<PAGE>


                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  FORM 10-KSB

[X] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
    of 1934

                    FOR THE FISCAL YEAR ENDED MARCH 31,2001

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934

              Commission file number: 1-15735

                            ELGIN TECHNOLOGIES, INC.
               (Name of Small Business Registrant In Its Charter)

          DELAWARE                                          95-4581906
   (State or Other Jurisdiction                          (I.R.S. Employer
  of Incorporation or Organization)                    Identification  No.)

                                10 COLUMBIA DRIVE
                                AMHERST, NH 03031
              (Address of Principal Executive Offices and Zip Code)

                                 (603) 598-4700
              (Registrant's telephone Number, Including Area Code)

   Securities registered under Section 12(b) of the Exchange Act:

                                      NONE

   Securities registered under Section 12(g) of the Exchange Act:

                              VOTING COMMON STOCK,
                          $.000833 PAR VALUE PER SHARE

         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-B 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-KSB or any
amendment to this Form 10-KSB. [ ]

         Registrant's revenues for its most recent fiscal year were $6,067,806.

         The aggregate market value of voting stock held by nonaffiliates of the
Registrant was approximately $954,418 as of March 31, 2001, based upon the
closing price on the National Quotation Bureau "Pink Sheets." Shares of Common
Stock held by each executive officer and director and by each person who
beneficially owns more than 5% of the outstanding Common Stock have been
excluded in that such persons may under certain circumstances be deemed to be
affiliates. This determination of executive officer or affiliate status is not
necessarily a conclusive determination for other purposes.

         There were 17,463,300 shares of Common Stock outstanding as of March
31, 2001.


<PAGE>


                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

INTRODUCTION
------------

         The Company was incorporated as Cross Atlantic Capital, Inc. under the
laws of the State of Delaware on May 28, 1986. The Company, since its
incorporation through September 30, 1997, was inactive at which time it acquired
all of the outstanding capital stock of Elgin e2 Inc. in exchange for 4,167,000
shares of its $.000833 par value Common Stock Elgin Technologies, Inc. has two
operating segments: Elgin Warren Power Systems that provides a wide-range of
power products and services to the telecommunication and related sectors, and
Logic Labs, which is a research and development stage company focusing on a new
generation of energy efficient lighting products.

ELGIN WARREN POWER SYSTEMS
--------------------------

OVERVIEW

         Elgin Warren Power Systems, has been a leading provider of products and
services for the telecommunications and related sectors for over 60 years. Our
products and services are utilized for power applications throughout the
communications infrastructure market. The growth of this sector has been fueled
by the convergence of voice, data and video transmissions for Internet usage in
both the commercial and consumer markets. It is projected over the next decade
that there will be robust growth in communications infrastructure due to
increased demand for broadband services, expanded e-commerce applications and
new generations of digital imaging communications. Elgin Warren's focus is to
provide "turn key" solutions to meet that demand by offering a full range of
advanced power products, a full compliment of custom engineering, and
installation/maintenance services that adhere to strict Bellcore standards.

         Our products include:

         o        AC/DC power supply systems ranging from 3 to 15,000 Amp plants

         o        Full range of power distribution and monitoring equipment

         o        Full range of engineering services, including: needs
                  assessment, power plant design, power plant
                  modification/expansion, and monitoring system integration

         o        Full range of installation services for central office and
                  remote locations, including: new constructions, retrofit,
                  expansion of existing sites and all maintenance services.

         Our products are designed for both central office and remote
applications, and offer the latest in monitoring connectivity that ensures full
remote capabilities. Our designs reflect the current market trends toward a
greater emphasis on power density and scalability. The market is being driven by
increased infrastructure capacity demands in high population centers where real
estate costs are forcing the industry to deliver more power in less space.
Management believes that this trend will continue in the future, and has focused
its engineering resources to address those demands.

         Although power density and scalability are increasingly becoming more
important, the main design consideration for our products remains the
reliability and quality of the power that is delivered into the network. Minor
fluctuations in power, or disruptions measured in milliseconds can seriously
effect sensitive data transmission in today's digital environment. To ensure the
highest performance standard for reliability, our engineers design systems with
built-in redundancy (back up) for key components that automatically pick up
capacity in the event of a component failure. In addition, we have continued to
improve the ability of our monitoring systems to handle a multitude of new
functions and that can be connected into the customer's proprietary network.


                                       2
<PAGE>


INDUSTRY BACKGROUND

         Elgin Warren Power Systems products and services are part of the
overall power conversion market which is estimated to have worldwide revenues of
$24 billion for 2000. The market for communications equipment, in general, has
enjoyed rapid growth and changes in the last decade as a result of industry
deregulation and the advent of the Internet. Deregulation brought a whole new
generation of competition into the marketplace, with new long distance
providers, CLEC's (Competitive Local Exchange Carriers) and wireless carriers
requiring large infrastructure projects. As a result of the Internet, and
related technological advances, the market for new communication services
expanded rapidly.

         Although there will be normal business cycle corrections, like the
current weakness represents, management believes that the long term trend for
growth in the communications equipment and services sector will remain in place,
as the demand for new commercial and consumer services requiring increased
capacity will continue to drive the market. Most of the growth will be created
by the new generations of digital media technology (voice, sound, video and
data) which will require greater amounts of power to drive increasingly larger
amounts of data through a broadband environment.

         To meet the power needs of current design trends, which utilize greater
numbers of semiconductors throughout the entire network, engineers have adopted
a DISTRIBUTED POWER architecture versus the previous centralized power design. A
distributed power design allows for the more efficient distribution of power
throughout the system, simplifies engineering, and increases overall system
reliability by decreasing the effect of an individual component failure and
offers back-up through redundancy and load sharing. In addition to efficiency
and reliability benefits, distributed power architecture allow the system to be
designed on a modular basis, which creates a greater degree of scalability for
future growth.

PATENTS

         The Company's Telecom Power business does not currently own any
patents, trademarks, licenses, concessions or franchises that are of any
material value to its business, now or in the future. The Company is not party
to any royalty or labor agreements.

COMPETITIVE STRATEGY

      Our focus is on providing a turn key solution to meet the power needs of
our customer base. We believe that our EF&I (Engineer, Furnish & Install)
approach provides us with many synergies that gives us a competitive edge over
"equipment only" vendors. Some of the advantages are:

         o        By providing complete engineering and project management
                  services, we have a better understanding of current system
                  architecture trends through our involvement in all aspects of
                  the engineering function.

         o        By installing our equipment, we understand the importance of
                  designing equipment that minimizes installation problems, and
                  saves time and expense in the field.

         o        In addition to working with our equipment, our engineering and
                  installation groups, at the request of some customers, work
                  with other vendors' equipment in the field. This exposure
                  provides us with insight into the latest in market
                  trends/advances.

         o        Engineering and installation services improve our position
                  with our customers by providing a "value added" service to our
                  product/service mix. In cyclical markets where new
                  construction are affected by downturns, engineering and
                  installation provide a stabilizing effect by generating
                  revenues from upgrade, retrofit and maintenance services.


                                       3
<PAGE>


      From working with our customers to assess their needs, a few key trends
have emerged as important in developing our power system design. From this
knowledge, we have focused on providing systems with the following selling
points: high power density (we currently offer one of the highest power density
rated systems available), high power efficiency, full scalability, full
redundancy, full remote monitoring capabilities, 480 V three phase design and
one of the strongest reliability/warranty coverage in the industry. We believe
that our 60 year history in providing proven power solutions has given us a
strong base from which to build upon in the future.

MASTER LITE BALLAST SYSTEM (MASTER LITE-TM-)
--------------------------------------------

            In 1997, the Company acquired Logic Labs, a research and development
stage company that has focused on the development of a new generation of
lighting products that utilizes advanced DC power supply technology. The new
product is called the Master Lite Ballast System and is targeted to meet the
needs of the estimated $3.2 billion market for lighting ballasts used in
fluorescent lighting. The system is based upon a new architecture that
centralizes the power supply function into a unit that is more functional and
efficient than basic electronic ballast systems and paired with a new lamp
driver design. The Company believes that its 60 year history as a designer of
high quality DC power supply systems gives it a strong base for developing this
product.

         Although there has been some development in newer, more sophisticated,
electronic ballasts, the majority of fluorescent lighting products used in
today's market have remained essentially unchanged in the past fifty (50) years.
Twenty-five (25) years after the oil embargo, the United States has given up
almost all the gains realized through energy conservation efforts during the
late eighties and early nineties. Noting recent developments in the energy
markets, with remarkable price hikes and electric grid shortfalls causing
rolling blackouts, energy efficiency should become more important factor in the
lighting market. The Company's dimmable electronic distributed lighting system
(Master Lite-TM-) may represent the ability for substantial savings for every
energy lighting dollar.

PRODUCT OVERVIEW

         The lamp ballast is a critical element in the efficient operation of a
fluorescent light. Ballasts typically perform two primary tasks in a fluorescent
light: 1) power control conditioning, filtering and voltage transformation and
2) lamp control for both starting and continuous operation. Traditionally, these
tasks have been performed together by a magnetic ballast in an approximately 2"
x 12" box weighing about 2 to 6 pounds.

         Magnetic ballasts have been optimized, but at their best they present
serious problems in noise, efficiency and regulation. Furthermore, their poor
power factor limits the ability of the power utility to drive real power. In
recognition of the seriousness of the disadvantages of the magnetic ballasts,
the 1990 National Appliance Energy Conservation Act ("NAECA") required all
ballasts for commercial fluorescent lighting systems to have efficiencies
greater than or equal to those of energy efficient magnetic ballasts. This
legislation effectively banned the use of a majority of magnetic technology for
new lighting applications.

         To fill the void, the ballast industry has replaced the heavy magnetic
ballast with solid state electronic units. This electronic circuitry converts
the input AC voltage to a high voltage DC level using high frequency switching
to boost the voltage while correcting the power factor. The DC is then converted
back to high frequency AC avoiding noise and raising the light emission of the
lamp for a given power input.

         The Master Lite-TM- system increases energy efficiency significantly,
with up to 40% savings over standard magnetic ballast performance. In addition,
dimming is provided as a standard feature at no additional cost. The drivers
sense the output of the "master" and dim as commanded by the customer's control
of the "master". This unique patented approach requires no additional wiring
other than adjustment control and can be retrofitted into existing systems.


                                       4

<PAGE>


         Logic Labs is developing innovative features related to energy
management as add-on components to the base Master Lite-TM-. These features
include daylight harvesting, occupancy sensing and in process lamp usage
monitoring. Some "high end" ballasts presently offer these features as separate
components, but at a wholesale price of more than 100% over the cost of the
ballast. The Company believes that Logic Labs' Master Lite-TM- is able to
provide these features at a fraction of the competitors' cost, thereby further
increasing energy savings.

COMPETITION

            The global market for lighting is highly competitive, with large
global diversified companies such as Sieman's Osram-Sylvania, Philips
Electronics, SLI and General Electric, there is formidable competition in all
areas. In addition, companies such as Motorola and Advanced Transformer compete
in the component market for ballasts. The market becomes more fragmented into
various niches and the lighting fixture market remains a highly fragmented
dominated by regional companies.

         Virtually every ballast manufacturer in today's marketplace has built
its business by developing and delivering a large array of ballasts for the
fluorescent lighting industry. The Company plans to make one of the primary
attributes of the Master Lite-TM- technology the ability to address a wide range
of the fluorescent lighting industry's needs with a multi-purpose distributed
dimmable electronic lighting system.

         The present design allows Master Lite-TM- to give the customer the
freedom and flexibility to attain their desired lighting using its distributed
dimmable electronic lighting system. The multi-faceted features of the Master
Lite-TM- allow the customer to realize significant energy savings by utilizing
the dimming and daylight harvesting features of the system; maintain constant
desired lumen outputs per lamp as needed in each workplace environment and
realize low harmonic distortion of less than 3%.

         Historically, fluorescent industry lighting users were required to
select a specific ballast for a specific need or application. When the Master
Lite-TM- distributed dimmable electronic system is fully developed, the Company
believes that the customer may be able to realize all attributes at a market
competitive price with competition's best in class product.

PATENTS

         The Company has developed a network of interrelated patents, which
cover the various configurations of the Master Lite-TM- technology. The Company
has filed for patent coverage, which has either been granted or pending, for all
of its primary designs in key markets.

FUTURE OPPORTUNITIES
--------------------

         The Company plans development efforts, which may include international
expansion, new product launches and product expansions. The Company holds
international patent protection for the Master Lite-TM- in the European
community, Korea and Canada. When fully developed, the Company believes that the
system will be so flexible that it may be able to operate in virtually any
foreign electric system without redesign. The Company projects the foreign
fluorescent lighting market to be ten times the size of the U.S. market.

         The Company also intends to launch as a new product Master Lite-TM-
with integrated energy management. Given the centralized power control of the
Master Lite-TM-, the system could be ideally suited for advanced energy
management and control. The Company has developed a patented approach to dimming
control for light output. Current testing reveals that this feature enables
light output dimming below 40% normal output. Further dimming capability raises
the wholesale cost of the ballast substantially with diminished savings. The
Company expects its dimming control to increase costs by no more than 10% to
20%.

         The Company plans to attempt to expand Master Lite-TM- to applications
outside the fluorescent lighting industry such as the neon lighting industry,
transportation including automotive, avionics and shipbuilding and the high
intensity gas tube lighting market such as metal halide, argon and sodium.


                                       5
<PAGE>


         The Company is also attempting to develop the ability to place the lamp
driver inside the lamp. This technology would allow the Company to provide a
substitute technology for use of compact fluorescents, one of the highest margin
and fastest growing markets in lighting today. Compact fluorescents were
designed to replace inefficient incandescent lights. By placing the lamp driver
inside the lamp, the Company believes that it can significantly increase energy
efficiency and reduce harmonic distortions. Such features could allow the
"inside the lamp" technology to replace incandescent lighting. From an energy
savings standpoint, the Company believes that, when fully developed, Master
Lite-TM- may far exceed core coil magnetic ballast competition.

CUSTOMERS
---------

         Three customers accounted for 27%, 14% and 12% of accounts receivable
as of March 31, 2001. Sales to agencies of the U.S. Government accounted for 12%
and 13% in fiscal 2001 and 2000, respectively. Another customer accounted for
17% and 14% of sales in fiscal 2001 and 2000, respectively.

REGULATORY APPROVAL AND COMPLIANCE
----------------------------------

         Products manufactured by the Company generally do not require any
government approval. Products sold to agencies of the U.S. government (i.e.,
military, FAA, etc.) require adherence to certain specifications in the normal
and ordinary course of manufacture.

         There exists no known current or pending government regulation that
would either impede or enhance the operations of the Company.

         The Company's operations do not use, consume or generate any hazardous
or environmentally dangerous materials. As a result, minimal costs are incurred
in the compliance with Federal, State and local environmental laws.

EMPLOYEES
---------

         As of March 31, 2001, the Company employed a total of sixty five (65)
employees, all of which are full time employees. None of these employees is
covered by a collective bargaining agreement. The Company believes that its
labor relations are good.

ITEM 2.  DESCRIPTION OF PROPERTY

         The Company's headquarters and manufacturing facility is located in
Amherst, New Hampshire in a 32,000 sq. ft., single story, brick and mortar
building, maintained in very good condition. Use and occupancy costs are
approximately $15,500 per month.

         The Company relocated from its Hudson, NH facility and entered into a
new lease for the current headquarters on May 1, 2000. The new lease is for five
years having an annual escalator and expires in April 2005. (See Risk Factors --
Dependence on Major Production Facilities, herein below).

         Were funds to become available for investment, it is the opinion of
management that those funds would be conservatively invested in short to medium
range savings vehicles insured by the F.D.I.C. or its equivalent. Purchases of
real estate would be limited to buildings occupied by the Company or its
divisions. The Company has no intention to invest in real estate mortgages,
non-occupied real estate or securities of any nature.

ITEM 3.  LEGAL PROCEEDINGS

LEWIS W. KUNIEGEL, ET AL V. ELGIN TECHNOLOGIES, INC.

In October 2000 the Company settled a complaint filed on March 6, 2000 in the
Cumberland County Superior Court (Portland, ME) brought by Lewis W. Kuniegel and


                                       6
<PAGE>


Judith A. Kuniegel against the Company. The settlement was for an amount not
material to the Company's financial position or results of operations.

ROMEO FEGUNDES & DAWN FEGUNDES V. WARREN POWER SYSTEMS

         This is an action filed in Supreme Court in Kings County, New York in
July 1998 against Warren Power, New York Telephone Company, and Bell Atlantic
seeking damages for personal injuries sustained during an installment by
Comforce Global, Inc., a contractor for Warren Power. Comforce Global, Inc. has
been brought into the case as a third party defendant. The complaint seeks
compensatory damages of $11,000,000 and punitive damages of $3,000,000. The case
involves an injury to a worker on a construction site that was supervised and
controlled by Warren Power. Discovery is complete and the case has been set for
trial. Warren Power has turned the matter over to its liability insurance
carrier that has appointed legal counsel to represent Warren Power.

INVERNESS CORPORATION AND MENOTOMY FUNDING, LLC V. THE COMPANY

         This is an action filed in Middlesex Superior Court in Cambridge,
Massachusetts in June, 1997 against the Company, e2 Electronics, Inc. (f/k/a
Elgin e2, Inc.), EAC Acquisition I Corporation ("EAC") and others, alleging
breach of contract and a variety of other causes of action relating to the
alleged failure of EAC to repay certain loans and the failure of the Company to
honor certain warrants to purchase Common Stock.

         In late 1996, the Company's investment bankers, Mason Cabot Holdings,
Ltd., formed EAC for the purpose of acquiring the assets of a troubled
corporation located in Billerica, Massachusetts. The parties intended that EAC
would acquire the assets of the business and then manage its operations in an
effort to make it a viable concern. As part of the transaction, Inverness sold
the assets to EAC in return for a short-term note for $1,640,442. During the
negotiation of the loan agreement, Inverness represented that it would provide
working capital of $300,000 pursuant to the Revolving Line of Credit of
$1,780,000 referenced in the loan agreement. As part of the consideration for
the transaction, e2 Electronics issued warrants to purchase 750,000 shares of
stock in a publicly traded company that would be the survivor of a merger with
e2 Electronics. Neither the Company nor e2 Electronics was ever a party to the
loan transaction, nor did either guarantee the debt of EAC. Mason Cabot granted
to the Company an option to purchase all of the common stock of EAC.

         The parties anticipated that the short-term note would be paid through
the infusion of new capital from third party investors. However, after several
loan forbearances for which e2 Electronics issued additional warrants, neither
the working capital from Inverness nor any new capital from investors was
forthcoming. By May 1997, EAC ceased to operate. Inverness filed suit to obtain
money damages in the amount of $7,650,000 for the alleged failure to honor the
warrants issued by e2 Electronics in connection with the transaction. It is the
Company's position that the warrants are invalid because the issuance of the
warrants was fraudulently induced and that the conditions precedent to the
exercise of the warrants never occurred. The Company and EAC have counterclaimed
against Inverness for common law fraud, breach of contract and related claims.
The Company and EAC allege they were fraudulently induced into entering into the
loan transaction and issuing the warrants in exchange for a non-existent
operating line of credit based upon false representations by Inverness that it
had the liquidity and ability to fund the line of credit. The case is presently
in the discovery phase and resolution is expected in fiscal year 2002.


                                       7
<PAGE>

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

            The annual meeting of shareholders was held on January 29, 2001. All
matters voted on were approved. The results are as follows:

         PROPOSAL I

         The following directors were elected at the meeting to serve a one-year
         term as directors:

<TABLE>
<CAPTION>
                                                           FOR          AGAINST          WITHHELD
                                                           ---          -------          --------
              <S>                                       <C>                <C>              <C>
              Peter Bordes, Jr.                         10,259,484         0                0
              Jonathan Scott Harris                     10,259,484         0                0
              Primo Ianieri                             10,259,484         0                0
              Philip A. Pascarelli, Jr.                 10,259,484         0                0
              Michael J. Smith                          10,259,484         0                0
</TABLE>


         PROPOSAL II

         The proposal to amend the Company's Restated Articles of Incorporation
         to increase the number of authorized shares of Common Stock from
         60,000,000 to 100,000,000 shares was approved. As a result, the
         Company's Restated Articles of Incorporation were amended to increase
         the number of authorized shares to 100,000,000.

<TABLE>
<CAPTION>
                 FOR                   AGAINST           ABSTAINED
                 ---                   -------           ---------
             <S>                       <C>               <C>
             10,259,284                  200                 0
</TABLE>


                                       8
<PAGE>


                                    PART II

ITEM 5.  MARKET FOR THE COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

MARKET INFORMATION

         The Company's stock was quoted on the OTC Bulletin Board from October
1997 through mid-November 1999 (Symbol: ELGN). As of mid-November 1999, bid and
ask quotations for the Company's stock have been available on the NQB "Pink
Sheets."

         The high and low sales prices of the Company's Common Stock for each of
the following quarters are:

<TABLE>
<CAPTION>
Quarter Ended                        High/Ask          Low/Bid
-------------------------------------------------------------------
<S>                                    <C>              <C>
March 31, 2001                         $     0.50       $     0.08
December 31, 2000                            0.51             0.21
September 30, 2000                           0.32             0.15
June 30, 2000                                1.13             0.15
March 31, 2000                               3.00             0.10
December 31, 1999                            0.50             0.06
September 30, 1999                           1.88             0.13
June 30, 1999                                3.44             1.56
March 31, 1999                               3.75             2.25
December 31, 1998                            6.25             1.75
September 30, 1998                           8.38             6.00
June 30, 1998                               10.50             7.00
March 31, 1998                              10.50             9.88
December 31, 1997                            9.50             4.38
</TABLE>

         Source:  Standard and Poor's Comstock.
         These quotations reflect inter-dealer prices, without retail mark-up,
         mark down or commission and may not represent actual transactions.

SHAREHOLDERS OF RECORD

         There were 212 holders of record of the Common stock of the Company as
of March 31, 2001.

DIVIDENDS DECLARED

         There are no, nor have there been any, cash dividends declared on the
Voting Common stock of the Company. The Company is not likely to declare and pay
dividends in the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

         From December 1997 through March 1998, the Company raised $2,365,301
through various private placements of warrants to purchase 788,434 of the
Company's Common Stock at a price of $3 per share. These transactions were
exempt from registration under Section 4(2) and/or Rule 504 of Regulation D of
the Securities Act.

         In March and April of 1998, the Company sold 2,333,333 shares of Common
Stock to Horace T. Ardinger, Jr. at a purchase price of $3.00 per share, for a
total of $7,000,000. The transaction was exempt from registration under Section
4(2) and/or Rule 504 of Regulation D of the Securities Act. In connection with
this sale, Mr. Ardinger also received warrants to purchase 100,000 shares of the
Common Stock of the Company for which he paid nominal consideration. Said
warrants are exercisable at $3.00 per share and expire March 10, 2003. In
November, 1998 the Company granted Mr. Ardinger additional rights to avoid
dilution of his ownership of the issued and outstanding or issuable shares of
the Common Stock of the Company.


                                       9
<PAGE>


         In April, 1998 the Company issued one hundred thousand (100,000)
unregistered shares of Common Stock to Lewis and Judith Kuniegel ("Kuniegel")
pursuant to the Company's Agreement of Merger with Communication Service
Company, a Maine corporation and Kuniegel. These transactions were exempt from
registration under Section 4(2) of the Securities Act.

         During fiscal 1999, the Company's Board of Directors authorized the
issuance of 97,200 shares of its Common Stock having a fair market value at the
time of issuance of $291,600 to employees of the Company as bonuses for services
rendered.

         In December 2000, the Board of Directors authorized the issuance of
25,313 warrants to purchase shares of the Common Stock of the Company with an
exercise price equal to a 20% premium to the closing price on December 29, 2000
(equivalent to $.288) to the bearers of certain convertible Subordinated Notes
in consideration for extension of the maturity date of the notes to January 2,
2002. The fair market value of the warrants at time of issuance was $5,832.

Item 6. Management's Discussion and Analysis or Plan of Operation

INTRODUCTION
------------

         The following discussion of the financial condition and results of
operations of the Company should be read in conjunction with the Company's
Consolidated Financial Statements and related notes included herein.

SELECTED FINANCIAL DATA
-----------------------

<TABLE>
<CAPTION>
                                      FOR THE YEARS ENDED
                                            MARCH 31,
                                -------------------------------
                                    2001               2000
                                -----------         -----------
<S>                             <C>                 <C>
Sales                            $6,068,000          $7,424,000
Cost of sales                     5,450,000           6,957,000
                                -----------          ----------
Gross margin (loss)                 618,000             467,000
Operating expenses                3,417,000           3,627,000
                                -----------          ----------
Operating loss                   (2,799,000)         (3,160,000)
Other expenses                    3,769,000           1,917,000
                                ============        ============
Net loss                        ($6,568,000)       ($5,077,000)
                                ============        ============
</TABLE>


SALES

         The Company had sales of $6,068,000 for fiscal 2001 and $7,424,000 for
fiscal 2000. The decrease in sales of $1,356,000 (18.3%) was mainly the result
of the general softness of the telcom market and the restructuring of the sales
force.

COST OF SALES

         The cost of sales for fiscal 2001 and 2000 were $5,450,000 and
$6,957,000 (representing 90% and 94% of sales respectively). The low volume
levels that the company has experienced in both fiscal years has limited the
margin contribution to fixed manufacturing costs resulting in nominal gross
margins.

OPERATING EXPENSES

         Operating expenses were down $210,000 (6%) from $3,627,000 (49% of
sales) in fiscal 2000 to $3,417,000 (56% of sales) in fiscal 2001. Lower
personnel costs resulting from business restructuring and reduced R&D spending
more than offset higher legal fees.

OTHER EXPENSES

         Other expenses increased $1,852,000 (97%) from $1,917,000 (26% of
sales) to $3,769,000 (62% of sales) in fiscal 2000 and 2001, respectively.
Interest expense on the loan agreement amounted to $1,244,000 due to increased
borrowings from an affiliate. Imputed interest resulting from the beneficial
conversion features on convertible debt transactions was $2,350,000 in fiscal
2001 as compared to $800,000 in fiscal 2000. This increase was primarily due to
the instances of conversion strike prices exceeding the fair values of the
Company's Common Stock during fiscal 2001.

FORWARD LOOKING STATEMENTS AND CERTAIN RISK FACTORS
---------------------------------------------------

         The Company cautions readers that certain important factors may affect
the Company's actual results and could cause such results to differ materially
from any forward-looking statements that may be deemed to have been made in this
Form 10-KSB or that are otherwise made by or on behalf of the Company. For this
purpose, any statements contained in the Form 10-KSB that are not statements of
historical fact may be deemed to be forward-looking statements. Without limiting
the generality of the foregoing, words such as "may," "expect," "believe,"
"anticipate," "intend," "could," "estimate," or "continue" or the negative or
other variations thereof or comparable terminology are intended to identify
forward-looking statements. Factors that may affect the Company's results
include, but are not limited to, the Company's lack of profitability, its
dependence on a limited number of customers and key personnel, its ongoing need
for additional financing and its dependence on certain industries. The Company
is also subject to other risks detailed herein or which will be detailed from
time to time in the Company's future filings with the Securities and Exchange
Commission.

RISK FACTORS
------------

OPERATING LOSSES, CASH FLOW SHORTAGES AND GOING CONCERN

         The Company has limited access to available working capital, which
impacts the Company's ability to operate efficiently. As a consequence, results
from operations have been negatively affected and it is expected that they will
continue to be adversely affected. There exists a substantial risk that the
Company will be required to curtail or discontinue its current business
operations.

         Since Elgin Technologies commenced operations in 1994, the Company and
its subsidiaries, have produced losses in each year and had an accumulated
deficit of $57,688,602 at March 31, 2001. For the year ending March 31, 2001,
the Company has continued to experience losses of $6,568,000 on revenues of
$6,068,000. The major contributors to the accumulated losses were continued
research and development efforts to bring Master Lite-TM- to market, along with
the capital needed to rebuild the telecom power and conversion businesses, and
the imputed interest charged to operations on the beneficial conversion features
of convertible debt transactions.

         The Company and its subsidiaries have experienced cash flow constraints
throughout their operating history, resulting in lower orders and decreased
margins. The Telecom Power business has been negatively impacted in its efforts
to turnaround and expand, principally by the Company's history of lack of
working capital,

                                       10
<PAGE>

restructuring, consolidations and substantial operating losses. Management is
making every effort to reverse these trends by reducing the operating costs of
the Company's existing product lines and seeking to expand into less costly,
more profitable products and services. These efforts will, however, require
increased capital infusion and Management cautions that there can be no
assurances that these efforts will be successful.

         Even though the Company is in the process of bringing Master Lite-TM-
to market, there can be no assurance that the Company will successfully complete
the product's technology or that the product and technology will gain acceptance
or that the Company will not experience adverse operating results, including,
but not limited to substantial additional losses, in the future.

         The substantial operating losses of the Company's operating segments
incurred through and subsequent to March 31, 2001, and the Company's limited
ability to obtain financing other than from one major investor raises
substantial doubt concerning the ability of the Company to realize its assets
and pay its obligations as they mature in the ordinary course of business. These
conditions, among others, raises substantial doubt among the Company's
independent auditors about the Company's ability to continue as a going concern.
The accompanying consolidated financial statements do not include any
adjustments relating to the recoverability and classification of asset carrying
amounts or the amount and classification of liabilities that might result should
the Company be unable to continue as a going concern. Management will continue
efforts to reduce the operating costs of the Company's existing product lines
and seek to expand into less costly, more profitable products and services.
These efforts will, however, require increased working capital infusions. At
present the Company's sole source of financing is from one major investor.
Management cautions that there can be no assurances that these efforts will be
successful or that the investor will continue to provide financing or that
alternative sources of funds will be available for management to implement its
plan.

SUBSIDIARY BANKRUPTCY

         On June 1, 1998, e2 Electronics (the Company's wholly-owned subsidiary)
filed a Chapter 7 bankruptcy petition in the United States Bankruptcy Court for
the Western District of Pennsylvania. In connection with the bankruptcy, DC&A
Partners, e2 Electronics' largest secured creditor, purchased e2 Electronics'
assets from the Bankruptcy Court for $177,000. DC&A is a company formed by
principals of Mason Cabot, the Company's former investment banking firm. Until
the bankruptcy has been concluded, there is a possibility that the Bankruptcy
Court could invalidate certain pre-petition transactions or make other findings,
determinations or rulings that could have material adverse effects on the
Company and/or its properties.

BUSINESS DEVELOPMENT RISKS

         The Company is following a business plan intended to expand its sales
efforts and market penetration along with the continued development and
marketing of the Master Lite-TM- technology. Implementation of this plan will
require substantial additional capital for product development, marketing and
promotion. No assurance can be given that the Company will be successful in
expanding its current sales or distribution capabilities or developing new
products that result in increased sales and earnings or that its marketing and
promotion activities will have the intended effect of expanding sales and
increasing earnings.

COMPLETION OF TECHNOLOGY DEVELOPMENT; RELIANCE ON NEW PRODUCT INTRODUCTIONS

         The ability of the Company to execute its business plan is
substantially reliant upon the completion of the development of its proprietary
technologies, including but not limited to Master Lite-TM-, and the successful
marketing of products based upon those technologies. There can be no assurance
that the Company will complete this development or that such development will
result in viable and/or marketable products. The Company's failure to complete
the development of its technologies and/or market products based thereon could
have a material adverse effect on the Company's financial condition and results
of operations.


                                       11
<PAGE>


         Furthermore, as a result of technological changes and developments,
many technologies are successfully marketed for only a short period of time.
There can be no assurance that (i) any of the Company's current or future
products will continue to be accepted for any significant period of time or (ii)
the market will accept the Company's new products, or if such acceptance is
achieved, that it will be maintained for any significant period of time. The
Company's success will be dependent upon the Company's ability to bring existing
products to market and to develop new products and product lines. The failure of
the Company's products and product lines to achieve and sustain market
acceptance and to produce acceptable margins could have a material adverse
effect on the Company's financial condition and results of operations.

NEED FOR ADDITIONAL FINANCING

         The Company currently has only one major investor as its sole financing
source. There can be no assurance that this investor will continue to fund the
Company's operations. Without working capital from this investor or an
alternative financing source, the Company could be required to curtail or
discontinue its current business operations. The Company's business plan is
based upon current assumptions about the costs of its implementation. If these
assumptions prove incorrect or if there are unanticipated expenses, the Company
may be required to seek additional equity and/or debt financing. No assurance
can be given that the Company will be able to obtain such financing upon
favorable terms and conditions. Moreover, no assurance can be given that the
Company will be able to successfully implement any or all of its business plan,
or if implemented, that it will accomplish the desired objectives of product
expansion and increased revenues and earnings.

                                       12

<PAGE>

INFLUENCE BY CHAIRMAN; STOCKHOLDERS AGREEMENT

         The Company's Chairman, Primo Ianieri, beneficially owns 3,315,685
shares of Common Stock, representing 19.0% of the Company's issued and
outstanding stock, and rights to purchase stock. As a result, Mr. Ianieri could
influence most matters requiring approval of the stockholders of the Company.
Furthermore, the Company, Mr. Ianieri and other significant stockholders of the
Company are parties to a Stockholders Agreement dated as of September 28, 1997
that provides, inter alia, that:

         The Company's Board of Directors shall consist of seven (7) seats;
         Three (3) of said Directors shall be selected by Mr. Ianieri and one of
         which shall be Mr. Peter Bordes, Sr.
         The three (3) Directors selected by Mr. Ianieri shall comprise an
             Executive Committee of the Board of Directors, which shall have
             veto power over any proposed acquisition, merger, offering or sale
             of equity securities, borrowings or other issuances of debt
             securities.

Copies of the above referenced Stockholders Agreement are available from the
Company.

INFLUENCE BY INVESTOR; SUBSTANTIALLY ALL ASSETS PLEDGED; CONTINUED DILUTION

         In connection with a Secured Revolving Credit Agreement, Secured Note
Payable, Stock Pledge Agreement and Security Agreements between the Company and
Horace T. Ardinger, Jr. dated as of November 13, 1998 and subsequent amendments
thereto, (the "Ardinger Credit Documents") as well as credit agreements with
others, the Company has pledged substantially all of its assets as security for
the performance of its obligations. In the event that the Company was to default
on the payment of any amounts owed under the agreements, the lenders would have
the ability to satisfy the obligations by selling or causing the sale of some or
all of the assets of the Company.

         Under the terms of the Ardinger Credit Documents, as of March 31, 2001,
Mr. Ardinger beneficially owns or has the right to acquire 55,871,774 shares of
the Company's Common Stock, which is 79.5% of the class (see Part III, Item 11
hereinbelow). As a result, Mr. Ardinger would be able to greatly influence most
matters requiring approval of the stockholders of the Company, including the
election of the majority of the Board of Directors. Pursuant to a Voting
Agreement dated as of April 1, 1998, (see Exhibit 9.2), Mr. Ardinger is entitled
to either be elected to the Company's Board of Directors or have his designee so
elected. Mr. Ardinger's current designee to the Company's Board of Directors is
Michael Smith, who also currently serves as the Company's Chief Financial
Officer and Executive Vice President. Mr. Ardinger has also been granted a
license in California, Texas and Florida in certain proprietary technology of
Logic Labs and rights of first refusal to potential future licensing of certain
related technology pursuant to a License Agreement dated as of April 1, 1998.
Furthermore, as a result of ongoing capital contributions by Mr. Ardinger, his
beneficial ownership of the Company's Common Stock is likely to increase and may
result in continued substantial dilution to the current holdings of the other
stockholders.

DEPENDENCE ON MAJOR PRODUCTION FACILITIES

         One hundred (100%) percent of the Company's production is located at
its facility in Amherst, New Hampshire. An interruption of that production or


                                       13
<PAGE>


transportation to and from the production facilities, by natural disasters or
other causes, would materially and adversely affect the Company's business and
results of operations.

LIMITATION ON DIRECTORS' LIABILITIES UNDER DELAWARE LAW

         Under Delaware law, directors of the Company are not liable to the
Company or its stockholders for monetary damages for breach of fiduciary duty,
except for liability in connection with a breach of duty of loyalty for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, for dividend payments or stock repurchases illegal under
Delaware law or any transaction in which a director has derived an improper
personal benefit.

ABSENCE OF DIVIDENDS

         The Company has paid no cash dividends on its Common Stock since
inception. The Company currently intends to retain earnings, if any, for use in
its business and does not anticipate paying any cash dividends in the
foreseeable future.


                                       14
<PAGE>


ITEM 7.  FINANCIAL STATEMENTS

                    ELGIN TECHNOLOGIES, INC. AND SUBSIDIARIES
                     (Formerly Cross Atlantic Capital, Inc.)

                                 MARCH 31, 2001

                                   I N D E X
<TABLE>
<CAPTION>

                                                                     PAGE NO.
                                                                     --------
FINANCIAL STATEMENTS:
<S>                                                                  <C>
       Independent Accountants' Report ...........................      F-2


       Consolidated Balance Sheet as at March 31, 2001 ...........      F-3


       Consolidated Statements of Operations

          For the Years Ended March 31, 2001 and 2000 ............      F-4


       Consolidated Statements of Changes in Capital Deficiency

          For the Years Ended March 31, 2001 and 2000 ............      F-5


       Consolidated Statements of Cash Flows

          For the Years Ended March 31, 2001 and 2000 ............      F-6


       Notes to Consolidated Financial Statements ................   F-7 - F-27
</TABLE>


                                      F-1
<PAGE>


                      WEINICK SANDERS LEVENTHAL & CO., LLP
                          CERTIFIED PUBLIC ACCOUNTANTS
                       1515 BROADWAY NEW YORK, N.Y. 10036

                         INDEPENDENT ACCOUNTANTS' REPORT

To the Stockholders and Board of Directors
Elgin Technologies, Inc. and Subsidiaries

We have audited the accompanying consolidated balance sheet of Elgin
Technologies, Inc. (formerly Cross Atlantic Capital, Inc.) and Subsidiaries as
at March 31, 2001, and the related statements of operations, cash flows, and
changes in capital deficiency for the two years then ended. 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 auditing standards generally accepted
in the United States of America. 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 amount 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 consolidated financial position of Elgin
Technologies, Inc. (formerly Cross Atlantic Capital, Inc.) and Subsidiaries as
at March 31, 2001, and the results of their operations and their cash flows for
each of the two years ended March 31, 2001, in conformity with accounting
principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As shown in the financial
statements, the Company has a working capital deficiency of $15,218,997 and
liabilities exceed assets by $15,288,063 at March 31, 2001 and, in addition, the
Company has incurred losses since inception. These conditions, among others,
raise substantial doubt about the Company's ability to continue as a going
concern. Management's plan in regard to this matter is discussed in Note 1. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.

                                       /S/ WEINICK SANDERS LEVENTHAL & CO., LLP

New York, N. Y.
May 25, 2001


                                      F-2
<PAGE>


                    ELGIN TECHNOLOGIES, INC. AND SUBSIDIARIES
                     (Formerly Cross Atlantic Capital, Inc.)

                           CONSOLIDATED BALANCE SHEET
                                 MARCH 31, 2001

                                   A S S E T S


<TABLE>
<S>                                                                                      <C>                <C>
Current assets:
  Cash                                                                                        $ 105,882
  Accounts receivable, less allowances for doubtful
    accounts and customer deductions of $54,000                                                 498,024
  Inventories, at the lower of cost or market,
    less allowance for obsolescence, excess
    quantities and valuation                                                                  1,225,230
  Prepaid expenses and other current assets                                                      78,706
                                                                                            -----------
        Total current assets                                                                                    $ 1,907,842

Property assets, net of accumulated depreciation                                                                    173,374

Security deposits and other assets                                                                                   26,349
                                                                                                              -------------

                                                                                                                $ 2,107,565
                                                                                                              =============

                       LIABILITIES AND CAPITAL DEFICIENCY


Current liabilities:
  Secured note payable                                                                      $ 9,225,000
  Current maturities of long-term debt                                                        1,665,309
  Due to affiliates                                                                             155,734
  Accounts payable                                                                              902,224
  Pre-petition liabilities                                                                    1,012,000
  Accrued expenses and other current liabilities                                              4,166,572
                                                                                           ------------
        Total current liabilities                                                                               $17,126,839

Deferred rent                                                                                                        14,478

Long-term debt                                                                                1,919,620
Less:  Current maturities                                                                     1,665,309
                                                                                           ------------
        Total long-term debt                                                                                        254,311

Capital deficiency:
  Common stock, $.000833 par value
    Authorized - 100,000,000 shares
    Issued and outstanding - 17,463,300 shares                                                   14,546
  Additional paid-in capital                                                                 42,385,993
  Accumulated deficit                                                                     ( 57,688,602)
                                                                                          -------------
        Total capital deficiency                                                                               ( 15,288,063)
                                                                                                               ------------

                                                                                                                $ 2,107,565
                                                                                                               ============
</TABLE>

                 See notes to consolidated financial statements.


                                      F-3
<PAGE>


                    ELGIN TECHNOLOGIES, INC. AND SUBSIDIARIES
                     (Formerly Cross Atlantic Capital, Inc.)

                      CONSOLIDATED STATEMENTS OF OPERATIONS



<TABLE>
<CAPTION>
                                                                                                For the Years Ended
                                                                                                      March 31,
                                                                                             ---------------------------
                                                                                               2001               2000
                                                                                             --------           --------
<S>                                                                                     <C>                 <C>
Net sales                                                                                  $6,067,806          $7,423,771
Cost of sales                                                                               5,449,937           6,956,921
                                                                                         ------------        ------------
Gross margin                                                                                  617,869             466,850
                                                                                         ------------        ------------
Operating expenses:
  Selling                                                                                     665,003             896,965
  Research and development                                                                    575,825             826,680
  General and administrative                                                                2,116,611           1,742,406
  Bad debts (recoveries)                                                                (          58)             71,656
  Amortization of financing costs                                                              59,641              89,091
                                                                                         ------------        ------------
Total operating expenses                                                                    3,417,022           3,626,798
                                                                                         ------------        ------------

Loss from operations                                                                      ( 2,799,153)        ( 3,159,948)

Other expense:
  Interest                                                                                  3,768,761          1,916,646
                                                                                         ------------        ------------

Net loss                                                                                  ($6,567,914)       ($5,076,594)
                                                                                          ============       ============

Net loss per common share                                                                   ($0.37)             ($0.29)
                                                                                            =======             =======

Weighted average number of
  shares outstanding                                                                       17,591,249         17,425,303
                                                                                           ===========        ===========
</TABLE>


                 See notes to consolidated financial statements.


                                      F-4
<PAGE>


                    ELGIN TECHNOLOGIES, INC. AND SUBSIDIARIES
                     (Formerly Cross Atlantic Capital, Inc.)

            CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL DEFICIENCY

                   FOR THE YEARS ENDED MARCH 31, 2001 AND 2000


<TABLE>
<CAPTION>
                                                      Common Stock
                                              ----------------------------
                                                 Number                            Additional                          Total
                                                  of                                Paid-In        Accumulated       Capital
                                                 Shares           Amount            Capital          Deficit        Deficiency
                                              -----------      -----------        -----------     -------------    -------------

<S>                                           <C>              <C>               <C>              <C>             <C>
Balance at April 1, 1999                       16,473,051         $13,722         $39,230,617     ($46,044,094)   ($ 6,799,755)
Conversion of warrants into common stock        1,117,000             930        (        930)            -               -
Conversion of debt into common stock                1,550               1               6,199             -              6,200
Interest on convertible debt                         -                -               800,000             -            800,000
Net loss for the year                                -                -                   -       (  5,076,594)    ( 5,076,594)
                                              -----------      ----------        ------------     ------------     ------------

Balance at March 31, 2000                      17,591,601          14,653          40,035,886     ( 51,120,688)    (11,070,149)
Interest on convertible debt                          -               -             2,350,000             -          2,350,000
Cancellations due to settlements              (   128,301)     (      107)                107             -               -
Net loss for the year                                -                -                  -        (  6,567,914)    ( 6,567,914)
                                              -----------      ----------        ------------     ------------     ------------

Balance at March 31, 2001                      17,463,300         $14,546         $42,385,993     ($57,688,602)   ($15,288,063)
                                              ===========      ==========        ============     =============   =============
</TABLE>



                 See notes to consolidated financial statements.


                                      F-5
<PAGE>


                    ELGIN TECHNOLOGIES, INC. AND SUBSIDIARIES
                     (Formerly Cross Atlantic Capital, Inc.)

                      CONSOLIDATED STATEMENTS OF CASH FLOWS


<TABLE>
<CAPTION>
                                                                         For the Years Ended
                                                                               March 31,
                                                                  --------------------------------
                                                                        2001               2000
                                                                   ------------        -----------
<S>                                                               <C>                <C>
Cash flows from operating activities:

  Net loss                                                         ($6,567,914)        ($5,076,594)
                                                                   ------------        -----------
  Adjustments to reconcile net loss to net
      cash used in operating activities:
    Deferred rent                                                       14,478                -
    Accrued interest on debt                                         1,370,999             823,312
    Depreciation and amortization                                      119,840             224,712
    Provision for inventory obsolescence                           (   861,084)        ( 3,250,592)
    Interest on convertible debt                                     2,350,000             800,000
    Provision for doubtful accounts                                (    91,000)             14,500
    Increase (decrease) in cash flows as
        a result of changes in assets and
        liabilities and account balances:
      Accounts receivable                                              787,291             320,354
      Inventories                                                    1,239,245           2,481,330
      Prepaid expenses and  other current assets                   (       959)        (    32,794)
      Security deposits and other assets                                62,111         (    85,348)
      Accounts payable                                             (   647,395)            281,243
      Accrued expenses and other current liabilities                 1,137,766         (   109,347)
                                                                   ------------        -----------
  Total adjustments                                                  5,481,292           1,467,370
                                                                   ------------        -----------

Net cash used in  operating activities                             ( 1,086,622)        ( 3,609,224)
                                                                   ------------        -----------

Cash flows used in investing activities:

  Property assets                                                  (   179,753)        (    16,497)
                                                                   ------------        -----------

Cash flows from financing activities:

  Payment of long-term debt                                        (   287,043)        (   313,920)
  Proceeds from secured note payable                                 2,500,000           2,500,000
  Payment of amount due to affiliates                              (   985,539)               -
                                                                   ------------        -----------
Net cash provided by financing activities                            1,227,418           2,186,080
                                                                   ------------        -----------

Net decrease in cash                                               (    38,957)        ( 1,439,641)

Cash at beginning of year                                              144,839           1,584,480
                                                                   ------------        -----------

Cash at end of year                                                 $  105,882          $  144,839
                                                                   ===========         ===========

Supplemental Disclosures of Cash Flow Information:
  Cash payments during the year for:

    Interest                                                        $   46,308          $  128,071
                                                                   ===========         ===========
    Income taxes                                                    $     -             $     -
                                                                   ===========         ===========
Supplemental Schedules of Noncash Financing Activities:

  Conversion of debt to equity                                      $     -             $    6,200
                                                                   ===========         ===========
  Interest on convertible debt                                      $2,350,000          $  800,000
                                                                   ===========         ===========
</TABLE>


                 See notes to consolidated financial statements.



                                      F-6

<PAGE>


                    ELGIN TECHNOLOGIES, INC. AND SUBSIDIARIES
                     (Formerly Cross Atlantic Capital, Inc.)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

              As at March 31, 2001 and for the Two Years Then Ended


NOTE  1 -  REALIZATION OF ASSETS - GOING CONCERN.

                             The accompanying consolidated financial statements
                 have been prepared in conformity with accounting principles
                 generally accepted in the United States of America, which
                 contemplate continuation of the Company as a going concern. The
                 Company has incurred substantial operating losses in each of
                 its segments for the two years ended March 31, 2001. Management
                 on June 1, 1998 placed its contract engineering division of its
                 telecommunications segment originally located at Erie,
                 Pennsylvania into voluntary liquidation when management caused
                 a filing under Chapter 7 of Title 11 of the United States
                 Bankruptcy Code for its wholly-owned subsidiary, e2
                 Electronics, Inc. ("e2 Electronics"). The Court appointed a
                 trustee who is liquidating the assets of e2 Electronics for the
                 benefit of its creditors.

                             The accompanying consolidated financial statements
                 reflect a working capital deficiency of $15,219,000 at March
                 31, 2001, of which $1,012,000 is attributable to the net
                 obligations of e2 Electronics. Upon the conclusion of the
                 liquidation e2 Electronics, the capital deficiency at March 31,
                 2001 will decrease by the forgiveness of the net indebtedness
                 of e2 Electronics of $1,012,000. The Company's segments,
                 lighting manufacturing and telecom power system equipment
                 manufacturing, incurred losses from operations of $2,357,000
                 and $442,000, respectively, and in fiscal 2001 and in fiscal
                 2000 incurred operating losses of $2,415,000 and $745,000,
                 respectively. In fiscal 2001 and 2000, these segments had a
                 combined negative cash flow from operating activities of
                 $1,087,000 and $3,609,000, respectively. The Company's primary
                 source of cash has been the sale of its securities to and loans
                 from a stockholder.

                             As described in Note 12, e2 Electronics, the
                 Company and/or its continuing subsidiaries are defendants in a
                 number of legal actions, some of which, should the plaintiffs
                 prevail, would have a serious adverse effect on the Company's
                 financial condition.

                             The substantial operating losses of the Company's
                 operating segments incurred through and subsequent to March 31,
                 2001, and the Company's limited ability to obtain financing
                 other than from a stockholder raises substantial doubt
                 concerning the ability of the Company to realize its assets and
                 pay its obligations as they mature in the ordinary course of
                 business. These conditions, among others, raise substantial
                 doubt about the Company's ability to continue as a going
                 concern. The accompany-


                                      F-7

<PAGE>


NOTE  1 -  REALIZATION OF ASSETS - GOING CONCERN.  (Continued)

                 ing consolidated financial statements do not include any
                 adjustments relating to the recoverability and classification
                 of asset carrying amounts or the amount and classification of
                 liabilities that might result should the Company be unable to
                 continue as a going concern. Management is making every effort
                 to reverse these trends by the hiring of a new President/CEO
                 and appointing a new Vice President as head of sales to
                 implement a turnaround of the Company's businesses. New
                 management will continue efforts to reduce the operating costs
                 of the Company's existing product lines and seek to expand into
                 less costly, more profitable products and services. These
                 efforts will, however, require increased working capital
                 infusions. At present the Company's sole source of financing is
                 from a stockholder. Management cautions that there can be no
                 assurances that these efforts will be successful or that the
                 stockholder will continue to provide financing or that
                 alternative source of funds will be available for management to
                 implement its plan.

                             The new management team believes that it is
                 possible to turn around the Company's financial performance and
                 has begun implementing its business plan. This plan calls for
                 focusing on two main performance areas, which are: 1) overhead
                 reduction and 2) revenue/margin improvement.

                   Overhead reduction.

                             Since the new management team came on board, the
                 Company has reduced its overhead and will continue to look for
                 overhead reduction opportunities in the future. Benefits have
                 been realized by consolidating all facilities and moving
                 headquarters to a lower cost facility, reducing staffing by
                 streamlining operations and closing facilities, and by
                 implementing other outsourcing strategies to limit the
                 Company's overhead structure.

                   Revenue/margin improvement.

                             The Company has a 61-year history of providing
                 quality products to the industry, and management has
                 repositioned its marketing of its products to focus on that
                 history. Management has implemented new strategies to improve
                 margins by streamlining its product offerings by focusing on
                 those items in its product lines that have higher margins and
                 have strong market demand. By narrowing its product offerings
                 and purchasing more efficiently, the Company is able to reduce
                 its raw materials cost component thereby adding to margin
                 improvement. Management also intends to overhaul its marketing
                 efforts and restructure its sales department to strengthen
                 these strategies.

                             In addition, the Company is completing its beta
                 site testing of its Master Light /fluorescent product line. It
                 is anticipated that the Company will be able to generate
                 revenues from this product line in 2002.


                                      F-8

<PAGE>


NOTE 2 - BANKRUPTCY PROCEEDINGS - CHAPTER 7.

                             On June 1, 1998, management filed a petition for
                 its wholly owned subsidiary, e2 Electronics, Inc. ("e2
                 Electronics"), under Chapter 7 of Title 11 (a liquidation) of
                 the United States Bankruptcy Code in the Western District of
                 Pennsylvania of the United States Bankruptcy Court (the
                 "Court"). The Petitioner sought to have the court liquidate its
                 assets and disburse the proceeds therefrom to its creditors for
                 which the Court appointed Trustee. The results of operations of
                 e2 Electronics, after the filing, are not included in the
                 accompanying consolidated financial statements because
                 operations were conducted by the Court-appointed Trustee and
                 all of e2 Electronics' records were transferred to the Trustee,
                 and were not available for audit.

                             On May 30, 2000, the Bankruptcy Trustee for e2
                 Electronics filed a Complaint to Avoid Fraudulent Transfer, to
                 obtain Turnover of Property of the Estate, Equitable
                 Subordination and Injunctive Relief in the Bankruptcy Court
                 against Warren Power Systems, Inc., the Company and DC&A
                 Partners, Inc. However, the deadline for the defendants to
                 answer the Complaint has been continued generally to give the
                 parties an opportunity to negotiate for a cost-effective
                 resolution of the Complaint by compromise and settlement, if
                 possible. To that end, the Trustee propounded discovery
                 requests, including interrogatories and requests for the
                 production of documents, which defendants Warren Power Systems,
                 Inc. and the Company have answered in detail. After the Trustee
                 completes his due diligence with respect to a possible
                 settlement, the parties will negotiate in earnest. The next
                 status conference with the Bankruptcy Court is scheduled to be
                 held on September 10, 2001.

                             Several years before e2 Electronics' Chapter 7
                 bankruptcy filing in June of 1998, e2 Electronics issued a
                 secured promissory note to Star Bank, N.A., an institutional
                 lender. The note was secured by, inter alia, certain assets of
                 e2 Electronics have an aggregate historical cost value of
                 $915,000. In early 1998, the Star Bank note was approaching
                 maturity. The principal and interest due under the note at that
                 time totaled $528,000. The Company did not want e2 Electronics
                 to fully pay and discharge Star Bank's secured note because it
                 wanted to maintain the validity of the security interest so
                 that other creditors of e2 Electronics could not establish
                 senior liens over the assets. Similarly, the Company did not
                 want to purchase the Star Bank note itself because it was
                 concerned that such a purchase of the parent company of the
                 debtor would allow a third party creditor to challenge the
                 validity of the security interest. Accordingly, the Company
                 proposed to its investment bankers that they purchase the Star
                 Bank note and security interest over e2 Electronics' assets.
                 Accordingly, the investment bankers, who had a substantial
                 investment and interest in the Company, caused DC&A Partners,
                 Ltd., a corporation that they controlled, to purchase the Star
                 Bank note and related security interest from Star Bank at par,
                 making DC&A the holder of the secured lien.


                                      F-9

<PAGE>


NOTE  2 -  BANKRUPTCY PROCEEDINGS - CHAPTER 7.  (Continued)

                             Subsequent to the Chapter 7 filing, DC&A paid the
                 trustee a non-refundable fee of $10,000 for a license to
                 operate the business of e2 Electronics in order to preserve the
                 value of e2 Electronics' assets. DC&A then moved for a court
                 ordered sale, pursuant to which it would pay $100,000 for the
                 assets. A condition of the trustee's agreement to this motion
                 was that the $100,000 would be carved out of DC&A's secured
                 claim, i.e., these funds would be available for the unsecured
                 creditor's pool. At the hearing on the motion for court ordered
                 sale, another interested party was present and bid on the
                 assets. DC&A ultimately won the bidding at a price of $177,000.
                 The court carved the first $100,000 out of DC&A's secured claim
                 as stated above, but allowed DC&A to recover the additional
                 $77,000 in partial satisfaction of its secured claim.

                             DC&A subsequently sold the assets to Warren Power
                 Systems, Inc., a subsidiary of the Company in consideration of
                 the forgiveness by the Company of certain monies that it had
                 loaned to DC&A.

                             The assets and liabilities of e2 Electronics, Inc.
                 at the date of the filing petition is as follows:

                                      F-10

<PAGE>


<TABLE>
                 <S>                                            <C>
                 Accounts receivable                              $   210,000
                 Rent deposits                                         23,000
                 Property assets                                       20,000
                 Investments                                           71,000
                 Inventories net of reserve
                   for obsolescence of $1,560,000                      13,000
                                                                 ------------
                 Total assets                                         337,000
                                                                 ------------

                 Accounts payable-trade                               951,000
                 Accrued expenses and other
                   current liabilities                                214,000
                 Loan payable - DC&A Partners Ltd.                    600,000
                                                                 ------------
                                                                    1,765,000
                                                                 ------------

                 Net liabilities                                  ($1,428,000)
                                                                 ============
</TABLE>

                             During the seven months ended December 1998 the
                 rent deposit was utilized by the landlord for rent, which was
                 charged to operations in the second quarter of fiscal 1999. The
                 collection of the receivable resulted in the issuance of
                 discounts and allowances of $28,000 which was charged to
                 operations in the second quarter of 1999. The investments,
                 management believes, are presently in the charge of the
                 Trustees. The inventory, certain property and $100,000 in cash
                 were given to DC&A in partial satisfaction of its secured loan.
                 Since that time, management has not been able to obtain from
                 the Trustees what, if any, additional changes to the assets and
                 liabilities have occurred.


                                      F-11

<PAGE>


NOTE  2 -  BANKRUPTCY PROCEEDINGS - CHAPTER 7.  (Continued)

                             Based upon the information supplied to management
                 by the Trustees, the prepetition liabilities net of the assets
                 at March 31, 1999, 2000 and 2001, are as follows:






<TABLE>
                 <S>                                            <C>
                 Cash                                            $    82,000
                 Investments                                          71,000
                                                                 -----------
                                                                     153,000
                                                                 -----------

                 Accounts payable-trade                              951,000
                 Accrued expenses and other liabilities              214,000
                                                                 -----------
                                                                   1,165,000
                                                                 -----------

                                                                 ($1,012,000)
                                                                 ===========
</TABLE>


NOTE  3 -  DESCRIPTION OF BUSINESS.

                             The Company was incorporated as Cross Atlantic
                  Capital, Inc. ("CROA") under the laws of the State of Delaware
                  on May 28, 1986. CROA, since its incorporation through
                  September 30, 1997, was inactive at which time it acquired all
                  of the outstanding capital stock of e2 Electronics, Inc.
                  (f/k/a Elgin e2 Inc) in exchange for 4,167,000 shares of its
                  $.000833 par value Common Stock. Prior to the acquisition,
                  CROA had issued and outstanding 600,000 shares of its Common
                  Stock. The merger was treated as a recapitalization. In
                  January 1998, CROA changed its name to Elgin e2, Inc. and, in
                  June 1998, to Elgin Technologies, Inc. (the "Company"). In
                  January 1998, e2 Electronics, Inc. changed its name from Elgin
                  e2, Inc. to its current name.

                             The effects of this recapitalization are as
                  follows:

                                      F-12


<PAGE>


<TABLE>
                                                                          DATE              PAR VALUE         SHARES
                                                                  -------------------  ------------------  --------------
<S>                                                              <C>                         <C>           <C>
Initial issue of common stock
  to original CROA                                                  May 28, 1986             $.000833         600,000

Equivalent number of shares issued
  to stockholders of Elgin e2 in
  exchange for the share of Elgin e2
  to reflect the recapitalization                                September 30, 1997          $.000833       4,167,000
                                                                                                            ---------

Total shares issued and outstanding
  after giving effect to merger
  treated as a recapitalization                                                                             4,767,000
                                                                                                            =========
</TABLE>

                                      F-13


<PAGE>


NOTE  3 -  DESCRIPTION OF BUSINESS.  (Continued)

                             e2 Electronics was incorporated in Delaware in
                 April 1994 as a provider of contract manufacturing services and
                 custom power equipment to original equipment manufacturers in
                 the industrial process control, medical instrumentation and
                 telecommunications industries, e2 Electronics commenced
                 operations in April 1994 with its acquisition of the net assets
                 of Charter Technologies, Inc. from a United States Bankruptcy
                 Court appointed Trustee. e2 Electronics also acquired certain
                 net assets from two other entities in fiscal 1995. These three
                 acquisitions resulted in the recording of $1,018,000 in
                 goodwill.

                             e2 Electronics on July 10, 1996 acquired all of the
                 capital stock of Ascom Warren, Inc. ("Warren") in a transaction
                 accounted for as a purchase. e2 Electronics, then merged Warren
                 into itself. The purchase price of $2,298,000 for the Company's
                 power system manufacturing segment was paid in cash of
                 $1,298,000 plus the issuance of a $1,000,000 promissory note
                 with 10% interest, payable in four annual installments of
                 $250,000.

                             In December 1997, the Company acquired all of the
                 capital stock of Logic Laboratories, Inc. ("Logic") for
                 2,000,000 shares of its Common Stock (valued at $3.00 per
                 share) plus a conditional payment of an additional 500,000
                 shares of the Company's Common Stock, if and when Logic
                 achieves $10,000,000 in sales in any one fiscal year, in a
                 transaction accounted for as a purchase. Logic had
                 insignificant revenues, no saleable products and no tangible
                 assets at the date of the acquisition. Logic had sales of
                 $35,000 for the year ended March 31, 2001 and $105,000 in
                 identifiable assets at March 31, 2001. Sales for the year ended
                 March 31, 2000 were $35,000 and its identifiable assets were
                 $84,000. As the sales criterion was not met, the additional
                 contingent consideration is not owned. If the conditional
                 shares of the Company's Common Stock were issued (upon Logic
                 achieving the sales target), the purchase price of Logic would
                 be increased in accordance with EITF 95-8 and adjusted at the
                 then current fair value of the Company's Common Stock in
                 accordance with Accounting Principles Board of Opinion No. 16.

                             On April 24, 1998, the Company acquired all of the
                 assets and liabilities of Communication Service Company ("CSC")
                 which installs power systems for 100,000 shares of its Common
                 Stock (valued at $3.00 per share) plus the cash and accounts
                 receivable of CSC on the date of acquisition. The transaction
                 is being accounted for as a purchase in the accompanying
                 consolidated financial statements. The fair value of the
                 consideration paid to the sellers of CSC exceeded the fair
                 value of the remaining net assets acquired by $300,000 and
                 initially was recorded as goodwill. The goodwill was charged to
                 operations on the acquisition date due to the uncertainty of
                 the Company's ability to continue as a going concern.

                             Management determined the purchase price for Logic
                 and CSC to be valued at $3.00 per share, in accordance with
                 EITF 95-19, which requires the shares issued to be valued at
                 the time of tender. In addition, the $3.00 per share valuation
                 was based on recent private placement sales of the Company's
                 stock to investors.


                                      F-14

<PAGE>


NOTE  3 -  DESCRIPTION OF BUSINESS.  (Continued)

                             The accompanying consolidated financial statements
                 as at March 31, 2001 and for the two years then ended include
                 the accounts of the Company and its wholly-owned subsidiaries
                 except for e2 Electronics, Inc. whose accounts are included
                 from April 1, 1998 to the date of the filing of its bankruptcy
                 proceedings on June 1, 1998. Upon the filing of the bankruptcy
                 petition, the assets and liabilities are being liquidated by
                 the Trustee of the Court. The accompanying consolidated
                 financial statements reflect the acquisitions of CSC, Logic,
                 Warren and the net assets of Charter Technologies, Inc. from
                 their respective dates of their purchase through March 31,
                 2001, in accordance with Accounting Principles Board Opinion
                 No. 43 and Item 310 of Regulation S-B.

NOTE  4 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.

                 (a)      Revenue Recognition:

                             The Company recognizes revenues in accordance with
                 accounting principles generally accepted in the United States
                 of America in the period in which it performs its installation
                 services. In addition, the Company recognizes product revenues
                 when they are shipped to the respective customers. The Company
                 records expenses in the period in which they are incurred, in
                 accordance with accounting principles generally accepted in the
                 United States of America.

                 (b)      Use of Estimates:

                             The preparation of financial statements in
                 conformity with accounting principles generally accepted in the
                 United States of America requires management to make estimates
                 and assumptions that affect certain reported amounts and
                 disclosures. Accordingly, actual results could differ from
                 those estimates.

                 (c)      Cash and Cash Equivalents:

                             The Company considers all highly liquid debt
                 instruments purchased with a maturity of three months or less
                 to be cash equivalents.

                 (d)      Concentrations of Credit Risk:

                             Financial instruments that potentially subject the
                 Company to significant concentrations of credit risk consist
                 principally of cash and trade accounts receivable. The Company
                 places its cash with high credit quality financial institutions
                 which at times may be in excess of the FDIC insurance limit.

                                      F-15


<PAGE>


NOTE  4 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.  (Continued)

                (d)   Concentrations of Credit Risk: (Continued)

                             Agencies of the U.S. government accounted for 12%
                 and 13% of sales in fiscal 2001 and 2000, respectively. Another
                 customer accounted for 17% and 14% of sales in fiscal 2001 and
                 2000, respectively. Concentrations of credit risk with respect
                 to trade accounts receivable of the Company's segments are
                 limited due to the wide number of their customers. At March 31,
                 2001, three customers accounted for 27%, 14% and 12% of
                 accounts receivable. With the filing of the e2 Electronics,
                 Inc.'s bankruptcy proceedings, the receivables of this
                 subsidiary were placed in the custody of the Trustee who is
                 responsible for their liquidation.

                 (e)      Inventories:

                             Inventories are stated at the lower of cost
                 (first-in, first-out method) or market.

                 (f)      Property and Equipment:

                  (i)     The cost of property and equipment is depreciated
                          over the estimated useful lives of the related assets
                          of 3 to 5 years. Depreciation is computed on the
                          straight-line method for financial reporting
                          purposes. Repairs and maintenance expenditures, which
                          do not extend original asset lives, are charged to
                          income as incurred.

                 (ii)     The Company adopted Statement of Financial Accounting
                          Standards No. 121 "Accounting for the Impairment of
                          Long-Lived Assets and for Long-Life Assets to be
                          Disposed of". The statement required that the Company
                          recognizes and measures impairment losses of
                          long-lived assets to be disposed of. At March 31,
                          2001, the carrying value of the Company's other assets
                          approximate their estimated fair value.

                 (g)      Research and Development Costs:

                            The Company charges to operations all research and
                 development costs as incurred. Purchased in-process research
                 and development represents the value assigned in a purchase
                 business combination to research and development projects of
                 the acquired business that were commenced but not yet
                 completed at the date of the acquisition and which, if
                 unsuccessful, have no alternative future use in research and
                 development activities or otherwise. In accordance with
                 Statement of Financial Accounting Standards No. 2 "Accounting
                 for Research and Development Costs", as interpreted by FASB
                 Interpretation No. 4, amounts assigned to purchased in-process
                 research and development meeting the above criteria must be
                 charged to expense at the date of consummation of the purchase
                 business combination.


                                      F-16

<PAGE>


NOTE  4 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.  (Continued)

                (g)   Research and Development Costs: (Continued

                             The acquisition of Logic Labs centered on the
                 development of lighting products based on an application of a
                 DC power supply (versus standard AC power) to drive industrial
                 systems, this system is called Master Lite. At the time of the
                 acquisition, Logic had filed initial patent applications and
                 had initial laboratory prototypes of the product for a
                 fluorescent system. The Company valued the acquisition at
                 $7,901,000 ($3.00 per share of the Company's stock plus Logic's
                 net worth) based upon management's assessment of the market
                 potential for the then existing prototype application and of
                 the potential for future product offerings based upon its
                 designs as applied to lighting categories. Upon the acquisition
                 of Logic, management determined that the product would require
                 significant engineering and design expenditures and would
                 require several years of development. During the development
                 process, several design iterations have been generated and the
                 Company has filed and received patents for these improvements
                 to the original design. Due to these improvements and post
                 acquisition developments in the lighting market, the Company
                 has modified its original market concept. In addition, due to
                 delays in regulatory review, the Company has modified its
                 original view as to the value of the original designs purchased
                 from Logic. Accordingly, the acquired net worth was deemed by
                 management to have little or no future value and was written
                 off to operations in fiscal 1998.

                 (h)      Deferred Financing Costs:

                             Direct costs incurred in connection with obtaining
                 financing have been capitalized and were being amortized over
                 the term of the respective financing agreements. Amortization
                 of deferred financing costs aggregating $60,000 and $89,000 in
                 2001 and 2000 was charged to operations.

                 (i)      Income Taxes:

                             The Company complies with Statement of Financial
                 Accounting Standards No. 109 ("SFAS 109"), "Accounting for
                 Income Taxes," which requires an asset and liability approach
                 to financing accounting and reporting for income taxes.
                 Deferred income tax assets are computed for differences between
                 financial statement reporting and tax basis of assets and
                 liabilities that will result in future taxable or deductible
                 amounts, based on the enacted tax laws and rates in the periods
                 in which differences are expected to affect taxable income. The
                 principal asset and liability differences are depreciation and
                 amortization of property and intangible assets, valuation
                 allowances of accounts receivable and inventories, and
                 utilization of the Company's tax loss carryforwards. Management
                 has fully reserved the net deferred tax assets as it is not
                 more likely than not that the deferred tax asset will be
                 utilized in the future.


                                      F-17

<PAGE>


NOTE  4 -  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES.  (Continued)

                 (j)      Loss Per Common Share:

                             Loss per common share is based on the weighted
                 average number of common shares outstanding. In March 1997,the
                 Financial Accounting Standards Broad issued Statement No. 128
                 ("SFAS 128"), "Earnings Per Share," which requires dual
                 presentation of basic and diluted earnings per share on the
                 face of the statements of operations which the Company has
                 adopted. Basic loss per share excludes dilution and is computed
                 by dividing income available to Common Stockholders by the
                 weighted-average common shares outstanding for the period.
                 Diluted loss per share reflects the potential dilution that
                 could occur if convertible debentures, options and warrants
                 were to be exercised or converted or otherwise resulted in the
                 issuance of Common Stock that then shared in the earnings of
                 the entity.

                             Since the effect of outstanding options, warrant
                 and convertible debenture conversions are antidilutive in all
                 periods presented, it has been excluded from the computation of
                 loss per common share.

                 (k)      Significant Adjustments:

                             In the opinion of management, all significant
                 adjustments, estimates and disclosures have been recorded and
                 are an integral component of its consolidated financial
                 statements.

                 (l)      Fair Value of Financial Instruments:

                             The Company adopted Statement of Financial
                 Accounting Standards No. 121 ("SFAS No. 121"), "Accounting for
                 the Impairment of Long-Lived Assets and for Long-Lived Assets
                 to be Disposed of." The statement requires that the Company
                 recognize and measure impairment losses of long-lived assets to
                 be disposed of. The Company reviews long-lived assets and
                 certain identifiable intangibles held and used for possible
                 impairment whenever events or changes in circumstances indicate
                 that the carrying amount of an asset may not be recoverable.
                 Management has continued to evaluate its long-lived assets and
                 does not believe any other assets have incurred any impairment
                 and the amounts stated in the accompanying consolidated
                 financial statements approximate their fair value.


                                      F-18

<PAGE>


NOTE 5 - INVENTORIES.

                             The components of the inventories in determining
                 the cost of sales are as follows:

<TABLE>
                 <S>                                             <C>
                 Raw materials                                   $  1,785,000
                 Work-in-process                                      162,000
                 Finished goods                                       397,000
                                                                  -----------
                                                                    2,344,000
                 Allowance for obsolescence
                   and disposal                                     1,119,000
                                                                  -----------

                                                                  $ 1,225,000
                                                                  ===========
</TABLE>



                             During fiscal 1999, the Trustee liquidated e2
                 Electronics, Inc.'s operations inventory and the proceeds from
                 such liquidation, if any, are being held by the Trustee for
                 distribution to the e2 Electronics, Inc.'s creditors.

                             The components of the inventories in determining
                 the cost of sales in 2000 and 1999 are as follows:


<TABLE>
<CAPTION>
                                                          March 31,
                                               ------------------------------
                                                   2000              1999
                                               -----------       ------------
<S>                                             <C>                <C>
Raw materials                                   $2,290,000         $3,378,000
Work-in-process                                    740,000          1,780,000
Finished goods                                     553,000            907,000
                                               -----------       ------------
                                                 3,583,000          6,065,000
Allowance for obsolesence
  and disposal                                   1,980,000          5,231,000
                                               -----------       ------------

                                                $1,603,000         $  834,000
                                               ===========         ==========
</TABLE>


                                      F-19

<PAGE>


NOTE  5 -  INVENTORIES.  (Continued)

                             In May 1999, the manufacturing segment sold for
                 $10,000 part of its obsolete raw material and work-in-process
                 inventories whose cost was approximately $1,517,000. Management
                 estimates that the remaining $1,119,000 allowance for
                 obsolescence at March 31, 2001 is sufficient for the continuing
                 operating segments to dispose of its obsolete and excess
                 inventory and that this allowance reflects the sustained and
                 measurable loss incurred due to the obsolescence of and the
                 excess inventories.

                             During fiscal 1999, the Trustee liquidated this
                 operation's inventory and the proceeds from such liquidation,
                 if any, are being held by the Trustee for distribution to the
                 Petitioner's creditors.

NOTE  6 -  PROPERTY ASSETS.

<TABLE>
                             Property assets consist of the following:

                 <S>                                                 <C>
                 Machinery and equipment                              $ 63,800
                 Furniture and fixtures                                120,300
                 Leasehold improvements                                106,500
                                                                      --------
                                                                       290,600
                 Less:  Accumulated depreciation
                          and amortization                             117,200
                                                                      --------

                                                                      $173,400
                                                                      ========
</TABLE>


                             Depreciation charged to operations in fiscal 2001
                 and 2000 was $60,200 and $135,600, respectively. During the
                 year ended March 31, 2000, the Company's landlord terminated
                 the lease for its premises in Hudson, N.H. resulting in the
                 write-off of its unamortized leasehold costs of $109,000.
                 Management and the landlord subsequently agreed to allow the
                 Company to remain in its facility until April 2000 at which
                 time the Company moved to its new leased facility in Amherst,
                 N.H. (See Note 11).


                                      F-20

<PAGE>


NOTE 7 - FINANCING.

(a)      Revolving Lines of Credit:

                             In November 1998, the Company entered into a
                 revolving line of credit with a major stockholder. At March 31,
                 2000, $6,725,000 was outstanding under this facility. Through
                 March 31, 2001, the stockholder advanced an additional
                 $2,500,000 under the facility which aggregates to $9,225,000
                 outstanding at March 31, 2001. Since the Company has not made
                 the required monthly stated interest payments of 10%, the rate
                 by the terms of the agreement is automatically increased to
                 15%. Accrued interest of $2,221,000 is outstanding at March 31,
                 2001. The average outstanding debt under the facility was
                 $7,975,000 and $6,325,000 during fiscal 2001 and 2000,
                 respectively. Interest charged to operations was $1,244,000 in
                 fiscal 2001 and $794,000 in fiscal 2000 at an average interest
                 rate of 15%. The outstanding principal and accrued interest
                 thereon are collateralized by all of the Company's assets.
                 Warren and Logic have guaranteed this indebtedness and have
                 pledged their assets as collateral for the outstanding
                 principal and accrued interest outstanding. Additionally, at
                 the holder's option, the principal outstanding indebtedness is
                 convertible into the Company's Common Stock at $0.55 per share
                 for $4,225,000 of the obligation, $0.20 per share for
                 $1,050,000 of the obligation, $0.14 per share for $250,000 of
                 the obligation and $0.10 per share for $3,700,000 of the
                 obligation.

                 (b)      Long-Term Debt:

                             Long-term debt is comprised of the following:

<TABLE>
                 <S>                                                  <C>
                 Commonwealth of Pennsylvania
                     Department of Commerce Bonds (i):
                   Machinery and equipment                            $ 323,300
                   Capital loan fund                                     27,600

                 Subordinated notes (ii)                              1,012,500

                 Convertible subordinated notes (iii)                   256,200

                 Other notes payable                                    300,000
                                                                      ---------

                                                                      1,919,600
                 Less:  Portion currently payable                     1,665,300
                                                                      ---------

                                                                      $ 254,300
                                                                      =========
</TABLE>


                                      F-21

<PAGE>


NOTE  7 -  FINANCING.  (Continued)

                 (b)      Long-Term Debt:  (Continued)

                 (i)      In 1995, a subsidiary, which is in bankruptcy (see
                          Note 2), entered into two loan agreements for an
                          aggregate of $700,000 which was used to acquire
                          property assets. The Company has assumed these
                          obligations payable to the Commonwealth of
                          Pennsylvania and certain of the assets which the funds
                          were used to acquire.

                 (ii)     Commencing in February 1996 through October 1996, e2
                          Electronics, Inc. ("e2 Electronics") sold securities
                          in a private placement consisting of 10% interest
                          bearing subordinated notes and warrants to acquire
                          shares of the e2 Electronics' Common Stock at $4.00
                          per share. No value was assigned to the warrants.
                          Upon the recapitalization by the Company of e2
                          Electronics, the subordinated debt became obligations
                          of the Company and the warrants were issued for
                          shares in the Company's Common Stock at $4.00 per
                          share. The Company received $1,637,500 in proceeds
                          from the offering before costs related to the
                          offering. Certain note holders converted their debt
                          into the Company's Common Stock in the amount of
                          $6,200 for 1,550 common shares during fiscal 2000.
                          The holders of the notes, aggregating $1,012,500 at
                          March 31, 2001, are due interest aggregating $589,000
                          at March 31, 2001.

                 (iii)    In December 1997, a subsidiary issued two convertible
                          subordinated notes aggregating $256,000 to a
                          corporate stockholder of the Company. The 10%
                          interest bearing notes, which were due and payable in
                          December 1998, remain outstanding at March 31, 2001.
                          The notes and accrued interest thereon aggregating
                          $85,000 (March 31, 2001) are collateralized by all of
                          this subsidiary's assets and, at the holder's option,
                          are convertible into the Company's Common Stock at
                          $3.00 per share. The noteholder also paid $65,000 for
                          warrants to acquire 32,500 shares of the Company's
                          Common Stock for no additional consideration.

                             The Company is in violation of several covenants of
                 its various debt agreements at March 31, 2001. Under the terms
                 of the debt agreements, the covenant violations accelerate
                 principal repayment and the entire amounts outstanding are due
                 and payable immediately. Some of the debt holders had commenced
                 actions against the Company seeking payment. The actions were
                 resolved by the Company agreeing to make installment payments
                 to the creditors.

                             Future aggregate maturities on long-term debt at
                 March 31, 2001 are as follows:

<TABLE>
<CAPTION>
                      Years Ending
                        March 31,
                      -------------
                      <S>                                   <C>
                          2002                               $1,665,309
                          2003                                  101,527
                          2004                                  106,722
                          2005                                   46,062
                                                             ----------

                                                             $1,919,620
                                                             ==========
</TABLE>


                                      F-22

<PAGE>


NOTE  8 -  ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES.

                             Accrued expenses and other current liabilities are
comprised of the following:

<TABLE>
<S>                                                              <C>
Payroll and commissions                                           $  445,700
Vacation pay                                                          60,600
Payroll taxes and fringe benefits                                     94,900
Professional fees                                                    186,200
Interest                                                           3,157,600
Warranty reserve                                                      41,600
Other                                                                180,000
                                                                 -----------

                                                                  $4,166,600
                                                                 ===========
</TABLE>


NOTE  9 -  INCOME TAXES.

                             The deferred tax benefit results from differences
                 in recognition of expenses for tax and financial reporting
                 purposes and for minimum tax provision of the various state and
                 local taxing authorities where the Company and its subsidiaries
                 are subject to tax. The Company has deferred tax assets
                 consisting of the following temporary differences:


<TABLE>
<CAPTION>
                                                                                 March 31,
                                                                    --------------------------------
                                                                        2001                 2000
                                                                    -----------          -----------
<S>                                                                <C>                  <C>
Net operating loss carryforward                                     $10,215,000          $ 8,993,000
Inventory obsolescence allowance                                        392,000              614,000
Allowance for doubtful accounts                                          19,000              299,000
Intangible assets                                                       910,000              963,000
Other                                                                    47,000               47,000
                                                                    -----------          -----------
                                                                     11,583,000           10,916,000

Less:  Valuation allowance                                         ( 11,583,000)        ( 10,916,000)
                                                                    -----------          -----------

Net deferred tax asset                                             $      -             $       -
                                                                    ===========          ===========
</TABLE>



                             In light of the continuing losses incurred by the
                 Company since its inception, management estimates that it is
                 more likely than not that the benefits from the deferred tax
                 assets will not be realized and, accordingly, the entire tax
                 asset has been fully reserved.


                                      F-23

<PAGE>


NOTE  9 -  INCOME TAXES.  (Continued)

                             The difference between income taxes computed using
                 the statutory federal income tax rate and the rate shown in the
                 financial statements are summarized as follows:


<TABLE>
<CAPTION>
                                                                 For The Years Ended March 31,
                                                     ------------------------------------------------------
                                                         2001            %              2000             %
                                                    -------------      -----        ------------       -----
<S>                                                  <C>               <C>          <C>                <C>
Loss before income taxes                             ($6,568,000)                   ($5,076,000)
                                                     ============                   ============
Computed tax benefit
  at statutory rate                                  ($2,233,000)      (34.0)       ($1,726,000)       (34.0)

Non-deductible portion
  of compensatory element of
  common stock issuances:
    Research and development                                -             -                -              -
    Compensation for services                               -             -                -              -
  Goodwill                                                  -             -                -              -
  Finance charges                                         31,000         0.5             31,000          0.6
  Interest on convertible debt                           799,000        12.1            280,000          5.5

Other                                                      5,000         0.1              5,000          0.1

Reserve for operating loss
  carryforward tax asset                               1,398,000        21.3          1,410,000         27.8
                                                   -------------      ------       ------------       ------

Income tax benefit                                       $ -              -             $ -              -
                                                   =============      ======       ============       ======
</TABLE>




                             The net operating loss carryforwards at March 31,
                 2001 expire as follows:

<TABLE>
                            <S>                         <C>
                            2010                        $   905,000
                            2011                          1,959,000
                            2012                          1,676,000
                            2013                          7,444,000
                            2014                          6,164,000
                            2015                          7,546,000
                            2016                          3,491,000
                                                        -----------

                                                        $29,185,000
                                                        -----------
</TABLE>


                             The Tax Reform Act of 1986 enacted a complex set of
                 rules limiting the utilization of net operating loss
                 carryforwards to offset future taxable income following a
                 corporate ownership change. Among other things, the Company's
                 ability to utilize its operating loss carryforwards is limited
                 following a change in ownership in excess of fifty percentage
                 points in any three-year period. Additionally, the net
                 operating loss will be reduced to the extent of the amount of
                 indebtedness extinguished, if any, under the bankruptcy
                 liquidation proceedings of one of the Company's subsidiaries.
                 The effects, if any, of the potential bankruptcy proceeding's
                 debt extinguishment and the change in ownership are not
                 reflected in the foregoing tables.


                                      F-24

<PAGE>


NOTE 10 - CAPITAL.

                 (a)      Redeemable Common Stock:

                             As part of the purchase agreement for the
                 acquisition of the net assets of Charter Technologies, Inc.,
                 certain creditors of Charter were holders of redeemable Common
                 Stock of the Company, valued at $419,000. In 1998, the Company
                 settled with these creditors for $141,00 in cash, warrants to
                 acquire 303,043 shares of the Company's Common Stock for no
                 consideration (all of which are outstanding at December 31,
                 1999), and warrants to acquire 95,000 shares of the Company's
                 Common Stock at $3.00 per share (all of which are outstanding
                 at March 31, 2001) as full payment for the Company's redeemable
                 Common Stock.

                 (b)      Common Stock:

                             In March 5, 1998, an individual acquired 333,333
                 shares of the Company's Common Stock for cash of $3.00 per
                 share. In April 1998, this individual purchased additional
                 shares and warrants to acquire the Company's Common Stock for
                 $6,000,000 in cash before offering costs. Of the 2,163,334
                 common shares acquired in April 1998, 163,333 are to be issued
                 to a consultant for his advisory services in connection with
                 the sale of the securities. The purchaser also received
                 warrants to acquire an additional 100,000 common shares at
                 $3.00 per share. In November 1998, the Company gave this
                 individual additional rights to avoid dilution of his ownership
                 of the issued and outstanding or issuable shares of the
                 Company's Common Stock. This individual had loaned the Company
                 $6,725,000 at March 31, 2000 (see Note 7). This person has the
                 option to convert the debt outstanding at March 31, 2001 into
                 approximately 27,432,000 shares of the Company's Common Stock.

                             In April 1998, the Company issued 100,000 shares of
                 its Common Stock whose fair market value at date of issuance
                 was $300,000, or $3.00 per share, as partial consideration for
                 the purchase of Communication Service Company.

                             During fiscal 1999, the Company's Board of
                 Directors authorized the issuance of 97,200 shares of its
                 Common Stock having a fair market value at the time of issuance
                 of $291,600, or $3.00 per share, to employees of the Company as
                 bonuses for services rendered.

                             In fiscal 1999, the Company issued 16,800 of its
                 common shares having a fair market value of $50,400, or $3.00
                 per share, as settlement of a lawsuit.

                             Pursuant to the convertible notes conversion
                 option, certain holders of the Company's subordinated
                 convertible debentures (See Note 7) converted their outstanding
                 loans and accrued interest into 105,950 shares (during fiscal
                 1999) and 1,550 shares (during fiscal 2000) of the Company's
                 Common Stock.


                                      F-25

<PAGE>


NOTE 10 -  CAPITAL.  (Continued)

                 (c)      Warrants:

                             In fiscal 1997, warrants to acquire 1,350,000
                 shares of the Company's Common Stock were issued to Inverness
                 Corporation and Menotomy Funding, LLC in connection with a loan
                 agreement. The exercisability and validity of these warrants
                 are currently being challenged by the Company. Inverness
                 Corporation and Menotomy Funding, LLC have initiated an action
                 against the Company and others (See Note 11).

                             In fiscal 1997, 1998 and 1999, the Company sold
                 7,300,000 warrants at $1.00 each and 788,434 at $3.00 each
                 aggregating $9,665,000 prior to related offering costs. Each
                 warrant allowed the holder to convert the warrant into a like
                 number of the Company's common shares for no additional
                 consideration. Through March 31, 2001, 7,976,434 warrants have
                 been converted into a like number of the Company's common
                 shares.

                             In fiscal 1996 and 1997, the Company raised
                 $1,638,000 before offering costs through private placements of
                 its convertible notes of $1,638,000 and cashless warrants to
                 acquire 409,395 common shares at $4.00 per share. Through March
                 31, 2001, $719,000 of convertible debentures and accrued
                 interest have been converted into 179,700 shares of the
                 Company's Common Stock.

                             The Company employed the services of placement
                 agents, consultants and investment bankers to assist in and to
                 render advise with respect to the sale of its Common Stock and
                 warrants. One of the consultants agreed to accept 163,333
                 shares, of the Company's Common Stock as compensation for its
                 services. Although those shares have not actually been issued,
                 they are reflected in accompanying financial statements as
                 issued and outstanding.

                             An investment banker was granted for its financial
                 services rendered, warrants to acquire (i) 493,034 shares of
                 the Company's Common Stock at $1.00 per share, (ii) 78,843
                 shares of Common Stock at $3.00 per share and in addition,
                 90,000 shares of the Company's Common Stock valued at $1.00 per
                 share issued through March 31, 2001. The warrants remain
                 outstanding at March 31, 2001.


                                      F-26

<PAGE>


NOTE 11 -  COMMITMENTS AND CONTINGENCIES.

                 (a)      Leases:

                             As of March 31, 2001, the Company is a lessee under
                 an operating real property lease for its manufacturing,
                 warehouse and office facility in Amherst, N.H. The lease is for
                 five years expiring in April 2005. Amortizing, future rent
                 payments on a straight-line basis over the life of the lease
                 resulted in a deferred rent liability of $14,478 at March 31,
                 2001.

                             Minimum future rentals under the noncancellable
                 operating lease at March 31, 2001 are as follows:

<TABLE>
<CAPTION>
                           Years Ending
                             March 31,
                           ------------
                       <S>                                      <C>
                               2002                                  $168,065
                               2003                                   176,100
                               2004                                   184,135
                               2005                                   192,170
                               2006                                    16,070
                                                                 ------------
                       Total minimum future
                          rental payments                            $736,540
                                                                 ============
</TABLE>


                             Rent expense was $95,323 and $69,487 for the years
                 ended March 31, 2001 and 2000, respectively.

                 (b)      Litigation:

                 (i)       A subsidiary of the power manufacturing segment is
                           one of several defendants in an action for personal
                           injuries sustained by an individual. The plaintiff's
                           alleged injuries were allegedly incurred as a result
                           of the negligence of a contractor employed by the
                           subsidiary to install a power system at the
                           plaintiff's workplace. The plaintiff and his spouse
                           are seeking damages of $14,000,000. The Company's
                           insurance carrier has appointed counsel to represent
                           the subsidiary and such counsel as well as management
                           is unable to render an opinion on the ultimate
                           outcome of the lawsuit.

                 (ii )     The Company, e2 Electronics, two former officers, a
                           stockholder of the Company, the Company's investment
                           bankers and its general corporate counsel as well as
                           other parties are named defendants in a lawsuit filed
                           in Middlesex Superior Court in Cambridge, Mass. in
                           June 1997 by Inverness Corporation and Menotomy
                           Funding, LLC. The plaintiffs allege breach of
                           contract and a variety of other causes of action
                           relating to the alleged failure of the Company to
                           honor certain stock warrants. In late 1996 a
                           defendant, EAC Acquisition I Corporation ("EAC"), was
                           formed by the Company's investment bankers for the
                           sole purpose of acquiring assets of a troubled
                           corporation located in Billerica, Mass. The parties
                           intended that EAC, whose President was a former
                           officer of the Company would acquire the assets of
                           the business and then manage its operations in an
                           effort to make it a viable concern. As part of the
                           transaction, plaintiffs sold the entire assets to EAC
                           for a short-term note aggregating $1,640,442.


                                      F-27

<PAGE>


NOTE 11 -  COMMITMENTS AND CONTINGENCIES.  (Continued)

                 (b)      Litigation:  (Continued)

                 (ii)     (Continued)

                           During the negotiation of the loan agreement, the
                           plaintiffs represented that they would provide
                           working capital of $300,000 pursuant to the revolving
                           line of credit of $1,780,000 referenced in the loan
                           agreement. As part of the consideration for the
                           transaction, the Company issued a warrant to purchase
                           750,000 shares of warrant stock in a publicly traded
                           company (CROA) that would be the survivor of a merger
                           with the Company. The Company was never a party to
                           the loan transaction and did not guarantee the debt
                           of EAC.

                           The parties anticipated that the short-term note
                           would be paid through the infusion of new capital
                           from third party investors. However, after several
                           loan forbearances for which the Company issued
                           additional warrants, neither the working capital from
                           the plaintiffs nor any new capital from investors was
                           forthcoming. By May 1997, the plaintiffs foreclosed
                           on their security interest in EAC's assets, thereby
                           forcing EAC to cease operations.

                           Plaintiffs filed suit to obtain money damages in the
                           amount of $7,650,000 for the alleged failure to honor
                           the warrants issued by the Company in connection with
                           the transaction. It is the Company's position that
                           the conditions precedent to the exercise of the
                           warrants never occurred. The Company and EAC have
                           counterclaimed against the Plaintiffs for common law
                           fraud, breach of contract and related claims. The
                           Company and EAC allege they were fraudulently induced
                           into entering into the loan transaction and issuing
                           the warrants in exchange for a non-existent operating
                           line of credit based upon false representations by
                           plaintiffs that it had the liquidity and ability to
                           fund the line of credit. The case is presently in the
                           discovery phase and trial is not expected before the
                           latter part of the year 2000. Management is unable to
                           determine the ultimate resolution of this action and
                           what effect, if any, the resolution would have on the
                           Company's financial condition.

                 (iii)     The Company and/or its subsidiaries are named
                           defendants or co-defendants in numerous actions with
                           its subsidiary in bankruptcy, e2 Electronics, Inc.
                           These cases, in the opinion of counsel, will be
                           resolved through the bankruptcy proceedings. The
                           ultimate aggregate resolutions of the lawsuits, in
                           management's opinion, will not have a material
                           adverse effect on the Company's financial condition.

                           The Company is not able to estimate its potential
                           liability in any of the above actions although
                           management believes that these matters are without
                           merit, and accordingly, no reserves for potential
                           liabilities have been provided for either of these
                           actions.

                                      F-28

<PAGE>


NOTE 12 -  SEGMENT INFORMATION.

                             The Company's operations are comprised of its
                 lighting manufacturing and power system equipment manufacturing
                 segments. Set forth below are sales, operating losses, research
                 and development costs, depreciation and identifiable assets of
                 the segments in thousands.


<TABLE>
<CAPTION>
                                                         Power
                                          Lighting      Systems       Company
                                          --------      -------       -------
<S>                                          <C>         <C>           <C>
For the year ended March 31, 2001:
  Net sales                                  $  8        $6,068        $6,068
  Operating loss                              442         2,357         2,799
  Depreciation                                 -             60            60
  Research and development                    321           255           576
  Identifiable assets                         105         2,003         2,108

For the year ended March 31, 2000:
  Net sales                                  $ 35        $7,389        $7,424
  Operating loss                              745         2,415         3,160
  Depreciation                                 -            136           136
  Research and development                    516           300           827
  Identifiable assets                          84         3,138         3,222
</TABLE>

                                      F-29


<PAGE>


ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

         None.


                                   PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT.

DIRECTORS AND OFFICERS

         Listed below are the Company's executive officers and directors whose
terms expire at the next annual meeting of shareholders:

<TABLE>
<CAPTION>
                                                                                          DATE
                                                                            TERM OF   DIRECTORSHIP
NAME                             POSITION                          AGE   DIRECTORSHIP  COMMENCED
----                             --------                          ---   ------------  ---------
<S>                              <C>                               <C>        <C>    <C>
Primo Ianieri                    Director (Chairman)               66         (1)      April 1994
                                 & Secretary

Peter Bordes, Jr.                Director                          38         (1)       July 1995

Jonathan Scott Harris            Director, President and           44         (1)    October 2000
                                 Chief Executive Officer

Michael J. Smith                 Director, Chief Financial         41         (1)       July 1999
                                 Officer and Executive
                                 Vice President

Philip A. Pascarelli, Jr.        Director                          35         (1)    October 2000
</TABLE>

--------------------------------------------------------------------------------
All members of the Board of Directors serve for a one (1) year term or until
their successors shall have been appointed.

         Set forth below is a brief background of the executive officers and
directors of the Company, based on information supplied by them.

PRIMO IANIERI, 66, co-founded the Company in April 1994. He is the founder and
sole owner of Key International, Inc., and the Chairman of the Boards of
Directors of both the Company and Key International, Inc. He is a graduate of
Lehigh University where he received a Bachelor of Science degree in engineering
and business. He received a Masters Degree in Marketing from Farleigh Dickinson
University. In 1968, Mr. Ianieri and a partner formed Key International, Inc. to
fulfill a need in the pharmaceutical and food industries whereby process
equipment could be offered on a short cycle time in order for these companies to
enter the market on an accelerated basis.

PETER BORDES, JR., 38, became a director of the Company in 1995. In 1995, Mr.
Bordes became Principal of Mason Cabot, LLC, an investment banking and research
boutique. From November, 1994 through December 1995, Mr. Bordes was employed at
Stires and O'Donnell, Inc. Mr. Bordes also serves as a director of other
publicly held companies.

JONATHAN SCOTT HARRIS, 44, became a Director in October 2000, and President and
Chief Executive Officer of the Company in February 2000. Mr. Harris has
extensive management and supervisory experience in the technology sector,
including oversight of marketing and sales divisions and cost and inventory
control programs. Mr. Harris is a graduate of the Air Force Academy where he
received a Bachelor of Science degree in Electrical Engineering. Mr. Harris also
holds a Masters in Business Administration from Purdue University. Previously,
Mr. Harris served as Director of Operations for Bell Atlantic and as Vice
President of Operations for Mastec, a telecommunications and utility contractor.

                                      15


<PAGE>


MICHAEL J. SMITH, 41, became a Director of the Company in March 1999, and Chief
Financial Officer and Executive Vice President in February 2000. From January
25, 2000 to February 21, 2000, Mr. Smith served as President, Interim Chief
Executive Officer and Interim Chief Financial Officer. Mr. Smith has over
fourteen years of experience in the securities industry specializing in finance
for middle market and emerging growth companies. Previously, Mr. Smith served as
an investment banker for Brill Securities, a New York investment firm, as
President of Stanhope Capital, Inc., a New York venture capital firm, and as
Managing Director of Condor Ventures, Inc. a Connecticut based venture capital
firm. In addition, Mr. Smith has served as an outside business consultant to
numerous private emerging growth companies and presently serves on the board of
directors of TREEV, Inc. (Nasdaq: TREV), a provider of integrated document
management software solutions.

PHILIP A. PASCARELLI, JR., 35, became of Director of the Company in October
2000. Mr. Pascarelli has been in the securities industry for over eight years,
and is currently a Managing Director for Investment Banking at Brill Securities,
a New York investment firm. Mr. Pascarelli specializes in technology based
companies and consults in the areas of capital formation, joint ventures,
mergers and acquisitions. Mr. Pascarelli currently serves on the board of
directors of several private companies.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

            Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's officers and directors, and persons who own more than ten
percent of a registered class of the Company's equity securities, to file
reports of securities ownership and changes in such ownership with the
Securities and Exchange Commission (the "SEC"). Officers, directors and greater
than ten percent shareholders also are required by rules promulgated by the SEC
to furnish the Company with copies of all Section 16(a) forms they file.

         Based solely upon a review of the copies of such forms furnished to
the Company, the absence of a Form 3, 4 or 5 or written representations that
no Forms 5 were required, the Company believes that, during fiscal year 2001,
its officers, directors and greater than ten percent beneficial owners
complied with all applicable Section 16(a) filing requirements except as
follows: Peter Bordes, Jr., Michael J. Smith, Jonathan Scott Harris, Philip
A. Pascarelli, Jr., and Primo Ianieri each filed a Form 3 more than ten days
after the effective date of the Company's Form 10SB12G; the Company did not
receive copies of Section 16(a) forms from Horace T. Ardinger, Jr. and Robert
Smallwood. Mr. Smallwood ceased to be a director of the Company on January
29, 2001.

ITEM 10. EXECUTIVE COMPENSATION

         The following table sets forth certain summary information with respect
to the compensation paid to the Company's President and Chief Executive Officer
and top compensated officers of the Company for services rendered in all
capacities to the Company for the fiscal years ended March 31, 2000 and 2001:

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
     Name and               Fiscal Year
     Principal                Ended                                                          All Other
     Position               March 31,             Salary       Bonus        Options        Compensation
     --------               ---------             ------       -----        -------        ------------
<S>                            <C>               <C>            <C>         <C>                <C>
Scott Harris(1),               2001              $150,000       None          None             None
President and Chief            2000              $15,577        None        200,000            None
Executive Officer
</TABLE>

--------------------
         The Company had no other executive officers whose total annual salary
         and bonus exceeded $100,000 for such fiscal years.

         (1)   Mr. Harris commenced employment with the Company on February 21,
               2000. Pursuant to his employment contract with the Company, Mr.
               Harris is to receive an annual base salary of $150,000 to be
               augmented by certain bonus provisions. In addition, Mr. Harris
               was granted 200,000 options to purchase shares of Common Stock on
               or about April 5, 2001 and on each anniversary thereafter. The
               options will vest incrementally over a three year period
               subsequent to the date of each grant. For the full text of the
               contract, please see the Company's Form 10-SB filed March 9,
               2000.


                                      16

<PAGE>


ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

(a)   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

      The following table sets forth as of March 31, 2001; information
concerning the names, addresses, amount and nature of beneficial ownership and
percent of such ownership with respect to (1) each person, or group known to the
Company to be the beneficial owner of more than five percent (5%) of the
Company's Common Stock; (2) each officer and director of the Company; and (3)
all officers and directors of the Company as a group.

      Two companies affiliated with each other claim to hold warrants to
purchase 1,350,000 shares of the Company's Common Stock at an exercise price of
$2.01 per share. The Company disputes the validity of the warrants and is
litigating the matter. (see Legal Proceedings herein below and Note 11 to
Financial Statements)

<TABLE>
<CAPTION>
                                     Amount and
                                     Nature of
                                     Beneficial
Name and Address                     Ownership (1)          Percent of Class
----------------                     ----------             ----------------
<S>                                <C>                           <C>
Peter Bordes, Jr..................   3,163,887(2)                17.5%(3)
140 West 79 Street
Apartment 4B
New York, NY  10004

Jonathan Scott Harris.............           0(4)                 0.0%
c/o Elgin Technologies, Inc.
10 Columbia Drive
Amherst, NH 03031

Primo Ianieri.....................   3,315,685(5)                19.0%
c/o Key International, Inc.
480 Route 9
Englishtown, NJ  07726

Michael Smith......................     40,000(6)                 0.2%
c/o Elgin Technologies, Inc.
10 Columbia Drive
Amherst, NH 03031

Philip A. Pascarelli, Jr............   208,333(7)                 1.2%
c/o Elgin Technologies, Inc.
10 Columbia Drive
Amherst, NH 03031
-------------------------------------------------------------------------------------
All Officers and Directors

 as a Group (5 persons)............  6,727,905                   37.3%(3)
-------------------------------------------------------------------------------------

Horace T. Ardinger, Jr............. 55,871,774(8)                79.5%(9)
9040 Governor's Row
Dallas, TX 75356

Robert C. Smallwood................  1,406,695                    8.1%
751 Miller Drive, S.E.
Leesburg, VA  22075
</TABLE>

---------------------
(1)  In accordance with the rules of the Securities and Exchange Commission,
amounts include shares of Common Stock issuable upon the exercise of warrants
and/or other convertible securities currently exercisable, or exercisable or
convertible within sixty (60) days.

(2)  Includes 90,000 shares and 571,887 cashless warrants to purchase shares
of the Company's Common Stock held by Mason Cabot Holdings, Ltd., of which Mr.
Bordes is a principal.

     Includes 150,000 shares held by Mr. Bordes' father's estate.


                                      17

<PAGE>

     Includes 152,000 shares held by Greater Media, Inc., of which Mr. Bordes'
father was a control person.

(3)  Percentage is based on 18,035,187 shares of Common Stock which would be
the total number of shares outstanding upon the conversion of certain warrants
held by Mason Cabot Holdings, Ltd. Mr. Bordes' present ownership of Common Stock
issued and outstanding is 2,592,000 shares or 14.8%.

(4)  Pursuant to the terms of Mr. Harris' employment agreement, Mr. Harris was
granted 200,000 options to purchase shares of Common Stock on or about April 5,
2001 and will be granted an equal number of options on each anniversary thereof.
The options will vest incrementally over a three year period subsequent to the
date of each grant.

(5)  Includes 95,586 shares held by Mr. Ianieri's children.
     Includes 299,510 shares Mr. Ianieri holds in nominee for William Mosconi.

(6)  Includes 30,000 shares held by Go Fish, of which Mr. Smith is a control
person.

(7)  Includes 45,000 shares held by Mr. Pascarelli's father.

(8)  Includes 250,000 shares held by Mr. Ardinger's wife.
     Includes a Secured Note Payable (as amended) (the "Note") issued by the
Company, which as of March 31, 2001 totaled $9,225,000. The Note is convertible
at any time, at the holder's option, into shares of the Company's Common Stock
at $0.55 per share for $4,225,000 of the obligation, $0.20 per share for
$1,050,000 of the obligation, $0.14 per share for $250,000 of the obligation,
and $0.10 per share for $3,700,000 of the obligation.

     In connection with loans he has made to the Company, Mr. Ardinger holds
534,000 warrants to purchase shares of the Company's Common Stock at $0.55 per
share and 300,000 warrants to purchase shares of the Company's Common Stock at
$3.00 per share.

(9)  Percentage is based on 70,251,741 shares of Common Stock which would be the
total number of shares outstanding upon the conversion by Mr. Ardinger of
certain warrants, as well as the full conversion of that certain Secured Note
Payable. Mr. Ardinger's present ownership of Common Stock issued and outstanding
is 3,083,333 shares or 17.7%.

(b)   CHANGES IN CONTROL.

      NONE

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

RELATED TRANSACTIONS

         As discussed under Part II, Items 5, 6 and 7, and Part III, Item 11,
Horace T. Ardinger is currently the chief source of operating capital for the
Company. He has invested in the Company through a number of loans and stock
purchases. In connection with these loans and investments, the Company has
entered into the Ardinger Credit Documents pursuant to which Mr. Ardinger has,
as of March 31, 2001, the ability to convert the principal sum of Nine Million
Two Hundred Twenty Five Thousand Dollars ($9,225,000) in debt into equity,
which would result in his beneficial ownership of 79.5% of the outstanding
shares of the Company's Common Stock. As discussed elsewhere in this Form
10-KSB, Mr. Ardinger holds security interests in substantially all the assets
of the Company. Mr. Ardinger also has the right to have himself or his
designee elected to one (1) seat on the Board of Directors of the Company.

         Mr. Ardinger purchased in the ordinary course of business, lighting
products from the Company to be used in a Company testing facility. The
transaction is valued at under $10,000.

         Peter Bordes, Jr., a director of the Company, is a principal in Mason
Cabot Holdings, Ltd., an investment banking firm which has arranged a series of
private placements of subordinated debt through convertible notes and cashless
warrants by the Company which raised a total of Eleven Million, Two Hundred
Three Thousand Dollars ($11,203,000).

         The Company presently owes $106,000 to Key International, Inc. in
connection with loans and services rendered to the Company. Primo Ianieri, the
Chairman of the Board of Directors of the Company, is President and Chief
Executive Officer of Key International, Inc.


                                      18

<PAGE>


ITEM 13. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K.

         (a) ITEMS FILED AS PART OF REPORT

                  1.  Financial Statements

                  The financial statements of the Company as set forth in the
                  Index to Consolidated Financial Statements under Part II, Item
                  8 of this Form 10-KSB are hereby incorporated by reference.

                  2.  Exhibits

                  The exhibits listed under Item 13(c) are filed as part of this
                  Form 10-KSB.

         (b) REPORTS ON FORM 8-K

                       The Company filed a current report on Form 8-K dated
                       February 13, 2001, to report under Item 5 (Other Events)
                       that:

                           1.       The Company's Board of Directors had voted
                                    to approve an issuance of 25,313 warrants to
                                    certain holders of convertible subordinated
                                    notes who agreed to extend the maturity date
                                    of their Notes to January 2, 2002.

                           2.       The Company's shareholders' at the annual
                                    shareholders' meeting approved an amendment
                                    to the Company's Certificate of
                                    Incorporation to increase the number of
                                    authorized shares of Common Stock from Sixty
                                    Million (60,000,000) shares to One Hundred
                                    Million (100,000,000) shares and that the
                                    shareholders elected five directors: Peter
                                    Bordes, Jr., Jonathan Scott Harris, Primo
                                    Ianieri, Philip A. Pascarelli, Jr., and
                                    Michael J. Smith, to serve as Directors of
                                    the Company for terms expiring in 2002.

         (c) EXHIBITS

<TABLE>
<CAPTION>
             EXHIBIT
             NUMBER  NOTES    DESCRIPTION
             ------  -----    -----------
             <S>     <C>      <C>
              3.1    10-SB*   Articles of Incorporation and amendments
                              thereto

              3.2    10-SB*   By-Laws

              9.1    10-SB*   Stockholders Agreement dated as of October
                              10, 1997 by and among Primo Ianieri, Richard
                              L. Audet, Dianne Toner, Michael Ianieri,
                              Deborah Antipin and Valerie Ianieri.

              9.2    10-SB*   Voting Agreement dated as of April 1, 1998
                              by and among Elgin e2, Inc., Mason Cabot
                              Holdings, Inc., Horace T. Ardinger, Jr.,
                              Primo Ianieri, Peter Bordes and their
                              spouses.

              10.1   10-SB*   Secured Revolving Credit Agreement dated as
                              of November 13, 1998 by and between Elgin
                              Technologies, Inc. and Horace T. Ardinger,
                              Jr.

              10.2   10-SB*   Convertible Revolving Promissory Note dated
                              as of November 13, 1998, made by Elgin
                              Technologies, Inc. in favor of Horace T.
                              Ardinger, Jr.
</TABLE>


                                      19

<PAGE>


<TABLE>
             <S>     <C>      <C>
              10.3   10-SB*   Agreement dated as of January 25, 2000 by
                              and between William Mosconi and Elgin
                              Technologies, Inc., e2 Electronics, Inc.,
                              Logic Laboratories, Inc., Warren Power
                              Systems, Inc., and William Mosconi,
                              concerning the resignation of William
                              Mosconi.

              10.4   10-SB*   Employment Agreement dated as of February
                              21, 2000 by and between Jonathan Scott Harris and
                              Elgin Technologies, Inc.

              21     00/K**   List of Subsidiaries of the Registrant.
</TABLE>

------------------
*SEE Form 10SB12G filed with the Securities and Exchange Commission March 9,
2000.
**SEE Form 10KSB filed with the Securities and Exchange Commission on July
14, 2000.


                                      20

<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.

ELGIN TECHNOLOGIES, INC.
    (Registrant)


Date: July 13, 2001


By:   /s/ MICHAEL J. SMITH
      --------------------
      Name:  MICHAEL J. SMITH
      Title:  EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER

                                      21