UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
(Mark One)
For the quarter ended June 28, 2002
x		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
		For the quarterly period ended January 2, 2004
[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~For the~~or ~~transition period from~~ to

Commission File Number: 33-96858-01		Commission File Number: 33-96858
COMMUNICATIONS & POWERINDUSTRIES HOLDINGCORPORATION		COMMUNICATIONS & POWERINDUSTRIES, INC.
(Exact name of registrant as specified in its charter)		(Exact name of registrant as specified in its charter)
Delaware(State of Incorporation)		Delaware(State of Incorporation)
77-0407395(I.R.S. employer identification number)		77-0405693(I.R.S. employer identification number)
811 Hansen WayPalo Alto, California 94303-1110(650) 846-2900 (Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)		811 Hansen WayPalo Alto, California 94303-1110 (650) 846-2900 (Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Securities registered pursuant to Section 12(b) of the Act:		Securities registered pursuant to Section 12(b) of the Act:
None		None
Securities registered pursuant to Section 12(g) of the Act:		Securities registered pursuant to Section 12(g) of the Act:
None		None


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

		For the transition period from ________ to ________

Indicate by check mark whether each 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 [ ].


Commission file number: 33-96858-01		Commission file number: 33-96858
COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION		COMMUNICATIONS & POWER INDUSTRIES, INC.
(Exact Name of Registrant as Specified in Its Charter)		(Exact Name of Registrant as Specified in Its Charter)
Delaware		Delaware
(State or Other Jurisdiction of Incorporation or Organization)		(State or Other Jurisdiction of Incorporation or Organization)
77-0407395		77-0405693
(I.R.S. Employer Identification No.)		(I.R.S. Employer Identification No.)
811 Hansen Way		811 Hansen Way
Palo Alto, California 94303-1110		Palo Alto, California 94303-1110
(650) 846-2900		(650) 846-2900
(Address of Principal Executive Offices and Telephone Number, Including Area Code)		(Address of Principal Executive Offices and Telephone Number, Including Area Code)

Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes o No x

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding for each of the Registrant’s classes of Common Stock, as of the latest practicable date: Communications & Power Industries Holding Corporation: ~~4,908,172~~100 shares of Common Stock, $.01 par value, at ~~July~~ February 316, ~~2002~~2004. Communications & Power Industries, Inc.: 1 share of ~~Common~~ Common Stock, $.01 par value, at ~~July~~February 316, ~~2002~~2004.

TABLE OF CONTENTS

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
PART I: FINANCIAL STATEMENTS
		Consolidated Condensed Balance Sheets, June 28, 2002 and September 28, 2001
	ITEM 1: CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
		Consolidated Condensed Statements of Operations for the 13-week periods ended June 28, 2002 and June 29, 2001
		COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
		Consolidated Condensed Statements of Operations for the 39-week periods ended June 28, 2002 and June 29, 2001
			CONSOLIDATED CONDENSED BALANCE SHEETS
		Consolidated Condensed Statements of Cash Flows for the 39-week periods June 28, 2002 and June 29, 2001
			CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
COMMUNICATIONS & POWER INDUSTRIES, INC.
			CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
		Consolidated Condensed Balance Sheets, June 28, 2002 and September 28, 2001
		COMMUNICATIONS & POWER INDUSTRIES, INC.
		Consolidated Condensed Statements of Operations for the 13-week periods ended June 28, 2002 and June 29, 2001
			CONSOLIDATED CONDENSED BALANCE SHEETS
		Consolidated Condensed Statements of Operations for the 39-week periods ended June 28, 2002 and June 29, 2001
			CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
		Consolidated Condensed Statements of Cash Flows for the 39-week periods June 28, 2002 and June 29, 2001
			CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
		Notes to Consolidated Condensed Financial Statements
			NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
	ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
	ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
	ITEM 4: CONTROLS AND PROCEDURES
PART II: OTHER INFORMATION
SIGNATURES
EXHIBIT 10.11.1
Exhibit Index
EXHIBIT 10.12.1
EXHIBIT 3.1
EXHIBIT 10.13.1
EXHIBIT 4.1
EXHIBIT 10.14.1
EXHIBIT 4.2
EXHIBIT 99.1
EXHIBIT 10.1
EXHIBIT 99.2
EXHIBIT 10.2
EXHIBIT 99.3
EXHIBIT 10.3
EXHIBIT 99.4
EXHIBIT 10.4
EXHIBIT 10.5
EXHIBIT 31
EXHIBIT 32
EXHIBIT 99

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)


PART I: FINANCIAL INFORMATION
ITEM 1: CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
	COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
		Consolidated Condensed Balance Sheets, January 2, 2004 and October 3, 2003	2
		Consolidated Condensed Statements of Operations for the 13-week period ended January 2, 2004 and the 14-week period ended January 3, 2003	3
		Consolidated Condensed Statements of Cash Flows for the 13-week period ended January 2, 2004 and the 14-week period ended January 3, 2003	4
		Notes to Consolidated Condensed Financial Statements	8
	COMMUNICATIONS & POWER INDUSTRIES, INC.
		Consolidated Condensed Balance Sheets, January 2, 2004 and October 3, 2003	5
		Consolidated Condensed Statements of Operations for the 13-week period ended January 2, 2004 and the 14-week period ended January 3, 2003	6
		Consolidated Condensed Statements of Cash Flows for the 13-week period ended January 2, 2004 and the 14-week period ended January 3, 2003	7
		Notes to Consolidated Condensed Financial Statements	8
ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			15
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			25
ITEM 4: CONTROLS AND PROCEDURES			25
PART II: OTHER INFORMATION			26
SIGNATURES			28

PART I: FINANCIAL INFORMATION
ITEM 1: CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
	COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
		Consolidated Condensed Balance Sheets, June 28, 2002 and September 28, 2001	2
		Consolidated Condensed Statements of Operations for the 13-week periods ended June 28, 2002 and June 29, 2001	3
		Consolidated Condensed Statements of Operations for the 39-week periods ended June 28, 2002 and June 29, 2001	4
		Consolidated Condensed Statements of Cash Flows for the 39-week periods June 28, 2002 and June 29, 2001	5
		Notes to Consolidated Condensed Financial Statements	10
	COMMUNICATIONS & POWER INDUSTRIES, INC.
		Consolidated Condensed Balance Sheets, June 28, 2002 and September 28, 2001	6
		Consolidated Condensed Statements of Operations for the 13-week periods ended June 28, 2002 and June 29, 2001	7
		Consolidated Condensed Statements of Operations for the 39-week periods ended June 28, 2002 and June 29, 2001	8
		Consolidated Condensed Statements of Cash Flows for the 39-week periods June 28, 2002 and June 29, 2001	9
		Notes to Consolidated Condensed Financial Statements	10
ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			13
PART II: OTHER INFORMATION			21
SIGNATURES			22

- 1 -

-1-

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands-unaudited)

		June 28,			September 28,
		January 2,			October 3,
		2002			2001
		2004			2003
ASSETS
Current Assets
	Cash and cash equivalents	$	238,~~459~~067		$	233,~~903~~751
	Accounts receivable, net		3635,~~686~~255			4633,~~738~~128
	Inventories		4336,~~959~~380			5737,~~678~~358
	Deferred taxes		876			3,500
	Other current assets		2,191			2,210
	Other current assets		2,192			2,241
Total current assets			111,893			106,447
Total current assets			86,172			113,060
Property, plant, and equipment, net			51,834			52,947
Property, plant, and equipment, net			57,267			62,698
Goodwill			19,149			19,149
Goodwill and other intangibles, net			23,132			23,452
Intangibles, net			1,045			1,140
Debt issue costs, net			31,~~649~~940			42,~~857~~285
Total assets		$	~~170~~185,~~220~~861		$	~~204~~181,~~067~~968
LIABILITIES, PREFERRED STOCK ANDSTOCKHOLDERS’ DEFICIT
Current Liabilities
	Revolving credit facility	$	7,685		$	21,293
	Senior subordinated notes	$	26,000			—
	Current portion of capital leases		151			919
	Mortgage financing		17,500			17,500
	Mortgage financing		17,750			18,000
	Accounts payable		12,876			15,624
	Senior term loan		—			20,000
	Accrued expenses		21,126			21,445
	Accounts payable		13,274			14,729
	Product warranty		6,130			5,401
	Accrued expenses		20,778			17,859
	Income taxes payable		6,132			3,584
	Product warranty		4,467			4,225
	Accrued dividends payable		17,058			15,449
	Income taxes payable		3,034			407
	Advance payments from customers		8,961			10,203
	Accrued dividends payable		8,183			4,387
Total current liabilities			115,783			89,206
	Advance payments from customers		9,567			9,193
Senior subordinated notes			74,000			100,000
Total current liabilities			84,889			111,012
Total liabilities			189,783			189,206
Senior subordinated notes			100,000			100,000
Senior Redeemable Preferred Stock of CPI			28,960			28,907
Obligations under capital leases			—			90
Junior Preferred Stock of CPI			30,349			29,300
Total liabilities			184,889			211,102
Senior Redeemable Preferred Stock of Subsidiary			28,640			28,479
Junior Preferred Stock of Subsidiary			24,567			22,094
Commitments and contingencies
Stockholders’ Deficit
	Common stock		4950			4950
	Additional paid-in capital		1921,~~111~~519			1921,~~111~~519
	Accumulated deficit		(85,823	)		(75,587	)
	Deferred compensation		(1,195	)		(1,289	)
	Stockholder loans		(1,213	)		(1,181	)
	Accumulated deficit		(82,341	)		(84,469	)
Net stockholders’ deficit			(67,876	)		(57,608	)
	Stockholder loans		(1,264	)		(1,256	)
Total liabilities, preferred stock and stockholders’ deficit		$	170,220		$	204,067
Net stockholders’ deficit			(63,231	)		(65,445	)
Total liabilities, preferred stock and stockholders’ deficit		$	185,861			181,968

See accompanying notes to the unaudited consolidated condensed financial statements.

- 2 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (in thousands —- unaudited)

			13-Week		~~13-Week~~		14-Week		~~13-Week~~
			period ended		~~period ended~~		period ended		~~period ended~~
					June 28,				June 29,
			January 2,				January 3,
					2002				2001
			2004				2003
Sales	~~Sales~~		$	68,313	$	~~64,792~~		61,626	$	~~72,724~~
Cost of sales	~~Cost of sales~~			47,141		~~48,128~~		44,936		~~57,071~~
Gross profit	~~Gross profit~~			21,172		~~16,664~~		16,690		~~15,653~~
Operating costs and expenses:	~~Operating costs and expenses:~~
	Research and development		~~Research and development~~	1,733		~~1,584~~		1,445		~~1,466~~
	Selling and marketing		~~Selling and marketing~~	3,624		~~4,097~~		3,924		~~4,648~~
	General and administrative		~~General and administrative~~	4,130		~~4,807~~		3,878		~~5,954~~
Total operating costs and expenses	~~Total operating costs and expenses~~			9,487		~~10,488~~		9,247		~~12,068~~
Operating income	~~Operating income~~			11,685		~~6,176~~		7,443		~~3,585~~
	Interest expense					(4,228	)			(5,208	)
Other income				—				267
	Income (loss) before taxes					1,948				(1,623	)
Interest expense				(3,559	)			(3,670	)
	Income tax expense					2,987				250
Income before taxes				8,126				4,040
	Net loss					(1,039	)			(1,873	)
Income tax expense				3,287				1,504
Preferred dividends:
Net income				4,839				2,536
		Senior redeemable preferred stock				1,310				1,115
Preferred dividends:
		Junior preferred stock				853				743
	Senior redeemable preferred stock			1,609				1,402
Net loss attributable to common stock					$	(3,202	)		$	(3,731	)
	Junior preferred stock			1,048				914
Net income attributable to common stock			$	2,182				220

See accompanying notes to the unaudited consolidated condensed financial statements.

- 3 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

CONSOLIDATED CONDENSED STATEMENTS OF ~~OPERATIONS~~CASH FLOWS (in thousands —- unaudited)

					39-Week				39-Week
			13-Week				14-Week
			period ended		~~period ended~~		period ended		~~period ended~~
					June 28,				June 29,
			January 2,				January 3,
					2002				2001
			2004				2003
	Sales				$	191,632			$	199,670
OPERATING ACTIVITIES
	Cost of sales					147,863				158,596
	Net cash provided by operating activities		$	6,194				13,328
	Gross profit					43,769				41,074
INVESTING ACTIVITIES
	Operating costs and expenses:
	Purchase of property, plant and equipment, net			(239	)			(263	)
			Research and development			4,356				4,395
FINANCING ACTIVITIES
			Selling and marketing			11,682				12,975
	Repayments on capital leases			—				(27	)
			General and administrative			13,950				16,216
	Payment of debt issue costs			—				(254	)
	Total operating costs and expenses					29,988				33,586
	Net repayment from bank overdraft			(1,639	)			(2,333	)
	Operating income					13,781				7,488
	Repayment of mortgage financing			—				(250	)
	Gain on sale of property, plant and equipment					—				887
	Net cash used in financing activities			(1,639	)			(2,864	)
	Interest expense					(12,767	)			(15,739	)
NET INCREASE IN CASH AND CASH EQUIVALENTS				4,316				10,201
	Income (loss) before taxes					1,014				(7,364	)
Cash and cash equivalents at beginning of period				33,751				2,724
	Income tax expense					4,820				750
Cash and cash equivalents at end of period			$	38,067				12,925
	Net loss					(3,806	)			(8,114	)
Preferred dividends:
		Senior redeemable preferred stock				3,796				3,233
		Junior preferred stock				2,473				2,155
Net loss attributable to common stock					$	(10,075	)		$	(13,502	)

See accompanying notes to the unaudited consolidated condensed financial statements.

- 4 -

COMMUNICATIONS & POWER INDUSTRIES, ~~HOLDING CORPORATION~~INC. and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (in thousands — unaudited)

		39-Week			39-Week
		period ended			period ended
		June 28,			June 29,
		2002			2001
OPERATING ACTIVITIES
	Net cash provided by (used in) operating activities	$	36,517		$	(3,984	)
INVESTING ACTIVITIES
	Proceeds from sale of property, plant and equipment		—			1,922
	Purchase of property, plant and equipment		(2,144	)		(3,784	)
	Net cash used in investing activities		(2,144	)		(1,862	)
FINANCING ACTIVITIES
	Repayments on capital leases		(858	)		(595	)
	Payment of debt issue costs		(101	)		(2,368	)
	Repayment of terminated revolving credit facility		—			(40,000	)
	Net (repayment) proceeds from revolving credit facility		(13,608	)		25,580
	Repayments on terminated senior term loans		—			(16,049	)
	(Repayment) proceeds from senior term loan		(20,000	)		20,000
	(Repayment) proceeds from mortgage financing		(250	)		18,000
	Net cash (used in) provided by financing activities		(34,817	)		4,568
NET DECREASE IN CASH AND CASH EQUIVALENTS			(444	)		(1,278	)
Cash and cash equivalents at beginning of period			2,903			4,766
Cash and cash equivalents at end of period		$	2,459		$	3,488

See accompanying notes to the unaudited consolidated condensed financial statements.

-5-

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands-unaudited)

		June 28,			September 28,
		January 2,			October 3,
		2002			2001
		2004			2003
ASSETS
Current Assets
	Cash and cash equivalents	$	238,~~459~~067		$	233,~~903~~751
	Accounts receivable, net		3635,~~686~~255			4633,~~738~~128
	Inventories		4336,~~959~~380			5737,~~678~~358
	Deferred taxes		876			3,500
	Other current assets		2,191			2,210
	Other current assets		2,192			2,241
Total current assets			111,893			106,447
Total current assets			86,172			113,060
Property, plant, and equipment, net			39,144			40,132
Property, plant, and equipment, net			43,725			48,672
Goodwill			19,149			19,149
Goodwill and other intangibles, net			23,132			23,452
Intangibles, net			1,045			1,140
Debt issue costs, net			31,~~558~~935			42,~~715~~263
Note receivable from parent			5,750			5,750
Total assets		$	~~162~~178,~~337~~916		$	~~195~~174,~~649~~881
LIABILITIES, REDEEMABLE PREFERRED STOCK AND DEFICIT
LIABILITIES, PREFERRED STOCK ANDSTOCKHOLDERS’ DEFICIT
Current Liabilities
	Revolving credit facility	$	7,685		$	21,293
	Senior subordinated notes	$	26,000			—
	Current portion of capital leases		151			919
	Accounts payable		12,876			15,624
	Senior term loan		—			20,000
	Accrued expenses		22,612			22,783
	Accounts payable		13,274			15,175
	Product warranty		6,130			5,401
	Accrued expenses		21,690			18,196
	Income taxes payable		6,429			3,838
	Product warranty		4,467			4,225
	Accrued dividends payable		17,058			15,449
	Income taxes payable		3,197			407
	Advance payments from customers		8,961			10,203
	Accrued dividends payable		8,183			4,387
Total current liabilities			100,066			73,298
	Advance payments from customers		9,567			9,193
Senior subordinated notes			74,000			100,000
Total current liabilities			68,214			93,795
Deferred income on sale-leaseback			6,781			6,887
Senior subordinated notes			100,000			100,000
Total liabilities			180,847			180,185
Deferred income on sale-leaseback			7,417			7,735
Senior Redeemable Preferred Stock			28,960			28,907
Obligations under capital leases			—			90
Total liabilities			175,631			201,620
Senior Redeemable Preferred Stock			28,640			28,479
Commitments and contingencies
Stockholders’ Deficit:
	Junior preferred stock		2			2
	Common stock		—			—
	Additional paid-in capital		4351,~~724~~807			4150,~~252~~758
	Accumulated deficit		(84,447	)		(74,523	)
	Deferred compensation		(1,195	)		(1,289	)
	Stockholder loans		(1,213	)		(1,181	)
	Accumulated deficit		(80,241	)		(82,426	)
Net stockholders’ deficit			(41,934	)		(34,450	)
	Stockholder loans		(1,264	)		(1,256	)
Total liabilities, senior redeemable preferred stock and stockholders’ deficit		$	162,337		$	195,649
Net stockholders’ deficit			(30,891	)		(34,211	)
Total liabilities, senior redeemable preferred stock and stockholders’ deficit		$	178,916			174,881

See accompanying notes to the unaudited consolidated condensed financial statements.

-6 5 -

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (in thousands —- unaudited)

			13-Week		~~13-Week~~		14-Week		~~13-Week~~
			period ended		~~period ended~~		period ended		~~period ended~~
					June 28,				June 29,
			January 2,				January 3,
					2002				2001
			2004				2003
Sales	~~Sales~~		$	68,313	$	~~64,792~~		61,626	$	~~72,724~~
Cost of sales	~~Cost of sales~~			47,141		~~48,128~~		44,936		~~57,071~~
Gross profit	~~Gross profit~~			21,172		~~16,664~~		16,690		~~15,653~~
Operating costs and expenses:	~~Operating costs and expenses:~~
	Research and development		~~Research and development~~	1,733		~~1,584~~		1,445		~~1,466~~
	Selling and marketing		~~Selling and marketing~~	3,624		~~4,097~~		3,924		~~4,648~~
	General and administrative		~~General and administrative~~	4,511		~~5,154~~		4,222		~~6,359~~
Total operating costs and expenses	~~Total operating costs and expenses~~			9,868		~~10,835~~		9,591		~~12,473~~
Operating income	~~Operating income~~			11,304		~~5,829~~		7,099		~~3,180~~
	Interest expense					(3,731	)			(4,530	)
Other income				—				267
	Income (loss) before taxes					2,098				(1,350	)
Interest expense				(3,078	)			(3,124	)
	Income tax expense					3,150				250
Income before taxes				8,226				4,242
	Net loss					(1,052	)			(1,600	)
Income tax expense				3,330				1,581
Preferred dividends:
Net income				4,896				2,661
		Senior redeemable preferred stock				1,310				1,115
Preferred dividends:
		Junior preferred stock				853				743
	Senior redeemable preferred stock			1,609				1,402
Net loss attributable to common stock					$	(3,215	)		$	(3,458	)
	Junior preferred stock			1,048				914
Net income attributable to common stock			$	2,239				345

See accompanying notes to the unaudited consolidated condensed financial statements.

-7 6 -

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

CONSOLIDATED CONDENSED STATEMENTS OF ~~OPERATIONS~~CASH FLOWS (in thousands —- unaudited)

					39-Week				39-Week
			13-Week				14-Week
			period ended		~~period ended~~		period ended		~~period ended~~
					June 28,				June 29,
			January 2,				January 3,
					2002				2001
			2004				2003
	Sales				$	191,632			$	199,670
OPERATING ACTIVITIES
	Cost of sales					147,863				158,596
	Net cash provided by operating activities		$	6,194				13,078
	Gross profit					43,769				41,074
INVESTING ACTIVITIES
	Operating costs and expenses:
	Purchase of property, plant and equipment, net			(239	)			(263	)
			Research and development			4,356				4,395
FINANCING ACTIVITIES
			Selling and marketing			11,682				12,975
	Repayments on capital leases			—				(27	)
			General and administrative			14,985				16,896
	Payment of debt issue costs			—				(254	)
	Total operating costs and expenses					31,023				34,266
	Net repayment of bank overdraft			(1,639	)			(2,333	)
	Operating income					12,746				6,808
	Net cash used in financing activities			(1,639	)			(2,614	)
	Gain on sale of property, plant and equipment					—				887
NET INCREASE IN CASH AND CASH EQUIVALENTS				4,316				10,201
	Interest expense					(11,257	)			(14,253	)
Cash and cash equivalents at beginning of period				33,751				2,724
	Income (loss) before taxes					1,489				(6,558	)
Cash and cash equivalents at end of period			$	38,067				12,925
	Income tax expense					4,983				750
	Net loss					(3,494	)			(7,308	)
Preferred dividends:
		Senior redeemable preferred stock				3,796				3,233
		Junior preferred stock				2,473				2,155
Net loss attributable to common stock					$	(9,763	)		$	(12,696	)

See accompanying notes to the unaudited consolidated condensed financial statements.

-8 7 -

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (in thousands — unaudited)

		39-Week			39-Week
		period ended			period ended
		June 28,			June 29,
		2002			2001
OPERATING ACTIVITIES
	Net cash provided by (used in) operating activities	$	36,166		$	(3,708	)
INVESTING ACTIVITIES
	Proceeds from sale of property to parent		—			17,250
	Proceeds from sale of property, plant and equipment					1,922
	Purchase of property, plant and equipment		(2,144	)		(3,784	)
	Net cash (used in) provided by investing activities		(2,144	)		15,388
FINANCING ACTIVITIES
	Repayments on capital leases		(858	)		(595	)
	Payment of debt issue costs		—			(1,894	)
	Repayments of terminated revolving credit facility		—			(40,000	)
	Net (repayments) proceeds from revolving credit facility		(13,608	)		25,580
	Repayments of terminated senior term loans		—			(16,049	)
	(Repayments) proceeds from senior term loan		(20,000	)		20,000
	Net cash used by financing activities		(34,466	)		(12,958	)
NET DECREASE IN CASH AND CASH EQUIVALENTS			(444	)		(1,278	)
Cash and cash equivalents at beginning of period			2,903			4,766
Cash and cash equivalents at end of period		$	2,459		$	3,488

See accompanying notes to the unaudited consolidated condensed financial statements.

-9-

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

NOTES TO CONSOLIDATED
CONDENSED FINANCIAL STATEMENTS
(unaudited)

1. Basis of Presentation

The accompanying unaudited consolidated condensed financial statements of Communications & Power Industries Holding Corporation (“Holding”) and Communications & Power Industries, Inc. (“CPI”, both companies together referred to as the “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in annual financial statements have been condensed or omitted and, accordingly, these financial statements should be read in conjunction with the financial statements and the notes thereto contained in the Company’s ~~September 28, 2001~~ Annual Report on Form 10-K. for the year ended October 3, 2003. Management believes that these unaudited interim condensed financial statements contain all adjustments, all of which are of a normal recurring nature, necessary to present fairly the financial position of the Company, and its results of operations and cash flows for the interim period presented. The results for the interim periods reported are not necessarily indicative of the results for the complete fiscal year ~~2002~~2004.

As allowed by Statement of Financial Accounting Standards (“SFAS”) No. 123, Accounting for Stock-Based Compensation,” as amended by SFAS No. 148, “Accounting for Stock-Based Compensation – Transition and Disclosure,” the Company applies the intrinsic value-based method of accounting prescribed by Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and related interpretations. Under this method, compensation expense is recorded only if the current market price of the underlying stock exceeded the exercise price at the measurement date. During fiscal year 2003, the Company issued stock options to employees which were subsequently determined to have been issued below the fair value of the stock on the date of grant. The compensation cost associated with the 2003 stock options is amortized as a charge against income under the caption “General and administrative” in the Consolidated Statement of Operations on a straight-line basis over the four year vesting period of the options. If compensation cost for the Company’s stock-based compensation plan had been determined consistent with SFAS No. 123, the Company’s net income would have changed to the pro forma amounts indicated below:

- 8 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC.
and subsidiaries
(A wholly owned subsidiary of Communications & Power Industries Holding Corporation)


		Holding					CPI

		13-Week			14-Week		13-Week			14-Week
		Period Ended			Period Ended		Period Ended			Period Ended
		January 2,			January 3,		January 2,			January 3,
(In thousands)		2004			2003		2004			2003

Net income as reported		$	4,839			2,536	$	4,896			2,661
Add:
	Stock-based compensation included in net income determined under intrinsic value method, net of tax		94			0		94			0
Deduct:
	Stock-based compensation determined under fair value based method, net of tax		(203	)		32		(203	)		32

Pro forma net income		$	4,730		$	2,568	$	4,787		$	2,693

2. Inventories

Inventories are stated at the lower of average cost or market (net realizable value). The main components of inventories are as follows:

		June 28,			September 28,
			January 2,			October 3,
		2002			2001
(In thousands)			2004			2003
		(In thousands)
Raw materials and parts			$	25,186			26,330
Raw materials and parts		$	32,339		$	40,776
Work in process				8,894			8,786
Work in process			8,004			14,874
Finished goods				2,300			2,242
Finished goods			3,616			2,028
	Inventories		$	36,380			37,358
Total inventories		$	43,959		$	57,678

3. ~~Supplemental~~Accrued ~~Cash Flow Information~~Warranty

	Holding				CPI
	39-Week Period Ended				39-Week Period Ended
	June 28,		June 29,		June 28,		June 29,
	2002		2001		2002		2001
	(In millions)
Cash Payments
Interest payments	$	9.0	$	11.6	$	8.3	$	10.9
Tax payments	$	0.7	$	0.6	$	0.7	$	0.6
Non-cash Financing
Unpaid cash dividends on senior preferred stock	$	8.2	$	3.2	$	8.2	$	3.2

The Company’s products are generally warranted for a variety of periods, typically one to three years or a predetermined product usage life. The Company assesses the adequacy of its preexisting warranty liabilities and adjusts the balance based on actual experience and changes in future expectations. The following table reconciles the changes in the Company’s accrued warranty:

-10-


		13-Week			14-Week
		Period Ended			Period Ended
		January 2,			January 3,
(In thousands)		2004			2003

Beginning accrued warranty		$	5,401			4,823
	Cost of warranty claims		(972	)		(1,300	)
	Accruals for product warranty		1,701			1,558

Ending accrued warranty		$	6,130			5,081

- 9 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

4. ~~Segments~~Supplemental ~~and~~Cash ~~Related~~Flow Information

The Company has two reportable segments: vacuum electronic devices (“VEDs”) and satcom equipment. The CEO, identified as the Chief Operating Decision Maker, evaluates performance and allocates resources based on the Company’s principal performance measure: earnings before income taxes, interest, depreciation and amortization (“EBITDA”).


	Holding				CPI

	13-week		14-Week		13-week		14-Week
	Period		Period		Period		Period
	Ended		Ended		Ended		Ended
	January 2,		January 3,		January 2,		January 3,
(In thousands)	2004		2003		2004		2003

Cash Payments
Interest payments	$	302	$	546	$	58	$	86
Tax payments	$	739	$	64	$	739	$	64
Non-cash Financing
Unpaid cash dividends on senior preferred stock	$	1,609	$	1,402	$	1,609	$	1,409

~~Summarized financial information concerning the Company’s reportable segments is shown in the following table~~5. ~~Included~~Segments ~~in the “Other” column is financial information for the Company’s Solid State Products Division, which did not meet the quantitative thresholds,~~ and ~~certain~~Related ~~unallocated corporate-level operating~~Information ~~expenses. Intersegment product transfers are recorded at cost.~~

			Satcom
(In thousands)	VED”s		Equipment			Other			Total
For the 13-Week Period Ended June 28, 2002:
Revenues from external customers	$	54,103	$	10,015		$	674		$	64,792
Intersegment product transfers		3,531		—			229			3,760
EBITDA — Holding		11,535		541			(3,135	)		8,941
EBITDA — CPI		11,535		541			(3,642	)		8,434
For the 13-Week Period Ended June 29, 2001:
Revenues from external customers	$	52,775	$	17,124		$	2,825		$	72,724
Intersegment product transfers		6,196		—			480			6,676
EBITDA — Holding		9,108		(260	)		(1,929	)		6,919
EBITDA — CPI		9,108		(260	)		(2,495	)		6,353
For the 39-Week Period Ended June 28, 2002:
Revenues from external customers	$	152,962	$	36,920		$	1,750		$	191,632
Intersegment product transfers		8,400		—			855			9,255
EBITDA — Holding		27,724		768			(5,890	)		22,602
EBITDA — CPI		27,724		768			(7,409	)		21,083
For the 39-Week Period Ended June 29, 2001:
Revenues from external customers	$	148,819	$	44,191		$	6,660		$	199,670
Intersegment product transfers		14,936		—			1,178			16,114
EBITDA — Holding		24,189		(921	)		(4,897	)		18,371
EBITDA — CPI		24,189		(921	)		(5,911	)		17,357

The Company has two reportable segments: vacuum electronic devices (“VEDs”) and satcom equipment. Management evaluates performance and allocates resources based on earnings before provision for income taxes, interest expense, depreciation and amortization (“EBITDA”).

~~-11-~~Summarized financial information concerning the Company’s reportable segments is shown in the following table. Intersegment product transfers are recorded at cost.


			Satcom
(In thousands)	VEDs		Equipment		Other			Total

For the 13-week Period Ended
January 2, 2004:
Revenues from external customers	$	58,147		9,719		447			68,313
Intersegment product transfers		3,293		—		—			3,293
EBITDA – Holding		14,393		228		(1,512	)		13,109
EBITDA – CPI		14,393		228		(2,018	)		12,603
For the 14-Week Period Ended
January 3, 2003:
Revenues from external customers	$	50,956		10,586		84			61,626
Intersegment product transfers		2,207		—		—			2,207
EBITDA – Holding		9,608		1,298		(1,479	)		9,427
EBITDA – CPI		9,608		1,298		(1,983	)		8,923

EBITDA represents earnings before provision for income taxes, interest expense, depreciation and amortization. Other companies may define EBITDA differently and, as a result, our measure of EBITDA may not be directly comparable to EBITDA of other companies. A reconciliation of EBITDA from

- 10 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

~~A reconciliation of EBITDA from~~ reportable segments to Income ~~(Loss)~~ before ~~Taxes~~ taxes is as follows:

	Holding					CPI
	13-Week Period Ended					13-Week Period Ended
	13-week		14-Week			13-week		14-Week
(In thousands)	June 28, 2002		June 29, 2001			June 28, 2002		June 29, 2001
	Period Ended		Period Ended			Period Ended		Period Ended
Segment EBITDA	$	8,941	$	6,919		$	8,434	$	6,353
	January 2,		January 3,			January 2,		January 3,
(In thousands)	2004		2003			2004		2003
Segment EBITDA	$	13,109	$	9,427		$	12,603	$	8,923
Less:
Depreciation and amortization		21,~~765~~424		31,~~334~~717			21,~~605~~299		31,~~173~~557
Interest expense		43,~~228~~559		53,~~208~~670			3,~~731~~078		43,~~530~~124
Income (loss) before taxes	$	1,948	$	(1,623	)		2,098	$	(1,350	)
Income before taxes	$	8,126	$	4,040		$	8,226	$	4,242

	Holding					CPI
	39-Week Period Ended					39-Week Period Ended
(In thousands)	June 28, 2002		June 29, 2001			June 28, 2002		June 29, 2001
Segment EBITDA	$	22,602	$	18,371		$	21,083	$	17,357
Less:
Depreciation and amortization		8,821		9,996			8,337		9,662
Interest expense		12,767		15,739			11,257		14,253
Income (loss) before taxes	$	1,014	$	(7,364	)	$	1,489	$	(6,558	)

Sales by geographic area to unaffiliated customers (based on the location of customer) are as follows:

	13-Week Period Ended				39-Week Period Ended
	13-Week		14-Week
(In thousands)	June 28, 2002		June 29, 2001		June 28, 2002		June 29, 2001
	Period Ended		Period Ended
United States	$	42,289	$	46,318	$	135,078	$	134,989
	January 2,		January 3,
All foreign countries		22,503		26,406		56,554		64,681
(In thousands)	2004		2003
Total Sales	$	64,792	$	72,724	$	191,632	$	199,670
United States	$	44,760		38,036
All foreign countries		23,553		23,590
Total sales	$	68,313		61,626

CPI ~~has~~had aone ~~single~~ customer, the US Government, that ~~accounts~~accounted for 10% or more of consolidated sales. Sales to this customer were $1415.20 million, ~~and~~or 22.0%, and $11.25 million, or 18.7%, of the Company’s consolidated sales for the 13-week period ended ~~June~~January 282, ~~2002~~2004 and ~~June 29, 2001, respectively. Sales to this customer were $34.4 million and $32.3 million of~~ the ~~Company’s consolidated sales for the 39~~14-week period ended ~~June 28, 2002 and June~~January 293, ~~2001~~2003, respectively. A substantial majority of these sales were VED segment products, but this customer also purchased satcom equipment products.

56. ~~Mortgage~~Recent ~~Refinancing~~Accounting Pronouncements

OnIn ~~June~~January 2003, the Financial Accounting Standards Board (the “FASB”) issued Interpretation No. 146, ~~2002~~“Consolidation of Variable Interest Entities”, ~~Holding’s~~which addresses ~~mortgage~~consolidation ~~financing~~by business enterprises of ~~$18.0M~~variable ~~was~~interest ~~refinanced.~~entities which ~~Under~~have one or both of the following characteristics: (1) The equity investment at risk is not sufficient to permit the ~~terms~~entity to finance its activities without support from other parties and (2) the equity investors lack one or more of the ~~refinancing,~~defined essential characteristics of a controlling financial interest. This Interpretation requires existing unconsolidated variable interest entities to be consolidated by their primary beneficiaries if the entities ~~loan~~do ~~was~~not ~~extended~~effectively ~~until~~disperse ~~June~~risks among the participating parties. This Interpretation applies immediately to variable interest entities created after January 131, 2003 and ~~the Company~~to ~~agreed~~variable tointerest ~~pay~~entities ~~two~~in ~~principal~~which ~~installments~~an ofenterprise obtains ~~$250,000~~an oninterest ~~June~~after that date. On October 19, ~~2002~~2003, FASB Staff Position ~~and~~FIN ~~December~~46-6, “Effective Date of FASB Interpretation No. 146, ~~2002~~Consolidation of Variable Interest Entities” was issued. ~~The~~This ~~mortgage~~delayed ~~bears~~the effective date of this Interpretation for variable interest atentities acreated ~~rate~~before ofFebruary 1, 2003 ~~LIBOR~~until ~~plus~~January 3, ~~4.25%.~~

-12 11 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

~~MANAGEMENT’S~~2004. The ~~DISCUSSION~~Company ~~AND~~has ~~ANALYSIS~~evaluated OFthe ~~FINANCIAL~~impact ~~CONDITION~~of ~~AND~~the ~~RESULTS~~provisions OFof Interpretation ~~OPERATIONS~~46 and it believes it will not have a material impact on the Company’s consolidated financial statements.

~~The~~In ~~following~~May ~~discussion~~2003, ~~reflects~~ the ~~condensed~~FASB ~~consolidated~~issued ~~results~~SFAS No. 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.” SFAS No. 150 ~~Communications~~requires &that ~~Power~~certain ~~Industries~~financial ~~Holding~~instruments ~~Corporation~~with characteristics of both liabilities and equity be classified as liabilities in statements of financial position. The financial instruments affected include mandatorily redeemable stock, ~~which~~certain ~~are~~financial ~~materially~~instruments that require or may require the issuer to ~~consistent~~buy back some of its shares in exchange for cash or other assets and certain obligations that can be settled with ~~those~~shares of ~~CPI~~stock. ~~except~~SFAS asNo. 150 ~~identified~~is effective ~~below~~for all financial instruments entered into or modified after May 31, 2003 and ~~should~~must be ~~read~~applied into existing financial instruments at the beginning of ~~conjunction~~the ~~with~~first fiscal period beginning after December 15, 2003 for non-public entities. The Company is currently analyzing this Statement and has not yet determined its impact on the ~~condensed~~Company’s consolidated financial ~~statements~~position ~~and~~or results ~~notes~~of operations. ~~thereto:~~

~~CRITICAL~~7. ~~ACCOUNTING~~Goodwill ~~POLICIES~~and Other Intangible Assets

~~Management is required to make judgements, assumptions and estimates in~~Goodwill ~~preparing its financial statements and related disclosures in conformity with~~ accounting principles generally accepted in the United States. The Company’s significant accounting policies are described in Note 2 to the Consolidated Financial Statements in the Annual Report on Form 10-K for the fiscal year ended September 28, 2001. The following critical accounting policies are those policies that management believes can affect its financial statements materially and involves subjective assumptions, judgements, or estimates.

~~Revenue~~As isof ~~recognized~~January 2, on2004 aand ~~sale~~October 3, to2003, athe ~~customer~~Company ~~when~~had ~~persuasive~~$19.1 million ~~evidence~~ of an ~~arrangement exists~~goodwill, ~~delivery~~$13.4 million of which has ~~occurred,~~been ~~the~~allocated ~~price~~to isthe ~~fixed~~VED orsegment ~~determinable,~~ and ~~collectibility is reasonably assured~~$5. ~~The Company monitors the~~7 ~~creditworthiness~~million of ~~its~~which ~~customers~~has ~~and~~been ~~does~~allocated ~~not~~to ~~record~~the ~~revenue~~satcom onequipment ~~sales if collection is not reasonably assured~~segment. ~~The~~There ~~Company’s products are generally~~were ~~subject~~no tochanges ~~warranties,~~in ~~and~~ the ~~Company~~carrying ~~provides~~amount ~~for the estimated future costs~~ of ~~repair,~~goodwill ~~replacement~~for ~~or customer accommodation at~~ the ~~time~~quarter ofended ~~sale as an~~January 2, ~~additional cost of product~~2004.

~~Inventories~~Intangible ~~are stated at the lower of average cost or market. The carrying~~Assets ~~value of inventory is reduced for estimated obsolescence or unmarketable~~ ~~inventory based upon assumptions about future demand and market conditions. If~~ actual demand were to be substantially lower than estimated, further write-downs could be required. While these estimates require management to make assumptions and judgements, management believes its understanding of the markets and customers the Company serves as well as the mature nature of many of the products the Company manufactures provides it with the ability to make reliable estimates. Management also evaluates the carrying value of inventory for lower of cost or market on an individual product or contract basis. Analyses are performed based on the estimated costs at completion and if necessary, a provision is recorded to properly reflect the product or contract at the lower of cost or net realizable value (selling price less estimated cost of disposal). If actual contract costs were to be substantially higher than estimated, further provisions could be required.

~~The~~As ~~Company~~of ~~reviews~~January 2, ~~long-lived~~2004 ~~assets~~and ~~for~~October 3, ~~impairment~~2003, ~~whenever~~the ~~events~~Company orhad ~~changes~~$1.9 million of inintangible ~~circumstances~~assets ~~indicate~~at ~~that~~cost, ~~the~~with ~~carrying~~accumulated ~~amount~~amortization of an$0.9 million ~~asset may not be~~and ~~recoverable~~$0.8 million, ~~Recoverability~~respectively. Amortization of ~~long-lived~~intangible assets isfor ~~measured~~the ~~by comparison of~~fiscal ~~its~~quarters ~~carrying~~ended ~~amount~~January 2, to2004 ~~future~~and ~~net~~January 3, ~~cash~~2003 ~~flows~~was ~~expected~~approximately ~~to be generated from the~~$0.1 ~~operation~~million ~~and~~each ~~sale~~quarter. ofAmortization ~~long-lived~~expense ~~assets.~~for Ifthese ~~such~~intangible assets ~~are~~is projected ~~considered~~ to be ~~impaired,~~ ~~the~~approximately ~~Company’s carrying value is reduced to its estimated fair value~~$0. ~~Adverse~~4 million ~~changes~~per inyear ~~the~~through ~~customers~~fiscal ~~and~~year ~~markets served by the Company could result in future impairments of long-lived assets~~2006.

~~-13-~~8. Redemption of 12% Senior Subordinated Notes of CPI

On December 4, 2003, CPI instructed the trustee under the indenture (“12% Indenture”) governing the 12% Senior Subordinated Notes due 2005 (“12% Notes”) to send a notice to all of the registered holders of the 12% Notes, notifying them that CPI had elected to redeem $26.0 million in principal amount of the 12% Notes on January 5, 2004, pursuant to and in accordance with the terms of the 12% Indenture.

On January 5, 2004, CPI redeemed $26.0 million in principal amount of the 12% Notes, pursuant to and in accordance with the terms of the 12% Indenture. The redemption occurred at a price equal to 101.5% of the principal amount of such notes plus accrued and unpaid interest to January 5, 2004. In connection with the redemption, CPI and Holding entered into an amendment to CPI’s secured credit facility (“Credit Facility”) that, among other things, permitted CPI to redeem up to an aggregate maximum amount of $30.0 million of the 12% Notes in any fiscal year. At the closing of the merger described in Note 9 below, CPI issued a notice of redemption for the remaining outstanding 12% Notes. The

- 12 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

~~Goodwill~~Company ~~represents~~has ~~the~~classified ~~excess of~~ the ~~purchase price over the fair value of the net assets acquired~~$26.0 million ~~The Company assesses the recoverability~~ of ~~the~~12% ~~carrying amount~~Notes ofredeemed ~~goodwill~~on ~~by determining whether the carrying amount of goodwill can~~January 5, be2004 ~~recovered~~as ~~through~~a ~~undiscounted~~current ~~net~~liability ~~cash~~in ~~flows of~~ the ~~acquired~~accompanying ~~operation~~consolidated ~~over the~~condensed ~~remaining amortization period. If determined to be impaired, the carrying~~balance ~~amount~~sheets isas ~~reduced to its estimated fair value which is based on an estimate~~ of ~~discounted~~ ~~future net cash flows. Adverse changes in the industries served by the Company~~January 2, ~~customer demand or other market conditions could result in future impairments of goodwill~~2004.

~~RESULTS~~9. ~~OF OPERATIONS~~Merger

~~The~~On ~~Company~~January 23, ~~serves~~2004, Holding completed the ~~communications,~~merger ~~radar,~~(“Merger”) ~~electronic~~of ~~countermeasures,~~CPI Merger Sub ~~industrial,~~Corp. ~~medical~~(“Merger Sub”) with and ~~scientific~~into ~~markets.~~Holding Inpursuant ~~addition,~~to the ~~Company~~terms ~~divides~~ of the Agreement ~~communications~~and ~~market~~Plan ~~into~~of ~~applications~~Merger ~~for~~(the ~~ground-based~~“Merger Agreement”), ~~satellite~~dated ~~uplinks for~~as ~~military~~of November 17, 2003, by and ~~commercial~~among ~~uses~~Holding, CPI Acquisition Corp. (“~~satcom~~Acquiror”), Merger Sub and ~~broadcast~~Green ~~sectors.~~Equity ~~The~~Investors ~~Company~~II, L.P., ~~defines~~as ~~and~~the ~~discusses~~representative ~~its~~of ~~orders~~the ~~and~~securityholders ~~sales~~of ~~trends~~Holding, byunder ~~the~~which ~~end~~Acquiror, Merger ~~markets~~Sub’s toparent ~~more clearly~~corporation ~~relate~~and ~~its~~a ~~business~~corporation tocontrolled ~~outside~~by ~~investors~~affiliates of The Cypress Group L.L.C. ~~Internally~~(collectively, ~~however~~“Cypress”), ~~the~~a New York-based private ~~Company~~equity isfirm, ~~organized~~agreed ~~into~~to ~~six~~acquire ~~operating~~Holding. ~~units~~In ~~that~~connection ~~are~~with ~~differentiated~~the ~~based~~Merger, onHolding ~~products~~and CPI refinanced all of their outstanding indebtedness. ~~Four~~As part of ~~these~~the refinancing, ~~operating~~CPI ~~units~~effected ~~comprise~~a covenant defeasance under the ~~Company’s~~12% ~~vacuum~~Indenture and ~~electronic~~elected ~~device~~to ~~(“VED”)~~redeem ~~segment.~~in ~~The~~full ~~Company~~the ~~also~~remaining ~~has~~$74.0 million aoutstanding ~~satellite~~aggregate ~~communications~~principal ~~equipment~~amount ~~unit,~~of ~~which~~the is12% aNotes ~~separate~~pursuant ~~segment,~~to ~~and~~the aterms ~~solid~~of ~~state~~the 12% Indenture. ~~products~~In ~~unit~~addition, ~~which~~CPI isterminated ~~not~~the ~~reported~~Credit asFacility aand ~~separate~~Holding ~~segment.~~paid ~~Segment~~off ~~data for~~all ~~VED~~amounts owing under, and ~~satcom~~terminated, ~~equipment~~the ~~segments~~loan ~~are~~agreement ~~included~~related into ~~Note~~the 4San Carlos Property. CPI also redeemed all of the ~~Notes~~outstanding shares of its 14% Junior Cumulative Preferred Stock and elected to redeem all of the outstanding ~~Consolidated~~shares ~~Condensed~~of ~~Financial~~its ~~Statements~~Series B 14% Senior Redeemable Exchangeable Cumulative Preferred Stock.

~~Orders~~In ~~during~~connection with the ~~third~~Merger, ~~quarter~~CPI entered into a $130.0 million credit agreement (“Credit Agreement”). This Credit Agreement consists of ~~Fiscal~~a ~~2002~~$40.0 million ~~were~~revolving commitment, with a sub-facility of $5515.20 million asfor ~~compared~~letters toof credit and $~~57.~~5.0 million for ~~the~~swingline ~~third~~loans ~~quarter~~(“Revolver”), ofwhich ~~Fiscal~~expires ~~2001.~~on January 23, ~~This~~2010, ~~decrease~~and ofa $290.3 0 million ~~for~~term ~~the~~loan ~~quarter~~(“Term ~~primarily~~Loan”), ~~reflects~~which ~~continued~~expires ~~weakness~~on July 23, in2010. The Term Loan requires 1.0% of the ~~commercial~~loan amount to be repaid ~~communications~~annually ~~market~~in ~~(down~~quarterly $installments 11of 0.625% beginning June ~~million)~~30, ~~offset~~2004 inand continuing ~~part~~for byfive ~~fluctuations~~years with the remainder due in equal quarterly ~~the~~installments ~~timing~~thereafter. ofThe ~~order~~Credit ~~receipts~~Agreement inis ~~other~~guaranteed ~~non-communication~~by ~~markets~~Acquiror, Holding ~~particularly~~and all of CPI’s domestic subsidiaries and collateralized with a ~~radar~~security agreement, ~~when~~which ~~compared~~includes toa ~~the~~security ~~third~~interest ~~quarter~~in ofcertain ~~Fiscal~~property ~~2001~~and fixtures.

~~Orders~~The ~~for~~Credit ~~the~~Agreement ~~first~~provides ~~nine~~for ~~months~~Revolver ofand ~~Fiscal~~Term ~~2002~~Loan ofborrowings ~~$191.9 million~~that ~~have declined~~will ~~approximately~~initially ~~$11.5 million~~bear orinterest ~~5.7%~~at ~~from~~a ~~the~~rate ~~$203.3 million~~equal into ~~the~~LIBOR ~~same~~plus ~~period of Fiscal 2001~~3.00% ~~The~~per ~~decrease~~annum ~~from Fiscal 2001 levels was expected and can be attributed primarily to~~ (the ~~decrease in orders in the commercial communications~~ ~~market~~3.00% ~~which~~being ~~were~~referred ~~down~~to ~~$20.5 million~~as ~~from~~ the ~~first~~“Applicable ~~nine~~LIBOR ~~months of Fiscal 2001~~Margin”), as ~~communications~~or ~~companies continue to delay capital spending. This situation is expected to continue into Fiscal 2003. Orders in~~ the ~~electronic~~Alternate ~~countermeasures~~Base ~~market~~Rate ~~decreased~~(“ABR”) byplus $2.~~5 million~~0% ~~from~~per annum; the ~~comparable~~ABR ~~period last~~is ~~year due primarily to~~ the ~~timing~~greater of ~~order releases from quarter to quarter. Industrial orders decreased $2.2~~(a) ~~million from~~ the ~~first nine months of~~Prime ~~Fiscal~~Rate ~~2001~~and ~~primarily as a result of weak economic conditions. Offsetting these decreases somewhat are orders in~~ (b) the ~~radar,~~Federal ~~medical~~Funds ~~and~~Rate ~~scientific~~plus ~~markets~~0. ~~There~~50%. isIn ~~strong~~addition ~~demand~~to ~~in radar market at this time; orders for the first nine~~customary ~~months~~fronting ofand ~~Fiscal~~administrative ~~2002~~fees ~~exceed~~under the ~~comparable~~Credit ~~period~~Agreement, ofCPI ~~Fiscal~~will ~~2001 by $4.5~~pay ~~million~~Letter ~~and~~of ~~the~~Credit ~~trend~~Participation isfees ~~expected~~equal to ~~continue into~~ the ~~fourth~~Applicable ~~quarter.~~LIBOR ~~Medical~~Margin per ~~orders~~annum ~~are~~on ~~$6.5 million higher than~~ the ~~prior~~average ~~year~~daily ~~due~~amount ~~to the receipt~~ of ~~large orders~~letter ~~for VED’s used in the treatment~~ of ~~cancer.~~credit ~~Although these orders reoccur annually~~exposure, ~~their timing was accelerated~~ and ~~their value has increased from the~~a ~~prior~~commitment ~~year.~~fee ~~Medical~~of ~~orders on an annual basis are expected to be consistent with Fiscal 2001~~0.50% ~~Scientific~~per ~~orders~~annum ~~have increased by $2.7 million~~ on ~~a year-to-date~~the ~~basis~~average ~~compared~~daily tounused ~~Fiscal~~amount ~~2001 due primarily to the receipt~~ of ~~the~~ ~~final~~revolving ~~phase on an order from a government research laboratory~~commitment. ~~Excluding this~~ ~~order, orders in the scientific~~

~~-14-~~The Credit Agreement contains a number of covenants that, among other things, restrict the ability of Acquiror, Holding, CPI and certain of its subsidiaries to sell assets; engage in mergers and acquisitions; pay dividends and distributions or repurchase their capital stock; incur additional indebtedness or issue equity interests; make investments and loans; create liens or further negative pledges on assets; engage in certain transactions with affiliates; enter into sale and leaseback transactions; change their business or ownership; amend agreements or make prepayments relating to subordinated indebtedness; amend or waive provisions of charter documents, agreements with respect to capital stock or any other document related to the Merger Agreement or related transaction documents in a

- 13 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

~~market~~manner ~~are~~that ~~expected~~is tomaterially beadverse ~~fairly~~to ~~consistent with~~the ~~Fiscal~~lenders; ~~2001 levels. Overall, incoming order levels fluctuate significantly on a quarterly basis~~ and ~~a particular quarter’s order rate may not be~~change ~~indicative~~their offiscal ~~future order levels~~year. InThese ~~addition,~~covenants ~~the Company’s sales~~ are ~~highly dependent~~subject ~~upon manufacturing scheduling, performance and shipments and, accordingly, it is not possible~~ to ~~accurately~~certain ~~predict when these orders will be recognized as sales~~exceptions.

AsIn ~~of June 28~~addition, ~~2002,~~ the ~~Company~~Credit ~~had~~Agreement ~~order~~requires ~~backlog~~CPI ofand ~~$149.0 million, representing~~its ~~approximately~~subsidiaries ~~seven months of sales, compared~~ to ~~order backlog of~~maintain ~~$160.7 million,~~the orfollowing ~~approximately~~financial ~~seven-and-~~covenants: a~~-half~~ ~~months~~minimum ofinterest ~~sales,~~coverage asratio; ofa ~~June~~maximum ~~29,~~total ~~2001.~~leverage ~~Order~~ratio; ~~backlog~~a atminimum ~~the~~fixed ~~end~~charge ofcoverage ~~the~~ratio; ~~third~~and ~~quarter~~a ~~also decreased slightly~~maximum ~~from~~capital ~~$151.5 million~~expenditures ~~at the end of Fiscal 2001~~limitation.

~~Sales~~In ~~for~~connection with the ~~third~~Merger, ~~quarter~~CPI ofissued ~~Fiscal~~an ~~2002~~aggregate ~~were~~principal ~~$64.8 million,~~amount ~~a decrease~~ of $7125.90 million, orof ~~10.9~~8%, ~~from~~Senior ~~the~~Subordinated ~~same~~Notes ~~period~~due in2012 ~~Fiscal~~(“8% ~~2001~~Notes”). ~~This~~CPI ~~decrease was~~is ~~driven~~required ~~primarily~~to bypay ~~lower~~interest ~~sales~~on in the ~~commercial~~8% ~~communications~~Notes ~~market.~~semiannually, ~~Sales~~beginning on August 1, ~~for~~2004. ~~the~~The ~~first~~indenture ~~nine~~governing ~~months~~the terms of ~~Fiscal~~the ~~2002~~8% ~~were~~Notes ~~$191.6 million,~~(the ~~down $~~“8~~.1 million~~% Indenture”), ~~from~~contains ~~$199.7 million~~restrictive inprovisions ~~the~~which, ~~comparable~~among ~~period~~other things, limit CPI and certain of ~~Fiscal~~its ~~2001.~~subsidiaries ~~This~~from ~~decrease~~incurring ~~can~~certain indebtedness, selling assets beor ~~attributed~~consolidating toor ~~lower~~merging ~~demand~~with inor ~~the~~into ~~commercial~~other ~~communications~~companies, ~~and~~paying ~~industrial~~dividends or ~~markets~~repurchasing ~~with~~or ~~sales~~redeeming ~~down~~capital ~~$11.1 million~~stock, making certain investments and entering $4into certain types of transactions with their affiliates.~~4 million~~ The payment of principal, ~~respectively~~premium and interest on, ~~from~~and other obligations evidenced by the 8% Notes is ~~comparable~~subordinated ~~period~~in right of ~~Fiscal~~payment, ~~2001.~~as ~~Offsetting~~set ~~this~~forth ~~decrease~~in ~~are~~the ~~sales~~8% Indenture, to the ~~radar,~~prior ~~medical~~payment ~~and~~in ~~scientific~~full ~~markets~~of ~~which~~all ~~have~~senior ~~increased~~debt by(as ~~$2.9 million~~defined in the 8% Indenture), ~~$1.4 million~~including ~~and~~indebtedness ~~$4.0 million~~under the Credit Agreement, ~~respectively~~whether ~~from~~outstanding on the date ~~first~~of ~~nine~~the ~~months~~8% ~~of Fiscal~~Indenture ~~2001~~or thereafter incurred. ~~Sales~~CPI’s inpayment obligations under the ~~radar~~8% Notes are jointly and ~~scientific~~severally ~~markets~~guaranteed ~~have~~by ~~benefited~~Acquiror, ~~from~~Holding ~~increased~~and ~~military~~all ~~and~~of ~~research~~CPI’s ~~spending~~domestic subsidiaries. ~~Sales~~The 8% Notes may be redeemed as described in, and subject to the ~~electronic countermeasures~~terms ~~market~~and ~~were~~conditions ~~down~~set $0forth in, the 8% Indenture.~~9 million~~ ~~from~~In addition, the ~~first~~8% ~~nine~~Indenture ~~months~~requires ofthe Company to make an offer ~~Fiscal~~to ~~2001~~purchase the 8% Notes in certain circumstances.

~~Gross margin increased 4.2% to 25.7% for the third quarter of Fiscal 2002, compared with the third quarter of Fiscal 2001. The gross margin also increased for the nine~~-~~month~~ ~~period~~14 ~~from 20.6% of sales in Fiscal 2001 to 22.8% of sales in Fiscal 2002. Gross margins were negatively effected in Fiscal 2001 by start~~-~~up costs on several new satcom products. In addition, margin fluctuations~~ ~~are expected due to the mix of products sold during any period.~~

Operating costs and expenses were $10.5 million, or 16.2% of sales, for the third quarter of Fiscal 2002 as compared to $12.1 million, or 16.6 % of sales, for the third quarter of Fiscal 2001. For the nine months ended June 28, 2002, operating costs and expenses decreased $3.6 million compared with a year ago from $33.6 million, or 16.8 % of sales, in Fiscal 2001 to $30.0 million, or 15.7% of sales, in Fiscal 2002. A portion of this decrease reflects a $1.3 million reduction in costs for the first nine months of Fiscal 2002 as compared to the comparable period of Fiscal 2001 which was associated with the relocation of the Satcom Division’s production from Palo Alto, California to the Company’s facility in Ontario, Canada. Fiscal 2001 operating costs also include $0.4 million for the consolidation of the Company’s administrative offices into a single building in Palo Alto. The remainder of the decrease reflects the Company’s continuing efforts to reduce costs and improve operating efficiency.

Earnings before interest, income taxes, depreciation and amortization (“EBITDA”)1 for the third quarter of Fiscal 2002 were $8.9 million, or 13.7% of sales, compared to $6.9 million, or 9.5% of sales, for the

1 EBITDA is presented because some investors may use it as a financial indicator of the ability to service or incur indebtedness. EBITDA should not be considered as an alternative to net earnings (loss), as a measure of operating results, cash flows or liquidity.

-15-

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

~~third~~ITEM ~~quarter of Fiscal 2001. EBITDA for the first nine months of Fiscal 2002 were $22.6 million, or 11.8% of sales, compared to $18.4 million, or 9.~~2%: ofMANAGEMENT’S ~~sales,~~DISCUSSION ~~for the~~AND ~~first~~ANALYSIS ~~nine~~OF ~~months~~FINANCIAL ofCONDITION ~~Fiscal~~AND ~~2001.~~RESULTS ~~This~~OF ~~increase in EBITDA can be~~OPERATIONS ~~attributed to the improved margins coupled with the impact of lower operating~~ ~~costs.~~

~~Income tax expense for the third quarter of Fiscal 2002 was $3.0 million~~Overview ~~compared to $0.3 million for the third quarter of Fiscal 2001. For the nine~~ ~~months ended June 28, 2002, the income tax expense was $4.8 million compared to~~ $0.8 million for the corresponding period of Fiscal 2001. The increase in income tax expense relates primarily to taxable income resulting from a timing difference in conjunction with the Satcom relocation to Canada.

~~Net~~The ~~loss~~following ~~was~~discussion ~~$1.0 million~~reflects ~~for~~ the ~~third~~condensed ~~quarter~~consolidated results of Communications ~~Fiscal~~& ~~2002~~Power ~~compared~~Industries toHolding ~~a net~~Corporation ~~loss~~(“Holding”), ofwhich ~~$1.9 million~~are materially ~~for~~consistent ~~the~~with ~~third~~those ~~quarter~~ of ~~Fiscal~~Communications ~~2001.~~& ~~For~~Power ~~the~~Industries, ~~nine~~Inc. ~~months ended June 28~~(“CPI”, ~~2002,~~both ~~the~~companies ~~net~~together ~~loss~~referred ~~was $3.8 million compared~~ to aas ~~net loss of $8.1 million for~~ the ~~corresponding~~“Company”), ~~period~~except ~~of Fiscal 2001. The decrease~~as inidentified ~~the~~below ~~net loss for both periods resulted from improved gross margins, decreased operating~~ and ~~interest~~should ~~expenses~~be ~~partially~~read ~~offset by the increase~~ in ~~income~~ ~~tax~~conjunction ~~expense.~~with ~~Interest~~the ~~expense has decreased due to a reduction in~~condensed ~~outstanding~~consolidated ~~debt~~financial asstatements ~~well~~and asnotes ~~lower interest rates.~~thereto:

~~CPI’s~~The ~~operating~~Company ~~results~~is ~~differ~~a ~~slightly~~leading ~~from~~designer, ~~Holding~~manufacturer ~~due~~and toglobal amarketer ~~sale-leaseback~~of vacuum ~~transaction~~electron ~~between~~devices ~~CPI~~(“VEDs”), ~~and~~satellite ~~Holding~~communications ~~which~~amplifiers, ~~took~~medical ~~place~~x-ray generators inand ~~December~~other ~~2000.~~related Inproducts ~~the first~~for ~~nine~~critical ~~months~~defense ofand ~~Fiscal~~commercial applications. ~~2002,~~The ~~CPI~~Company’s ~~net~~defense ~~income~~applications ~~before~~include ~~taxes~~radar, ~~was $1.5~~electronic ~~million,~~warfare ~~which~~and ~~was~~communications ~~approximately~~end ~~$0.5 million~~markets ~~higher~~and ~~than~~our ~~Holdings’~~commercial ~~net~~applications ~~income~~include ~~before~~communications, ~~taxes~~medical, ofindustrial ~~$1.0 million.~~and Asscientific aend ~~result~~markets. Communications applications consist of ~~this~~applications ~~transaction,~~for ~~operating~~military ~~costs~~and commercial satellite ~~for~~communications ~~CPI~~uses ~~were~~and ~~approximately~~broadcast $1uses.~~0 million~~ ~~higher~~The ~~than~~Company ~~those~~defines ofand ~~Holding~~discusses ~~due to~~its ~~rental~~recorded ~~payments~~orders ~~paid~~and bysales ~~CPI~~trends toby ~~Holding~~these ~~for~~end ~~use~~markets ofin ~~the~~order ~~San~~to ~~Carlos~~more ~~facility~~clearly ~~offset~~relate byits ~~amortization~~business ofto ~~the~~outside ~~deferred~~investors. ~~gain~~Internally, onhowever, the ~~sales-leaseback~~Company ~~and~~is ~~additional~~organized ~~depreciation~~into onfive ~~the~~operating ~~San~~divisions ~~Carlos~~that ~~facility.~~are ~~Interest~~differentiated ~~expense,~~based ~~net,~~on ~~for~~products ~~CPI~~operating ~~was~~in ~~approximately~~two $1segments.~~5 million~~ ~~lower~~Four ~~than that~~ of ~~Holding.~~these ~~The~~operating ~~decrease primarily~~divisions ~~relates to~~ comprise the ~~fact that Holding~~Company’s ~~interest~~vacuum ~~expense~~electronic ~~includes~~device ~~interest paid~~(“VED”) onsegment. ~~the~~The ~~mortgage~~Company ~~financing~~also ofhas ~~the San Carlos facility combined with CPI’s~~a ~~interest~~satellite ~~income~~communications onequipment ~~a note receivable with Holding~~segment. ~~All~~Segment ~~other operations~~ data ~~for~~ ~~CPI~~ is ~~consistent~~included ~~with~~in ~~Holding’s~~Note ~~for~~5 of the ~~third~~Notes ~~quarter~~to ofConsolidated ~~Fiscal~~Condensed ~~2002~~Financial Statements.

~~FINANCIAL~~The ~~CONDITION~~Company’s fiscal years are the 52- or 53-week periods which end on the Friday nearest September 30. Fiscal year 2004 will be comprised of the 52-week period ending October 1, 2004, and fiscal year 2003 was comprised of the 53-week period ended October 3, 2003. The first quarter of fiscal year 2004 was comprised of 13 weeks, whereas the first quarter of fiscal year 2003 was comprised of 14 weeks.

~~Cash~~On ~~flows provided by operating activities for the first nine months of Fiscal 2002 were $36.5~~December ~~million~~4, ~~compared~~2003, ~~with~~CPI ~~cash~~elected ~~used~~to inredeem ~~operating activities of~~ $426.0 million ~~during the first nine months of Fiscal 2001. The positive cash flow was generated primarily from reductions~~ in ~~accounts~~aggregate ~~receivable and~~principal ~~inventories~~amount ~~from Fiscal 2001 balances. The Company began the year with significant amounts~~ of ~~accounts~~its ~~receivable~~12% ~~and~~Senior ~~inventory~~Subordinated ~~and~~Notes ~~has~~due ~~made substantial~~2005 ~~progress~~(“12% inNotes”) ~~reducing the balances by $10.1 million~~ and ~~$13.7~~on ~~million~~January 5, ~~respectively~~2004, ~~contributing~~CPI toredeemed ~~improved~~such ~~cash~~12% ~~performance~~Notes.

~~Investing~~On ~~activities~~January 23, ~~were~~2004, ~~comprised~~Holding completed the merger (“Merger”) of ~~investment~~CPI inMerger ~~property,~~Sub Corp. ~~plant~~(“Merger Sub”) with and into Holding pursuant to the terms of the ~~equipment~~Agreement ~~totaling~~and ~~$2.1 million~~Plan ~~for~~of Merger (the“Merger ~~first~~Agreement”), ~~nine~~dated ~~months~~as of ~~Fiscal~~November 17, 2003, ~~2002~~by and among Holding, CPI Acquisition Corp. (“Acquiror”), Merger Sub and ~~Purchases~~Green Equity Investors II, L.P., as the representative of ~~property~~the securityholders of Holding, ~~plant~~under which Acquiror, Merger Sub’s parent corporation and ~~equipment~~a corporation ~~decreased~~controlled ~~approximately~~by $1affiliates of The Cypress Group L.~~7 million~~L.C. (collectively, ~~from~~“Cypress”), a New York-based private equity firm, agreed to acquire Holding. In connection with the ~~comparable~~Merger, ~~period~~Holding and CPI refinanced all of ~~Fiscal~~their ~~2001~~outstanding indebtedness. As part of ~~which~~the ~~approximately~~refinancing, CPI effected a covenant defeasance under the indenture (“12% Indenture”) governing the 12% Notes and elected to redeem in full the remaining $174.0 million outstanding aggregate principal ~~can~~amount beof ~~attributed~~the 12% Notes pursuant to the ~~relocation~~terms of the ~~Company’s~~12% ~~satcom~~Indenture. ~~operations~~In addition, toCPI terminated its ~~facility~~ inexisting ~~Ontario,~~secured ~~Canada.~~credit ~~The~~facility ~~remaining~~and ~~decrease~~Holding ispaid off aall ~~result~~amounts ofowing under, and terminated, the ~~Company’s~~ ~~continued~~loan ~~focus~~agreement onrelated ~~cash~~to ~~management~~the San Carlos Property. ~~The~~CPI ~~Company~~also ~~currently~~redeemed ~~anticipates that~~all ~~capital~~of ~~expenditure~~the ~~requirements~~outstanding ~~for~~shares ~~Fiscal~~of ~~2002~~its ~~will~~14% Junior beCumulative ~~down~~Preferred Stock

-16 15 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

~~significantly~~and ~~from~~elected ~~the~~to ~~$5.8 million~~redeem ~~spent~~all inof ~~Fiscal~~the ~~2001~~outstanding shares of ~~which~~its ~~$4.4~~Series ~~million~~B 14% Senior Redeemable Exchangeable Cumulative Preferred ~~related~~Stock. See Note 9 of the Notes to ~~ongoing~~Consolidated ~~capital~~Condensed ~~improvement~~Financial ~~requirements~~Statements.

~~Financing~~Orders ~~activities~~recorded during the first ~~nine~~quarter ~~months~~ of ~~Fiscal~~fiscal ~~2002~~year 2004 were ~~related~~$73.4 ~~primarily~~million, as compared to ~~repayment~~$75.3 million offor the ~~Company’s~~first quarter of fiscal year 2003. The $201.09 million ~~senior~~or ~~term~~2.5% ~~loan~~decrease ~~and~~is not considered significant as order ~~repayments~~levels fluctuate from quarter to quarter based on the timing of when actual order receipts are received. The various increases and decreases within the markets discussed below are primarily related to timing rather than to any material changes in the Company’s ~~secured~~markets. ~~credit~~Electronic ~~facility~~warfare ~~(“Credit~~orders ~~Facility”)~~for the first quarter of fiscal year 2004 were $137.9 million, a decrease of $3.6 million from the first quarter of fiscal year 2003. The decrease is due primarily to timing of order releases from quarter to quarter by original equipment manufacturers and government logistics agencies, and annual orders in this market are expected to be consistent with fiscal year 2003 levels. Medical orders decreased by $201.0 million to $6.2 million ~~senior~~in ~~term~~the ~~loan~~first ~~was~~quarter ~~repaid~~of infiscal ~~June~~year ~~2002~~2004, ~~using~~as compared ~~approximately~~to the first quarter of fiscal year 2003, due principally to the timing of orders from established customers. Communications orders decreased $93.6 million to $19.4 million, as compared to the first quarter of fiscal year 2003, due primarily to a large order from a direct-to-home service supplier that did not reoccur in the first quarter of fiscal year 2004. However, the Company received another large order from a direct-to-home service supplier in January 2004. Industrial orders increased $3.4 million to $5.2 million in ~~available~~the ~~cash~~first ~~and~~quarter of ~~drawing~~fiscal year 2004 from $101.78 million in the comparable period of fiscal year 2003, due primarily to increased orders from ~~its~~the Company’s stocking ~~line~~distributor. Orders from this distributor were weak throughout fiscal year 2003 but are expected to return to normal levels in fiscal year 2004. Radar and scientific orders for the first quarter of ~~credit~~fiscal year 2004 increased by $1.4 million and $1.6 million, respectively, as compared to the first quarter of 2003, due principally to fluctuations in the timing of order receipts. Incoming order levels fluctuate significantly on a quarterly basis and a particular quarter’s order rate may not be indicative of future order levels. In addition, the Company’s sales are highly dependent upon manufacturing scheduling, performance and shipments and, accordingly, it is not possible to accurately predict when these orders will be recognized as sales.

Order backlog consists of firm orders for which goods and services are yet to be provided. As of ~~June~~January 282, ~~2002~~2004, the Company had an order backlog of $23178.5 1 million, ~~available~~representing ~~under~~approximately ~~its revolving~~eight ~~line~~months of ~~credit~~sales, ~~that~~compared ~~expires~~to ~~December~~an order backlog of $159.0 22million, ~~2004.~~representing ~~The~~approximately ~~following~~seven ismonths ~~a summary~~of sales, as of ~~certain~~January 3, ~~obligations~~2003. ~~and~~Order ~~commitments~~backlog ofincreased during the ~~Company~~first asquarter of ~~June~~fiscal year 2004 by $6.0 28million from $172.1 million at the end of fiscal year 2003. Although orders can be and sometimes are modified or terminated, the amount of ~~2002:~~modifications and terminations has historically not been material compared to total contract volume.

		Due in Fiscal Years
												2007 and
(In thousands)		2002		2003		2004		2005		2006		Thereafter		Total
Debt obligations, including capital lease obligations		$	7,805	$	17,781	$	—	$	100,000	$	—	$	—	$	125,586
Noncancellable operating leases			288		593		430		294		9		—		1,614
Senior Redeemable Preferred Stock			—		—		—		—		—		28,640		28,640
	Total cash obligations	$	8,093	$	18,374	$	430	$	100,294	$	9	$	28,640	$	155,840
Standby letters of credit		$	349	$	4,528	$	18	$	—	$	—	$	—	$	4,895

- 16 -

The Company’s debt obligations include mortgage financing of $17.8 million which was refinanced in June 2002. Under the terms of the refinancing, the loan was extended until June 1, 2003 and the Company agreed to pay two principal installments of $250,000 on June 1, 2002 and December 1, 2002. Management expects that cash to be generated by operations and borrowing under its Credit Facility in conjunction with either extending or finding alternative financing will allow it to meet this obligation. However, there can be no assurance that the combination of cash generated by operations, borrowing availability from the Company’s Credit Facility and additional collateral-based financing will be sufficient to meet the Company’s cash requirements. If the Company is unable to satisfy such cash requirements from these sources, the Company will adopt one or more alternatives, such as reducing or delaying capital expenditures, reducing discretionary costs, negotiating an increase to the Company’s borrowing capacity under its line of credit, and selling and leasing back its facility in San Carlos, California in a transaction with an outside party.

-17-

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

~~Market~~Critical ~~Risk~~Accounting Policies

Management is required to make judgments, assumptions and estimates in preparing its financial statements and related disclosures in conformity with accounting principles generally accepted in the United States. The Company’s significant ~~market~~accounting ~~risk~~policies ~~disclosures~~are ~~set~~described ~~forth~~in Note 2 to the Consolidated Financial Statements in ~~its~~the Annual Report on Form 10-K for the fiscal year ended ~~September~~October 283, ~~2001,~~2003. ~~have~~The ~~not~~following ~~changed~~critical accounting policies are those ~~significantly~~policies that management believes affect its more significant estimates and assumptions used in preparation of its consolidated financial statements.

Revenue Recognition

The estimated sales values of performance under certain contracts to commercial customers and U.S. Government fixed-price and fixed-price incentive contracts are recognized under the percentage of completion method of accounting. When applying the percentage of completion method, the Company relies on estimates of total expected contract revenue and costs. Recognized revenues and profit are subject to revisions as the contract progresses towards completion.

Allowance for Doubtful Accounts

The Company monitors the creditworthiness of its customers based on a variety of factors, including the length of time the receivables are past due, the financial health of the customer, economic conditions and historical experience. If collectibility is considered uncertain, then the Company will record a reserve to reduce the receivable to the amount considered collectable. If circumstances change, then further adjustments could be required.

Warranty Reserves

The Company’s products are generally subject to warranties, and the Company provides for the estimated future costs of repair, replacement or customer accommodation at the time of sale as an additional cost of sales. Management’s estimates are based on historical costs for warranty, and are adjusted when circumstances indicate that future costs are expected to vary from historical levels. If actual product failure rates or material usage incurred differs from the Company’s estimates, then revisions to the estimated warranty liability would be required.

Inventory Valuation

Inventories are stated at the lower of average cost or market (net realizable value). The carrying value of inventory is reduced for estimated obsolescence or unmarketability based upon assumptions about future demand, market conditions, product lifecycles and product pricing. If the Company’s assumptions were to be substantially different than estimated, further adjustments could be required. While these estimates require management to make assumptions and judgments, management believes its understanding of the markets and customers the Company serves, as well as the mature nature of many of the products the Company manufactures, provides it with the ability to make reliable estimates. Management also evaluates the carrying value of inventory for lower of cost or market on an individual product or contract basis. Analyses are performed based on the estimated costs at completion and if necessary, a provision is recorded to properly reflect the inventory value of the products or contracts at the lower of cost or net realizable value (selling price less estimated cost of disposal). If estimated costs, based on these analyses, for fixed-price contracts, which represent virtually all of the Company’s contracts, are significantly

- 17 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC.
and subsidiaries
(A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

higher than originally estimated, provisions are also required, and in such a case, the Company records a reserve that is charged to costs of goods sold.

Impairment of Long-Lived Assets

The Company reviews long-lived assets, excluding intangible assets that are covered by Statement of Financial Accounting Standards (“SFAS”) No. 142, “Goodwill and Other Intangible Assets”, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of long-lived assets is measured by comparison of its carrying amount to future net cash flows expected to be generated from the operation and sale of long-lived assets. If such assets are considered to be impaired, the Company’s carrying value is reduced to its estimated fair value with a charge to general and administrative at the time of the reduction. Adverse changes in the customers and markets served by the Company could result in future impairments of long-lived assets.

Goodwill Impairment

Goodwill represents the excess of the purchase price over the fair value of the net assets acquired. The Company performs an annual goodwill impairment test during the fourth quarter of each fiscal year, or earlier if an event or circumstance indicates that an impairment loss has occurred. Goodwill and certain other corporate assets and liabilities are assigned to the reporting units which are consistent with the Company’s operating divisions. The fair value of the reporting units are then compared to the carrying value to determine if there is any potential impairment. The process of evaluating potential impairment is subjective and requires judgments regarding revenue forecasts, discount rates, and weighted average cost of capital among other things. Adverse changes in the industries served by the Company, customer demand or other market conditions could result in future impairments of goodwill.

Results of Operations

The following table sets forth Holding’s historical results of operations as a percentage of sales for each of the periods indicated (both periods unaudited).

- 18 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC.
and subsidiaries
(A wholly owned subsidiary of Communications & Power Industries Holding Corporation)


		13-Week			14-Week
		period ended			period ended
		January 2,			January 3,
		2004			2003

Sales			100.0	%		100.0	%
Cost of sales			69.0			72.9

	Gross profit		31.0			27.1
Research and development			2.5			2.3
Selling and marketing			5.3			6.4
General and administrative (a)			6.0			6.3

Operating income			17.1			12.1
Other income			0.0			0.4
Interest expense			(5.2	)		(6.0	)

	Income before taxes		11.9			6.5
Income tax expense			4.8			2.4

	Net income		7.1	%		4.1	%

Other Data:
	EBITDA (b)		19.2	%		15.3	%

(a)		General and administrative expense includes foreign currency gain (loss).

(b)		EBITDA represents earnings before provision for income taxes, interest expense, depreciation and amortization. Other companies may define EBITDA differently and, as a result, our measure of EBITDA may not be directly comparable to EBITDA of other companies. Management believes that the presentation of EBITDA provides useful information to investors regarding our results of operations because they assist in analyzing and benchmarking the performance and value of our business. Although we use EBITDA as a financial measure to assess the performance of our business, the use of EBITDA is limited because it does not include certain material costs, such as interest and taxes, necessary to operate our business. EBITDA should be considered in addition to, and not as a substitute for, net income in accordance with GAAP as a measure of performance or net cash provided by operating activities in accordance with GAAP as a measure of liquidity. For reconciliation of EBITDA to Income before taxes, see Note 5 of the Notes to Consolidated Condensed Financial Statements.

Sales. Sales for the first quarter of fiscal year 2004 were $68.3 million, an increase of $6.7 million or 10.9%, from the same period in fiscal year 2003. Radar and electronic warfare sales were $25.7 million and $6.3 million for the first quarter of fiscal year 2004, respectively, which represents increases of $2.3 million and $1.8 million, respectively, from the first quarter of fiscal year 2003. These increases were due to increased spending by the Department of Defense for VEDs that are sold in these markets. Communications sales in the first quarter of fiscal year 2004 were $2.9 million lower than the prior year level due primarily to the timing of shipments from quarter to quarter and somewhat lower demand for communications products. The increased sales of products in the medical market of $1.7 million were due to increased demand for x-ray generators and VED products for the medical market. Increased sales in the industrial market of $2.2 million were due to higher demand for semiconductor products. Scientific sales were $3.0 million, an increase of $1.6 million from the first quarter of fiscal year 2003, due primarily to higher VED shipments to the Department of Energy.

Gross Margin. Gross profit was $21.2 million in the first quarter of fiscal year 2004, compared to $16.7 million for the same period in fiscal year 2003, an increase of $4.5 million or 26.9%. Higher shipment

- 19 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC.
and subsidiaries
(A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

volume improved gross profit by approximately $2.9 million. As a percentage of sales, gross margin was 31.0% in the first quarter of fiscal year 2004, compared to 27.1% for the same period in fiscal year 2003. This increase in gross profit was offset somewhat by unfavorable movements in foreign currency exchange rates, primarily due to the weakness of the U.S. dollar relative to the Canadian dollar. The first quarter of fiscal year 2004 gross margin is consistent with the average for the prior three quarters (31.8%), with improvement in margins beginning in the second quarter of fiscal year 2003. The increase in gross profit as a percentage of sales since the first quarter of fiscal year 2003 resulted primarily from gains in production efficiencies, increase in sales volume, resolution of technical problems for products and in manufacturing, favorable product mix, improved pricing for certain products and completion of contracts with lower pricing in prior periods.

Research and Development Expenses. Research and development expenses were $1.7 million, or 2.5% of sales, for the first quarter of fiscal year 2004, compared to $1.4 million, or 2.3% of sales, for the first quarter of fiscal year 2003. The increase is primarily attributable to additional development efforts on products for the radar and medical markets.

Selling, Marketing, General and Administrative Expenses. Selling, marketing, general and administrative expenses were $7.8 million, or 11.4% of sales, for the first quarter of fiscal year 2004, compared to $7.8 million, or 12.7% of sales, for the first quarter of fiscal year 2003. Selling and marketing expenses decreased by $0.3 million to $3.6 million from the first quarter of fiscal year 2003, due primarily to lower third party commission costs and the timing of expenses for promotion and advertising. General and administrative expenses increased by $0.3 million to $4.1 million from the first quarter of fiscal year 2003, due primarily to expenses associated with the Merger.

Other Income. Other income of $0.3 million in the first quarter of fiscal year 2003 represents the Company’s portion of the fair value of stock received from its life and disability insurance provider resulting from the insurance company’s 2001 demutualization.

EBITDA. EBITDA for the first quarter of fiscal year 2004 was $13.1 million, or 19.2% of sales, compared to $9.4 million, or 15.3% of sales, for the first quarter of fiscal year 2003. This increase in EBITDA is attributable primarily to the improvement in gross margin as discussed above. For reconciliation of EBITDA to Income before taxes, see Note 5 of the Notes to Consolidated Condensed Financial Statements.

Interest Expense. Interest expense was $3.6 million, or 5.2% of sales, for the first quarter of fiscal year 2004 as compared to $3.7 million, or 6.0% of sales, for the first quarter of fiscal year 2003. Interest expense did not change significantly from the first quarter of fiscal year 2003. However, interest expense will increase in the future as a result of the consummation of the Merger and the related transactions.

Income Tax Expense. Income tax expense for the first quarter of fiscal year 2004 was $3.3 million compared to $1.5 million for the first quarter of fiscal year 2003. The tax expense for the first quarter of fiscal year 2004 represents an effective tax rate of approximately 40% compared to an effective tax rate of approximately 37% for the first quarter of fiscal year 2003. The lower effective tax rate in fiscal year 2003 was due to the expected utilization of net operating loss carryforwards in fiscal year 2003.

Net Income. Income before taxes and preferred dividends was $8.1 million for the first quarter of fiscal year 2004 compared to income before taxes and preferred dividends of $4.0 million for the

- 20 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC.
and subsidiaries
(A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

corresponding period of fiscal year 2003, an increase of $4.1 million. Net income after taxes but before preferred dividends was $4.8 million for the first quarter of fiscal year 2004, an improvement of $2.3 million compared to net income after taxes but before preferred dividends of $2.5 million for the first quarter of fiscal year 2003.

Differences between Holding and CPI. CPI’s operating results differ slightly from Holding’s due to a sale-leaseback transaction between CPI and Holding which took place in December 2000. In the first quarter of fiscal year 2004, CPI’s net income before taxes was $8.2 million compared to Holding’s net income before taxes of $8.1 million. As a result of this transaction, operating costs for CPI were approximately $0.4 million higher than those of Holding due to rental payments paid by CPI to Holding for use of the San Carlos facility, offset by amortization of the deferred gain on the sale-leaseback and additional depreciation by Holding on the San Carlos facility. Interest expense for CPI was approximately $0.5 million lower than that of Holding. The decrease primarily relates to the fact that Holding’s interest expense includes interest paid on the mortgage financing of the San Carlos facility. In addition, interest income from Holding of $0.2 million related to an intercompany receivable included in CPI’s results is eliminated upon consolidation for Holding. All other operations data for CPI are consistent with Holding’s operations data for the first quarter of fiscal year 2004.

Financial Condition

Operating Activities. As of January 2, 2004, the Company’s cash and cash equivalents were $38.1 million, as compared to $33.8 million at October 3, 2003. In the first quarter of fiscal year 2004 and 2003, cash and cash equivalents generated by Holding and CPI are the same. In the first quarter of fiscal year 2003, the components of Holding’s cash flow and that of CPI’s differ by Holding’s $0.3 million repayment of mortgage refinancing that was funded by an intercompany payment from CPI.

In the first quarter of fiscal year 2004, the Company’s $4.3 million increase in cash and cash equivalents relates to $6.2 million of cash generated from operating activities, offset in part by $0.2 million net cash used in investing activities and $1.6 million used in financing activities. Cash provided by operating activities in the first quarter of fiscal year 2004 was generated primarily from $4.8 million in net income.

In the first quarter of fiscal year 2003, the Company’s $10.2 million increase in cash and cash equivalents relates to $13.3 million of cash generated from operating activities, offset in part by $0.3 million net cash used in investing activities and $2.9 million used in financing activities. Cash provided by the Company’s operating activities in the first quarter of fiscal year 2003 was generated primarily from $2.5 million in net income, $4.4 million in advance payments from customers, and $4.1 million in inventory reduction.

Investing Activities. Net cash used in investing activities in the first quarter of fiscal year 2004 and 2003 was for the purchase of property, plant and equipment of $0.2 million and $0.3 million, respectively. The Company expects the level of capital expenditures in fiscal year 2004 to be moderately higher than fiscal year 2003 levels; however, the Company will continue to manage capital expenditures consistent with business conditions. The Company’s continuing operations typically do not have large capital requirements. Capital expenditures are generally made to replace existing assets, increase productivity, facilitate cost reductions or meet regulatory requirements.

Financing Activities. For both Holding and CPI, net cash used in financing activities in the first quarter

- 21 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC.
and subsidiaries
(A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

of fiscal year 2004 was primarily for the $1.6 million repayment of bank overdraft. For Holding, net cash used in financing activities in the first quarter of fiscal year 2003 was primarily for the $2.3 million repayment of bank overdraft, $0.3 million payment of debt issue costs and $0.3 million repayment on the mortgage. For CPI, net cash used in financing activities in the first quarter of fiscal year 2003 was primarily for the $2.3 million repayment of bank overdraft and $0.3 million payment of debt issue costs.

CPI’s financial condition differs from that of Holding, as discussed above, in that CPI’s debt obligations and financing activities do not include $17.5 million of mortgage financing due in January 2004. This mortgage financing resulted from Holding’s purchase of the San Carlos facility from CPI in a sale-leaseback transaction which took place in December 2000. In connection with the sale-leaseback transaction, CPI entered into a non-cancelable lease with Holding for the San Carlos real property for a term of twenty years with a fixed annual rent of $2.45 million. The mortgage financing was repaid in full in connection with the Merger in January 2004.

In connection with the Merger, CPI entered into a $130.0 million credit agreement (“Credit Agreement”). This Credit Agreement consists of a $40.0 million revolving commitment, with a sub-facility of $15.0 million for letters of credit and $5.0 million for swingline loans (“Revolver”), which expires on January 23, 2010, and a $90.0 million term loan (“Term Loan”), which expires on July 23, 2010. The Term Loan requires 1.0% of the loan amount to be repaid annually in quarterly installments of 0.25% beginning June 30, 2004 and continuing for five years with the remainder due in equal quarterly installments thereafter. The Credit Agreement is guaranteed by Acquiror, Holding and all of CPI’s domestic subsidiaries and collateralized with a security agreement, which includes a security interest in certain property and fixtures. After giving effect to the Merger and related transactions, the Company has $90.0 million outstanding under the Term Loan and availability of $40.0 million under the Revolver.

The Credit Agreement provides for Revolver and Term Loan borrowings that will initially bear interest at a rate equal to LIBOR plus 3.00% per annum (the 3.00% being referred to as the “Applicable LIBOR Margin”), or the Alternate Base Rate (“ABR”) plus 2.0% per annum; the ABR is the greater of (a) the Prime Rate and (b) the Federal Funds Rate plus 0.50%. In addition to customary fronting and administrative fees under the Credit Agreement, CPI will pay Letter of Credit Participation fees equal to the Applicable LIBOR Margin per annum on the average daily amount of letter of credit exposure, and a commitment fee of 0.50% per annum on the average daily unused amount of revolving commitment.

The Credit Agreement contains a number of covenants that, among other things, restrict the ability of Acquiror, Holding, CPI and certain of its subsidiaries to sell assets; engage in mergers and acquisitions; pay dividends and distributions or repurchase their capital stock; incur additional indebtedness or issue equity interests; make investments and loans; create liens or further negative pledges on assets; engage in certain transactions with affiliates; enter into sale and leaseback transactions; change their business or ownership; amend agreements or make prepayments relating to subordinated indebtedness; amend or waive provisions of charter documents, agreements with respect to capital stock or any other document relating to the Merger Agreement or related transaction documents in a manner that is materially adverse to the lenders; and change their fiscal year. These covenants are subject to certain exceptions.

- 22 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC.
and subsidiaries
(A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

In addition, the Credit Agreement requires CPI and its subsidiaries to maintain the following financial covenants: a minimum interest coverage ratio; a maximum total leverage ratio; a minimum fixed charge coverage ratio; and a maximum capital expenditures limitation.

In addition to the Credit Agreement, and in connection with the Merger, CPI issued an aggregate principal amount of $125.0 million of Notes due 2012 (“8% Notes”). CPI is required to pay interest on the 8% Notes semiannually, beginning on August 1, 2004. The indenture governing the terms of the 8% Notes (“8% Indenture”) contains restrictive provisions which limit, among other things, CPI and certain of its subsidiaries from incurring certain indebtedness, selling assets or consolidating or merging with or into other companies, paying dividends or repurchasing or redeeming capital stock, making certain investments and entering into certain types of transactions with their affiliates. The payment of principal, premium and interest on, and other obligations evidenced by the 8% Notes is subordinated in right of payment, as set forth in the 8% Indenture, to the prior payment in full of all senior debt (as defined in the 8% Indenture), including indebtedness under the Credit Agreement, whether outstanding on the date of the 8% Indenture or thereafter incurred. CPI’s payment obligations under the 8% Notes are jointly and severally guaranteed by Acquiror., Holding and all of CPI’s domestic subsidiaries. The 8% Notes may be redeemed as described in, and subject to the terms and conditions set forth in, the 8% Indenture. In addition, the 8% Indenture requires the Company to make an offer to purchase the 8% Notes in certain circumstances.

Generally, there can be no assurance that the combination of cash generated by operations, borrowing availability from the Credit Agreement and additional financing will be sufficient to meet the Company’s cash requirements. If the Company is unable to satisfy such cash requirements from these sources, the Company may adopt one or more alternatives, such as reducing or delaying capital expenditures, reducing discretionary costs, and attempting to negotiate an increase to the Company’s borrowing capacity under its Credit Agreement, although there can be no assurances that such alternatives will be available on acceptable terms, if at all.

Recent Accounting Pronouncements

In ~~July~~January ~~2001~~2003, the Financial Accounting Standards Board (“FASB”) issued Interpretation ~~SFAS~~ No. ~~142~~ 46, “~~Goodwill~~Consolidation ~~and~~of ~~Other~~Variable ~~Intangible~~Interest ~~Assets.~~Entities”, ~~SFAS~~which addresses ~~No. 142~~consolidation ~~addresses~~by ~~financial accounting~~business ~~and~~enterprises ~~reporting~~of ~~for~~variable ~~acquired~~interest ~~goodwill~~entities which ~~and~~have ~~other~~one ~~intangible~~or ~~assets. SFAS~~both ~~No.~~of the following characteristics: (1) ~~142~~The ~~changes~~equity investment ~~the~~at ~~accounting~~risk ~~for~~is ~~goodwill~~not ~~from~~sufficient anto ~~amortization~~permit ~~method~~the entity to an ~~impairment-only~~finance ~~approach.~~its activities ~~Goodwill~~without ~~will~~support befrom ~~tested~~other ~~annually~~parties and ~~whenever~~(2) the equity investors lack ~~events~~one or ~~circumstances~~more ~~occur~~of ~~indicating~~the ~~that~~defined ~~goodwill~~essential ~~might~~characteristics beof ~~impaired~~a controlling financial interest. ~~Upon~~This Interpretation requires existing unconsolidated variable ~~adoption~~interest ofentities ~~SFAS~~to ~~No. 142,~~be ~~amortization~~consolidated ofby ~~goodwill~~their ~~recorded~~primary ~~for~~beneficiaries ~~business~~if the ~~combinations~~entities ~~will~~do ~~cease.~~not ~~Companies~~effectively ~~are~~disperse ~~required~~risks toamong ~~adopt~~the ~~SFAS~~participating Noparties. ~~142 for~~ ~~fiscal~~This ~~years~~Interpretation ~~beginning~~applies immediately to variable interest entities created after ~~December~~January 1531, ~~2001,~~2003 ~~but~~and ~~early~~to ~~adoption~~variable isinterest entities in which an enterprise ~~permitted.~~obtains ~~The~~an ~~Company~~interest ~~plans~~after tothat ~~adopt~~date. ~~this~~On ~~Statement~~October 9, ~~beginning~~2003, inFASB ~~the~~Staff ~~first~~Position ~~quarter~~FIN 46-6, “Effective Date of ~~Fiscal~~FASB ~~2003~~Interpretation ~~and~~No. 46, ~~therefore~~Consolidation ~~has~~of Variable ~~not~~Interest ~~yet~~Entities” ~~determined~~was issued. This delayed the ~~impact~~effective ondate ~~its~~of ~~consolidated~~this ~~financial~~Interpretation ~~position~~for orvariable ~~results~~interest ofentities ~~operations~~created before February 1, 2003 until January 3, 2004. AtThe Company has evaluated the ~~beginning~~impact of the ~~Fiscal~~provisions ~~2003,~~of ~~the~~Interpretation ~~goodwill~~46 ~~balance,~~and ~~net~~it ofbelieves ~~amortization,~~it iswill ~~expected~~not tohave bea ~~$21.7~~material ~~million~~impact on the Company’s consolidated financial statements.

~~The FASB issued SFAS No. 143, “Accounting for Asset Retirement Obligations,” in August 2001, and SFAS No. 144, “Accounting for the Impairment or Disposal of Long~~-~~lived~~ ~~Assets,”~~23 in October 2001. SFAS No. 143 is effective for fiscal years beginning after June 15, 2002 and will require that the fair value of an asset retirement obligation be recorded as a liability in the period in which it incurs the obligation. SFAS No. 144 is effective for fiscal years beginning after December 15, 2001. It provides a single accounting model for long-~~lived~~ ~~assets to be disposed of and replaces SFAS No. 121 “Accounting for the~~ Impairment of Long-Lived Assets and Long-Lived Assets to Be Disposed Of.” The Company does not expect the adoption of these statements to have a material effect on the Company’s consolidated financial position or results of operations. The Company will adopt these Statements beginning in the first quarter of Fiscal 2003

In May 2002, the FASB issued SFAS No. 145, “Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections.” This Statement rescinds FASB Statement No. 4, “Reporting Gains and Losses from Extinguishment of Debt,” and an amendment of that Statement, FASB Statement No. 64, “Extinguishments of Debt Made to Satisfy Sinking-Fund Requirements.” This Statement amends FASB Statement No. 13, “Accounting for Leases,” to eliminate an inconsistency between the required accounting for sale-leaseback transactions and the required accounting for certain lease modifications that have economic effects that are similar to sale-leaseback transactions. This Statement also amends other existing authoritative pronouncements to make various technical corrections, clarify meanings, or describe their applicability under changed conditions. The provisions of SFAS No. 145 are effective in fiscal years beginning after May 15, 2002, with early adoption permitted and, in general, are to be applied prospectively. The Company is currently assessing the impact of SFAS No. 145 on its financial position, results of operations and cash flows as well as timing of its adoption.

-18-

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

In ~~July~~May ~~2002~~2003, the FASB issued SFAS No. ~~146~~150, “Accounting for ~~Costs~~Certain ~~Associated~~Financial Instruments with ~~Exit~~Characteristics ~~and~~of ~~Disposal~~both ~~Activities~~Liabilities and Equity.” ~~This~~SFAS ~~statement revises the accounting for~~No. 150 ~~exit~~requires ~~and~~that ~~disposal~~certain ~~activities~~financial ~~under~~instruments ~~EITF~~with ~~Issue~~characteristics ~~94-3,~~of ~~“Liability Recognition for~~both ~~Certain~~liabilities ~~Employee~~and ~~Termination~~equity ~~Benefits~~be ~~and~~classified ~~other~~as ~~Costs~~liabilities toin ~~Exit~~statements anof ~~Activity,” by~~financial ~~spreading~~position. ~~out~~The ~~the~~financial ~~reporting~~instruments ofaffected ~~expenses~~include ~~related~~mandatorily ~~to restructuring activities.~~redeemable ~~Commitment~~stock, tocertain afinancial ~~plan~~instruments tothat ~~exit~~require ~~an activity~~ or ~~dispose~~may ofrequire ~~long-lived~~the ~~assets~~issuer ~~will~~to nobuy ~~longer~~back besome ~~sufficient~~of toits ~~record~~shares ain ~~one-time~~exchange ~~charge~~ for ~~most~~cash ~~anticipated costs. Instead, companies will record exit~~ or ~~disposal~~other ~~costs~~assets ~~when~~and ~~they are “incurred”~~certain ~~and~~obligations that can be ~~measured~~settled atwith ~~fair~~shares ~~value,~~of ~~and they will subsequently adjust the recorded liability for changes in estimated cash flows~~stock. ~~The provisions of~~ SFAS No. ~~146~~150 ~~are~~ is effective ~~prospectively~~ for ~~exit~~all orfinancial ~~disposal~~instruments ~~activities~~entered ~~initiated~~ into or modified after ~~December~~May 31, 2003 ~~2002.~~and ~~Earlier~~must ~~adoption~~be isapplied ~~encouraged.~~to ~~Companies~~existing ~~may not restate previously issued~~ financial ~~statements~~instruments ~~for~~at the ~~effect~~beginning of the ~~provisions of~~first ~~SFAS~~fiscal ~~No. 146~~period ~~and~~beginning ~~liabilities~~after ~~that~~December 15, a2003 ~~Company~~for ~~previously recorded under EITF Issue 94~~non-~~3 are grandfathered~~public entities. The Company is currently ~~assessing~~analyzing ~~the~~this ~~impact~~Statement ~~of SFAS~~and ~~No. 146~~has onnot yet determined its ~~financial~~impact ~~position,~~on ~~results~~the ofCompany’s ~~operations~~consolidated ~~and~~financial ~~cash~~position ~~flows as~~or ~~well~~results ~~as timing~~ of ~~its adoption~~operations.

Cautionary Statements Regarding Forward-Looking Statements

This document contains forward-looking statements that relate to future events or the Company’s future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “~~expect~~except,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of such terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially.

Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither ~~the~~ the Company nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. All written and oral forward-looking statements made in connection with this report ~~which~~that are attributable to the Company or persons acting on the Company’s behalf are expressly qualified in their entirety by the “risk factors,” including those contained in Exhibit 99 hereto, and other cautionary statements included herein and in the Company’s other filings with the Securities and Exchange Commission (“SEC”). The Company is under no duty to update any of the forward-looking statements after the date of this report to conform such statements to actual results or to changes in the Company’s expectations.

The information in this report is not a complete description of the Company’s business or the risks and uncertainties associated with an investment in the Company’s securities. WeYou ~~urge~~should ~~you to~~ carefully ~~review and~~ consider the various risks and ~~disclosures~~uncertainties ~~made~~that byimpact the Company’s inbusiness and the other information in this report and in the Company’s other ~~reports~~ ~~filed~~filings with the SEC before you decide to invest in the Company or to maintain or increase your investment. Such risks and uncertainties include, but are not limited to, the following:

~~Risk~~• ~~Factors~~ the Company’s indebtedness is substantial; • the Company’s debt agreements have restrictions that limit its flexibility in operating its business; • the Company’s ability to generate the significant amount of cash needed to service its debt and to fund capital expenditures or other liquidity needs depends on many factors beyond its control; • the Company has had historical losses; • the Company may be unable to retain and/or recruit key management and other personnel; • the markets in which the Company sells its products are competitive; • the end markets in which the Company operates are subject to technological change;

~~You~~- ~~should~~24 ~~carefully consider the various risks and uncertainties that impact~~- ~~the Company’s business and the other information in this report and the~~ Company’s other filings with the SEC before you decide to invest in the Company or to maintain or increase your investment. Such risks and uncertainties include, but are not limited to, the following: product demand and market acceptance risks; the effect of general economic conditions; the impact of competitive products and pricing; new product development and commercialization; technological difficulties and the ability to increase margins; production

-19-

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

~~interruptions~~• ~~due~~a tosignificant ~~power~~portion ~~shutdowns~~of the Company’s sales is, and ~~volatility~~is ~~in energy~~expected ~~costs;~~to continue to be, from contracts with the U.S. Government; ~~export~~• ~~policies~~the Company generates sales from contracts with foreign governments; ~~changes~~• inthe ~~Governmental appropriations,~~Company’s ~~national~~international ~~defense~~operations ~~policies~~subject it to social, political and ~~availability~~economic risks of ~~Government~~doing ~~funds~~business in foreign countries; ~~changes~~ • the Company may not be successful in ~~environmental~~obtaining ~~regulation~~the necessary export licenses and ~~legislation;~~technical ~~availability~~assistance ofagreements ~~certain critical~~to ~~materials~~conduct operations abroad and ~~raw~~Congress ~~material~~may ~~price~~prevent ~~fluctuations;~~proposed sales to foreign customers. • the Company’s ~~ability to~~results ~~generate~~of ~~the~~operations ~~significant~~and ~~amount~~financial ofcondition ~~cash~~may ~~needed~~be toadversely ~~service~~affected by increased or unexpected costs incurred by it on its ~~debt;~~contracts and sales orders; • the Company’s ~~ability~~business could be adversely affected by environmental regulation and legislation, liabilities relating to ~~obtain~~contamination ~~financing~~and changes in ~~the~~our ~~future~~ability to recover under Varian Medical Systems Inc.’s ~~Any~~indemnity; of• the ~~foregoing factors~~Company ~~could~~has ~~cause~~only a limited ability to protect its intellectual property rights; • the Company’s ~~business,~~inability ~~results~~to obtain certain necessary raw materials and key components could disrupt the manufacture of ~~operations,~~its orproducts and cause its financial condition and results of operations to suffer; and ~~actual~~• ~~results~~the ~~could~~Company ~~differ~~is ~~materially~~controlled ~~from~~by ~~those expected~~affiliates of The Cypress Group L. L.C.

~~-20-~~Any of the foregoing factors could cause the Company’s business, results of operations, or financial condition to suffer, and actual results could differ materially from those expected.

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company’s market risk disclosures set forth in its Annual Report on Form 10-K for the fiscal year ended October 3, 2003, have not changed materially.

ITEM 4: CONTROLS AND PROCEDURES

Management, including the Company’s principal executive officer and principal financial officer, has evaluated, as of the end of the period covered by this report, the effectiveness of the design and operation of the Company’s disclosure controls and procedures with respect to the information generated for use in this report. Based upon, and as of the date of that evaluation, the principal executive officer and principal financial officer concluded that the disclosure controls and procedures were effective to provide reasonable assurances that information required to be disclosed in the reports filed or submitted under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

There have been no changes in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

- 25 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC., and subsidiaries (A wholly owned subsidiary of Communications & Power Industries Holding Corporation)

PART II: OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

None.

ITEM 2: CHANGES IN SECURITIES

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

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

~~None.~~Holding submitted the following items to its stockholders for approval by written consent:

(i) the Merger Agreement, the Merger and the related transactions, and the amendment and restatement of the certificate of incorporation of Holding in connection with the Merger. Holding received written consents approving these matters from the holders of 4,720,672 shares of Common Stock, representing approximately 94.26 % of the total outstanding shares of Common Stock.

(ii) the payment by Holding and CPI of certain potential parachute payments to certain executives in accordance with Section 280G(b)(5)(A)(ii) of the Internal Revenue Code of 1986, as amended (the “IRC”). Holding received written consents approving these matters from the holders of 4,474,250 shares of Common Stock, representing approximately 92.78% of the total outstanding shares of Common Stock entitled to vote on these matters under the IRC.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

(a) The following exhibits are being filed as part of this report:

Exhibit No.		Description
Exhibit
10.11.1		Modification Agreement of Secured Loan between Holding and Wells Fargo Bank, National Association, dated June 1, 2002
No.		Description
10.12.1		Amended and Restated Promissory Note Secured by Deed of Trust by Holding in favor of Wells Fargo Bank, National Association, dated June 1, 2002
3.1		Certificate of Incorporation of Communications & Power Industries Holding Corporation (as amended and restated on January 23, 2004).
10.13.1		Memorandum of Modification Agreement Amending Deed of Trust by Holding in favor of Wells Fargo Bank, National Association, dated June 1, 2002
3.2		Bylaws of Communications & Power Industries Holding Corporation (Incorporated by reference to Communications & Power Industries, Inc.’s Registration Statement on Form S-1 (Registration No. 33-96858), filed on September 12, 1995).
10.14.1		Junior Lienor’s Consent and Subordination Agreement by CPI in favor of Wells Fargo Bank, National Association, dated June 1, 2002
99.1		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.2		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.3		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.4		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

- 26 -

COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
and subsidiaries

COMMUNICATIONS & POWER INDUSTRIES, INC.
and subsidiaries
(A wholly owned subsidiary of Communications & Power Industries Holding Corporation)


Exhibit
No.		Description

3.3		Restated Certificate of Incorporation of Communications & Power Industries, Inc., filed with the Delaware Secretary of State on August 11, 1995 (Incorporated by reference to Communications & Power Industries, Inc.’s Registration Statement on Form S-1 (Registration No. 33-96858), filed on September 12, 1995).

3.4		Amended and Restated Bylaws of Communications & Power Industries, Inc., dated March 19, 2002 (Incorporated by reference to Communications & Power Industries, Inc.’s Quarterly Report on Form 10-Q, for the quarter ended March 29, 2002).

4.1		Indenture relating to the 8% Senior Subordinated Notes due 2012, dated as of January 23, 2004, among Communications & Power Industries, Inc., as Issuer, the Guarantors named therein, as Guarantors, and BNY Western Trust Company, as Trustee.

4.2		Registration Rights Agreement, dated as of January 23, 2004, among Communications & Power Industries, Inc., the Guarantors named therein, and UBS Securities LLC, Bear, Stearns & Co. Inc., and Wachovia Capital Markets, LLC, as the Initial Purchasers.

10.1		Credit Agreement, dated as of January 23, 2004, among Communications & Power Industries, Inc., as Borrower, the Guarantors named therein, the Lenders from time to time party thereto, UBS Securities LLC, Bear, Stearns & Co. Inc., UBS Loan Finance LLC, UBS AG, Stamford Branch, Bear Stearns Corporate Lending Inc., Wachovia Bank, National Association, and Wachovia Capital Markets, LLC.

10.2		Security Agreement, dated as of January 23, 2004, among Communications & Power Industries, Inc., the Guarantors party thereto, and UBS AG, Stamford Branch.

10.3		Form of Option Rollover Agreement (U.S. Employees).

10.4		Form of Option Rollover Agreement (Canadian Employees).

10.5		Form of Management Stockholders Agreement among CPI Acquisition Corp., Cypress Merchant Banking Partners II L.P., Cypress Merchant Banking II C.V., 55th Street Partners II L.P., Cypress Side-by-Side LLC, and certain management stockholders named therein.

31		Rule 13a-14 (a) /15d-14 (a) Certifications.

32		Section 1350 Certifications.

99		Risk factors related to the offering of 8% Senior Subordinated Notes due 2012.

(b) Reports on Form 8-K:

NoA ~~reports~~report ~~were filed~~ on Form 8-K ~~during~~was filed on November 21, 2003 under Item 5 to announce that Holding entered into the ~~quarter~~Agreement ~~ended~~and ~~June 28~~Plan of Merger dated as of November 17, ~~2002~~2003.

-21 27 -

SIGNATURES

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

COMMUNICATIONS & POWER INDUSTRIES HOLDINGCORPORATION
		COMMUNICATIONS & POWER INDUSTRIES HOLDING CORPORATION
~~By:~~	~~/s/ O. Joe Caldarelli~~	By:	/s/ O. Joe Caldarelli
	O. Joe Caldarelli Chief Executive Officer Date: August 8, 2002
			O. Joe Caldarelli
			Chief Executive Officer
			Date: February 11, 2004
		By:	/s/ Joel Littman
			Joel Littman
			Chief Financial Officer, Treasurer and Secretary
			(Principal Financial and Accounting Officer)
			Date: February 11, 2004

~~By:~~- ~~/s/~~28 ~~Joel Littman Joel Littman Chief Financial Officer, Treasurer and Secretary (Principal Financial and Accounting Officer) Date: August 8, 2002~~-

-22-

SIGNATURES

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

~~COMMUNICATIONS & POWER INDUSTRIES, INC.~~		COMMUNICATIONS & POWER INDUSTRIES, INC.
~~By:~~	~~/s/ O. Joe Caldarelli~~	By:	/s/ O. Joe Caldarelli
	O. Joe Caldarelli Chief Executive Officer Date: August 8, 2002
			O. Joe Caldarelli
			Chief Executive Officer
			Date: February 11, 2004
		By:	/s/ Joel Littman
			Joel Littman
			Chief Financial Officer, Treasurer and Secretary
			(Principal Financial and Accounting Officer)
			Date: February 11, 2004

~~By:~~- ~~/s/~~29 ~~Joel Littman Joel Littman Chief Financial Officer, Treasurer and Secretary (Principal Financial and Accounting Officer) Date: August 8, 2002~~-

-23-

~~EXHIBIT~~Exhibit ~~INDEX~~Index

Exhibit No.		Description
Exhibit
10.11.1		Modification Agreement of Secured Loan between Holding and Wells Fargo Bank, National Association, dated June 1, 2002
No.		Description
10.12.1		Amended and Restated Promissory Note Secured by Deed of Trust by Holding in favor of Wells Fargo Bank, National Association, dated June 1, 2002
3.1		Certificate of Incorporation of Communications & Power Industries Holding Corporation (as amended and restated on January 23, 2004).
10.13.1		Memorandum of Modification Agreement Amending Deed of Trust by Holding in favor of Wells Fargo Bank, National Association, dated June 1, 2002
3.2		Bylaws of Communications & Power Industries Holding Corporation (Incorporated by reference to Communications & Power Industries, Inc.’s Registration Statement on Form S-1 (Registration No. 33-96858), filed on September 12, 1995).
10.14.1		Junior Lienor’s Consent and Subordination Agreement by CPI in favor of Wells Fargo Bank, National Association, dated June 1, 2002
3.3		Restated Certificate of Incorporation of Communications & Power Industries, Inc., filed with the Delaware Secretary of State on August 11, 1995 (Incorporated by reference to Communications & Power Industries, Inc.’s Registration Statement on Form S-1 (Registration No. 33-96858), filed on September 12, 1995).
99.1		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
3.4		Amended and Restated Bylaws of Communications & Power Industries, Inc., dated March 19, 2002 (Incorporated by reference to Communications & Power Industries, Inc.’s Quarterly Report on Form 10-Q, for the quarter ended March 29, 2002).
99.2		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
4.1		Indenture relating to the 8% Senior Subordinated Notes due 2012, dated as of January 23, 2004, among Communications & Power Industries, Inc., as Issuer, the Guarantors named therein, as Guarantors, and BNY Western Trust Company, as Trustee.
99.3		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
4.2		Registration Rights Agreement, dated as of January 23, 2004, among Communications & Power Industries, Inc., the Guarantors named therein, and UBS Securities LLC, Bear, Stearns & Co. Inc., and Wachovia Capital Markets, LLC, as the Initial Purchasers.
99.4		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
10.1		Credit Agreement, dated as of January 23, 2004, among Communications & Power Industries, Inc., as Borrower, the Guarantors named therein, the Lenders from time to time party thereto, UBS Securities LLC, Bear, Stearns & Co. Inc., UBS Loan Finance LLC, UBS AG, Stamford Branch, Bear Stearns Corporate Lending Inc., Wachovia Bank, National Association, and Wachovia Capital Markets, LLC.
10.2		Security Agreement, dated as of January 23, 2004, among Communications & Power Industries, Inc., the Guarantors party thereto, and UBS AG, Stamford Branch.
10.3		Form of Option Rollover Agreement (U.S. Employees).
10.4		Form of Option Rollover Agreement (Canadian Employees).
10.5		Form of Management Stockholders Agreement among CPI Acquisition Corp., Cypress Merchant Banking Partners II L.P., Cypress Merchant Banking II C.V., 55th Street Partners II L.P., Cypress Side-by-Side LLC, and certain management stockholders named therein.
31		Rule 13a-14 (a) /15d-14 (a) Certifications.
32		Section 1350 Certifications.
99		Risk factors related to the offering of 8% Senior Subordinated Notes due 2012.

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