants to purchase Class A Common Stock.
(i)  Includes (1) options to purchase 62 shares of Class A Common Stock granted
     under the Stock Option Plan, (2) 100 shares of Class A Common Stock held by
     Kristen Larsen, the wife of Mr. Larsen, which may be deemed to be owned by
     Mr. Larsen and (3) 100 shares of Class A Common Stock held by the Aurora
     Capital Partners 401(k) Plan for the benefit of Kurt Larsen. Does not
     include options to purchase and additional 30.5 shares of Class A Common
     Stock granted under the Stock Option Plan not exercisable as of the date
     hereof.
(j)  Consists of warrants to purchase 6,791 shares of Class A Common Stock and
     1,400 shares of Class A Common Stock owned by the Oaktree Fund, and
     warrants to purchase 331.1 shares of Class A Common Stock issued to the
     Oaktree Fund following the issuance of options under the Stock Option Plan
     pursuant to certain anti-dilution provisions of the Discount Warrants, as
     well as options to purchase 62 shares of Class A Common Stock granted under
     the Stock Option Plan. Does not include options to purchase 30.5 shares of
     Class A Common Stock granted under the Stock Option Plan not exercisable as
     of the date hereof. To the extent that the stockholder, as a principal of
     Oaktree, participates in the process to vote or to dispose of any shares or
     warrants held by the Oaktree Fund, he may be deemed under such
     circumstances for the purposes of Section 13 of the Securities Exchange Act
     of 1934, as amended (the "Exchange Act"), to be the beneficial owner of
     such securities. The stockholder disclaims beneficial ownership of
     securities held by the Oaktree Fund.
(k)  Includes warrants to purchase 340 shares of Class A Stock and options to
     purchase 62 shares of Class A Common Stock granted under the Stock Option
     Plan. Does not include options to purchase 30.5 shares of Class A Common
     Stock granted under the Stock Option Plan not exercisable as of the date
     hereof.
(l)  Consists of warrants to purchase 6,791 shares of Class A Common Stock and
     1,400 shares of Class A Common Stock owned by the Oaktree Fund, and
     warrants to purchase 331.1 shares of Class A Common Stock issued to the
     Oaktree Fund following the issuance of options under the Stock Option Plan
     pursuant to certain antidilution provisions of the Discount Warrants. The
     stockholder is the general


<PAGE>

     Partner of the Oaktree Fund. Does not include options to purchase Class A
     Common owned by Mr. Kaplan.
(m)  Included warrants to purchase 6,791 shares of Class A Common Stock and
     1,400 shares of Class A Common Stock owned by the Oaktree Fund, and
     warrants to purchase 331.1 shares of Class A Common Stock issued to the
     Oaktree Fund following the issuance of options under the Stock Option Plan
     pursuant to certain antidilution provisions of the Discount Warrants. Does
     not include options to purchase Class A Common Stock owned by Mr. Kaplan.
(n)  Consists of warrants to purchase 6,791 shares of Class A Common Stock and
     1.400 shares of Class A Common Stock owned by the Oaktree Fund, and
     warrants to purchase 331.1 shares of Class A Common Stock issued to the
     Oaktree Fund following the issuance of options under the Stock Option Plan
     pursuant to certain antidilution provisions of the Discount Warrants. Does
     not include options to purchase Class A Common Stock owned by Mr. Kaplan.
     To the extent that the stockholder, as a principal of Oaktree, participates
     in the process to vote or to dispose of any shares or warrants held by
     Oaktree Fund, he may be deemed under such circumstances for the purposes of
     Section 13 of the Exchange Act, to be the beneficial owner of such
     securities. The stockholder disclaims beneficial ownership of such
     securities.
(o)  Consists of Discount Warrants to purchase 1,262 shares of Class A Common
     Stock owned by Northstar High Total Return Fund ( the "Northstar Fund"),
     and warrants to purchase 76.4 shares of Class A Common Stock issued to the
     Northstar Fund following the issuance of options under the Stock Option
     Plan pursuant to certain antidilution provisions of the Discount Warrants.
     Northstar Investment Management Corp. ("Northstar") is the investment
     advisor of the Northstar Fund and may be deemed to beneficially own such
     warrants.
(p)  Affiliate of CSFB.
(q)  A wholly owned subsidiary of Credit Suisse Group, an entity incorporated
     under the laws of Switzerland.
(r)  Such shares may be deemed to be beneficially owned by CSFB.
(s)  Does not include shares of Class A Common Stock held by certain employees
     of CSFB.
(t)  An indirect wholly owned subsidiary of Credit Suisse Group, an entity
     incorporated under the laws of Switzerland. CSFB is a subsidiary of
     Credit Suisse First Boston, Inc., which is a subsidiary of CFSB, a Swiss
     Bank, which is a subsidiary of Credit Suisse Group. Each of such
     entities may be deemed to beneficially own the shares of Class A Common
     Stock and warrants owned by affiliates of CSFB.
(u)  Consists of shares of Class A Common Stock owned by affiliates and
     employees of CSFB.
(v)  The stockholder, an entity incorporated under the laws of Switzerland, is
     the ultimate parent entity of CSFB and Merban Equity.
(w)  The stockholder is an employee of CSFB.
(x)  Consists of warrants to purchase 416 shares of Class A Common Stock and
     options to purchase 67 shares of Common Stock granted under the Stock
     Option Plan. Does not include warrants to purchase 34 shares of Class A
     Common Stock or options to purchase 33 shares of Class A Common Stock
     granted under the Stock Option Plan not exercisable as of the date hereof.

<PAGE>

(y)  Consists of warrants to purchase 316 shares of Class A Common Stock and
     options to purchase 67 shares of Class A Common Stock granted under the
     Stock Option Plan. Does not include warrants to purchase 34 shares of Class
     A Common Stock or options to purchase 33 shares of Class A Common Stock
     granted under the Stock Option Plan not exercisable as of the date hereof.
(z)  Consists of options granted under the Stock Option Plan. Does not include
     options to purchase an additional 30.5 shares of Class A Common Stock
     granted under the Stock Option Plan not exercisable as of the date hereof.
(aa) Includes (i) (1) 1,832.5 shares of Class A Common Stock, (2) 3,748.4 shares
     of Class B Common Stock, (3) warrants to purchase 5,146 shares of Class A
     Common Stock, (4) warrants to purchase 10,077.4 shares of Class B Common
     Stock, and (5) options to purchase 1,176 shares of Class A Common Stock
     granted under the Stock Option Plan, held by members of management and (ii)
     1,400 share of Class A Common Stock and warrants to purchase 7,122.1 shares
     of Class A Common Stock held by the Oaktree Fund. Does not include warrants
     to purchase 68 shares of Class A Common Stock or options to purchase 861.5
     shares of Class A Common Stock granted under the Stock Option Plan not
     exercisable as to the date hereof.



<PAGE>


ITEM  13.       CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Set forth below is a summary of certain agreements and arrangements, as well as
other transactions between the Company and related parties which have taken
place during the Company's most recent fiscal year.

THE RECAPITALIZATION

         As discussed above, in connection with the Recapitalization, (i) the
Company paid the Dividend to Holdings in the amount of approximately $56.1
million to finance the Recapitalization, (ii) Holdings sold the Discount
Debentures and the Discount Warrants to the Oaktree Fund and Northstar
Investment Management Corp. ("Northstar"), (iii) Holdings used the proceeds of
the Dividend and the proceeds from the sale of the Discount Debentures and the
Discount Warrants to redeem Holdings Common Stock and Preferred Stock and
purchase Holdings Warrants for aggregate consideration of approximately $92.2
million (including shares of Holdings Common Stock and Preferred Stock and
Holdings Warrants owned by members of management and affiliates of Holdings),
(iv) Holdings assigned its rights to purchase certain shares of Holdings Common
Stock and Holdings Warrants under the Recapitalization Agreement to Dr.
Hartnett, certain affiliates of CSFB, the Oaktree Fund, Mr. Morrison, The
Sommers Family Trust and Mr. Quain, (v) Holdings effected the Hartnett
Repurchase of 1,250 Holdings Warrants from Dr. Hartnett for an amount per share
of Holdings Common Stock underlying such Holdings Warrants equal to $514 less
the approximately $77 exercise price of such warrants (an aggregate of
approximately $550,000), (vi) Holdings issued warrants exercisable for 1,250
shares of Class B Common Stock at an exercise price of $514 per share of Common
Stock to Dr. Hartnett, (vii) Holdings made the Hartnett Loan in the amount of
$500,000, (viii) Holdings paid the Hartnett Fee in the amount of $1 million,
(ix) Holdings converted all of Dr. Hartnett's shares of Holdings Common Stock
into shares of Class B Common Stock, and amended all Holdings Warrants held by
Dr. Hartnett to provide that they be exercisable for shares of Class B Common
Stock, (x) the Company repaid outstanding indebtedness (approximately $52.1
million) on the Existing Revolving Credit Facility and the Existing Term Loan,
(xi) Holdings paid a fee of $1.6 million to CSFB, in connection with the sale of
the Discount Debentures, (xii) the Company paid a fee to CSFB of $3.85 million
in connection with the sale of the Notes, (xiii) the Company entered into the
Senior Credit Facilities with, among others, an affiliate of CSFB and paid (1)
certain fees to such lenders and (2) a fee of $1.5 million to CSFB in connection
therewith, and (xiv) the Company agreed to indemnify CSFB and certain affiliates
of CSFB in connection with certain matters relating to the Recapitalization.

         The Hartnett Loan bears no interest and is recourse only to the
securities purchased with the proceeds thereof. As of April 3, 1999, the entire
principal balance of the Hartnett Loan remained outstanding.

         The assignment of rights under the Recapitalization Agreement referred
to in clause (iv) above, was undertaken in order to achieve certain desired
post-Recapitalization equity positions and to satisfy certain contractual
obligations of the Company and Holdings. In exchange for such assignments, the
assignees assumed the obligations of the Company and Holdings under the
Recapitalization Agreement with respect to such shares of Common Stock or
Holdings Warrants.

<PAGE>

         The Hartnett Repurchase and the grant of certain warrants to Dr.
Hartnett referred to in clause (vi) above were undertaken to enable Dr. Hartnett
to fulfill his obligations with respect to certain shares of Common Stock
assigned to him and referred to in clause (iv) above without Dr. Hartnett
suffering a diminution of his fully-diluted equity position in Holdings. Upon
the Hartnett Repurchase, all obligations of Holdings under the Holdings Warrants
repurchased were extinguished.

         The Hartnett Fee was paid to Dr. Hartnett in consideration of services
rendered in connection with the preparation, negotiation and consummation of the
Recapitalization.

         In connection with the Recapitalization, the Oaktree Fund purchased
approximately $59.8 million principal amount at maturity of Discount Debentures
and Discount Warrants to purchase 5,469 shares of Common Stock from Holdings in
exchange for approximately $32 million. Mr. Kaplan, a director of Holdings and
the Company, is a principal of Oaktree, the general partner of the Oaktree Fund.

         In addition, in connection with the Recapitalization and the other
transactions consummated in connection therewith, the Company paid Ernst &
Young, LLP a consulting fee in the amount of approximately $1 million.

         In connection with the Recapitalization and the redemption of certain
shares of Preferred Stock by Holdings pursuant thereto, Holdings released
certain holders thereof who were prior stockholders of the Company, from certain
indemnification obligations owing to Holdings. Such obligations arose under the
agreement pursuant to which Holdings purchased the Company from such
stockholders. The shares of Preferred Stock were held in escrow in connection
with such stockholders' obligations under such indemnification provisions. The
provisions of the escrow provided that the escrowed shares were to be released
upon any transaction involving a change in control of Holdings, except as to the
extent of claims previously made. As there were no pending claims, upon
consummation of the Recapitalization, such shares were released from escrow and
redeemed by Holdings. Any claims for environmental remediation at the facilities
covered by the released indemnification are being covered by other indemnifying
parties, and the Company believes that such other indemnification obligations
should be sufficient to cover all costs associated with the known or likely
environmental conditions at such facilities.


HARTNETT CONTROL PROVISION

         Through ownership of Class B Common Stock and the provisions of the
Certificate of Incorporation of Holdings granting such Class B Common Stock 10
votes per share, whether or not Dr. Hartnett owns a majority of the outstanding
capital stock of Holdings, he will have, subject to certain limitations, the
power to control a majority of the voting rights of all capital stock of
Holdings. Such right will be suspended for such periods during which Dr.
Hartnett ceases to serve in the management of the Company, or any successor
thereto, or owns less than 50% of the outstanding Holdings Common Stock on a
fully diluted basis that he owned immediately following the Recapitalization.



<PAGE>

EMPLOYMENT AGREEMENT

         Effective upon the closing of the Recapitalization, Dr. Hartnett
entered into a five-year Employment Agreement with the Company containing a
covenant restricting competition with the Company. See "Executive Compensation".


HARTNETT BONUS

         In connection with the acquisition of Nice by the Company, the Company
paid a bonus to Dr. Hartnett in the amount of $136,000. Such bonus was paid in
the first quarter of fiscal 1998.

MYERS' FEE

         W.E. Myers & Company, an entity which was owned and controlled by Mr.
Myers, a director of Holdings, received a $100,000 fee in 1997 for the provision
of investment bank services in connection with the acquisition of LPP by the
Company.

STOCKHOLDER AGREEMENTS

         Concurrently with the closing of the Recapitalization, Holdings entered
into a stockholders' agreement (the "Stockholders Agreement") with Dr. Hartnett,
the Oaktree Fund, Northstar and certain affiliates of CSFB. The Stockholders
Agreement provides for (i) restrictions on transfer of all securities of
Holdings held by the parties to the Stockholders Agreement, (ii) rights of first
refusal in favor of the parties to the Stockholders Agreement prior to any
transfer by a party (other than transfers to certain affiliates of the parties)
of securities of Holdings, (iii) tag-along rights in favor of the other parties
to the Stockholders Agreement upon certain transfers of securities of Holdings
by Dr. Hartnett, (iv) certain rights in favor of Dr. Hartnett to compel the
other parties to the Stockholders Agreement to sell securities of Holdings held
by such parties upon certain sales of securities of Holdings by Dr. Hartnett,
(v) certain preemptive rights in favor of the Oaktree Fund, Northstar and Dr.
Hartnett with respect to securities of Holdings, (vi) piggyback registration
rights in favor of all of the parties to the Stockholders Agreement with respect
to securities of Holdings, (vii) detailed registration rights in favor of the
Oaktree Fund and Northstar with respect to securities of Holdings, with
customary covenants regarding such registration and (vii) a grant to the Oaktree
Fund of the right to designate one member of the board of directors of each of
Holdings and the Company. Many of the rights and privileges contained in the
Stockholders Agreement terminate or become limited following an initial public
offering of securities of Holdings.

         The Board of Holdings has approved the entry into additional
stockholders' agreements with certain of Holdings other stockholders and
warrantholders providing for (i) the right to repurchase the stock or warrants
held by such parties upon the death or termination of employment of any
stockholder or warrantholder who is employed by Holdings or its subsidiaries,
(ii) the right to tag-along on certain sales of securities by other stockholders
of Holdings and (iii) certain rights in favor of Dr. Hartnett to compel such
stockholders and warrantholders to sell their securities of Holdings upon
certain sales of securities by Dr. Hartnett. Holdings anticipates executing
such agreements during fiscal 1999.

<PAGE>

         Prior to the Recapitalization, Holdings was a party to various
arrangements with its stockholders and warrantholders, all of which have been
terminated.

CONSULTING AGREEMENT

         Prior to the Recapitalization, the Company and Tribos Management
Company, Inc., an affiliate of Aurora, were parties to a consulting agreement
(the "Consulting Agreement"), whereby Tribos provided certain consulting
services to the Company in exchange for monthly payments of approximately
$36,000. The Consulting Agreement also provided for annual adjustments to the
fee, reimbursement of Tribos' expenses by the Company and the payment of
additional fees in connection with the acquisition of Nice. The total fees paid
in fiscal 1999, 1998 and 1997 pursuant to the consulting agreement were $0,
$108,000 and $429,000, respectively. The Consulting Agreement was terminated in
connection with the Recapitalization.

STOCK OPTION PLAN

         Effective February 18, 1998, Holdings adopted the Stock Option Plan and
issued options thereunder to certain of its directors, officers and employees.
See "Item 11. Executive Compensation".

WARRANT REISSUANCES

         The Board has approved a proposal to amend and restate the terms of
certain of its outstanding warrants, to, among other things, extend the terms
thereof. Such action will be effective as of February 18, 1998.


<PAGE>


                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT, SCHEDULES AND REPORTS
         ON  FORM 8-K


<TABLE>
<CAPTION>
<S>                                                                             <C>
Consolidated Statement of Operations for Each of the Fiscal Years
in the Three-Year Period Ended April 3, 1999                                    Part II  Item 8
Consolidated Balance Sheet at April 3, 1999, March 28, 1998 and
          March 29, 1997                                                        Part II  Item 8
Consolidated Statement of Cash Flows for Each of the Fiscal Years
         in the Three-Year Period Ended April 3, 1999                           Part II  Item 8

Consolidated Statement of Stockholder's (Deficit) Equity for Each of
the Fiscal Years in the Three-Year Period Ended April 3, 1999                   Part II  Item 8

Notes to Consolidated Financial Statements                                      Part II  Item 8

Independent Public Accountants' Report                                          Part II  Item 8

Independent Auditors' Report                                                    Part II  Item 8
</TABLE>










<PAGE>


ITEM 21.       EXHIBITS AND FINANCIAL SCHEDULES

         (a)      Exhibits.

                                  EXHIBIT INDEX



EXHIBIT
NUMBER                           DESCRIPTION OF DOCUMENT
------                           -----------------------

3.1*               Amended and Restated Certificate of Incorporation, dated June
                   23, 1997, of Roller Bearing Company of America, Inc.
                   ("RBCA").
3.2**              Bylaws of RBCA.
3.2(a)***          Amendment to the Bylaws of RBCA.
4.1**              Indenture, dated as of June 15, 1997 between RBCA and the
                   United States Trust Company of New York ("Trustee") with
                   forms of Outstanding Note and Exchange Note.
4.1(a)**           Supplemental Indenture, dated as of August 8, 1997 by and
                   between Bremen and the Trustee.
4.2**              Global Note Issued to Depository Trust Co., duly
                   authenticated by RBCA and the Trustee.
4.3**              Registration Rights Agreement dated June 17, 1997 between
                   RBCA, the Subsidiary Guarantors named therein and CSFB.
4.4***             Stock Option Plan of Holdings, dated as of February 18, 1998
                   with form of agreement.
4.5***             Form of Stock Transfer Restriction Agreement between Holdings
                   and certain of its stockholders.
4.6***             Form of Amended and Restated Warrant of Holdings.
10.1**             Purchase Agreement, dated June 17, 1997 among RBCA, the
                   Subsidiary Guarantors named therein and the CSFB
10.2**             Redemption and Warrant Purchase Agreement by and among
                   Holdings, Certain Stockholders of Holdings, and Michael J.
                   Hartnett, as purchaser representative, dated as of May 20,
                   1997, as amended by that certain Amendment No. 1, dated as of
                   June 23, 1997.
10.3**             Credit Agreement dated as of June 23, 1997, among RBCA, the
                   Lenders named therein and CSFB, as Administrative Agent.
10.4**             Pledge Agreement dated as of June 23, 1997, among RBCA, each
                   Subsidiary of RBCA named therein and CSFB.
10.5**             Security Agreement dated as of June 23, 1997, among RBCA,
                   each Subsidiary of RBCA named therein and CSFB.
10.6**             Guarantee Agreement dated as of June 23, 1997, among each of
                   the subsidiaries named therein of RBCA and CSFB.
10.7**             Asset Purchase Agreement by and among BFM Aerospace
                   Corporation, Ground Support, Inc., RBC Transport Dynamics
                   Corporation and Holdings, dated as of October 26, 1992.

<PAGE>



EXHIBIT
NUMBER                          DESCRIPTION OF DOCUMENT
------                          -----------------------

10.8**             Asset Purchase Agreement by and among BFM Aerospace
                   Corporation, BFM Transport Dynamics Corporation, RBC
                   Transport Dynamics Corporation and Holdings, dated as of
                   October 26, 1992.
10.9**             Agreement and Plan of Reorganization among RBCA, Roller
                   Bearing Acquisition Company, Inc., Holdings and the
                   Stockholders of RBCA, dated March 31, 1992.
10.10**            Agreement of Merger between Roller Bearing Acquisition
                   Company, Inc. and RBCA, dated March 31, 1992.
10.11**            Asset Sale Agreement by and between IMO Industries Inc. and
                   RBCA, dated as of May 10, 1993.
10.12**            Asset Purchase Agreement by and among BPP Acquisition
                   Corporation, Beaver Precision Products, Inc., RBCA, and Lloyd
                   J. Baretz, dated as of October 18, 1998.
10.13**            Asset Purchase Agreement By and Among SKF USA Inc., Nice and
                   RBCA, dated as of February 28, 1997.
10.14**            Lease between General Sullivan Group, Inc. and RBC Bearings,
                   dated July 11, 1995, for West Trenton, New Jersey premises.
10.15**            Lease between Industrial Development Group and RBCA, dated
                   March 12, 1998 for Waterbury, Connecticut premises.
10.16**            Letter of Credit Agreement, dated as of September 1, 1994,
                   between RBCA and Heller Financial, Inc. ("Heller").
10.17**            Termination, Release and Enhancement Letter of Credit
                   Documents Continuation Agreement dated June 23, 1997, by and
                   between Heller, RBCA and ITB.
10.18**            Executed counterpart of the Pledge and Security Agreement,
                   dated as of September 1, 1994, between RBCA, Heller and the
                   Trustee.
10.19**            Loan Agreement, dated as of September 1, 1994, between the
                   South Carolina Job - Economic Development Authority, ("the
                   Authority") and RBCA with respect to the Series 1994A Bonds.
10.20***           Agreement between Bremen, Indiana Plant of SKF USA, Inc and
                   International Union Automobile, Aerospace and Agricultural
                   Workers of America, U.A.W., Local 1368, effective July 20,
                   1998.
10.21**            Trust Indenture, dated as of September 1, 1994, between the
                   Authority and Mark Twain Bank, ("Bond Trustee"), with respect
                   to the Series 1994A Bonds.
10.22**            Loan Agreement, dated as of September 1, 1994, between the
                   Authority and RBCA, with respect to the Series 1994B Bonds.
10.23**            Trust Indenture, dated as of September 1, 1994, between the
                   Authority and Bond Trustee, with respect to the Series 1994B
                   Bonds.



<PAGE>


EXHIBIT
NUMBER                          DESCRIPTION OF DOCUMENT
------                          -----------------------

10.24**            Collective Bargaining Agreement between Heim, the
                   International Union, United Automobile, Aerospace and
                   Agricultural Implement Workers of America, U.A.W., and
                   Amalgamated Local 376, U.A.W., effective February 1, 1998.
10.25**            Collective Bargaining Agreement between Nice Specialty
                   Bearings Division, SKF Bearing Industries and United
                   Steelworkers of America (AFL - CIO) and its Local 6326,
                   effective October 26, 1998.
10.26**            Collective Bargaining Agreement between RBCA and the
                   International Union U.A.W. and its Local 502, effective
                   December 1, 1998.
10.27**            Employment Agreement effective as of June 23, 1997 between
                   RBCA and Michael J. Hartnett, Ph.D.
10.28**            Stockholders' Agreement dated as of June 23, 1997 by and
                   among Holdings, OCM Principal Opportunities Fund, Northstar
                   Investment Management Corporation, Merban Equity, the CSFB
                   Individuals named therein and Dr. Michael J. Hartnett.
10.29**            Promissory Note dated as of June 23, 1997 for $500,000 made
                   by Michael J. Hartnett, Ph.D. and payable to RBCA.
10.30**            Tax Sharing Agreement effective as of June 23, 1997, by and
                   among Holdings and RBCA, ITB, LPP and Nice.
10.31**            Asset Purchase Agreement by and among SKF USA Inc., Bremen
                   and RBCA dated as of August 8, 1997.
10.32***           Real Estate Purchase Agreement for the Walterboro , South
                   Carolina facility, dated March 27, 1998 by and between Linear
                   Precision Products, Inc., RBCA and Dana Corporation.
10.33***           Amendment to the Letter of Credit Agreement, dated as of June
                   23, 1998 between RBCA and Heller Financial Inc.
10.34***           Supplement No. 1 to Guarantee Agreement, dated as of August
                   8, 1997, by and between Bremen and CSFB.
10.35***           Supplement No. 1 to Indemnity, Subrogation and Contribution
                   Agreement, dated as of August 8, 1997, by and between Bremen
                   and CSFB.
10.36***           Supplement No. 1 to Security Agreement, dated as of August 8,
                   1997, by and between Bremen and CSFB.
10.37***           Supplement No. 1 to Pledge Agreement, dated as of August 8,
                   1997, by and between Bremen and CSFB.
10.38***           Agreement of Lease, dated as of November 1, 1964, between
                   Bren, Inc. and SKF Industries, Inc. with Assignment and
                   Agreement of Lease, dated August 8, 1997, between SKF USA,
                   Inc. and Bremen Bearings.
10.39***           Asset Purchase Agreement, dated as of June 3, 1998, by and
                   among Miller Acquisition Corporation, Miller Bearing Company
                   and the Shareholders of Miller Bearing Corporation.

<PAGE>

10.40***           Supplement No. 2 to Guarantee Agreement dated as of June 3,
                   1998, by and between Miller Acquisition Corporation and CSFB,
                   as Collateral Agent.
10.41***           Supplement No. 2 to Indemnity, Subrogation and Contribution
                   Agreement, dated as of June 3, 1998, by and between Miller
                   Acquisition Corporation and CSFB.
10.42***           Supplement No. 2 to Security Agreement, dated as of June 3,
                   1998, by and between Miller Acquisition Corporation and CSFB.
10.43***           Supplement No. 2 to Pledge Agreement, dated as of June 3,
                   1998, by and between Miller Acquisition Corporation and CSFB.
10.44****          Asset Purchase Agreement By and Among SKF USA Inc., Tyson
                   Bearing Company, Inc. and Roller Bearing Company of America,
                   Inc. dated as of June 11, 1999.
16.2**             Letter of Ernst & Young LLP regarding Change in Certifying
                   Accountant.
21.***             Subsidiaries of RBCA.
27.+               Financial Data Schedule.


           * Incorporated by reference to the Registration Statement on Form
           S-4, filed with the Securities and Exchange Commission by RBCA and
           its subsidiaries on August 8, 1997.

           **Incorporated by reference to Amendment No. 1 to the Registration
           Statement on Form S-4, filed with the Securities and Exchange
           Commission by RBCA and its subsidiaries on October 31, 1997.

           ***Incorporated by reference to the Company's Annual Report on
           Form 10-K for the year ended March 28, 1998.

           ****Incorporated by reference to the Company's Current Report on
           Form 8-K, dated June 11, 1999.

           + filed herewith.
<PAGE>




                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

ROLLER BEARING COMPANY OF AMERICA, INC.

                                    By:  /s/ Michael J. Hartnett
                                      ------------------------------------------
                                       Michael J. Hartnett
                                       President and Chief Executive Officer
                                       Chairman of the Board of Directors
                                       (Principal Executive Officer)


                                    By:  /s/ Anthony S. Cavalieri
                                      ------------------------------------------
                                       Anthony S. Cavalieri
                                       Vice President and
                                       Chief Financial Officer
                                       (Principal Financial and Accounting
                                       Officer)

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


June 21, 1999                       By:  /s/ Michael J. Hartnett
                                      ------------------------------------------
                                       Michael J. Hartnett
                                       Chairman of the Board of Directors,
                                       President and Chief Executive Officer


June 22, 1999                       By:  /s/  Stephen A. Kaplan
                                       -----------------------------------------
                                       Stephen A. Kaplan
                                       Director

June 22, 1999                       By:  /s/ Kurt B. Larsen
                                       -----------------------------------------
                                       Kurt B. Larsen
                                       Director

June 23, 1999                       By:  /s/ William E. Myers, Jr.
                                       -----------------------------------------
                                       William E. Myers, Jr
                                       Director

June 23, 1999                       By:  /s/ Mitchell I. Quain
                                       -----------------------------------------
                                       Mitchell I. Quain
                                       Director

June 23, 1999                       By:  /s/ Robert Anderson
                                      ------------------------------------------
                                       Robert Anderson
                                       Director

June 23, 1999                       By:  /s/ Richard R. Crowell
                                       -----------------------------------------
                                       Richard R. Crowell
                                       Director