PRE 14A

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[X] Preliminary Proxy Statement [ ] Confidential, For Use of the

[ ] Definitive Proxy Statement Commission Only (as permitted

[ ] Definitive Additional Materials by Rule 14a-6(e)(2))

[ ] Soliciting Material Pursuant to

Rule 14a-11(c) or Rule 14a-12

ANDERSEN GROUP, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box): [ ] No fee required.

[X] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:

2) Aggregate number of securities to which transaction applies:

3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

$11,900,000, which is the cash payment to Registrant as of the closing of the transaction.

4) Proposed maximum aggregate value of transaction: $11,900,000

5) Total fee paid: $2,380 (1/50th of 1% of proposed aggregate value stated above)

[ ] Fee paid previously with preliminary materials:

[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing.

1) Amount previously paid:

2) Form, Schedule or Registration Statement No.:

3) Filing Party:

4) Date Filed:

ANDERSEN GROUP, INC.

515 MADISON AVENUE

SUITE 2600

NEW YORK, NEW YORK 10022

NOTICE OF COMBINED SPECIAL MEETING AND ANNUAL MEETING

OF STOCKHOLDERS TO BE HELD ON [ ], 2002

To Our Stockholders:

A combined Special Meeting and Annual Meeting of stockholders of Andersen Group, Inc. (the "Company") will be held at The Wings Club, 52 Vanderbilt Avenue, 18^th Floor, New York, New York, on [ ], 2002, beginning at 11:15 a.m. New York time.

I. The Special Meeting is being held for the following purposes:

1. To consider and vote upon the proposed sale to Deringer Mfg. Company of substantially all of the inventory, manufacturing equipment, office furniture and intellectual property of the Company's wholly owned subsidiary, The J.M. Ney Company.

II. The Annual Meeting is being held for the following purposes:

1. To elect a Board of Directors for the ensuing year; and

2. To transact such other business that may properly come before the combined Special Meeting or Annual Meeting or any adjournment or postponement thereof.

Stockholders of record at the close of business on [ ], 2001 are entitled to notice of and to vote at the combined Special Meeting and Annual Meeting or any postponement or adjournment thereof.

YOUR VOTE IS IMPORTANT. IN ORDER TO ASSURE YOUR REPRESENTATION AT THE SPECIAL MEETING AND ANNUAL MEETING, YOU ARE REQUESTED TO COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE AND RETURN THE CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE.

By Order of the Board of Directors

/s/ Francis E. Baker

Francis E. Baker

Secretary

December ___, 2001

New York, New York

ANDERSEN GROUP, INC.

515 MADISON AVENUE

SUITE 2600

NEW YORK, NEW YORK 10022

(212) 826-8942

PROXY STATEMENT

This Proxy Statement relates to a combined Special Meeting and Annual Meeting of stockholders of the Company to be held on [ ], 2002 at 11:15 a.m. New York time, at The Wings Club, 52 Vanderbilt Avenue, 18^th Floor, New York, New York, or at such other time and place to which the special meeting may be adjourned or postponed. THE ENCLOSED PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY. The date of this Proxy Statement is [ ] . The proxy materials relating to the combined Special Meeting and Annual Meeting are first being mailed to stockholders entitled to vote at the combined meeting on or about [ ].

Only stockholders of record as of the close of business on [ ], 2001, are entitled to notice of, and to vote at, the Special Meeting and Annual Meeting or any adjournment thereof. On November 15, 2001, the Company had 2,093,161 shares of common stock outstanding. Each share is entitled to one vote. Shares may not be voted at the Special Meeting or Annual Meeting unless the holder thereof is present or represented by proxy.

Any stockholder executing the accompanying form of proxy has the power to revoke it at any time prior to its exercise by: (i) attending the Special Meeting or Annual Meeting and voting in person; (ii) duly executing and delivering a proxy bearing a later date; or (iii) sending written notice of revocation to the Secretary of the Company at 515 Madison Avenue, New York, New York 10022.

I. At the Special Meeting, stockholders will be asked to vote on the following:

1. The proposed sale to Deringer Mfg. Company ("Deringer") of substantially all of the inventory, manufacturing equipment, office furniture and intellectual property of the Company's wholly owned subsidiary, The J.M. Ney Company.

II. At the Annual Meeting, stockholders will be asked to vote on the following:

1. To elect a Board of Directors for the ensuing year; and

2. To transact such other business that may properly come before the Special Meeting or Annual Meeting or any adjournment or postponement thereof.

The Company's address is 515 Madison Avenue, Suite 2600, New York, New York 10022, and its telephone number is (212) 826-8942.

TABLE OF CONTENTS

I. SPECIAL MEETING

SUMMARY OF THE ASSET SALE

What Assets are Being Sold by the Company?*

What Liabilities are Being Assumed by Deringer?*

Who is the Purchaser?*

What is the Consideration for the Sale of Assets?*

What Will the Company Do with the Assets and Liabilities of JM Ney Not Being Purchased By Deringer?*

Why is the Company Selling the Assets of JM Ney?*

How Will the Proceeds be Used?*

What is the Board of Directors' Recommendation with Respect to the Asset Sale Proposal?*

Are There any Related Agreements?*

What are the Interests of Management OR Directors in the Asset Sale?*

What are the Significant Terms of the Asset Purchase Agreement?*

What Consents or Waivers Must the Company Obtain in Order to Complete the Asset Sale in Addition
to the Vote of the Stockholders?*

What Type of Accounting Treatment Will the Asset Sale Receive?*

What Are The U.S. Tax Consequences Of The Asset Sale To The Company?*

What are the U.S. Tax Consequences of the Asset Sale to You?*

Do I Have Any Appraisal Rights in Connection With the Asset Sale?*

ABOUT THE SPECIAL MEETING*

When and Where is the Special Meeting*

What is the Purpose of the Special Meeting?*

Who is Entitled to Vote?*

Who May Attend the Meeting?*

What Constitutes a Quorum?*

How Do I Vote?*

What if I Vote and then Change my Mind?*

What are the Board's Recommendations?*

What Vote is Required?*

What are the Effects of Abstentions and Broker Non-votes?*

Who Will Bear the Costs of Soliciting Proxies?*

FORWARD-LOOKING INFORMATION*

THE ASSET SALE*

Overview*

Business of the Company*

Reasons for the Asset Sale*

BACKGROUND OF THE ASSET SALE*

THE ASSET PURCHASE AGREEMENT*

Purchaser*

Assets and Liabilities Subject to the Asset Sale*

Purchase Price*

Conditions to Closing*

Indemnification Obligations*

No Solicitation*

Termination; Termination Fees*

Amendment*

Other Agreements in Connection with the Asset Sale*

Lease*

Escrow Agreement*

Potential Use of Proceeds - The Proposed CCTV Transaction*

MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES*

SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT*

STOCKHOLDER PROPOSALS*

OTHER MATTERS*

AVAILABLE INFORMATION*

II. ANNUAL MEETING

ABOUT THE ANNUAL MEETING*

When and Where is the Annual Meeting?*

What is the Purpose of the Annual Meeting?*

Who is Entitled to Vote?*

Who May Attend the Meeting?*

What Constitutes a Quorum?*

How Do I Vote?*

What if I Vote And then Change My Mind?*

What is the Board's Recommendations?*

What Vote is Required*

What are the Effects of Abstentions and Broker Non-votes?*

Who Will Bear the Costs of Soliciting Proxies?*

CORPORATE GOVERANCE*

REPORT OF THE AUDIT COMMITTEE*

ELECTION OF DIRECTORS*

EXECUTIVE COMPENSATION*

OPTIONS/SAR GRANTS IN LAST FISCAL YEAR*

Board Compensation Committee Report on Executive Compensation*

Performance Graph*

Pension Benefits*

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE*

PRINCIPAL STOCKHOLDERS AND SECURITY*

INDEPENDENT PUBLIC ACCOUNTANTS*

STOCKHOLDER PROPOSALS*

OTHER MATTERS*

INCORPORATION BY REFERENCE*

Pro Forma Financial InformationF-1

Appendix A Asset Purchase Agreement A-1

Appendix B Form of Lease B-1

Appendix C Form of Escrow Agreement C-1

Appendix D Audit Committee Charter. D-1

I. SPECIAL MEETING

SUMMARY OF THE ASSET SALE

The following is a summary of certain information contained in this Proxy Statement. It is not intended to be a complete statement of all of the material features of the proposed sale by the Company's wholly-owned subsidiary, The J.M. Ney Company ("JM Ney"), of substantially all of its inventory, manufacturing equipment, office furniture and intellectual property (the "Asset Sale") to a wholly-owned subsidiary of Deringer Mfg. Company (collectively, "Deringer"), and is qualified in its entirety by more detailed information contained elsewhere in this Proxy Statement under the heading "The Asset Sale" beginning on page 12, the Appendices hereto, and other information referred to in this Proxy Statement.

What Assets are Being Sold By The Company?

The Company, JM Ney and Deringer have entered into an Asset Purchase Agreement (the "Asset Purchase Agreement"), which provides that JM Ney will sell substantially all of its assets (including all of its operating assets) to Deringer. JM Ney is a full-service, precious metals materials and parts supplier to various automotive, medical, industrial electronics, telecommunications and military market segments. JM Ney's business includes the manufacture of metal alloys, specializing in various trademarked precious metal alloys, and the design, engineering and fabrication of custom precision products.

On a consolidated basis, the assets to be sold in this transaction or retained by JM Ney and sold after this transaction, represent approximately 41% of the book value of the Company's assets as of August 31, 2001, and account for 98% of the Company's revenue for the six months ended August 31, 2001. These assets include intellectual property related to JM Ney's products, raw materials and work in process. JM Ney will retain cash, accounts receivable booked prior to the closing of this transaction, certain refining inventory balances and its over-funded pension plan. JM Ney expects to convert to cash most of the net current assets that it does not sell to Deringer and pay current liabilities. JM Ney will also retain ownership of its Bloomfield, Connecticut manufacturing facility, which will be leased to Deringer under the terms of an eight-year lease to be executed in connection with this transaction.

What Liabilities are Being Assumed by Deringer?

Subject to satisfaction or waiver of all conditions to closing, Deringer will also assume certain liabilities of JM Ney including certain equipment leases and certain employee-related expenses. JM Ney will retain and Deringer will not assume, payment of trade payables, outstanding borrowings under its revolving credit agreement and term note with Sovereign Bank and long-term pension and health care obligations to former employees of JM Ney.

Who is the Purchaser?

The purchaser of JM Ney's assets will be a wholly-owned subsidiary of Deringer Mfg. Company, an Illinois corporation. Deringer is a privately held company with its principal place of business at 1250 Town Line Road, Mundelein, Illinois 60060. Deringer is engaged in the manufacturing and marketing of electrical contacts, including contact assemblies, welded wire contacts and tape assemblies and staked rivet assemblies.

What is the Consideration for the Sale of Assets?

In exchange for the assets and assumed liabilities, Deringer will pay JM Ney the purchase price, an amount in cash based on the following:

• $5,094,741 in cash, plus
• the cost of fixed asset additions since February 28, 2001 (estimated to be $140,000), plus
• the value of inventory to be acquired at the time of the closing (based on the fair value of the precious metal content and the book value of other inventory components) (estimated to be $6,550,000), plus
• the book value of the prepaid expenses to be acquired at the time of the closing (estimated to be $270,000), less
• the book value of the principal component of equipment leases to be assumed (estimated to be $17,000), less
• the amount of the accrued vacation for the employees of JM Ney to be hired by Deringer (estimated to be $200,000).

Using estimates based on internally prepared financial information as of October 31, 2001, the Company expects that at closing of the transaction, Deringer will pay JM Ney approximately $11,900,000 in cash, of which $600,000 will be held in escrow to fund payment of indemnification claims arising under the Asset Purchase Agreement, if any. Deringer also will enter into an eight-year lease with JM Ney for use of JM Ney's manufacturing facility in Bloomfield, Connecticut (the "Lease") with an annual lease payment of $290,000 in the first year. The lease payment is scheduled to increase to $330,600 in the last year of the Lease.

What Will the Company Do with the Assets and Liabilities of JM Ney Not Being Purchased By Deringer?

In addition to the proceeds expected to be received from the closing of this transaction, JM Ney expects to receive approximately $3,800,000 (based on estimates from internally prepared financial information as of October 31, 2001) from the collection of accounts receivable booked prior to the closing of this transaction and the sale of certain inventory components not being purchased by Deringer. JM Ney and the Company will still continue to own and hold the real estate being leased to Deringer and JM Ney's pension plan. JM Ney will still have certain long-term obligations for pension and health care benefits to former employees.

Why is the Company Selling the Assets of JM Ney?

The Company believes that the Asset Sale is in the best interests of the Company and its stockholders for the following reasons:

• The Company is concerned that technological requirements of JM Ney's business will require continued capital investment which will limit the cash available to support other corporate level objectives identified from time to time by the Company's Board of Directors;
• The Company is unwilling to make the additional investment necessary to acquire a strategic partner to help JM Ney generate acceptable levels of return on investment;
• The Company wishes to exit this particular manufacturing sector and focus on opportunities that offer more growth potential than JM Ney; and
• The Company will be able to realize the appreciation of the value of JM Ney's investment in fixed assets and precious metals while reducing its exposure to volatile markets for precious metals.

How Will the Proceeds be Used?

As noted above, based on internally prepared financial information as of October 31, 2001, the Company estimates that at closing of the transaction, Deringer will pay JM Ney approximately $11,900,000 in cash, of which $600,000 will held in escrow to fund payment of indemnification claims arising under the Asset Purchase Agreement, if any. JM Ney also expects to realize approximately $3,800,000 from the collection of accounts receivable booked prior to the closing of this transaction and the sale of certain of certain inventory components not being purchased by Deringer.

1. The Company expects to use a portion of the proceeds from this transaction to satisfy JM Ney's outstanding borrowings under its revolving credit agreement and term note with Sovereign Bank, which the Company currently estimates to be approximately $4,500,000 including interest;
2. The Company is negotiating the repurchase of all of the warrants to purchase common stock of JM Ney held by Sovereign Bank. The Company currently estimates that the aggregate purchase price for all the warrants will be at least $100,000;
3. The Company expects to purchase outstanding vested stock options of JM Ney granted to employees of JM Ney or held by employees of JM Ney at the closing of the Asset Sale for a price to be determined by the Company based on the remaining assets and liabilities of JM Ney. The Company currently estimates that the aggregate purchase price for these stock options could total approximately $200,000;
4. The Company expects to use a portion of the proceeds to satisfy certain severance obligations owed by JM Ney to employees not hired by Deringer, including Ronald N. Cerny, President of JM Ney, which the Company estimates will total $600,000;
5. The Company anticipates that legal and accounting fees, and other costs of this transaction may total approximately $300,000, and a portion of the proceeds will be used to pay those costs;
6. The Company also expects to use a portion of the proceeds of this transaction for general corporate purposes; or
7. The Company is also a party to a certain letter agreement (the "Letter Agreement") dated November 26, 2001, which provides a framework for the Company to acquire complete control of ZAO COMCOR -TV ("CCTV"). CCTV is an operator licensed to provide broadband cable television, high speed Internet access, and data transmission to up to 1.5 million residential and business customers within the City of Moscow, Russia. The Letter Agreement contemplates a series of proposed transactions by and among the Company, its minority (25%) owned subsidiary, ABC Moscow Broadband Communication Limited ("MBC"), OAO Moskovskaya Telecommunikatsionnaya Corporatsia ("COMCOR") and CCTV (collectively, the proposed transactions being referred to as the "CCTV Transaction"). As further discussed in more detail under the heading "The Asset Purchase Agreement" in this Section I of the Proxy Statement, if the CCTV Transaction is completed as contemplated in the Letter Agreement, the Company anticipates that it would devote the net proceeds of the Asset Sale to meet the Company's obligations in the CCTV Transaction.

Presently, MBC owns approximately 50% of the capital interests of CCTV. The other 50% of the capital interests of CCTV is owned by COMCOR. Under the terms of the proposed CCTV Transaction as presently contemplated and subject to further negotiation of definitive agreements: (i) the Company would acquire substantially all of the outstanding equity interests of MBC not presently owned by it in exchange for an as yet-to-be-determined number of shares of the Company's common stock; (ii) COMCOR would contribute certain assets to CCTV and transfer its holdings in CCTV to the Company (or its designee) in exchange for shares of the Company's common stock; (iii) the Company, together with MBC, or MBC alone as the Company's designee (or an alternate designee of the Company) would hold all of the capital interests of CCTV; and (iv) MBC would be obligated to invest up to an additional $16,000,000 in CCTV, some of which amount may be funded by the Company. In addition, the CCTV Transaction calls for ce rtain short-term loans to, and investments in, CCTV in exchange for shares of CCTV by each of MBC and COMCOR during the course of completing the CCTV Transaction, of which $2,000,000 has already been advanced by MBC to CCTV.

The CCTV Transaction is subject to a number of conditions precedent, which if not met or waived, would cause the CCTV Transaction not to occur. The consummation of the proposed CCTV Transaction, as presently contemplated, would make the net proceeds of the Asset Sale unavailable for other uses by the Company. Regardless of whether the proposed CCTV Transaction is completed, the Company will use approximately $6,000,000 of the proceeds from the Asset Sale for the purposes set forth in items 1-5 above. If the CCTV Transaction is not consummated for any reason, the Company will also use the proceeds from the Asset Sale for general corporate purposes and for other uses, including acquisitions and investments that the Board of Directors may approve in the future.

If the CCTV Transaction is consummated, there would be substantial ownership dilution to the existing stockholders of the Company as a result of the Company's issuance of new shares of its common stock to COMCOR and the holders of MBC's outstanding capital interests. Finally, in connection with the negotiation and approval of definitive arrangements for the CCTV Transaction, there are certain conflicts of interest, both direct and indirect, among the related parties to the proposed CCTV Transaction, including certain officers, directors and significant stockholders of the Company who are officers, directors and/or shareholders of MBC and/or CCTV. A more complete description of the proposed CCTV Transaction can be found under the heading "The Asset Purchase Agreement -Potential Use of Proceeds-The Proposed CCTV Transaction" in Section I of this Proxy Statement beginning on page 20. You are encouraged to review and understand the principal terms of the proposed CCTV Transaction as it relates to the possible use of proceeds generated by the Asset Sale.

The CCTV Transaction is subject to substantial negotiations among the parties and such negotiations may result in the material terms of the CCTV Transaction differing from those set forth in this Proxy Statement. There can be no assurances that the CCTV Transaction will occur.

THE COMPANY INTENDS TO PROCEED WITH THE ASSET SALE REGARDLESS OF THE LIKELIHOOD OF COMPLETING THE PROPOSED CCTV TRANSACTION. NEITHER THE BOARD OF DIRECTORS' RECOMMENDATION TO THE STOCKHOLDERS TO VOTE FOR THE ASSET SALE NOR THE BOARD'S DETERMINATION THAT THE ASSET SALE IS IN THE BEST INTERESTS OF THE COMPANY'S STOCKHOLDERS IS CONDITIONED UPON THE CONSUMMATION OF THE PROPOSED CCTV TRANSACTION. THE CONSUMMATION OF THE PROPOSED CCTV TRANSACTION IS NOT A CONDITION PRECEDENT TO THE ASSET SALE. YOU ARE NOT BEING ASKED TO VOTE ON THE PROPOSED CCTV TRANSACTION IN THIS PROXY.

What is the Board of Directors' Recommendation with Respect to the Asset Sale Proposal?

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE ASSET SALE.

Are There any Related Agreements?

In connection with the Asset Sale, the parties also propose to enter into the Lease and an escrow agreement (the "Escrow Agreement") to provide a source to fund payment of indemnification claims, if any, under the Asset Purchase Agreement.

Each of these agreements is attached as an Appendix and is described in greater detail under the heading "The Asset Sale-Other Agreements in Connection with the Asset Sale" in Section I of this Proxy Statement beginning on page 20.

What are the Interests of Management or Directors in the Asset Sale?

Only one of the executive officers and directors of the Company and one executive officer of JM Ney will benefit directly from the Asset Sale. Ronald N. Cerny, President of JM Ney and Andrew M. O'Shea, Chief Financial Officer of the Company and JM Ney, each hold stock options to purchase shares of common stock of JM Ney. The Company intends to repurchase the outstanding stock options of JM Ney held by to Messrs. Cerny and O'Shea at the closing of the Asset Sale on terms consistent with those of the other option holders. Additionally, the Company's Compensation Committee may consider the contributions of Oliver R. Grace, Jr., President and Chief Executive Officer, and Mr. O'Shea, in completing this transaction when the Compensation Committee determines the amount of incentive compensation payable to Mr. Grace, Jr. and Mr. O'Shea.

If the CCTV Transaction is completed, there may be additional benefits to certain officers and directors of the Company who are also officers, directors or shareholders of MBC.

What are the Significant Terms of the Asset Purchase Agreement?

The Company, JM Ney and Deringer have entered into the Asset Purchase Agreement that provides that JM Ney will sell substantially all of its assets to Deringer. Under the Asset Purchase Agreement, Deringer will pay JM Ney $5,094,741 in cash plus an amount to be determined prior to the closing based on the value of certain assets, inventory and liabilities. Based on information prepared as of October 31, 2001, the parties currently estimate the total purchase price to be approximately $11,900,000. The Company and JM Ney have made certain representations and warranties to Deringer in the Asset Purchase Agreement, including among others, the authority of each of the Company and JM Ney to enter into the Asset Purchase Agreement and with respect to JM Ney's financial statements, inventory, customer lists and the description of JM Ney's intellectual property. Deringer has made certain representations and warranties to the Company and JM Ney, including among others, the authority to enter in to the Asset Purchase Agreement.

Under the Asset Purchase Agreement, the Company, JM Ney and Deringer have also agreed to indemnify each other for certain losses due to breaches in their respective representations, warranties and covenants. The Company does not expect that any of the matters for which it has agreed to indemnify Deringer will have a material adverse effect on the Company's results of operations or financial condition following the closing. The Company and JM Ney have agreed to set aside $600,000 of the purchase price to be held in escrow to satisfy the indemnification claims, if any, brought by Deringer against the Company or JM Ney. Additionally, certain conditions must be satisfied or waived prior to the closing of the Asset Sale. These conditions include the receipt of approval of the Asset Sale by the Company's stockholders and obtaining the consents of certain lessors of manufacturing and office equipment and each of the Company's manufacturing customers to transfer certain rights and obligations unde r the applicable agreements to Deringer. Accordingly, even if the stockholders approve the Asset Sale, there can be no assurance that the Company will be successful in obtaining all required consents prior to closing. The material terms of the Asset Purchase Agreement are described under the heading "The Asset Purchase Agreement" in Section I of this Proxy Statement beginning on page 16. A copy of the Asset Purchase Agreement is attached as Appendix A and incorporated herein by reference.

What Consents or Waivers Must the Company Obtain in Order to Complete the Asset Sale in Addition to the Vote of the Stockholders?

In order to transfer substantially all of its assets pursuant to the Asset Sale, the Company must obtain a waiver of the holders of a majority of the principal amount of the Company's outstanding Debentures issued under the Company's Indenture dated as of February 26, 1998. In addition, JM Ney will need the consent of Sovereign Bank in connection with JM Ney's outstanding borrowings under its revolving credit agreement and term note with Sovereign Bank and with the warrants to purchase common stock of JM Ney issued to Sovereign Bank. The Company expects that these waivers will be obtained.

What Type of Accounting Treatment Will the Asset Sale Receive?

The Asset Sale will be accounted for as a sale of assets in accordance with generally accepted accounting principles. The Company will recognize a gain for book purposes based upon the excess net proceeds to be received from Deringer over the book value of the net assets sold.

What Are The U.S. Tax Consequences Of The Asset Sale To The Company?

The Company will recognize gain from the Asset Sale as well as the disposition of the net current assets not purchased by Deringer, after expenses of this transaction, in an amount equal to the difference between the net amount realized by the Company and the Company's adjusted tax basis in the assets sold or otherwise liquidated. The Company estimates that such gain will be approximately $2,518,000 after taxes. For income tax reporting purposes, portions of this gain are anticipated to be offset by current year operating losses, prior year net operating loss carryforwards and previously unrecognized net capital loss carryforwards.

What are the U.S. Tax Consequences of the Asset Sale to You?

The Asset Sale will have no direct U.S. federal income tax consequences to the Company's stockholders.

Do I Have Any Appraisal Rights in Connection With the Asset Sale?

Under Delaware law, the Company's stockholders are not entitled to dissenters' rights of appraisal with respect to the Asset Sale.

ABOUT THE SPECIAL MEETING

When and Where is the Special Meeting

The Special Meeting will be held on [ ], 2002 at 11:15 a.m. at The Wings Club, 52 Vanderbilt Avenue, 18^th Floor, New York, New York.

What is the Purpose of the Special Meeting?

At the Special Meeting, the Company's stockholders will be asked to consider and vote on the proposed Asset Sale. THE COMPANY'S BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE ASSET SALE AND RECOMMENDS THAT STOCKHOLDERS VOTE FOR APPROVAL OF THE ASSET SALE. For a description of the reasons why stockholders should vote in favor of the Asset Sale, see "The Asset Sale-Reasons for the Asset Sale" in Section I of this Proxy Statement on page 13.

Who is Entitled to Vote?

Only stockholders of record at the close of business on the record date, [ ], 2001, are entitled to receive notice of the Special Meeting and to vote the shares that they held on that date at the meeting, or any postponement or adjournment of the meeting. At the close of business on November 15, 2001, there were issued and outstanding 2,093,161 shares of the Company's common stock (the "Common Stock"), which are entitled to cast 2,093,161 votes.

Who May Attend the Meeting?

All stockholders as of the record date, or their duly appointed proxies, may attend the Special Meeting.

What Constitutes a Quorum?

The presence at the Special Meeting, in person or by proxy, of the holders of a majority of the outstanding Common Stock on the record date will constitute a quorum, permitting the Company to conduct its business at the Special Meeting. Proxies received but marked as abstentions will not be included in the calculation of the number of shares considered to be present at the meeting.

How Do I Vote?

You may vote on matters to come before the Special Meeting in two ways:

• You may attend the Special Meeting and cast your vote in person; or
• You may vote by completing, dating and signing the enclosed proxy card and returning it to Register & Transfer Company, the Company's transfer agent in the enclosed postage-paid envelope. If you deliver a valid proxy, you will authorize the individuals named on the proxy card, referred to as the proxy holders, to vote your shares according to your instructions. HOWEVER, IF YOU PROVIDE NO INSTRUCTIONS OR IF YOU ABSTAIN, SUCH NON-VOTE OR ABSTENTION WILL HAVE THE SAME EFFECT AS A VOTE AGAINST THE PROPOSAL.

What if I Vote and then Change my Mind?

You may revoke your proxy at any time before it is exercised by:

• filing a notice or revocation with the Company's Secretary;
• sending in another duly executed proxy bearing a later date; or
• attending the Special Meeting and casting your vote in person.

Your last vote will be the vote that is counted.

What are the Board's Recommendations?

THE BOARD RECOMMENDS A VOTE FOR THE PROPOSED ASSET SALE.

What Vote is Required?

Delaware law requires the approval of the holders of at least a majority of a corporation's outstanding voting shares for a sale or disposition of all or substantially all of a corporation's assets. As of the record date, there were 2,093,161 shares of the Company's common stock outstanding, of which 354,914 shares (approximately 17.0% of the outstanding shares) were beneficially held by the Company's officers and directors. The holders of at least 1,046,581 shares of the Common Stock must vote to approve the Asset Sale to complete the transaction. The Company has been advised that all of the officers and directors owning common stock of the Company intend to vote to approve the Asset Sale. If the holders of at least a majority of the outstanding Common Stock do not approve the Asset Sale at the Special Meeting, the Company cannot complete the transaction.

What are the Effects of Abstentions and Broker Non-votes?

Abstentions occur when a person with voting power checks the abstention box on a proxy card for a particular proposal or otherwise indicates that he or she abstains from voting on a proposal. A broker non-vote occurs when a nominee holding shares for a beneficial owner (i.e., your broker) returns an executed proxy but does not vote on a particular proposal because the nominee does not have the discretion to vote with respect to that particular proposal and has not received instructions from the beneficial owner.

If you hold your shares in "street name" through a broker or other nominee, your broker or nominee is not permitted to exercise voting discretion with respect to the Asset Sale. Thus, if you do not give your broker or nominee specific instructions as to how to vote in connection with the Asset Sale, your shares will not be voted on the Asset Sale and will not be counted in determining the number of shares necessary for approval. BECAUSE THE APPROVAL OF THE HOLDERS OF AT LEAST A MAJORITY OF THE COMPANY'S OUTSTANDING VOTING SHARES IS REQUIRED TO APPROVE THE ASSET SALE, RATHER THAN A MAJORITY OF THE SHARES VOTING AT THE SPECIAL MEETING, BROKER NON-VOTES AND ABSTENTIONS WILL HAVE THE EFFECT OF A VOTE AGAINST THE ASSET SALE.

Who Will Bear the Costs of Soliciting Proxies?

The Company will pay the cost of all proxy solicitations. Officers and other employees of the Company also may solicit proxies by personal interview, by electronic means or by telephone or facsimile equipment, in addition to the use of the mails. None of these individuals will receive special compensation for such services, which will be performed in addition to their regular duties, and some of them may not necessarily solicit proxies. The Company also has made arrangements with brokerage firms, banks, nominees and other fiduciaries to forward proxy solicitation materials for shares held of record by them to the beneficial owners of such shares. Upon request, the Company will reimburse these record holders for their reasonable out-of-pocket expenses.

THE COMPANY WILL PROVIDE, WITHOUT CHARGE, TO EACH PERSON TO WHOM THIS PROXY STATEMENT IS DELIVERED, UPON WRITTEN OR ORAL REQUEST OF SUCH PERSON AND BY FIRST CLASS MAIL OR OTHER EQUALLY PROMPT MEANS, A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR ITS FISCAL YEAR ENDED FEBRUARY 28, 2001, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. REQUESTS SHOULD BE DIRECTED BY MAIL TO FRANCIS E. BAKER, SECRETARY, ANDERSEN GROUP, INC., 515 MADISON AVENUE, SUITE 2600, NEW YORK, NY 10022 OR BY TELEPHONING THE COMPANY AT (212) 826-8942.

FORWARD-LOOKING INFORMATION

This Proxy Statement includes statements that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company's ability to consummate the Asset Sale. These forward-looking statements involve risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. Factors that could affect the Company's results and cause them to materially differ from those contained in the forward-looking statements include:

• The inability of the Company, JM Ney or Deringer to satisfy one or more conditions to closing, including the Company's inability to obtain any consents or waivers from third parties required to transfer the assets to Deringer;
• JM Ney may incur a break-up fee if it terminates the Asset Purchase Agreement;
• The purchase price paid by Deringer at the closing of this transaction may be less than currently anticipated if the value of the fixed asset additions or inventory to be acquired are less than currently estimated;
• The amount realized by JM Ney from the sale of certain inventory components not being purchased by Deringer may be less than currently anticipated if precious metals prices fluctuate significantly;
• The amount realized by JM Ney from the collection of accounts receivable booked prior to the closing of the Asset Sale may be less than currently anticipated if JM Ney is unable to collect certain accounts receivable.
• JM Ney may encounter difficulties in assigning obligations under certain existing contracts;
• Post-closing adjustments for open shop orders, product warranties, obsolete or slow-moving inventory and claims relating to the representations and warranties of the Company and JM Ney in the Asset Purchase Agreement may result in part, or all of the escrowed funds held under the Escrow Agreement, being returned to Deringer or, may result in the Company or JM Ney having to indemnify Deringer for indemnification claims beyond the amount of escrowed funds;
• The Company may not be able to find suitable alternatives to direct the proceeds to be realized from the Asset Sale if the CCTV Transaction is not consummated; and
• Other factors that the Company is currently unable to identify or quantify, but that may exist in the future.

THE ASSET SALE

ITEM 1 OF THE PROXY CARD

Overview

The Board of Directors of the Company is proposing that the stockholders authorize and approve the proposed sale of substantially all of JM Ney's assets to Deringer in accordance with the terms of the Asset Purchase Agreement attached as Appendix A to this Proxy Statement and incorporated herein by reference. On a consolidated basis, the assets to be sold in this transaction, or retained by JM Ney and sold after this transaction, represented approximately 41% of the book value of the Company's consolidated assets as of August 31, 2001, and accounted for 98% of the Company's revenue for the six months ended August 31, 2001. These assets include intellectual property related to JM Ney's products, raw materials and work in process. JM Ney will retain cash, accounts receivable booked prior to the closing of this transaction, certain refining inventory balances and its over-funded pension plan. JM Ney expects to convert to cash most of the net current assets that it does not sell to Deringer. J M Ney will also retain ownership of its Bloomfield, Connecticut manufacturing facility, which will be leased to Deringer under the terms of an eight-year lease to be executed in connection with this transaction. JM Ney will retain, and Deringer will not assume, responsibility for payment of outstanding trade payables, borrowings under its revolving credit agreement and term note with Sovereign Bank and long-term pension and health care obligations to former employees of JM Ney.

Although the material terms of the Asset Purchase Agreement are summarized below, the summary does not purport to be complete and is subject in all respects to the specific provisions of the Asset Purchase Agreement.

Business of the Company

Since February 1991 the Company's primary investment, which comprised approximately 74% of the Company's total consolidated assets at August 31, 2001, has been JM Ney. JM Ney historically operated in three industry segments: electronics, ultrasonic cleaning equipment and dental. In November 1995, JM Ney sold the assets and certain liabilities of the dental segment and in February 1998, JM Ney sold substantially all of the assets of the ultrasonic cleaning equipment segment. As a result, since February 1998, the Company has operated in two business segments: electronics and corporate. The electronics segment is comprised of the activities of JM Ney. The corporate segment is comprised of investment activities.

JM Ney is a full-service, materials and parts supplier to various automotive, medical, industrial electronics, telecommunications and military market segments. JM Ney manufactures metal alloys, specializing in various trademarked precious metal alloys, and the design, engineering and fabrication of custom precision products. The fabrication capabilities include wire drawing, rolling from ingot to foil, precision turning, stamping, injection and insert molding, as well as complex tool making.

JM Ney specializes in the custom engineering, design and manufacturing of precision metal contacts and insert-molded contact assemblies and connectors aimed at low amperage applications. Electrical contacts made utilizing precious metals, including gold, platinum, palladium and silver, are considered extremely dependable as the materials are inert and highly resistant to corrosion and wear. In developing a finished contact or connector assembly, JM Ney's technical staff works closely with customers, typically on an engineer-to-engineer level, in order to design a product that meets all of the metallurgical, electronic, dynamic and other performance specifications required for the customer's applications. JM Ney designs and builds the necessary molds and tools, and designs and manufactures the end product.

Following the closing of the Asset Sale, the Company intends to discontinue its Electronic Segment, which accounted for approximately 98% of total revenue for the fiscal year ended February 28, 2001. The Company will continue to make and hold investments, including but not limited to its investment in MBC and CCTV and may seek to complete the CCTV Transaction. The CCTV Transaction is described in more detail under the heading "The Asset Purchase Agreement -Potential Use of Proceeds-The Proposed CCTV Transaction" in Section I of the Proxy Statement beginning on page 20. The Company will also retain the overfunded pension plan and will receive the benefit of the proceeds from the Lease.

A description of the Company's business is contained in Item 1 of the Company's Annual Report on Form 10-K for the fiscal year ended February 28, 2001, which is incorporated by reference in this Proxy Statement and is provided to you with this Proxy Statement.

Reasons for the Asset Sale

The Company's Board of Directors believes that it is in the best interests of the Company and its stockholders to sell substantially all of the assets associated with JM Ney, other than the assets specifically excluded as provided above, and to focus the Company's resources and proceeds of the Asset Sale on pursuing new opportunities including, but not limited to, the CCTV Transaction.

The Board of Directors has unanimously approved the Asset Sale and the terms of the Asset Purchase Agreement. The Board of Director's decision to approve the Asset Sale is based on a number of factors including, among others, the following:

• The Company is concerned that technological requirements of JM Ney's business will require continued capital investment which will limit the cash available to support other corporate level objectives identified from time to time by the Company's Board of Directors;
• The Company is unwilling to make the additional investment necessary to acquire a strategic partner to help JM Ney generate acceptable levels of return on investment;
• The Company wishes to exit this particular manufacturing sector and focus on opportunities that offer more growth potential than JM Ney; and
• The Company will be able to realize the appreciation of the value of JM Ney's investment in fixed assets and precious metals while reducing its exposure to volatile markets for precious metals.

In addition to the factors set forth above, in the course of its deliberations concerning the Asset Sale, the Board of Directors consulted with the Company's legal and financial advisors as well as the Company's management team, and considered a number of other factors relevant to the Asset Sale, including:

• Reports from management regarding the Company's financial condition and the specific terms of the Asset Purchase Agreement, the Lease and the Escrow Agreement;
• The benefits to the Company resulting from the receipt of cash rather than other forms of potential consideration; and
• The belief that the terms of the Asset Purchase, the Lease and the Escrow Agreement are reasonable.

The Board of Directors also considered a number of potentially negative factors in its deliberations concerning the Asset Sale, including:

• Conducting the Asset Sale during an economic slowdown, which may have reduced the potential selling price of JM Ney's assets and operations;
• The uncertainties surrounding the use of proceeds; and
• The structure of the Asset Sale which leaves certain assets and liabilities with JM Ney.

In view of the wide variety of factors considered by the Board of Directors, the Board of Directors did not find it practicable to quantify or otherwise assign relative weight to the specific factors considered. After taking into account all of the factors set forth above, the Board of Directors unanimously agreed that the Asset Purchase Agreement and the consummation of the Asset Sale were fair to and in the best interests of the Company and its stockholders, and that the Company should proceed with the Asset Sale.

The Company's Board of Directors also believes that certain of the risks described above are unlikely to occur or were unlikely to have a material impact on the Company, while others can be avoided or mitigated by the Company, and that overall, the potential benefits of the Asset Sale outweigh the potential risks associated with the Asset Sale.

BACKGROUND OF THE ASSET SALE

The Company purchased JM Ney in February 1991. In November 1995, it sold the dental division and in February 1998, it sold the ultrasonic cleaning division. JM Ney is currently comprised of the electronics segment, which is the only remaining active operating division from the company that was acquired in 1991.

After several years of volatile precious metals markets, and concerns about the return on the perceived market value of the remaining investment being generated, the Board began to consider whether JM Ney would remain a part of its strategic business focus.

In June 2000, Mr. Roderick Lamm, Chairman of Deringer Mfg. Company approached Mr. Oliver R. Grace, Jr., the Company's President, regarding the prospect of Deringer acquiring JM Ney in one form or another. The Company provided Mr. Lamm with certain financial and business information to Deringer for their review. Based upon this information, representatives of Deringer conducted on-site due diligence during October 2000. Deringer and the Company then met in October 2000 to discuss the possibilities of an acquisition of Ney by Deringer. Although no agreement was reached at that meeting, it served as the basis for further informal discussions and the continued sharing of certain financial and operating information.

In February 2001, Deringer and JM Ney entered into a confidentiality agreement and non-binding letter of intent under which Deringer would acquire substantially all the net assets of JM Ney. This was followed by further due diligence by Deringer, its independent accounting firm and its outside legal counsel. This document, and the information reviewed and discussed during the course of the due diligence process served as the basis for further negotiations and discussions. Under the non-binding letter of intent, Deringer had the exclusive right to negotiate for the net assets of JM Ney until May 4, 2001. In the course of this process, the Company obtained appraisals of JM Ney's assets that contributed to the determination of the purchase price.

Mr. Grace, Jr. kept the Board of Directors informed of the status and progress of discussions at the April 5, 2001 and July 25, 2001 Board meetings, in addition to less formal communications between and subsequent to those meetings. At such times, the Board discussed both financial objectives of the transaction and alternate scenarios.

In addition, during August and September 2001, the Company cooperated with two other interested parties, neither of which made a firm offer that, in management's view, rivaled the terms of the sale that was being discussed with Deringer.

From May 2001 through November 8, 2001 specific terms and conditions of the Asset Purchase Agreement and the related schedules and exhibits thereto, the Escrow Agreement and Lease were discussed and negotiated by the parties.

The Boards of Directors of both JM Ney and the Company approved the transaction in a substantially final form on November 2, 2001, and granted management the authorization to sign documents, once they were in a form agreeable to both parties.

This led to the signing of the Asset Purchase Agreement by Deringer, the Company and JM Ney on November 8, 2001.

THE ASSET PURCHASE AGREEMENT

Purchaser

The purchaser of the assets of JM Ney is a wholly-owned subsidiary of Deringer, a privately-held company with a principal place of business at 1250 Town Line Road, Mundelein, Illinois 60060. Deringer is engaged in the manufacturing and marketing of electrical contacts, including contact assemblies, welded wire contacts and tape assemblies and staked rivet assemblies.

Assets and Liabilities Subject to the Asset Sale

The assets to be sold by JM Ney include substantially all of the assets of JM Ney, including the following:

• All intellectual property rights associated with JM Ney's products, including the use of the JM Ney name and the trademark names of its products;
• All rights and obligations under certain manufacturing agreements related to the JM Ney's products;
• Substantially all equipment and machinery related to JM Ney's products;
• All inventory related to JM Ney's products; and
• All furniture, fixtures, and equipment, except for certain excluded items, located at JM Ney's manufacturing facility in Bloomfield, Connecticut.

JM Ney will retain cash, accounts receivable booked prior to the closing of the transaction, certain refining inventory and its over-funded pension plan. JM Ney expects to convert to cash most of the net current assets that it does not sell to Deringer. As part of the Asset Sale, Deringer will assume JM Ney's obligations under certain equipment leases and certain employee-related expenses. JM Ney will retain, and Deringer will not assume, responsibility for payment of outstanding borrowings under its revolving credit agreement and term note with Sovereign Bank, and long-term pensions and health care obligations to former employees of JM Ney.

Purchase Price

In exchange for the assets and assumed liabilities, Deringer will pay JM Ney an amount in cash based on:

• $5,094,741 in cash, plus
• the cost of fixed asset additions since February 28, 2001 (estimated to be $140,000), plus
• the value of inventory to be acquired at the time of the closing (based on the fair value of the precious metal content and the book value of other inventory components) (estimated to be $6,550,000), plus
• the book value of the prepaid expenses to be acquired at the time of the closing (estimated to be $270,000), less
• the book value of the principal component of equipment leases to be assumed (estimated to be $17,000), less
• the amount of the accrued vacation for the employees of JM Ney to be hired by Deringer (estimated to be $200,000).

Using estimates based on internally prepared financial information as of October 31, 2001, the Company expects that at closing of the transaction, Deringer will pay the Company approximately $11,900,000 in cash, of which $600,000 will held in escrow to fund payment of indemnification claims arising under the Asset Purchase Agreement, if any.

As additional consideration, Derringer also will enter into the Lease for JM Ney's manufacturing facility in Bloomfield, Connecticut. Under the terms of the Lease, Deringer shall pay an annual rent of $290,000 in the first year of the Lease Term and increasing to $330,600 in the last year of the Lease Term.

Conditions to Closing

Deringer's obligation to complete the Asset Sale as contemplated by the Asset Purchase Agreement is subject to the satisfaction or waiver of the following conditions:

• All of the representations and warranties of the Company and JM Ney in the Asset Purchase Agreement must be true and correct in all material respects as of the closing date;
• The Company and JM Ney must have satisfied all covenants, agreements and conditions required by the Asset Purchase Agreement;
• No legal action pertaining to the assets or the transactions contemplated by the Asset Purchase Agreement shall have been threatened or pending in any court or administrative agency that seeks to restrain or prohibit the consummation of the closing of the Asset Sale;
• No adverse material adverse change regarding JM Ney's assets shall have occurred prior to the closing of this transaction;
• The Asset Sale must have been approved by the holders of at least a majority of the Company's outstanding common shares; and
• All material third party consents and waivers necessary for the Company to complete the transactions contemplated by the Asset Purchase Agreement shall have been obtained including a waiver of the holders of a majority of the principal amount of the Company's outstanding debentures issued under the Company's Indenture dated as of February 24, 1998, and the consent of Sovereign Bank.

The obligation of the Company and JM Ney to complete the Asset Sale under the Asset Purchase Agreement is subject to the satisfaction or waiver of the following conditions:

• All of Deringer's representations and warranties in the Asset Purchase Agreement must be true and correct in all material respects as of the closing date;
• Derigner must have satisfied all covenants, agreements and conditions required by the Asset Purchase Agreement;
• No action shall have been threatened or pending that would restrain or prohibit the Asset Sale;
• The Asset Sale must have been approved by the holders of at least a majority of the Company's outstanding common shares; and
• All material third party consents and waivers necessary for the Company to complete the transactions contemplated by the Asset Purchase Agreement shall have been obtained including a waiver of the holders of a majority of the principal amount of the Company's outstanding debentures issued under the Company's Indenture dated as of February 24, 1998 and the consent of Sovereign Bank.

Indemnification Obligations

The Company and JM Ney have agreed to indemnify Deringer against any liabilities, including reasonable legal fees and expenses ("Losses"), that Deringer may incur (i) resulting from any breach by the Company or JM Ney of any of the representations, warranties, covenants or agreements of the Company or JM Ney, respectively under the Asset Purchase Agreement, (ii) relating to the liabilities retained by JM Ney or (iii) resulting from any failure of the parties to comply with applicable bulk sales laws. In order to secure payment of the indemnification obligations of the Company and JM Ney, $600,000 of the purchase price will be delivered to the escrow agent (the "Escrow Agent") under the terms of the Escrow Agreement. Of this amount, $300,000 will be held by the Escrow Agent for any Losses incurred by Deringer resulting from a breach of the representations and warranties made by the Company and JM Ney in connection with the description of JM Ney's inventory. The other $300,000 will be he ld by the Escrow Agent for any losses incurred by Deringer resulting from the liabilities retained by JM Ney, a breach of the other representations and warranties made by the Company or JM Ney in the Asset Purchase Agreement or the failure of the parties to comply with applicable bulk sales laws. Deringer's sole remedy for any breaches of the representations and warranties concerning inventory shall be limited to the $600,000 set aside in the Escrow Agreement. Deringer's remedies with regard to any other Losses shall not be limited to the amounts deposited under the Escrow Agreement. The Escrow Agent shall release to JM Ney any amounts not subject to claims by Deringer eighteen months after the closing of the transaction. The material terms of the Escrow Agreement are described in greater detail under the heading "The Asset Sale- Other Agreements in Connection with the Asset Sale" in Section I of this Proxy Statement beginning on page 20. A copy of the form of Escrow Agreement is attached as Appendix C and i ncorporated herein by reference.

Deringer has agreed to indemnify the Company and JM Ney against any Losses (i) resulting from any breach by Deringer of any of its representations, warranties, covenants or agreements under the Asset Purchase Agreement or (ii) relating to the liabilities retained by JM Ney.

No Solicitation

The Company and JM Ney have agreed that neither party will, and will not permit its respective employees, officers, directors, agents or representatives to, solicit any sale or acquisition relating to JM Ney's assets, JM Ney's capital stock, substantially all of the assets of the Company or any merger, consolidation or business combination involving the Company or JM Ney (each, a "Takeover Proposal"). The Company, however, may participate in discussions or negotiations and furnish information if it receives an unsolicited Takeover Proposal and the Company's Board of Directors determines in good faith after consultation with outside counsel that it is necessary to do so in order to comply with its fiduciary duties to the Company's stockholders.

Termination; Termination Fees

The Asset Purchase Agreement may be terminated and the transactions contemplated thereby may be abandoned at any time prior to the closing by:

• the mutual written consent of the Company, JM Ney and Deringer;
• Deringer, if the Company's stockholders do not approve the Asset Sale;
• JM Ney, if the Company accepts the superior offer of a third party to purchase substantially all of JM Ney's or the Company's assets or the Company accepts a more favorable offer of a third party to purchase more than 50% of the outstanding voting stock of the Company;
• any party, if the Asset Sale is not consummated on or before February 28, 2002; or
• any party, if a material breach or default of the covenants or agreements contained in the Asset Purchase Agreement shall be made by the other party and not cured within ten (10) business days.

In addition, Deringer had the right any time through December 10, 2001 to terminate the transaction if it was not satisfied, in its sole discretion, with its review of JM Ney's customer relationships or the terms of any of JM Ney's fixed price contracts. Deringer did not exercise this right to terminate the Asset Purchase Agreement.

If JM Ney unilaterally terminates the Asset Purchase Agreement because the Company's Board of Directors has approved or entered into an agreement relating to an acquisition of JM Ney's assets or the Company's assets by a third party or the acquisition of more than 50% of the combined voting power of the Company's Common Stock by a third party, then the Company must pay Deringer $300,000 in cash within two (2) calendar days following the termination.

If Deringer terminates the Asset Purchase Agreement because the Company's stockholders have not approved the Asset Sale, then the Company must pay Deringer $75,000 in cash within two (2) calendar days following the termination unless the Company's stockholders have not approved the Asset Sale following the withdrawal of the recommendation by the Company's Board of Directors, in which case the Company shall pay Deringer $300,000 in cash within two (2) calendar days following the termination.

Amendment

Any amendment or modification to the Asset Purchase Agreement will only be effective if in writing and signed by all of the parties.

Other Agreements in Connection with the Asset Sale

In connection with the Asset Sale, the parties propose to enter into the following agreements:

Lease. Under the Lease, a form of which is attached as Appendix B and incorporated herein by reference, JM Ney has agreed to lease JM Ney's manufacturing facility located in Bloomfield, Connecticut (the "Premises") to Deringer for a term of eight years (the "Lease Term"). Under the terms of the Lease, Deringer shall pay an annual rent of $290,000 in the first year of the Lease Term and increasing to $330,600 in the last year of the Lease Term. In addition to standard provisions found in most commercial triple net leases, Deringer shall have the right of first refusal to purchase the Premises if JM Ney seeks to sell the Premises to a third party.

Escrow Agreement. Under the Escrow Agreement, a copy of which is attached as Appendix C and incorporated herein by reference, $600,000 of the purchase price under the Asset Purchase Agreement shall be delivered to U.S. Bank, N.A., as Escrow Agent, to secure payment of the indemnification obligations of the Company and JM Ney under the Asset Purchase Agreement. Under the terms of the Escrow Agreement, $300,000 will held by the Escrow Agent to secure any indemnification claims under the Asset Purchase Agreement (the "General Indemnification Escrow Fund") and $300,000 will be held by the Escrow Agent to secure indemnification claims by Deringer resulting from a breach of the representations and warranties of the Company and JM Ney relating to JM Ney's inventory (the "Inventory Indemnification Escrow Fund"). Claims against the Escrow Funds shall be the exclusive remedy for any damages incurred by Deringer resulting from a breach of the representations and warranties of the Company and J M Ney relating to JM Ney's inventory; in addition, only claims with respect to JM Ney's inventory may be made against the Inventory Indemnification Escrow Fund. Claims against the General Indemnification Escrow Fund shall not be the exclusive remedy by Deringer for any other indemnification claims under the Asset Purchase Agreement. The Escrow Agent shall release to JM Ney any amounts not subject to claims by Deringer eighteen months after the closing of this transaction.

Potential Use of Proceeds -The Proposed CCTV Transaction

The Company is a party to the Letter Agreement which contemplates a proposed transaction by and among the Company, MBC, COMCOR and CCTV. CCTV is an operator licensed to provide broadband cable television, high speed Internet access, and data transmission services to up to 1.5 million residential and business customers within the City of Moscow, Russia. The terms of the Letter Agreement provide a framework under which the Company would acquire substantially all of the capital interests of MBC. The Letter Agreement also contemplates that the Company, directly or through MBC or another designee of the Company, would acquire all of the capital interests of CCTV. As further discussed below, if the proposed CCTV Transaction is completed as currently contemplated, the Company would devote the net proceeds of the Asset Sale to meet the Company's obligations in the CCTV Transaction.

Presently, MBC owns approximately 50% of the capital interests of CCTV. The other 50% of the capital interests of CCTV is owned by COMCOR. Upon execution of definitive documents by and among the Company, MBC, COMCOR and CCTV, (i) MBC will invest $5,000,000 in CCTV in exchange for preferred shares of CCTV which will convert into ordinary voting shares of CCTV and (ii) COMCOR would contribute certain assets to CCTV which, together with contributions previously made to CCTV by COMCOR, would be valued at approximately $30,000,000. The assets would be contributed by COMCOR to CCTV in exchange for ordinary voting shares of CCTV. The preferred shares of CCTV issued to MBC will be converted to ordinary voting shares prior to the issuance of the CCTV shares to COMCOR. The ordinary voting shares held by MBC and COMCOR would be deposited with a custodian under an arrangement restricting the ability of each of MBC and COMCOR to vote such shares pending completion of certain subsequent steps in the CCT V Transaction. MBC has already advanced $2,000,000 to CCTV in exchange for a note which CCTV is obligated to repay. Repayment of this note will begin upon the earlier of 180 days after the advance or upon the additional $5 million investment by MBC in CCTV, described above.

Under the terms of the Letter Agreement, the Company would negotiate to acquire substantially all of the outstanding equity interests of MBC not presently owned by it in exchange for shares of the Company's common stock. The Company and representatives of MBC will determine whether this exchange will occur directly with the holders of MBC's capital interests or through a merger with a newly created subsidiary. In addition, the Company and the representatives of MBC will determine the aggregate value of the exchange or merger. Subject to the acquisition of the MBC capital interests, the Company would issue shares of its common stock, valued at approximately $30,000,000, to COMCOR (or COMCOR's designee) in exchange for (i) the transfer of COMCOR's 50% capital interest in CCTV to MBC (or another designee of the Company) and (ii) the transfer of the assets to CCTV by COMCOR, described above. The number of shares of the Company's common stock to be issued to COMCOR would depend upon the trading value of the Company's common stock at the time of the closing of the CCTV Transaction. Upon completion of the acquisition by the Company of the outstanding MBC capital interests and the issuance of the Company's common stock to COMCOR, MBC would contribute approximately $16,000,000 to CCTV in exchange for ordinary voting shares of CCTV. Some portion of the $16,000,000 investment by MBC may be funded by the Company with proceeds from the Asset Sale.

Under the terms contemplated in the Letter Agreement, the proposed CCTV Transaction is subject to a number of contingencies and conditions precedent including, but not limited to, the following:

- adoption by CCTV of all corporate action necessary to issue shares of CCTV to each of MBC and COMCOR;

- the approval by appropriate Russian regulatory authorities of numerous steps in the Transaction including the issuance of CCTV shares to MBC;

- negotiation, approval, execution and delivery of definitive agreements and documents among the Company, MBC, COMCOR and CCTV;

- approval of the transaction by the Committee on Foreign Investment in the United States pursuant to the Exon-Florio Amendment;

- approval of the stockholders of the Company and MBC; and

- the five-day average price of the Company's common stock remaining between $8 and $12 per share at the time of the closing of the CCTV Transaction.

Although MBC has already advanced CCTV $2,000,000, there can be no assurances that the remaining steps of the CCTV Transaction will occur or will occur as presently contemplated. If any of these conditions to the CCTV Transaction are not met or if possible, waived, the CCTV Transaction will not occur. In addition, the overall success of the CCTV Transaction may be dependent on the Company's ability to make continuing equity investments above and beyond that contemplated by the Letter Agreement in order to fund CCTV's future operations.

The consummation of the CCTV Transaction, as contemplated, would cause substantial ownership dilution to the existing stockholders of the Company. For example, dilution to the Company's stockholders would occur upon the issuance of the Company's common stock to COMCOR as described above. Additional dilution to the Company's stockholders would occur upon the issuance of the Company's common stock to the MBC holders in exchange for the MBC capital interests described above. If the proposed CCTV Transaction is completed, certain officers, directors and stockholders of the Company who are also officers, directors and/or stockholders of MBC would increase their ownership interests in the Company. There are additional, potential conflicts of interests, both direct and indirect, among the related parties to the CCTV Transaction, certain of which are described in the section entitled "Certain Relationships and Related Transactions," in the Corporate Governance portion of Section II of this Proxy S tatement. In addition, Yuri I. Pripachkin, the General Director of COMCOR, holds options to purchase the Company's common stock and is a member of the Board of Directors of the Company. Mr. Pripachkin and his affiliates own a controlling interest in COMCOR.

The consummation of the proposed CCTV Transaction, as presently contemplated, would make the net proceeds of the Asset Sale unavailable for other uses by the Company. Regardless of whether the proposed CCTV Transaction is completed, the Company will use approximately $6,000,000 of the proceeds from the Asset Sale for the purposes set forth in items 1-5 in the section entitled "What Will the Proceeds be Used For?" in the Question and Answer portion of Section I of this Proxy Statement. Conversely, if the CCTV Transaction is not consummated for any reason, the Company will use the undesignated portion of the remaining proceeds from the Asset Sale for general corporate purposes and for other uses, including acquisitions and investments that the Board of Directors may approve in the future.

THE CONSUMMATION OF THE PROPOSED CCTV TRANSACTION IS NOT A CONDITION PRECEDENT TO THE ASSET SALE. THE COMPANY INTENDS TO PROCEED WITH THE ASSET SALE REGARDLESS OF THE LIKELIHOOD OF COMPLETING THE PROPOSED CCTV TRANSACTION. NEITHER THE BOARD OF DIRECTORS' RECOMMENDATION TO THE STOCKHOLDERS TO VOTE FOR THE ASSET SALE NOR THE BOARD'S DETERMINATION THAT THE ASSET SALE IS IN THE BEST INTERESTS OF THE COMPANY'S STOCKHOLDERS IS CONDITIONED UPON THE CONSUMMATION OF THE PROPOSED CCTV TRANSACTION. YOU ARE NOT BEING ASKED TO VOTE ON THE PROPOSED CCTV TRANSACTION IN THIS PROXY.

MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES

The following summary of the material U.S. federal income tax consequences of the Asset Sale is not intended to be tax advice to any person, nor is it binding upon the Internal Revenue Service. In addition, no information is provided herein with respect to the tax consequences of the Asset Sale under applicable state, local, or foreign tax laws or other federal tax laws.

The Company will recognize taxable gain from the Asset Sale and from the disposition of other net current assets not purchased by Deringer, after expenses of this transaction, in an amount equal to the difference between the amount realized by the Company and the Company's adjusted tax basis in the assets sold or otherwise liquidated. The amount realized by the Company from the Asset Sale will equal the sum of :

• the cash consideration to be received by the Company from Deringer;
• the amount of the liabilities assumed by Deringer; and
• the aggregate amount of liabilities to which the assets being transferred are subject.

The Company had a federal net operating loss carry-forward of approximately $2,056,000 as of February 28, 2001 and it also anticipates that it will generate additional operating losses during the current fiscal year, excluding the impact of the Asset Sale. Accordingly, the Company anticipates that the projected gain generated by the Asset Sale will be partially offset by such net operating losses for federal regular income tax purposes, and, as a consequence, the Company will incur a smaller federal regular income tax liability in connection with the Asset Sale than would otherwise be paid.

The Asset Sale will not result in any direct federal income tax consequences to stockholders of the Company.

SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT

This table is provided in Part II -"The Annual Meeting" beginning on page 26 of this Proxy Statement.

STOCKHOLDER PROPOSALS

Any stockholder desiring to have a proposal included in our Proxy Statement for the Company's 2002 Annual Meeting must have delivered such proposal (which must comply with the requirements of Rule 14a-8 promulgated under the Securities Exchange Act of 1934) to our principal offices no later than April 30, 2002.

OTHER MATTERS

Our Board of Directors is not presently aware of any matters to be presented at the Special Meeting other than those described above. However, if other matters properly come before the Special Meeting, it is the intention of the persons named in the accompanying proxy to vote said proxy on such matters in accordance with their judgment.

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission. Reports, proxy statements and other information filed by the Company, including the Company's Annual Report on Form 10-K for the fiscal year ended February 28, 2001, may be inspected and copied at the public reference facilities maintained by the Commission at Room 1024, 450 5th Street, N.W., Washington, D.C. 20549 and at the Regional Offices at 233 Broadway, New York, NY 10279 and at Citicorp Center, Suite 1400, 500 W. Madison Street, Chicago, IL 60661. Copies of such information also may be obtained by mail from the Public Reference Section of the Commission at 450 5th Street, N.W., Washington, D.C. 20549 at prescribed rates. The Commission maintains a web site at www.sec.gov containing reports, proxy and informa tion statements and other information regarding registrants, including the Company, that file electronically.

ANDERSEN GROUP, INC

/s/ Francis E. Baker

Francis E. Baker

Secretary

December [ ], 2001

II. ANNUAL MEETING

ABOUT THE ANNUAL MEETING

When and Where is the Annual Meeting?

The Annual Meeting will be held on [ ], 2002 at 11:15 a.m., at The Wings Club, 52 Vanderbilt Avenue, 18^th Floor, New York, New York.

What is the Purpose of the Annual Meeting?

At the Annual Meeting, the Company's stockholders will be asked to consider and vote upon (i) the election of directors for the ensuing year (the "Election of Directors") and (ii) such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof.

Who is Entitled to Vote?

Only stockholders of record at the close of business on the record date, [ ], 2001, are entitled to receive notice of the Annual Meeting and to vote the shares that they held on that date at the meeting, or any postponement or adjournment of the meeting. At the close of business on November 15, 2001, there were issued and outstanding 2,093,161 shares of the Company's common stock, which are entitled to cast 2,093,161 votes.

Who May Attend the Meeting?

All stockholders as of the record date, or their duly appointed proxies, may attend the Annual Meeting.

What Constitutes a Quorum?

The presence at the Annual Meeting, in person or by proxy, of the holders of a majority of the outstanding shares on the record date will constitute a quorum, permitting the Company to conduct its business at the Annual Meeting. Proxies received but marked as abstentions will be included in the calculation of the number of shares considered to be present at the meeting.

How Do I Vote?

You may vote on matters to come before the Annual Meeting in two ways:

• You may attend the Annual Meeting and cast your vote in person; or
• You may vote by completing, dating and signing the enclosed proxy card and returning it to Register & Transfer Company, the Company's transfer agent in the enclosed postage-paid envelope. If you deliver a valid proxy, you will authorize the individuals named on the proxy card, referred to as the proxy holders, to vote your shares according to your instructions. UNLESS THE PROXY SPECIFIES THAT IT IS TO BE VOTED AGAINST OR IS AN ABSTENTION ON A LISTED MATTER, PROXIES WILL BE VOTED FOR THE ELECTION OF DIRECTORS AND OTHERWISE IN THE DISCRETION OF THE PROXY HOLDERS AS TO ANY OTHER MATTER THAT MAY COME BEFORE THE ANNUAL MEETING.

What if I Vote And then Change My Mind?

You may revoke your proxy at any time before it is exercised by:

• filing a notice or revocation with the Company's Secretary;
• sending in another duly executed proxy bearing a later date; or
• attending the Annual Meeting and casting your vote in person.

Your last vote will be the vote that is counted.

What is the Board's Recommendations?

THE BOARD RECOMMENDS A VOTE FOR THE ELECTION OF DIRECTORS. With respect to any other matter that properly comes before the meeting, the proxy holders will vote as recommended by the Board of Directors or, if no recommendation is given, in their own discretion.

What Vote is Required?

Under Delaware law, the Election of Directors requires the affirmative vote of a plurality of the votes cast by the shares entitled to vote at the Annual Meeting.

What are the Effects of Abstentions and Broker Non-Votes?

Abstentions occur when a person with voting power checks the abstention box on a proxy card for a particular proposal or otherwise indicates that he or she abstains from voting on a proposal. A broker non-vote occurs when a nominee holding shares for a beneficial owner (i.e., your broker) returns an executed proxy but does not vote on a particular proposal because the nominee does not have the discretion to vote with respect to that particular proposal and has not received instructions from the beneficial owner.

If you hold your shares in "street name" through a broker or other nominee, your broker or nominee is not permitted to exercise voting discretion with respect to the Election of Directors. Thus, if you do not give your broker or nominee specific instructions as to how to vote in connection with the Election of Directors, your shares will not be voted on the Election of Directors and will not be counted in determining the number of shares necessary for approval. BECAUSE THE APPROVAL OF THE HOLDERS OF AT LEAST A PLURALITY OF THE VOTES CAST BY THE SHARES ENTITLED TO VOTE IN THE ELECTION AT THE ANNUAL MEETING IS REQUIRED TO APPROVE THE ELECTION OF DIRECTORS, BROKER NON-VOTES AND ABSTENTIONS HAVE AN EFFECT ON THE OUTCOME OF THE ELECTION OF DIRECTORS.

Who Will Bear the Costs of Soliciting Proxies?

The Company will pay the cost of all proxy solicitations. Officers and other employees of the Company also may solicit proxies by personal interview, by electronic means or by telephone or facsimile equipment, in addition to the use of the mails. None of these individuals will receive special compensation for such services, which will be performed in addition to their regular duties, and some of them may not necessarily solicit proxies. The Company also has made arrangements with brokerage firms, banks, nominees and other fiduciaries to forward proxy solicitation materials for shares held of record by them to the beneficial owners of such shares. Upon request, the Company will reimburse these record holders for their reasonable out-of-pocket expenses.

THE COMPANY WILL PROVIDE, WITHOUT CHARGE, TO EACH PERSON TO WHOM THIS PROXY STATEMENT IS DELIVERED, UPON WRITTEN OR ORAL REQUEST OF SUCH PERSON AND BY FIRST CLASS MAIL OR OTHER EQUALLY PROMPT MEANS, A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR ITS FISCAL YEAR ENDED FEBRUARY 28, 2001, INCLUDING THE FINANCIAL STATEMENTS AND SCHEDULES THERETO, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. REQUESTS SHOULD BE DIRECTED BY MAIL TO FRANCIS E. BAKER, SECRETARY, ANDERSEN GROUP, INC., 515 MADISON AVENUE, SUITE 2600, NEW YORK, NY 10022 OR BY TELEPHONING THE COMPANY AT (212) 826-8942.

CORPORATE GOVERANCE

Meetings of the Board

During the fiscal year ended February 28, 2001, the Board of Directors held five regular meetings and three special meetings. All of the directors attended at least seventy-five percent (75%) of the aggregate of the meetings of the Board and of the meetings of the committees of the Board on which each served.

Executive Committee

The Board has an Executive Committee comprised of Oliver R. Grace, Jr. (Chairman), Francis E. Baker and John S. Grace. The responsibilities of the Executive Committee include selection of potential nominees for director and the recommendation of nominees to the full Board, monitoring the Company's management resources, structure, succession planning, development and performance of key executives and review and recommendation of new business opportunities to the entire Board. There were no meetings of the Executive Committee during the fiscal year ended February 28, 2001.

Nominating Committee

The Board does not have a Nominating Committee. The Executive Committee considers the qualifications of persons to be recommended to the Board and stockholders for election as directors of the Company. Such recommendations must be accompanied by appropriate background information and documentation.

Audit Committee

During the fiscal year ended February 28, 2001, the Board's Audit Committee was comprised of Louis A. Lubrano (Chairman), James J. Pinto and Thomas McPartland. The Audit Committee is primarily concerned with the effectiveness of the audits of the Company by the Company's independent certified public accountants. Among other things, its duties include: recommending the selection of independent certified public accountants; reviewing the scope of the audit to be conducted by them, as well as the results of their audit; reviewing the organization and scope of the Company's internal system of financial controls; evaluating the Company's financial reporting activities (including its Proxy Statement and Annual Report on Form 10-K) and the accounting standards and principles followed by the Company; and examining other reviews covering compliance by employees with important Company policies. The Directors who serve on the Audit Committee are all "independent" for the purposes of NASDAQ li sting standards. The Board of Directors has determined that none of the Audit Committee members have a relationship to the Company that may interfere with their independence from the Company and its management. The Board of Directors has adopted a written charter describing the functions of the Audit Committee. (See Appendix D, Audit Committee Charter for a more detailed description of the Audit Committee's functions). There were three meetings of the Audit Committee during the fiscal year ended February 28, 2001.

Compensation Committee

The Board has a Compensation Committee comprised of James J. Pinto (Chairman) and Louis A. Lubrano, each of whom is an independent, non-employee director. The Compensation Committee reviews and recommends executive compensation, including changes therein, and administers the Company's stock option plans. There was one meeting of the Compensation Committee during the fiscal year ended February 28, 2001.

Pension Committee

The Board also has a Pension Committee. This Committee is presently comprised of Frank A. Baker (Chairman) and Oliver R. Grace, Jr. The Pension Committee monitors the administration of the Company's and its subsidiary's qualified retirement plans to ensure investment management is consistent with the Committee's objectives. There were no meetings of the Pension Committee during the fiscal year ended February 28, 2001.

Independent Committee

The Board also has an Independent Committee comprised of Frank A. Baker (Chairman), Louis A. Lubrano and James J. Pinto. This Committee considers and reviews any and all transactions with affiliates of the Company. There were no meetings of the Independent Committee during the fiscal year ended February 28, 2001.

Director Compensation

During fiscal year 2001, each non-employee director received a fee of $10,200 per year, and $500 plus a reimbursement of expenses for each Board meeting attended. All non-employee directors that serve as Chairpersons of committees of the Board received additional compensation of $2,000 per year. In addition, Mr. John S. Grace, an employee of one of the Company's subsidiaries, received a salary of $12,000; plus $4,800 for Board fees and $500 for each Board meeting attended.

Employment Agreements

Ronald N. Cerny has an employment agreement with JM Ney, which, among other things, provides for severance pay in the event of involuntary termination for other than cause. In such case, the Company, at its option, will provide Mr. Cerny with twelve months of notice or salary and fringe benefits or any combination thereof. In connection with the Asset Sale, the Company is negotiating a severance package with Mr. Cerny.

Certain Relationships and Related Transactions

MBC: At February 28, 1999, the Company owned 50% of Treglos Investments Limited ("Treglos") which owned an investment in the Institute for Automated Systems ("IAS"), a Russian telecommunications company. At that date, Oliver R. Grace, Jr., the Company's President and Chief Executive Officer, and his brother John S. Grace, a Director of the Company, each owned directly and indirectly approximately 22% of Treglos. Treglos has since changed its name to ABC Moscow Broadband Communication Limited ("MBC").

During the period from March 1, 1999 through December 31, 1999, the Company invested an additional $300,000, including $39,000 of allocated salaries, in MBC, which was matched equally by the other Moscow Broadband shareholders. These funds were used primarily to pay expenses relating to developing an agreement with COMCOR to own and operate CCTV, which has undertaken to deliver cable television, data transmission and Internet access and IP telephony throughout the Moscow, Russia region.

During January 2000 through March 2000, MBC conducted a private placement of its common stock in which it raised $18,000,000 in gross cash proceeds. The Company invested $4,500,000 in this private placement, including the conversion of $500,000 of unrecorded accounts receivable from MBC into MBC stock. In addition, entities formed for the benefit of Oliver R. Grace, Jr. and John S. Grace, or their families, invested $6,090,000, including the conversion of $475,000 of receivables from MBC into MBC stock. Francis E. Baker, the Company's Chairman, invested $500,000, Thomas McPartland, a Director, invested $500,000, James J. Pinto, a Director, directly and indirectly invested $600,000, Peter N. Bennett, a Director, invested $200,000 and Andrew M. O'Shea, the Company's Chief Financial Officer, invested $10,000. Also, Ann Marie Lubrano, the daughter of Louis A. Lubrano, a Director, invested $100,000.

The accounts receivable to the Company and the Grace-controlled interests, as well as to one other investor, represented a portion of amounts paid into MBC from 1995 through 1999.

During January and February 2000, the Company allocated $46,833 of expenses to MBC for administrative and due diligence services. At February 29, 2000, the Company had recorded a receivable of $91,747 for such allocated costs and for expenses paid on MBC's behalf which was subsequently received.

During fiscal 2000, Oliver R. Grace, Jr., President and Chief Executive Officer, extended the Company a $1,000,000 loan for the purpose of increasing the Company's investment in MBC. This loan which bears interest at the annual rate of 8.5% to be paid quarterly, and is secured by a first lien on real estate owned by Andersen Realty, Inc., a wholly-owned subsidiary of the Company, had an original maturity date of August 2001 which was extended to April 2002. The loan was paid in full in December 2001 in connection with the sale of real estate which had been securing the obligations. During fiscal 2001, the Company paid Mr. Grace, Jr. interest totaling $85,000 in connection with this loan. In connection with the loan, Mr. Grace, Jr. also received a warrant to purchase 18,706 shares of the Company's stock at an exercise price of $16.04 per share.

During fiscal 2001, the Company allocated $203,696 of expenses to MBC for administrative services provided. During January and February 2000, the Company allocated $46,833 of expenses to MBC for administrative and due diligence services. Prior to January 2000, the Company did not allocate expenses to MBC.

The loan was paid in full in December 2001 in connection with the sale of the real estate which had been securing this obligation.

On November 26, 2001, the Company entered into the Letter Agreement with COMCOR, CCTV and MBC, which provides a framework for the Company, directly or through MBC, to acquire substantially all of the capital interests of CCTV. Under the terms of the proposed CCTV Transaction, the Company would issue shares of its common stock to COMCOR valued at approximately $30,000,000 in exchange for the transfer of COMCOR's 50% capital interests in CCTV to MBC as well as in consideration of the transfer of certain assets to CCTV by COMCOR. The number of shares of the Company's common stock to be issued to COMCOR would depend on the market value of the Company's shares at the time of the closing of the CCTV Transaction.

The Company would also negotiate to acquire the substantially all of the outstanding equity interests of MBC not presently owned by it in exchange for the Company's common stock. The Company and representatives of MBC will determine whether this exchange will occur directly with the holders of MBC's capital interests or through a merger with a newly created subsidiary. In addition, the Company and representatives of MBC will determine the aggregate value of the exchange or merger. There are certain conflicts of interest, both direct and indirect, among the related parties to the proposed CCTV Transaction, including certain officers, directors and significant stockholders of the Company who are officers, directors and/or shareholders of MBC and/or CCTV. A more complete description of the proposed CCTV Transaction can be found under the heading "The Asset Purchase Agreement-Potential Use of Proceeds-The Proposed CCTV Transaction" in Section I of the Proxy Statement beginning on page 21.

Other: During April 2000, the Company borrowed an additional $200,000 from Mr. Grace, Jr. in exchange for a 8.5% secured note and a warrant to purchase 5,393 shares of the Company's common stock at $11.13 per share. This transaction was authorized by the Board's Executive Committee subject to approval of the Board of Directors. During fiscal 2001, the Company paid Mr. Grace, Jr. interest totaling $16,338 in connection with this additional loan. This note and related interest was repaid by the Company in April 2001. This amount was borrowed to enable the Company to meet its preferred dividend and interest payment requirements.

In April 2000, the Company borrowed $50,000 from Francis E. Baker, Chairman, in exchange for an unsecured demand note which bears interest at the rate of 10% per annum. This transaction was authorized by the Board's Executive Committee subject to approval of the Board of Directors. During Fiscal 2001, the Company paid Mr. Baker interest totaling $528 in connection with this loan. This loan and related interest was repaid in May 2000.

The Company leases office space from a company owned by Oliver R. Grace, Jr., President and Chief Executive Officer, for which it paid $46,172 during the fiscal year ended February 28, 2001.

During fiscal 2001 the Company's Chairman and Secretary, Francis E. Baker, was granted a bonus in the form of the forgiveness of $111,743 of a $223,487 note payable from Mr. Baker to the Company. In May 2001, Mr. Baker repaid an unsecured non-interest-bearing note to the Company in the amount of $111,744. The original note was accepted by the Company in exchange for ownership of a life insurance policy at the approximate cash surrender value as of the date of the transaction.

REPORT OF THE AUDIT COMMITTEE

In the performance of our oversight responsibilities, the Audit Committee has reviewed and discussed with management the Company's audited consolidated financial statements for the year ended February 28, 2001.

The Audit Committee has discussed with the independent auditors the matters required to be discussed by Statement on Auditing Standards No. 61, Communication with Audit Committees.

The Audit Committee has received the written disclosures and the letter from the independent auditors required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees) and has discussed with the independent auditors the independent auditors' independence.

Based on the reviews and discussions referred to above, in reliance on management and the independent auditors, and subject to the limitations of our role, the Audit Committee recommended to the Board of Directors that the financial statements referred to above be included in the Company's Annual Report on Form 10-K.

The foregoing report has been

Approved by all of the members

of the Audit Committee

Louis A. Lubrano

James J. Pinto

Thomas McPartland

ELECTION OF DIRECTORS

ITEM 2 ON PROXY CARD

Eight directors are to be elected at the Annual Meeting for a term of one year and until their successors shall be elected and qualified. Unless authority is withheld, it is intended that votes will be cast pursuant to the enclosed proxy for the election of the eight nominees set forth below. Each of the nominees is presently a member of the Board and has agreed to serve as a director if so elected. In the event that any of the nominees should become unable or unwilling to serve as a director, a contingency which management has no reason to expect, it is intended, except when authority has been withheld, that the proxy will be voted FOR the election of such person, if any, as shall be designated by the Board. The names of, and certain information with respect to, the persons nominated for election as directors are as follows:

OLIVER R. GRACE, JR., age 47, has been a Director of the Company since 1986, President and Chief Executive Officer since 1997, and was Chairman from 1990 to 1997. Mr. Grace is the Chairman of Moscow Broadband Communication Ltd. He has also been President and a Director of AG Investors, Inc., one of the Company's subsidiaries, since 1992 and a Director of JM Ney since February 1997. Mr. Grace, Jr. is a General Partner of The Anglo American Security Fund L.P. and Republic Automotive Parts, Inc. He also serves on the Board of Directors of ComCor-TV. Mr. Grace, Jr. is the brother of Director John S. Grace.

FRANCIS E. BAKER, age 71, has been Chairman and Secretary of the Company since 1997, a Director since 1959, and President and Chief Executive Officer of the Company from 1959 to 1997. Mr. Baker is also the President of Moscow Broadband Communication Ltd. He also serves as a Director of JM Ney. He also serves on the Board of Directors of ComCor-TV.

PETER N. BENNETT, age 65, has been a Director of the Company since 1992. He is a private investor and financial consultant.

JOHN S. GRACE, age 44, has been a Director of the Company since 1990. He is the Chairman of Sterling Grace Corporation and a General Partner of The Anglo American Security Fund L.P. Mr. Grace has been an employee of AG Investors, Inc., one of the Company's subsidiaries, since 1992. John S. Grace is the brother of Oliver R. Grace, Jr.

LOUIS A. LUBRANO, age 68, has been a Director of the Company since 1983. Mr. Lubrano is currently Senior Vice President with Gilford Securities, Incorporated, a New York City-based brokerage firm. Mr. Lubrano was formerly with Herzog, Heine, Geduld, Inc., members of the New York Stock Exchange and from 1991-1996 was a Managing Director of Stires and Company, Inc.

THOMAS MCPARTLAND, age 43, has been a Director of the Company since April 2000. He is founder and majority shareholder of Convergence Media, Ltd., a consulting and investment company and former President and CEO of TCI Music now known as Liberty Digital. Mr. McPartland is the Executive Chairman and member of the Board of Directors of Redwood Partners International a pan-European executive search, strategic and financial consulting company focusing on the technology, media and telecommunications sector. Mr. McPartland is also a Board member of PlantAmerica, Inc., a company that specializes in providing information resources and related technology solutions for the green industry.

JAMES J. PINTO, age 50, has been a Director of the Company since 1988. He is President of the Private Finance Group Corp., a merchant banking and venture capital firm, a position he has held since 1990. Mr. Pinto also serves as a Director of FragranceNet.com, Inc.

YURI I. PRIPACHKIN, age 41, currently serves as Chairman of the Board of Directors of "Moscow Telecommunications Corporation" (COMCOR), a position he has held since 1997. Dr. Pripachkin had been a General Director of COMCOR from 1992 to 1997. Dr. Pripachkin also serves as President of Russian Association of Cable Television.

EXECUTIVE COMPENSATION

The following information is provided regarding the annual and long-term compensation paid or to be paid to the Chief Executive Officer and the three other most highly compensated executive officers of the Company with respect to the fiscal years 2001, 2000, and 1999.

SUMMARY COMPENSATION TABLE

				Long Term
				Compensation
	Annual Compensation			Awards
				Securities
				Underlying	All Other
Name and Principal Position	Fiscal Year	Salary (1) $	Bonus $	Options/SARs	Compensation (3)
				#	$
Oliver R. Grace, Jr. President and Chief Executive Officer	2001	95,077	-	-	2,971
	2000	60,446	-	-	2,017
	1999	85,000	-	-	2,550
Francis E. Baker Chairman and Secretary	2001	45,000(2)	-	-	111,743
	2000	98,000	-	-	-
	1999	120,000	15,000	20,000	-
Ronald N. Cerny President, The J.M. Ney Company	2001	186,024	-		5,319
	2000 1999	171,473 164,808	- 10,000	- 5,000	5,030 4,987
Andrew M. O'Shea Chief Financial Officer, and Chief Financial Officer of The J.M. Ney Company	2001	132,501	25,000		4,044
	2000	120,513	10,000	-	3,959
	1999	112,209	6,680	-	4,283

1. Includes amounts of compensation deferred by the employee pursuant to the Company's 401(k) plan.
2. For the fiscal year ended February 28, 2001, Mr. Baker received cash compensation from the Company totaling $45,000, a portion of which was included in the basis for allocations of expenses to Moscow Broadband. For the remaining portion of the fiscal year, he was compensated by Moscow Broadband. Total cash compensation received by Mr. Baker during Fiscal 2001 from both the Company and Moscow Broadband totaled $187,428.
3. For Messrs. Grace, Jr., Cerny and O'Shea this amount consists of contributions made by the Company in respect of its 401(k) plan. For Mr. Baker, this amount represents the portion of a note payable to the Company which was written off as a bonus.

OPTIONS/SAR GRANTS IN LAST FISCAL YEAR

No stock options were issued by the Company or by JM Ney during fiscal year 2001.

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR

AND FISCAL YEAR END OPTION/SAR VALUES

The following table sets forth certain information with respect to options/SARs exercised during fiscal year 2001 by the individuals named in the Summary Compensation Table and unexercised options to purchase the Company's Common Stock granted under the Incentive Stock Option Plan to the individuals named in the Summary Compensation Table.

Name	Shares Acquired On Exercise (#)	Value Realized ($)	Number of Securities Underlying Unexercised Options/SARs at Fiscal Year End(#) Exercisable/ Unexercisable	Value of Unexercised In-the- Money Options/SARs at Fiscal Year End($) Exercisable/ Unexercisable
Oliver R. Grace, Jr.	-	-	9,500/0	$30,941/$0
Francis E. Baker	-	-	20,000/0	$33,760/$0
Ronald N. Cerny	3,000	$22,313	5,000/0	$8,440/$0
Andrew M. O'Shea	10,000	$95,625	0/0	$0/$0

Board Compensation Committee Report on Executive Compensation

The Compensation Committee of the Board is responsible for reviewing the Company's executive compensation program and policies each year and determining the compensation of the Company's senior executive officers. The Committee's determination on compensation of the Company's Chief Executive Officer and other executive officers is reviewed with and approved by the entire Board.

The Compensation Committee of the Board was comprised of Messrs. James J. Pinto and Louis A. Lubrano, independent directors.

The fiscal year 2001 base pay of each of the Company's executive officers was determined on the basis of the individual's responsibilities and performance and a comparison with salaries paid by competitors of the Company. The bonus component of executive compensation is directly related to corporate and business unit performance. The Committee's overall policy regarding compensation of the Company's executive officers is to provide competitive salary levels and compensation incentives that attract and retain individuals of outstanding ability in key positions that recognize individual performance and the performance of the Company relative to the performance of other companies of comparable size, complexity and quality, and that support both the short-term and long-term goals of the Company. The executive compensation program includes elements which, taken together, constitute a flexible and balanced method of establishing total compensation for senior management.

Compensation paid to the Company's executive officers for fiscal year 2001 consisted primarily of salary, bonus and contributions made by the Company in respect of its 401(k) Plan.

For fiscal 2001, the Committee established the compensation of Oliver R. Grace, Jr., the President and Chief Executive Officer of the Company, using the same criteria used to determine compensation for other executive officers. Mr. Grace, Jr.'s fiscal 2001 base pay was based upon a voluntary salary reduction and the Committee's overall assessment of Mr. Grace, Jr.'s performance and upon market data.

It is the opinion of the Committee that the aforementioned compensation structures provide features which properly align the Company's executive compensation with corporate performance and the interests of its stockholders and which offer competitive opportunities in the marketplace.

Under Section 162(m) of the Internal Revenue Code and the regulations promulgated thereunder, deductions for employee remuneration in excess of $1 million which is not performance based are disallowed for publicly traded companies. The Committee has determined that it is unnecessary at this time to seek to qualify the components of its compensation program within the meaning of Section 162(m).

The foregoing report has been

approved by all members of the

Compensation Committee

James J. Pinto, Chairman

Louis A. Lubrano

Performance Graph

The following graph compares the performance of the Company for the periods indicated with the performance of the National Association of Securities Dealers Automated Quotation ("NASDAQ") Composite Stock Index (the "NASDAQ Composite") and the performance of the NASDAQ Industrial Composite Stock Index (the "Peer Group"). The comparative five-year total returns assume a $100 investment made on February 28, 1996 with dividends reinvested. The stockholder return shown for Andersen Group, Inc. ("AGI") on the following graph is not necessarily indicative of future stock performance.

Comparative Five-Year Total Returns

Andersen Group, Inc., NASDAQ Composite and Peer Group

(Performance results through February 28, 2001)

	1996	1997	1998	1999	2000	2001
AGI	$100.00	$183.33	$196.00	$133.33	$570.83	$211.68
NASDAQ Composite	$100.00	$166.69	$225.46	$291.36	$598.08	$195.61
Peer Group	$100.00	$141.14	$168.70	$167.82	$337.68	$135.96

Pension Benefits

The following table sets forth the estimated aggregate annual benefit payable upon retirement or at normal retirement age for each level of remuneration specified at the listed years of service in accordance with the Company's defined benefit plan. The pension benefits are based on calendar year earnings and are payable in the form of a life annuity. For calendar 2001, the maximum annual compensation limit for determining pension benefits was $170,000.

Pension Plan Table

Years of Service

Remuneration	5	1 0	15	20	25	30
$100,000	$ 4,450	$ 8,900	$13,350	$17,800	$22,250	$26,700
125,000	6,013	12,025	18,038	24,050	30,063	36,075
150,000	7,575	15,150	22,725	30,300	37,875	45,450
170,000	8,825	17,650	26,475	35,300	44,125	52,950

An individual's pension benefits are equal to the greater of the following two calculations: (A) .75% of final average earnings (average annual earnings for the five consecutive years of highest earnings in the employee's last 10 years of employment) plus .50% of final average earnings in excess of covered compensation (covered compensation equals the average of the Social Security wage base for the individual based upon his/her age) multiplied by the employee's years of service as a qualified employee (up to a maximum of 40 years), or (B) the sum of the individual's accrued pension benefit at December 31, 1993 calculated pursuant to (A) plus the individual's average compensation for the years since December 31, 1993 (average compensation equals the highest average annual earnings for the five consecutive years since December 31, 1993, up to a maximum of $160,000) multiplied by the percentages in (A), multiplied by the number of years of service since 12/31/93. Pension benefits payable upo n retirement are increased by a late retirement factor due to the delay in receipt of benefits if the employee continues to work after attaining the age of 65.

Pension benefits are not reduced on account of social security benefits received by the employee. Average earnings is the sum of the amounts shown in the columns labeled "Salary" and "Bonus" in the Summary Compensation Table. For purposes of the Pension Plan Table, the amount used for covered compensation is the average of the covered compensation for each of the individuals named in the Summary Compensation Table. As of February 28, 2001, the executive officers named in the Summary Compensation Table have the following years of credited service for pension plan purposes under the Table: Mr. Grace, Jr. 8 years; Mr. Cerny 7 years; and Mr. O'Shea 5 years. Mr. Baker's pension benefits have been computed in accordance with (B) of the above formula and have been enhanced by the late retirement factor pursuant to the Plan. The estimated aggregate annual benefit being paid to Mr. Baker from the Company's defined benefit pension plan is $29,913.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's officers and directors, and persons who own more than ten percent of its Common Stock ("Insiders"), to file reports of ownership and changes in ownership with the Securities and Exchange Commission and the National Association of Securities Dealers, Inc. Insiders are required by the regulations of the Commission to furnish the Company with copies of all Section 16(a) forms that they file.

Based solely on its review of the copies of such forms received by it or written representations from certain reporting persons that no such forms were required for those persons, the Company believes that during fiscal year 2001 all filing requirements applicable to its directors, officers and persons who own more than ten percent of the Company's Common Stock were satisfied.

PRINCIPAL STOCKHOLDERS AND SECURITY

OWNERSHIP OF MANAGEMENT OF THE COMPANY

The following table sets forth information regarding the beneficial ownership of Common Stock, as of October 31, 2001 by each director, by each named executive officer of the Company described in "Executive Compensation", by persons known by the Company who beneficially own 5% or more of the outstanding shares of Common Stock, and by all directors and executive officers of the Company as a group. The beneficial ownership information described and set forth below is based on information furnished by the specified persons and is determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended. It does not constitute an admission of beneficial ownership for any other purpose.

Name and Address of Beneficial Owner	Amount and Nature of Beneficial Ownership		Percent of Class
	Preferred	Common	Preferred	Common
Francis E. Baker(1) 8356 Sego Lane, Vero Beach, Florida	0	126,207	0	6.0
Estate of Oliver R. Grace, Sr. c/o Lorraine G. Grace, Executrix 49 Cove Neck Road, Oyster Bay, New York	0	156,360	0	7.5
Lorraine G. Grace(3) 49 Cove Neck Road, Oyster Bay, New York	0	181,069	0	8.6
Oliver R. Grace, Jr. (4) 55 Brookville Road, Glen Head, New York	6,000	269,387	3.2	12.4
John S. Grace(5 55 Brookville Road, Glen Head, New York	22,571	112,878	12.0	5.2
Peter N. Bennett(6) 6 Batersea High St. London SW11 3RA, England	43,935	88,409	23.3	4.1
The Bank of Butterfield(7) Rose Bank Centre 14 Bermudiana Road, Hamilton, Bermuda	16,863	327,326	9.0	15.4
Miles P. Jennings, Jr.(8) 4 Oakland Street, Bristol, Connecticut	0	150,000	0	7.2
First United Securities Limited(9) Exchange House P.O. Box 16, 54-58 Athol Street, Douglas, Isle of Man	0	133,636	0	6.4
Louis A. Lubrano(10)	0	8,000	0	(16)
James J. Pinto(11)	0	61,515	0	2.9
Thomas McPartland(12)	0	20,000	0	(16)
Yuri I. Pripachkin(13)	0	20,000	0	(16)
Ronald N. Cerny(14)	0	8,905	0	(16)
Andrew M. O'Shea(15)	0	8,552	0	(16)
All directors and executive officers as a group (3 (Preferred) and 10 (Common) persons, including certain of the above- named individuals)	72,506	687,922	38.6	28.4

1. Francis E. Baker has beneficial ownership of an aggregate of 126,207 shares of Common Stock and no shares of Preferred Stock. Of the Common Stock amount 44,401 shares are owned directly. The figure set forth in the table includes 58,900 shares of Common Stock with respect to which Mr. Baker has shared voting power as co-trustee under the Oliver R. Grace Grandchildren Trust U/R dated December 27, 1976 and 2,906 shares which such Trust owns by virtue of its ability to convert $47,000 principal amount of the Company's 10.5% Convertible Subordinated Debentures due 2007 (the "Debentures") to Common Stock within a 60-day period. Mr. Baker also holds a stock option to acquire an additional 20,000 shares of Common Stock which may be issued to him within a 60-day period. Mr. Baker disclaims beneficial ownership of such shares held in trust.

2. The Estate of Oliver R. Grace, Sr., c/o Lorraine G. Grace, Executrix, has direct beneficial ownership of an aggregate of 156,360 shares of Common Stock and no shares of Preferred Stock.

3. Lorraine G. Grace has beneficial ownership of 181,069 shares of Common Stock and no shares of Preferred Stock. Of the Common Stock amount, 13,638 shares are held by Mrs. Grace directly; 2,475 shares are held by Mrs. Grace, as trustee of a trust for the benefit of her children; 8,569 shares are held by virtue of the ability of Mrs. Grace to convert $139,000 principal amount of the Debentures to Common Stock within a 60-day period; and 156,360 shares are held by virtue of Mrs. Grace's appointment as executrix of the Estate of Oliver R. Grace, Sr. Lorraine G. Grace is the mother of Directors Oliver R. Grace, Jr. and John S. Grace.

4. Oliver R. Grace, Jr. has beneficial ownership of an aggregate of 269,387 shares of Common Stock and 6,000 shares of Preferred Stock. Of the Common Stock amount, 51,953 shares are held by Oliver R. Grace, Jr. directly, including 23,253 shares by virtue of Mr. Grace's ability to convert $376,000 principal amount of the Debentures to Common Stock within a 60-day period; 11,664 shares are held by virtue of Mr. Grace's ability, as custodian for the benefit of his children, to convert 6,000 shares of the Company's Preferred Stock to Common Stock within a 60-day period; 4,685 shares are held by Carolyn Grace, the spouse of Oliver R. Grace, Jr., of which 4,205 shares are held by Mrs. Grace by virtue of her ability to convert $68,000 principal amount of the Debentures to Common Stock within a 60-day period; 35,930 shares are held by virtue of the ability of The Anglo American Security Fund L.P. (of which Oliver R. Grace, Jr. is a general partner) to convert $581,000 principal amount of the De bentures to Common Stock within a 60-day period; 37,000 shares are held by a corporation owned by members of Mr. Grace's family and 94,556 shares are held in an individual retirement account for the benefit of Mr. Grace. Mr. Grace, Jr. also holds stock options to acquire an additional 9,500 shares of Common Stock which may be issued to him within a 60-day period. Mr. Grace, Jr. also holds stock warrants to acquire an additional 18,706 shares and 5,393 shares expiring March 2003 and April 2003 respectively. Oliver R. Grace, Jr. disclaims beneficial ownership of all shares owned by his spouse, by him as trustee for the benefit of family members, by his children, and by The Anglo American Security Fund, L.P. described herein.

5. John S. Grace has beneficial ownership of 112,878 shares of Common Stock and 22,571 shares of Preferred Stock. Of the Common Stock amount, 16,909 shares are owned by John S. Grace directly, including 1,051 shares held by virtue of Mr. Grace's ability to convert $17,000 principal amount of the Debentures to Common Stock within a 60-day period; 41,991 shares are held by virtue of the ability of The Anglo American Security Fund L.P. (of which John S. Grace is a general partner) to convert $581,000 principal amount of the Debentures to Common Stock within a 60-day period; 1,113 shares are held by virtue of the ability of Florida & Asia Consulting, Inc. (Lola Grace, the spouse of John S. Grace, is the sole stockholder of Florida & Asia Consulting, Inc.) to convert $18,000 principal amount of the Debentures to Common Stock within a 60-day period; 43,878 shares are held by virtue of the ability of Sterling Grace Capital Management, L.P. (John S. Grace is Chairman of Sterling Grace C orporation, the general partner of Sterling Grace Capital Management, L.P.) to convert 22,571 shares of the Preferred Stock to Common Stock within a 60-day period and 9,055 shares are held in an individual retirement account for Mr. Grace's benefit. Mr. Grace also holds stock options to acquire an additional 6,000 shares of Common Stock. John S. Grace disclaims beneficial ownership of all shares held by trustees for the benefit of members of his family and The Anglo American Security Fund L.P.

6. Peter N. Bennett has beneficial ownership of 88,409 shares of Common Stock and 43,935 shares of Preferred Stock. The figure set forth in the table includes shares held by virtue of the ability of Mr. Bennett to convert 43,935 shares of the Preferred Stock to 85,409 shares of Common Stock within a 60-day period. Also included in the figure set forth in the table are 3,000 shares of Common Stock which may be issued to Mr. Bennett within 60 days hereof upon the exercise of his existing exercisable stock option.

7. The Bank of Butterfield (the "Bank") has beneficial ownership of an aggregate of 327,326 shares of Common Stock and 16,863 shares of Preferred Stock as trustee of various trusts. Of the Common Stock amount 32,781 shares are held by virtue of the Bank's ability, as trustee, to convert 16,863 shares of the Preferred Stock to Common Stock within a 60-day period.

8. Miles P. Jennings reported his holdings as of November 13, 2001.

9. First United Securities Limited ("FUSL") has beneficial ownership of an aggregate of 133,636 shares of Common Stock, as trustee of various trusts, and no shares of Preferred Stock. Of the Common Stock amount 8,101 shares are held by virtue of the ability of FUSL to convert $112,000 principal amount of the Debentures to Common Stock within a 60-day period.

10. Louis A. Lubrano has beneficial ownership of 8,000 shares of Common Stock and no shares of Preferred Stock. Mr. Lubrano's ownership is represented by stock options to acquire 8,000 shares of Common Stock within a 60-day period.

11. James J. Pinto has beneficial ownership of 61,515 shares of Common Stock and no shares of Preferred Stock. Of the Common Stock amount, 53,515 shares are held directly. Also included in the figure set forth in the table are stock options to acquire 8,000 shares of Common Stock within a 60-day period.

12. Thomas McPartland holds non-qualified stock options to acquire 20,000 shares of common stock within a 60-day period.

13. Yuri I. Pripachkin holds non-qualified stock options to acquire 20,000 shares of common stock. These options are not exercisable until October 2002.

14. Ronald N. Cerny has beneficial ownership of 8,905 shares of Common Stock and no shares of Preferred Stock. Of the Common Stock amount, 3,000 shares are held directly and 905 shares are held in the Company's 401(k) Plan by virtue of Mr. Cerny's holdings of units of a Company stock fund within the Plan. Also included in the figure set forth in the table are stock options to acquire 5,000 shares of Common Stock within a 60-day period.

15. Andrew M. O'Shea has beneficial ownership of 8,552 shares of Common Stock and no shares of Preferred Stock. Of the Common Stock amount, 7,700 shares are held directly and 852 shares are held in the Company's 401(k) Plan by virtue of Mr. O'Shea's holdings of units of a Company stock fund within the Plan.

16. Represents less than one percent (1%) of the Common Stock.

INDEPENDENT PUBLIC ACCOUNTANTS

PricewaterhouseCoopers LLP is the Company's independent accounting firm, and has been since January 2001.

In January 2001, the Company's former auditors, Deloitte & Touche LLP, were dismissed by the Company for the fiscal year ended February 28, 2001. Deloitte & Touche LLP rendered an unqualified opinion with respect to the Company's consolidated financial statements for all the years covered by their reports up until the time of their dismissal. The dismissal of Deloitte & Touche LLP was approved by the Audit Committee of the Company's Board of Directors, and later ratified by the entire Board of Directors.

During the fiscal years ended February 28, 1999 and February 29, 2000, and the interim period from February 29, 2000 through January 11, 2001, there were no disagreements with Deloitte & Touche LLP on any matter of accounting principles or procedures, financial statement disclosures or auditing scope or procedures.

Effective January 11, 2001, upon recommendation of the Audit Committee of the Company's Board of Directors, the firm of PricewaterhouseCoopers LLP, 100 Pearl Street, Hartford, Connecticut 06103 was retained to perform an examination on and render an opinion with respect to the Company's consolidated financial statements as of and for the year ended February 28, 2001. During the past two fiscal years, the Company has not consulted with PricewaterhouseCoopers LLP regarding the application of accounting principles, or the type of audit opinion that might be rendered on the Company's financial statements. Furthermore, no written report or oral advice was provided by PricewaterhouseCoopers LLP that was an important factor in reaching a decision as to an accountant, auditor or financial report issue. PricewaterhouseCoopers LLP was not consulted on any matter which would be viewed as being the subject of a disagreement or reportable event.

Representatives of PricewaterhouseCoopers LLP will be present at the Annual Meeting

Audit Fees

The aggregate fees paid to PricewaterhouseCoopers LLP for professional services rendered for the audit of the Company's consolidated financial statements for the year ended February 28, 2001 were $97,000. This amount excludes fees paid by ABC Moscow Broadband Communication Limited or ZAO ComCor-TV for service provided by PricewaterhouseCoopers LLP for the financial statements of those entities for the year ended December 31, 2000. The aggregate fees paid to Deloitte & Touche LLP for their reviews of the Company's unaudited statements included in the Company's quarterly filings on Form 10-Q, and for Deloitte & Touche LLP's review of the Company's Annual Report on Form 10-K for the purposed of their granting the Company their consent to include their opinions with respect to previous year audits were $26,550.

Financial Information Systems Design and Implementation Fees

The aggregate fees billed for certain information technology services of the type described in Rule 2-01(C)(4) (ii)(B) of Regulation S-X rendered by either PricewaterhouseCoopers LLP or Deloitte & Touche LLP during the year ended February 28, 2001 were $0.

All Other Fees

The total fees billed for all other services rendered by PricewaterhouseCoopers LLP during the fiscal year ended February 28, 2001 were $67,500. The total fees billed for all other services rendered by Deloitte & Touche LLP during the fiscal year ended February 28, 2001 were $22,895.

STOCKHOLDER PROPOSALS

No Stockholder proposals were received by the Company during Fiscal 2001.

In order to be considered for inclusion in the Proxy Statement relating to the 2002 Annual Meeting of Stockholders, any proposal by a record holder of Common Stock, or a record holder of the Preferred Stock pursuant to the Preferred Stock Terms, must be received by the Company at its principal offices on or before April 30, 2002. A proponent of such a proposal must comply with the proxy rules under the Securities Exchange Act of 1934, as amended.

OTHER MATTERS

As of the date of this Proxy Statement, the Board and Management do not intend to present and have not been informed that any other person intends to present any matter for action at the Annual Meeting other than as discussed in this Proxy Statement. If any other matters properly come before the meeting, it is intended that the holders of the proxy will act in accordance with their best judgment.

INCORPORATION BY REFERENCE

The following documents filed by the Company with the SEC (File No. 0-1460) are incorporated by reference in this Proxy Statement:

1. Annual Report on Form 10-K for the year ended February 28, 2001;
2. Current Report on Form 8-K dated November 8, 2001; and
3. Quarterly Report on Form 10-Q for the quarterly period ended August 31, 2001.

The SEC permits the Company to "incorporate by reference" information into this Proxy Statement. This means that the Company can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this Proxy Statement, except, for any information superceded by information contained directly in this Proxy Statement. The Company incorporates by reference into this Proxy Statement additional documents that the Company may file with the SEC from the date of this Proxy Statement to the date of the Combined Special Meeting and Annual Meeting.

This Proxy Statement incorporates business and financial information about the Company that is not included in or delivered with this Proxy Statement. This information is available without charge to you upon your written or oral request to Secretary, Andersen Group, Inc., 515 Madison Avenue, Suite 2600, New York, New York 10022, telephone (212) 826-8942.

You should rely only on this information contained or incorporated by reference in this Proxy Statement in making your decision about how to vote on the proposals that will be presented at the Combined Special Meeting and Annual Meeting. We have not authorized anyone to provide you with information that is different from what is contained in this Proxy Statement. This Proxy Statement is dated as of December ___, 2001. You should not assume that the information is accurate as of any other date and you should not view either the mailing of this Proxy Statement to stockholders nor the completion of the sale as implying otherwise.

ANDERSEN GROUP, INC.

PRO FORMA UNAUDITED FINANCIAL INFORMATION

AND

THE J.M. NEY COMPANY UNAUDITED FINANCIAL STATEMENTS

INDEX TO UNAUDITED FINANCIAL INFORMATION

Page

Anderson Group, Inc. - Unaudited ProForma Consolidated

Condensed Financial Information

Summary of Presentation F-1

Andersen Group, Inc. Pro Forma Consolidated Balance Sheet

as of August 31, 2001 F-2

Andersen Group, Inc. Pro Forma Consolidated Condensed

Statements of Operations for the six months ended August 31, 2001 F-3

Andersen Group, Inc. Pro Forma Consolidated Condensed

Statements of Operations for the year ended February 28, 2001 F-4

Andersen Group, Inc. Pro Forma Consolidated Condensed

Statements of Operations for the year ended February 29, 2000 F-5

Andersen Group, Inc. Pro Forma Consolidated Condensed

Statements of Operations for the year ended February 28, 1999 F-6

Andersen Group, Inc. Notes to Pro Forma Consolidated Condensed

Financial Statements F-7

Financial Statements of The J.M. Ney Company (unaudited)

The J.M. Ney Company Balance Sheets as of August 31, 2001,

February 28, 2001 and February 29, 2000 F-8

The J.M. Ney Company Statement of Operations as of August

31, 2001, February 28, 2001, February 29, 2000 and February

28, 1999 F-9

The J.M. Ney Company Statements of Cash Flows as of August

31, 2001, February 28, 2001, February 29, 2000 and February

28, 1999 F-10

The J.M. Ney Company Statements of Changes in Shareholder's

Equity F-11

Notes to The J.M. Ney Company Unaudited Financial Statements F-12- F-22

F-22

APPENDIX A

ASSET PURCHASE AGREEMENT

APPENDIX B

FORM OF LEASE

APPENDIX C

FORM OF ESCROW AGREEMENT

APPENDIX D

AUDIT COMMITTEE CHARTER

ANDERSEN GROUP, INC.

COMBINED ANNUAL AND SPECIAL MEETING OF STOCKHOLDERS - , 2002

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints [ ] and [ ], and each of them, proxies, with full power of substitution, acting unanimously and voting or if only one is present and voting then that one, to vote the shares of stock of Andersen Group, Inc., which the undersigned is entitled to vote, at the Special Meeting of Stockholders to be held at [ ], on [ ], 2002, at 10:00 a.m. local time, and at any adjournment or adjournments thereof, with all the powers the undersigned would possess if present.

1. APPROVAL OF THE PROPOSED ASSET SALE AS DESCRIBED IN THE PROXY STATEMENT.

FOR AGAINST ABSTAIN ]

2. ELECTION OF ALL DIRECTORS

FOR AGAINST WITHHELD

(as noted below)

[PLEASE WRITE IN THE NAME OF ANY DIRECTOR NOMINEE FOR WHOM YOU WISH TO WITHHOLD YOUR VOTE.]

WITHHELD: __________________________________

Oliver R. Grace, Jr., Francis E. Baker, Peter N. Bennett, John S. Grace, Louis A. Lubrano, Thomas McPartland, James J. Pinto, Yuri I. Pripachkin

3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO VOTE UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THIS MEETING.

IF YOU RETURN YOUR PROPERLY EXECUTED PROXY, WE WILL VOTE YOUR SHARES AS YOU DIRECT. IF YOU DO NOT SPECIFY ON YOUR PROXY CARD HOW YOU WANT TO VOTE YOUR SHARES, WE WILL VOTE THEM FOR PROPOSAL 1, PROPOSAL 2 AND IN THE DISCRETION OF THE PROXIES ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS THEREOF.

PLEASE MARK, SIGN AND DATE THE REVERSE SIDE AND

RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE.

The undersigned hereby revokes any proxy or proxies heretofore given to vote such shares at said meeting or at any adjournment thereof.

Please sign EXACTLY as your name appears hereon. When signing as attorney, executor, administrator, trustee or guardian, please give your full title as such. If more than one trustee, all should sign. If shares are held jointly, both owners must sign.

DATED: _________________, 2002 ________________________________________

SIGNATURE

________________________________________

SIGNATURE IF HELD JOINTLY

PLEASE VOTE, SIGN, DATE, AND

RETURN THE PROXY CARD USING

THE ENCLOSED ENVELOPE

EX-99.A4 OTHER AGRMT

LEASE AGREEMENT

This Lease Agreement ("Lease") is dated as of the ___ day of _______________, 2002, is by and between The J.M. Ney Company, a Delaware corporation, having an address of 2 Douglas Street, Ney Industrial Park, Bloomfield, CT 06002 (the "Landlord"), and Deringer Mfg. Company, an Illinois corporation having an address of 1250 Town Line Road, Mundelein, IL 60060 (the "Tenant"), and evidences the agreement of Landlord and Tenant.

WHEREAS, Landlord, Tenant and certain other parties are parties to that certain Asset Purchase Agreement dated as of November 8, 2001 (the APurchase Agreement@), pursuant to which Tenant, as purchaser under the Purchase Agreement, will acquire certain of the assets of the Landlord, as seller under the Purchase Agreement, all as more particularly set forth in the Purchase Agreement; and

WHEREAS, Landlord and Tenant desire to enter into this Lease in connection with the consummation of the transactions specified in the Purchase Agreement.

NOW, THEREFORE, in consideration of the mutual covenants set forth in this Lease, and other good an valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant hereby agree as follows:

1. PREMISES

1.1  Identification of Premises. Landlord for and in consideration of the rents, covenants and agreements hereinafter reserved and contained on the part of Tenant to be paid, kept and performed, has demised and leased, and by these presents, does demise and lease, unto Tenant and Tenant does hereby take and hire, upon and subject to the covenants and conditions hereinafter expressed which Tenant agrees to keep and perform, the real property legally described on Exhibit "A" attached hereto, commonly known as 2 Douglas Street, Ney Industrial Park, Bloomfield, CT 06002 (the "Real Estate"), together with the building located thereon and all other improvements that are part of the building and all such fixtures, machinery, and equipment owned by Landlord and used in connection with the occupancy and operation of such building and other improvements (hereinafter referred to as the "Premises"), subjec t, however, to the following, if any: encumbrances, covenants, conditions, restrictions, easements, and rights-of-way, whether or not of record, and other matters of record, and to such matters as may be disclosed by inspection or survey. This Lease is intended by the parties to be a net/net/net lease, and to the extent of any uncertainty, ambiguity or vagueness that arises with respect to the interpretation or meaning of any of the provisions of the Lease, such uncertainty, ambiguity or vagueness shall be resolved in favor of the parties= desire for this Lease to be a net/net/net lease.

2. TERM

2.1  Term. Landlord demises and leases the Premises to Tenant and Tenant takes and hires the Premises for an initial term of eight (8) years, commencing on ____________ ___, 2002 (the ACommencement Date@), and expiring on ____________ ____, 2010, unless this Lease shall be sooner terminated as hereinafter provided.

2.2  Definition of "Term". As used in this Lease, the words "term of this Lease" or "the term" in reference to the duration of this Lease shall include the initial term, and any extensions or renewals thereof, unless the context clearly provides otherwise.

3. BASIC RENT

3.1  During Term. Tenant shall pay to Landlord at Andersen Group, Inc., 515 Madison Avenue, Suite 2600, New York, NY 10022 (or at such other place as Landlord may direct by written notice to Tenant), a total basic rental (hereinafter referred to as the "basic rent") which shall be paid monthly, in advance, commencing on the first day of every calendar month during the term of this Lease, in the amounts set forth in the following Schedule of Basic Rent Payments:

SCHEDULE OF BASIC RENT PAYMENTS

MONTH OF LEASE TERM	MONTHLY BASIC RENT	ANNUAL BASIC RENT
_______ __, 2002 through ______ __, 2003	$ 24,166.67	$ 290,000.00
_______ __, 2003 through ______ __, 2004	$ 24,650.00	$ 295,800.00
_______ __, 2004 through ______ __, 2005	$ 25,133.33	$ 301,600.00
_______ __, 2005 through ______ __, 2006	$ 25,616.67	$ 307,400.00
_______ __, 2006 through ______ __, 2007	$ 26,100.00	$ 313,200.00
_______ __, 2007 through ______ __, 2008	$ 26,583.33	$ 319,000.00
_______ __, 2008 through ______ __, 2009	$ 27,066.67	$ 324,800.00
_______ __, 2009 through ______ __, 2010	$ 27,550.00	$ 330,600.00

3.2  Partial Months. If the term of this Lease shall commence other than on the first day of a month, or if the term of this Lease shall end other than on the last day of a month, the basic rent for such month shall be prorated at the then current monthly basic rent and shall be payable (in the case of the commencement of the term, upon delivery of a signed Lease to Landlord).

3.3  No Set-Off. Tenant covenants to pay without notice or demand and without deduction or set-off for any reason whatsoever except as may be otherwise herein specifically provided, the basic rent and all other sums which under any provision of this Lease become additional rent or any other charge hereunder, at the times and in the manner in this Lease provided.

3.4  Late Payment Charge. If Tenant fails to make any payment within seven (7) days of the date such payment is due, Tenant shall, in addition to making such delinquent payment, pay to Landlord a sum equal to three percent (3%) of each such delinquent payment.

4. ADDITIONAL RENT

4.1  Impositions. Tenant agrees to pay to the appropriate taxing authority, as additional rent for the Premises, all real estate taxes, assessments, water and sewer rates and charges, and other governmental charges, general and special, ordinary and extraordinary, unforeseen as well as foreseen, of any kind and nature whatsoever, including but not limited to assessments for public improvements or benefits (all of which real estate taxes, assessments, water rates and sewer rates and charges, and other governmental charges are hereinafter referred to as "Impositions"), that are assessed, levied, confirmed, imposed, or incurred with respect to the Real Estate during the term of this Lease, regardless of when such Impositions are payable.

4.2  Proration for Lease Years Not Coinciding With Tax Years. Any Imposition relating to a fiscal period of the taxing authority, a part of which period is included within the term of this Lease and a part of which is included in a period of time either before the Commencement Date or after the expiration of this Lease, whether or not such Imposition shall be assessed, levied, confirmed, imposed, or incurred or become a lien upon the Premises, or shall become payable, during the term of this Lease, shall be adjusted as between Landlord and Tenant, so that Landlord shall pay that proportion of such Imposition which that part of such fiscal period included in the period of time either before the commencement or after the termination of this Lease bears to such fiscal period and Tenant shall pay the remainder thereof. With respect to any Imposition for public improvements or benefits which by law is payable, or at the option of the taxpayer may be paid, in installments, Landlord shall pay the installments thereof that become due and payable subsequent to the termination of this Lease, and Tenant shall pay to Landlord those installments that become due and payable during the term of this Lease.

4.3  Other Taxes. Should the State of Connecticut, or any political subdivision thereof, or any other governmental authority having jurisdiction over the Premises (a) impose a tax, assessment, charge or fee, or increase a then existing tax, assessment, charge or fee, which Landlord shall be required to pay, either by way of substitution for real estate taxes or any other Imposition herein or in addition to real estate taxes or any other Imposition herein, or (b) impose an income or franchise tax or a tax on rents in substitution for or as a supplement to real estate taxes or any other Imposition herein, all such taxes, assessments, charges or fees shall be deemed to constitute Impositions herein the payment of which shall be additional rent for which Tenant shall be liable and obligated to pay, it being the intention of Landlord and Tenant that the basic rent hereunder shall be paid to Landlord absolutely net without deduction of any kind or nature whatsoever, foreseen or unforeseen, except as may otherwise be provided in this Lease.

4.4  Other Items. Tenant also agrees to pay as additional rent hereunder, for each calendar year during the term of this Lease, the following: (a) any assessments or charges that are imposed by any association and/or declaration of protective covenants affecting the development, industrial park, subdivision or any other defined area within which the Premises are located; and (b) any ad valorem taxes that hereafter may be imposed and assessed or incurred for any personal property used in connection with the building and the land, regardless of when such ad valorem taxes are payable.

4.5  Tenant's Right to Contest Impositions. Tenant shall have the right to contest the amount or validity of any Imposition herein by appropriate legal proceedings, but this shall not be deemed or construed in any way as relieving, modifying or extending Tenant's covenant to make the additional rent deposits on account of any such Impositions at the time and in the manner provided in this Section 4. However, before proceeding with any such contest, Tenant shall deposit into escrow with a third party reasonably acceptable to Landlord, as security for the payment of the amount of any such contested Imposition, money in an amount sufficient, in the reasonable judgment of Landlord, to pay said Imposition, together with all interest and penalties in connection therewith and all charges that may or might be assessed against or become a charge on the Premises, or any part thereof, in said legal proce edings. In the event that such monies shall be insufficient to pay said Impositions (together with any interest and penalties or other charges) in full upon the termination of such legal proceedings, Tenant shall, forthwith, pay over to the appropriate taxing authority an amount of money sufficient, together with the monies so deposited pursuant to this Section 4.5, to pay the same. Landlord shall not be required to join in any such proceeding unless it shall be necessary for it to do so in order to properly prosecute such proceedings and Landlord is fully indemnified to its satisfaction against all costs and expenses in connection therewith. Landlord shall not be subjected to any liability for the payment of any costs or expenses in connection with Tenant's contest, nor to any liability for the payment of any costs or expenses in connection with any proceeding brought by Tenant, and Tenant covenants to indemnify and save harmless Landlord from any such costs or expenses.

4.6  Landlord's Right to Contest Impositions. Notwithstanding anything contained in Section 4.5, Landlord shall, at all times during the term of this Lease, have the right to contest the amount or validity of any Imposition herein by appropriate legal proceedings and all fees and costs incurred by Landlord in contesting the amount or validity of any Imposition herein, whether any reduction or limitation in the amount of any such Imposition is obtained, shall be considered as part of such Imposition which Tenant shall be liable and obligated to pay to Landlord.

5. SECURITY DEPOSIT

5.1  Amount; Purpose; Application. Tenant agrees to pay Landlord a security deposit of Twenty Four Thousand One Hundred Sixty Six and 67/00 Dollars ($24,166.67). Such security deposit shall be held by Landlord as security for the faithful performance by Tenant of all of the terms, covenants and conditions of this Lease to be kept and performed by Tenant, without any obligation on Landlord's part to pay any interest thereon. If, at any time during the term of this Lease, any basic rent, additional rent or other charges due Landlord hereunder shall be overdue and unpaid, then Landlord may, at the option of Landlord, appropriate and apply any portion of the security deposit to the payment of any such overdue rent or other charge. In addition, in the event of the failure of Tenant at any time during the term of this Lease to keep and perform any of the terms, covenants and conditions of this Lea se to be kept and performed by Tenant, then Landlord, at its option, may appropriate and apply the entire security deposit, or so much thereof as may be necessary, to compensate Landlord due to Tenant's breach. The use, application or retention of the security deposit, or any portion thereof, by Landlord shall not prevent Landlord from exercising any other right or remedy provided by this Lease or by law or in equity (it being intended that Landlord shall not first be required to proceed against the security deposit) and shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled.

5.2  Obligation to Replenish. Should the entire security deposit, or any portion thereof, be appropriated and applied by Landlord for the payment of overdue basic rent, additional rent or other charges due and payable to Landlord by Tenant hereunder or to compensate Landlord for loss or damage sustained by Landlord due to Tenant's breach hereunder, then Tenant shall, upon Landlord's demand, forthwith remit to Landlord a sufficient amount to restore the security deposit to the original sum deposited. Tenant's failure to so restore the security deposit within five (5) days after receipt of such demand shall constitute a breach of this Lease.

5.3  Return. Landlord agrees that if, upon the expiration of the term of this Lease, Tenant is not in default under any of the terms, covenants and conditions herein, Landlord shall, within thirty (30) days from the date Tenant surrenders possession of the Premises to Landlord return to Tenant the security deposit or such portion thereof as remains with Landlord on the date thereof. In no event will the security deposit be deemed to constitute, nor be used by Tenant to pay, the final month's or months' basic rent. In the absence of evidence satisfactory to Landlord of permitted assignments of the right to receive the security deposit, or of the remaining balance thereof, Landlord may return the same to the original Tenant, regardless of one or more assignments of Tenant's interest in this Lease or the security deposit. In such event, upon the return of the security deposit, or the remaining balance thereof, to the original Tenant, Landlord shall be completely relieved of liability with respect to the security deposit.

5.4  Transfer of Deposits by Landlord. Tenant acknowledges that Landlord has the right to transfer its interest in the Premises, and in this Lease and Tenant agrees that in the event of any such transfer, Landlord shall have the right to transfer the security deposit to the transferee. Upon such transfer, Landlord shall thereby be released from all liability or obligation to Tenant for the return of such security deposit and Tenant agrees to look solely to such transferee for the return of the security deposit.

6. CONDITION OF PREMISES

Except as provided for in Section 15 herein, Tenant's taking possession of the Premises or any portion thereof shall be conclusive evidence against Tenant that the Premises or such portion thereof, as the case may be, were in good order and satisfactory condition when Tenant took possession and that all work done on the Premises, pursuant to the terms hereof, if any, has been completed to Tenant's satisfaction.

7. INSURANCE

7.1  Landlord's Property and Casualty Coverages. During the entire term of this Lease, Tenant shall, at Tenant's sole cost and expense, maintain in full force and effect property and casualty insurance policy for the full replacement value of the Premises and building in which the Premises are located (which replacement value shall be established by Landlord from time to time during the term of this Lease) under a so-called "all risks" type of policy which shall include coverage for but not limited to, fire and lightning, extended coverage, vandalism, malicious mischief, flood and earthquake and such other coverages as Landlord shall elect to include in its reasonable discretion.

7.2  Tenant's Property and Casualty, Liability and Business Interruption Coverages. During the entire term of this Lease, Tenant shall, at Tenant's sole cost and expense, maintain in full force and effect each of the following types of insurance policies:

(a) Property and casualty insurance policy for the full replacement value of all of Tenant's personal property, trade fixtures and equipment under a so-called "all risks" type of policy which shall include coverage for but not limited to, fire and lightning, extended coverage, vandalism, malicious mischief, flood and earthquake; and

(b) Commercial general liability insurance policy, the limits of coverage for which shall be a combined single limit of not less than $1,000,000.00.

7.3  Companies; Forms. All policies of insurance (other than liability insurance) shall be kept in full force and effect continuously throughout the term of this Lease, shall be written and issued by companies authorized to do business in the State of Connecticut, and shall be in form and substance reasonably acceptable to Landlord and the mortgagee, if any, of the fee interest.

7.4  Persons and Interests Insured. The named insured in all policies of insurance shall be Tenant, Landlord, and the mortgagee, if any, of the fee interest, or such other persons as Landlord or such mortgagee shall from time to time require.

7.5  Cancellation Notices. All policies of insurance carried by Tenant shall contain provisions that the same shall not be canceled, terminated, or changed without at least thirty (30) days prior written notice to Tenant, Landlord and the mortgagee, if any, of the fee interest.

7.6  Evidence of Insurance. Standard certificates of all insurance policies required to be carried by Tenant shall be deposited with Landlord together with satisfactory evidence of payment in full of all premiums therefore prior to possession of the Premises by Tenant, or upon request by Landlord, duplicate originals of each such policy. Standard certificates of renewal of all policies of insurance, or upon request by Landlord, duplicate originals of each such policy, shall be deposited with Landlord not less than thirty (30) days prior to the expiration of the original policies of insurance or the immediately preceding renewal policies, as the case may be.

8. TENANT=S REPRESENTATION AND WARRANTY OF AUTHORITY

Tenant represents and warrants to Landlord that Tenant has full power, authority and capacity to execute and deliver this Lease, and that Tenant has taken all necessary corporate action to authorize the signatory below to execute this Lease on behalf of Tenant.

9. UTILITIES

Tenant agrees to pay or cause to be paid all charges for gas, water (including user charges imposed by any law, ordinance or regulation for the treatment and disposal of sewage, industrial wastes and other wastes in connection with Tenant's use of the Premises) electricity, light, heat or power, telephone or other communication service (including fire alarm and snow removal services) used, rendered or supplied upon or in connection with the Premises throughout the term of this Lease.

10. RIGHTS RESERVED TO LANDLORD

Landlord shall have the following rights, exercisable without notice and without liability to Tenant for damage or injury to property, person or business (all claims for damage being hereby released) and without effecting an eviction or disturbance of Tenant's use or possession or giving rise to any claim for set-offs, or abatement of rent:

(a) If Tenant vacates or abandons the Premises, at any time thereafter, to decorate, remodel, alter, repair or otherwise prepare the Premises for re-occupancy;

(b) To exhibit the Premises to others and to display "for rent" signs on the Premises during the last ninety (90) days of the Lease term and to exhibit the Real Estate to others and to display "for sale" signs on the Real Estate at all times during the Lease term; and

(c) At any time or times, to make, at its own expense (except as otherwise provided herein), repairs, alterations, additions and improvements, structural or otherwise, in or to the Premises, and to perform any acts related to the safety, protection or preservation thereof, and during such operations to take into and through the Premises, all material and equipment required for such operations, provided that Landlord shall cause as little inconvenience or annoyance to Tenant as is reasonably necessary in the circumstances.

11. REPAIRS AND MAINTENANCE

11.1  Landlord's Obligations. Except as otherwise noted in this Section 11.1, Landlord shall, at Landlord's sole cost and expense, make all capital repairs and replacements required to be made to (a) the roof, exterior walls and foundation of the building that is now part of the Premises or that may hereafter be constructed and become part of the Premises, or (b) the heating, cooling, ventilating, and all other mechanical equipment; the water, sewer, plumbing, and electrical systems; provided, however, that Landlord's obligation herein shall not extend to any damage, disrepair or replacement caused or required by Tenant's neglect or fault, which damage, disrepair or replacement shall be repaired by Landlord and charged to Tenant as additional rent. The provisions of this Section 11.1 shall not apply, however, in the event of and to the extent of any damage or destruction by fire or other casua lty or a taking by condemnation by any competent authority, in which events the obligation of Landlord shall be controlled as hereinafter otherwise provided in this Lease. Except as provided in this Section 11.1, Landlord shall not be obligated to make repairs, replacements, or improvements of any kind upon the Premises whether such repairs, replacements, or improvements to the Premises are interior or exterior, structural or nonstructural, ordinary or extraordinary, foreseen or unforeseen, all of which repairs, replacements, or improvements shall be the responsibility of Tenant as provided in this Lease. Notwithstanding any of the foregoing provisions of this Section 11.1 to the contrary, if structural repairs become necessary during the Lease term because of the application to the business carried on by Tenant of any law, ordinance, rule or regulation of any regulatory body, or because of any act or default on the part of Tenant, or because Tenant has overloaded any electrical or other system in the buil ding, Tenant shall make such structural repairs at its sole cost and expense, after first obtaining Landlord=s written approval of the plans and specifications and furnishing such indemnification against liens, costs, damages and expenses as Landlord may reasonably require.

11.2  Tenant's Obligations. Excepting as provided in Section 11.1 above, Tenant agrees, at its sole cost and expense at all times during the term of this Lease and such further time as Tenant occupies the Premises or any part thereof:

(a) To maintain in good order, repair and condition the entire Premises, promptly making all necessary repairs, interior and exterior, structural (except as provided in Section 11.1 above), and nonstructural, ordinary and extraordinary, foreseen and unforeseen, including, but without limiting the generality of the foregoing, repairs to but not replacements of: the roof; the heating, cooling, ventilating, and all other mechanical equipment; the water, sewer, plumbing, and electrical systems; the driveways, parking areas, and all other areas of the Premises; and

(b) To make all repairs to the Premises required by any law or ordinance or any order or regulation of any public authority, or fire underwriters or underwriters' fire prevention engineers relating to the use of the Premises by Tenant; to keep the Premises equipped with all safety appliances required because of Tenant's use; and to procure any licenses and permits required and otherwise comply with the orders and regulations of all governmental authorities relating to the use of the Premises by Tenant.

12. ALTERATIONS BY TENANT

12.1  Landlord's Consent Required. Tenant shall not make any alterations in or additions to the Real Estate ("Alterations") having a cost in excess of the amount of $20,000.00 on an aggregate basis during any single Lease year without Landlord's advance written consent in each and every instance having been first obtained, which written consent shall not be unreasonably withheld or delayed. If Landlord consents to such Alterations, before commencement of the work or delivery of any materials onto any part of the Premises, Tenant shall furnish Landlord with plans and specifications and permits necessary for such Alterations, all in form and substance satisfactory to Landlord. Landlord may impose such further conditions with respect to any Alterations as Landlord deems reasonably appropriate, including without limitation, requiring Tenant to furnish Landlord with security for the payment of all costs to be incurred in connection with such work. All Alterations shall be installed in a good and workmanlike manner and only new high-grade materials shall be used. All Alterations, whether temporary or permanent in character and whether made or paid for by Landlord or Tenant, shall, without compensation to Tenant, become Landlord's property upon installation on the Premises and shall be relinquished to Landlord in good condition, ordinary wear excepted, at the termination of this Lease by lapse of time or otherwise.

12.2  Tenant's Indemnification; Contractor's Insurance. Tenant agrees to hold Landlord harmless from any and all liabilities, costs and expenses of every kind and description (including, but not limited to, reasonable attorneys' fees and costs) which may arise out of or be connected in any way with any Alterations. Tenant shall furnish Landlord with standard certificates of insurance from all contractors performing labor or furnishing materials in connection with such Alterations, insuring Landlord against any and all liabilities which may arise out of or be connected in any way with such Alterations.

12.3  Approved Contractors; Payments; Lien Waivers. The work necessary to make such Alterations shall be done at Tenant's expense by contractors approved by Landlord, which approval shall not be unreasonably withheld or delayed. Tenant shall promptly pay to Tenant's contractors, as the case may be, when due, the cost of all such work. Upon completing any alterations, Tenant shall furnish Landlord with contractors' and subcontractors' affidavits and full and final waivers of lien and receipted bills covering all labor and materials expended and used therein or therefore, all in form and substance satisfactory to Landlord.

12.4  Compliance With Legal and Insurance Requirements. All Alterations shall comply with all insurance requirements applicable to the Real Estate, and with all ordinances, statutes and regulations of all governmental bodies, departments or agencies having jurisdiction over the Real Estate. Tenant shall permit Landlord to review and observe construction operations in connection with Alterations, if Landlord requests to do so, provided that Landlord shall have no duty to so review or observe.

13. RETURN OF PREMISES

13.1  Tenant's Obligations. At the termination of this Lease by lapse of time or otherwise:

(a) Tenant shall return the Premises in as good condition as when Tenant took possession except for ordinary wear and as otherwise provided in this Lease;

(b) Tenant shall remove any and all trade fixtures, equipment and personal property belonging to Tenant and signs installed on the Premises by Tenant during the term of this Lease; and

(c) All installations, additions, hardware, non-trade fixtures and improvements, temporary or permanent, in or upon the Premises, except movable furniture and equipment belonging to Tenant, whether placed there by Tenant or Landlord, shall be Landlord's property and shall remain upon the Premises, all without compensation, allowance or credit to Tenant.

Tenant's security deposit shall stand to secure Tenant's obligation to so restore and return the premises and to so remove the signs and other items which Tenant is required or Landlord directs Tenant to remove pursuant hereto, and Landlord shall not be obligated to return such security deposits to Tenant until the same are removed or restored in accordance with this provision.

13.2  Failure to Remove Trade Fixtures and Personal Property. All trade fixtures, equipment and personal property belonging to Tenant and not removed from the Premises within sixty (60) days after the termination of this Lease and not required by Landlord to have been removed as provided herein shall be conclusively presumed to have been abandoned by Tenant and title thereto shall pass to Landlord under this Lease as by a Bill of Sale.

14. TENANT'S USE OF PREMISES

14.1  Uses Permitted. Tenant shall occupy and use the Premises continuously during the term hereof for the following purpose specified: operation of the business sold pursuant to the Asset Purchase Agreement and any other related or incidental business, and any activity necessary, convenient or useful to such businesses.

14.2  Rules and Regulations. Tenant agrees to observe the following covenants and to comply with all rules and regulations that Landlord may hereafter from time to time make for the Premises:

(a) Tenant shall not make or permit to be made any use of the Premises which, directly or indirectly, is forbidden by public law, ordinance or governmental regulation or which may be dangerous to life, limb or property, or which may invalidate or increase the premium cost of any policy of insurance relating to the Premises or the use thereof; and

(b) Tenant shall not sell or offer to sell or permit to be sold or offered for sale in or about the Premises, any alcoholic or other intoxicating beverage.

15. ENVIRONMENTAL COMPLIANCE AND INDEMNITY

15.1  Compliance With Legal Requirements. During the entire term of this Lease (including any period of time Tenant occupies any part of the Premises prior to the commencement date of the term of the Lease), Tenant shall fully and strictly comply with all federal, state and local laws, ordinances, rules and regulations now or at any time hereafter in effect which regulate, relate to or impose liability or standards of conduct concerning any Hazardous Substances (as such term is hereafter defined), including without limitation the Comprehensive Environmental Response, Compensation and Liability Act and the Resource Conservation and Recovery Act but expressly excluding any Landlord obligations under applicable environmental, health and safety laws (collectively, the "Environmental Laws") and which directly or indirectly affect Tenant's business and Tenant's use of the Premises, and Tenant shall n ot permit the Premises to contain, be used to store or otherwise used to handle Hazardous Substances except where stored in sealed containers and in quantities normally associated with Tenant's business conducted on the Premises or for office maintenance and cleaning and, in those instances, the Hazardous Substances shall be handled or stored in compliance with all Environmental Laws. Tenant acknowledges that its compliance shall include, by way of illustration and not by way of limitation, the completion and timely filing of all reports and statements required pursuant to any Environmental Laws and the payment of all charges, fees and costs that may be assessed or imposed from time to time in connection therewith. However, Tenant=s obligations under this Section 15 in no way alters, nor is Tenant assuming, any obligations of Landlord under the Connecticut Hazardous Waste Establishment Act, as am ended, by virtue of entering into this Lease or as a result of a sale of the Premises during the Lease term.

15.2  Environmental Assessments. Landlord at any time and from time to time, during the entire term of the Lease, including any extensions or renewals thereof, may at its option (but without any obligation to Tenant to do so) cause any environmental test, inspections or evaluations of the Premises which Landlord may deem necessary in connection with Tenant's business and Tenant's use of the Premises. The selection of the person, firm or entity retained to complete such tests, inspections or evaluations shall be within the reasonable discretion of Landlord and all costs and expenses in connection therewith shall be paid for by Landlord. In connection therewith, Tenant shall permit Landlord and its environmental consultants or inspectors to have access to the Premises at all reasonable times following reasonable notice which shall be at least two (2) business days, and Tenant shall make availabl e to Landlord or to any such environmental consultant or inspector any information reasonable requested regarding the nature of any Hazardous Substances used, stored or otherwise present at the Premises in connection with Tenant's business and use of the Premises.

15.3  Disposals or Releases of Hazardous Substances. By entering into this Lease, Tenant in no way assumes responsibility or liability for any releases or disposals of Hazardous Substances or conditions that do or may violate Environmental Laws or give rise in any way to liability or responsibility for response costs at on, about or affecting the premises prior to the Commencement Date. In order to establish a baseline for environmental conditions and possible liability or responsibility for Hazardous Substances disposals or releases or conditions that do or may violate Environmental Laws or give rise to liability or responsibility for response costs, existing or occurring on or prior to the Commencement Date, Landlord shall prior to the Commencement Date, at a cost to be equally shared with the Tenant (subject to a maximum cost to the Tenant of $30,000 for Tenant's one- half of such expenses), professionally seal or cause to be professionally sealed all of the exposed cracks and other breaches in any exposed area of the manufacturing floor space, and cause all floor drains not connected to a wastewater system, if any, to be permanently closed or plugged. As of the Commencement Date, Landlord and Tenant agree that if Hazardous Substance disposals or releases are found to be under the floor or building structure, then a presumption will exist that such Hazardous Substances were disposed or released prior to the Commencement Date and Tenant shall have no liability or responsibility whatsoever for same. This presumption can be set aside only by clear and convincing evidence that Tenant or its agents caused or contributed to such disposal or releases. After the Commencement Date, if any environmental test, inspection or evaluation completed in connection with Tenant's business or Tenant's use of the Prem ises discloses a disposal, release, threatened release or the presence of Hazardous Substances on, over, under, from or affecting the Premises in violation of any Environmental Laws which has been caused or permitted by, attributed or related to or otherwise arising out of the use or occupancy of the Premises by Tenant or by anyone acting by, through or under Tenant, including, without limitation, any of Tenant's agents, employees, invitees, licensees, subtenants or assignees (in each case giving effect to the presumptions stated above) that requires cleanup or any other remedial action, Tenant shall, at Tenant's sole cost and expense, immediately cause such cleanup or any such remedial action to be completed to the extent necessary to return the Premises to its prior state and in accordance with and to the extent required by all applicable Environmental Laws and any orders and directives of any federal, state or local government authorities charged with responsibility or authority pursuant to any Environmen tal Laws; and Tenant's failure to do so shall entitle Landlord to cause such cleanup or remedial action to be conducted, and Tenant shall, immediately upon demand by Landlord, pay to Landlord all costs and expenses paid or incurred by Landlord as a result thereof, including, but not limited to, the test, inspection or evaluation that disclosed the violation of Environmental Laws.

15.4  Remedial Work. Should a release of any Hazardous Substances onto or from the Premises occur as a result of any intentional or unintentional act or omission on the part of Tenant or any other person, Tenant shall immediately notify Landlord thereof and, if such release is due to any act or omission of Tenant or of any of Tenant's employees, agents, invitees, licensees, subtenants or assignees, as soon as possible thereafter Tenant shall conduct and complete or cause to be conducted or completed any and all necessary corrective action in accordance with and to the extent required by all applicable Environmental Laws and any orders or directives of any federal, state or local government authorities charged with responsibility or authority pursuant to such Environmental Laws.

15.5  Indemnification. (a) Tenant agrees to hold Landlord, its officers, directors, agents, employees and their respective agents, harmless from and indemnified against all claims, penalties, fines, liabilities, settlements, damages and costs (including, but not limited to, reasonable attorneys' and other consultants' fees, investigation or laboratory fees, court costs and litigation expenses) arising out of, or as a result of (a) the presence, disposal, release or threatened release of any Hazardous Substances on, over, under, from or affecting the Premises or the land caused or permitted by, attributed or related to the use and occupancy of the Premises by Tenant or by anyone acting by, through or under Tenant, including without limitation any of Tenant's employees, agents, invitees, licensees, subtenants or assignees (in each case giving effect to the presumptions stated in Section 15.3 here in); (b) any personal injury (including wrongful death) or property damage (real or personal) arising out of or relating to any such presence, disposal, release or threatened release of any Hazardous Substances; (c) any violation of or failure to comply with any Environmental Laws or any orders, requirements or demands of any governmental authorities which are based upon or are related to such presence, disposal, release or threatened release of any Hazardous Substances arising out of the use and occupancy of the Premises by Tenant; or (d) Tenant's failure to comply with any of the requirements of this Section 15.

(b) Landlord agrees to hold Tenant, its officers, directors, agents, employees and their respective agents, harmless from and indemnified against all claims, penalties, fines, liabilities, settlements, damages and costs (including, but not limited to, reasonable attorneys' and other consultants' fees, investigation or laboratory fees, court costs and litigation expenses) arising out of, or as a result of (a) the presence, disposal, release or threatened release of any Hazardous Substances on, over, under, from or affecting the Premises or the land prior to the Commencement Date; (b) any personal injury (including wrongful death) or property damage (real or personal) arising out of or relating to any such presence, disposal, release or threatened release of any Hazardous Substances; (c) any violation of or failure to comply with any Environmental Laws or any orders, requirements or demands of any governmental authorities which are based upon or are related to such presence, disposal, releas e or threatened release of any Hazardous Substances prior to the Commencement Date; or (d) Landlord's failure to comply with any of the requirements of this Section 15.

15.6  Hazardous Substances Defined. For purposes of this Section 15, the term "Hazardous Substances" shall mean and include (a) any asbestos-containing building materials, lead paint, radon, urea formaldehyde foam insulation, PCBs in transformers; (b) petroleum products; (c) any waste, substance, material, pollutant or contaminant defined as hazardous or toxic in (or for purposes of) the Comprehensive Environmental Response, Compensation and Liability Act, or the Resource Conservation Recovery Act, as the same may heretofore or hereafter be amended; and (d) any waste, substance, material, pollutant or contaminant either (i) defined as hazardous or toxic in (or for purposes of) any other Environmental Laws now or at any time hereafter in effect or (ii) the presence, disposal, release or threatened release of which on, onto or from any premises (including the Premises) is governed by any other ap plicable Environmental Laws.

16. INDEMNITY

Tenant agrees to hold Landlord, its officers, directors, contractors, agents and employees harmless from and indemnified against all claims, liability and costs (including, but not limited to, reasonable attorneys' fees and costs) for injuries to persons and damage to, or the theft, misappropriation or loss of, property arising from occurrences in or about the Premises caused, in whole or in part, by the act, omission or negligence of Tenant, its contractors, agents, employees or visitors.

17. DAMAGE BY FIRE OR OTHER CAUSE

17.1  Complete Destruction; Landlord's Right to Terminate. In the event the Premises are rendered wholly untenantable by fire or other cause, which fire or other cause is not a result of Tenant's negligence, Landlord or Tenant may terminate this Lease by notice to the other party within thirty (30) days after the date of such fire or other cause, in which case, the basic rent and additional rent and any other charges shall be apportioned on a per diem basis and paid to the date of such fire or other cause; provided, however, in the event the Premises are rendered wholly untenantable by fire or other cause as a result of Tenant's fault or neglect, then and in such event, Tenant shall not be released from any of its obligations hereunder (including, without limitation, its duty to repair the Premises and its liability to Landlord for damages caused by such fire or other cause). If, however, neit her Landlord nor Tenant elect to exercise its rights to terminate the Lease, Landlord shall repair and restore the Premises with due diligence at Landlord's expense subject, however, to (i) reasonable delays for insurance adjustments, and (ii) delays caused by reasons beyond Landlord's control.

17.2  Partial Damage; Obligations to Repair. In the event the Premises are partially damaged by fire or other cause, which fire or other cause is not a result of Tenant's fault or negligence, but are not rendered wholly untenantable, Landlord shall repair and restore the Premises with due diligence at Landlord's expense, subject, however, to (i) reasonable delays for insurance adjustment, and (ii) delays caused by reasons beyond Landlord's control; provided, however, that in the event the Premises are partially damaged by fire or other cause as a result of Tenant's fault or neglect, then and in such event Landlord shall have no obligation to repair or restore the Premises or any part thereof and Tenant shall not be released from any of its obligations hereunder (including, without limitation, its duty to repair the Premises and its liability to Landlord for damages caused by such fire or other cause).

18. CONDEMNATION

18.1  Complete Taking. If the whole of the Premises or Real Estate are taken or condemned by any competent authority for any public or quasi-public use or purpose, or if any part of the Premises is taken or condemned by any competent authority for any public or quasi-public use or purpose and such taking would prevent or materially interfere with Tenant's use of the Premises for the purposes for which the Premises are then being used, the term of this Lease shall end upon, and not before, the date when the possession of the Premises so taken shall be required for such use and purpose. In such event, the current basic rent and additional rent and any other charges shall be apportioned as of the date of such termination.

18.2  Partial Taking. If part of the Premises or Real Estate shall be taken by any competent authority for any public or quasi-public use or purpose and this Lease is not terminated as provided in 18.1 above, the term of this Lease shall not terminate, but the current basic rent and additional rent and any other charges payable during the then unexpired portion of the term of this Lease shall be reduced in the same proportion that Tenant's use of the Premises is prevented by such taking. Landlord shall restore the Premises or Real Estate, as the case may be, to a condition as near to the condition that the Premises were immediately prior to such taking as is reasonably feasible considering all of the then existing circumstances.

18.3  Allocation of Award. Tenant shall have no right to any apportionment of or share in any condemnation award or judgment for damages caused by or resulting from any taking or condemnation of the Premises or Real Estate, whether partial or complete, and Landlord shall be entitled to the whole of such award or judgment. Notwithstanding the foregoing, Tenant shall be permitted to file its own separate claim for the unamortized value of Tenant's leasehold improvements, if any, to the extent that Landlord has not contributed to the cost thereof, plus the value of its trade fixtures, equipment and personal property and the cost of moving the same from the Premises; provided, however, that Tenant's claim for any one or more of the foregoing items or damages must be separately identified and not a part of and included in the condemnation award or judgment to Landlord and shall not be permitted to reduce Landlord's award.

19. LANDLORD'S RIGHTS AND REMEDIES

19.1  Tenant's Bankruptcy. If any voluntary or involuntary petition or similar pleading under any section or sections of any bankruptcy or insolvency act shall be filed by or against Tenant, or any voluntary or involuntary proceeding in any court or tribunal shall be instituted to declare Tenant insolvent or unable to pay Tenant's debts, or Tenant makes an assignment for the benefit of its creditors, or a trustee or receiver is appointed for Tenant or for the major part of Tenant's property, then to the extent such election is permitted by law and is not unenforceable under applicable Federal bankruptcy laws, Landlord may elect, but is not required, with or without notice of such election and with or without entry or other action by Landlord, to terminate this Lease.

19.2  Defaults by Tenant. If Tenant defaults in the payment of basic rent or additional rent or any other charges due Landlord and such default continues for seven (7) or more days after written notice from Landlord to Tenant, or if Tenant defaults in the prompt and full performance of any other provision of this Lease and Tenant does not cure the default within thirty (30) days after written demand by Landlord that the default be cured (or such longer period as is reasonably necessary to cure such default, provided Tenant is proceeding to cure such default with reasonable diligence), unless the default involves a hazardous condition, which shall be cured forthwith upon Landlord's demand, or if the leasehold interest of Tenant is levied upon under execution or is attached by process of law, or if Tenant abandons the Premises, then and in any such event Landlord may, if Landlord so elects but no t otherwise, with or without notice of such election and with or without any demand whatsoever, either terminate this Lease and Tenant's right to possession of the Premises or, without terminating this Lease, terminate Tenant's right to possession of the Premises. An election by Landlord to terminate Tenant's right to possession of the Premises without terminating the Lease shall not preclude a subsequent election by Landlord to terminate the Lease.

19.3  Surrender of Possession. Upon termination of this Lease, whether by lapse of time or otherwise, or upon any termination of Tenant's right to possession without termination of this Lease, Tenant shall surrender possession and vacate the Premises immediately, and deliver possession thereof to Landlord. Tenant hereby grants to Landlord full and free license to enter into and upon the Premises in such event, with or without process of law, and to repossess Landlord of the Premises as of Landlord's former estate and to expel or remove Tenant and any others who may be occupying or within the Premises and to remove any and all property therefrom, using such force as may be necessary, without being deemed in any manner guilty of trespass, eviction or forcible entry or detainer or conversion of property and without relinquishing Landlord's rights to the basic rent, additional rent or any other cha rges due Landlord, or any other right given to Landlord hereunder or by operation of law. Tenant expressly waives the service of any demand for the payment of any basic rent, additional rent or any other charges hereunder or for possession and the service of any notice of Landlord's election to terminate this Lease or to re-enter the Premises, including any and every form of demand and notice prescribed by any statute or other law, and agrees that the simple breach of any covenant or provision of this Lease by Tenant shall, of itself, without the service of any notice or demand whatsoever, constitute a forcible detainer by Tenant of the Premises within the meaning of the statutes of the State of Connecticut.

19.4  Landlord's Rights After Termination of Lease or Tenant's Right to Possession.

(a) Upon termination of this Lease as provided in Sections 19.1 and 19.2 herein, Tenant shall pay to Landlord forthwith without demand or notice the sum of the following:

(1) All rent, additional rent and other payments accrued to the date of such termination and a proportionate part of the rent otherwise payable for the month in which such termination occurs;

(2) The costs of performing all covenants of Tenant relating to the condition of the Premises during the term, such costs to be deemed prima facie to be the costs estimated by a reputable architect or contractor selected by Landlord or the amounts actually expended or incurred thereafter by Landlord;

(3) The reasonable attorney's fees incurred by Landlord in connection with Tenant=s default under this Lease; and

(4) Indemnity payments. The term Aindemnity payments@ as used in this Lease shall mean all the rent, additional rent and other payments reserved under this Lease which would have become due and owing thereunder from time to time during the unexpired term, less, to the extent not previously deducted or credited, the rent, additional rent and other payments actually collected and allocable to the Premises or to the portions thereof relet by Landlord, and plus, to the extent not previously charged, the reasonable costs and expenses, including but not limited to reasonable attorneys= and brokers=< /FONT> fees and expenses, paid or incurred by Landlord in connection with:

(a) Obtaining possession of the Premises.

(b) Removal and storage of Tenant=s property.

(c) Reletting the whole or any part of the Premises (which reletting may be for a period or periods of time less than the unexpired term hereof or extending beyond the term hereof.).

Such costs and expenses shall be deemed prima facie to be the amounts therefor invoiced to Landlord or actually expended or incurred therefor by Landlord. Notwithstanding any provision in this Lease to the contrary, in the event Tenant defaults in the performance of any of its obligations in this Lease, Landlord agrees to use commercially reasonable efforts to mitigate its damages, including, without limitation, reletting the Premises as soon as possible.

Tenant shall, without prior demand or notice, make indemnity payments monthly in arrears with respect to such portion thereof as includes rent (as distinguished from additional rent and other payments) and upon the respective dates provided therefor in the Lease with respect to additional rent and other payments. Landlord may sue for all such indemnity payments as they accrue without waiting until the date fixed in the Lease as the expiration date thereof.

(b) After entry into possession without termination of the Lease, Landlord, if and to the extent required by law, may relet the Premises or any part thereof for the account of Tenant to any person, firm or corporation other than Tenant for such rent, for such time and upon such terms as Landlord, in Landlord's sole discretion, shall determine. Landlord shall not be required to accept any tenant offered by Tenant or to observe any instructions given by Tenant about such reletting. In any such case, Landlord may make repairs, alterations and additions in or to the Premises and redecorate the same to the extent deemed necessary or desirable by Landlord. Tenant shall, upon demand, pay the cost thereof, together with Landlord's expenses of the reletting. If the consideration collected by Landlord upon any reletting of the Premises for Tenant's account is not sufficient to pay monthly the full amount of the basic rent and additional rent and any other charges reserved in this Lease, toget her with the cost of repairs, alterations, additions, redecorating and Landlord's other costs and expense of regaining possession and reletting the Premises, Tenant shall pay to Landlord the amount of each monthly deficiency upon demand. Landlord agrees to use commercially reasonable efforts to mitigate its damages suffered as a result of Tenant=s default hereunder.

19.5  Removal of Tenant's Property. Any and all property which may be removed from the Premises by Landlord pursuant to the authority of the Lease or of law, to which Tenant is or may be entitled, may be handled, removed or stored in a commercial warehouse or otherwise by Landlord at Tenant's risk, cost and expense, and Landlord shall not be responsible for the value, preservation or safekeeping thereof. Tenant shall pay to Landlord, upon demand, any and all expenses incurred in such removal and all storage charges against such property so long as the same shall be in Landlord's possession or under Landlord's control. Any such property of Tenant not removed from the Premises or retaken from storage by Tenant within thirty (30) days after the end of the term shall be conclusively presumed to have been abandoned by Tenant.

19.6  Equitable Relief. If Tenant violates any of the terms and provision of this Lease or defaults in any of its obligations hereunder, other than the payment of basic rent, additional rent or any other charges payable hereunder, such violation may be restrained or such obligation enforced by injunction or other equitable action.

19.7  No Waivers. No delay or omission of the right to exercise any power by Landlord shall impair any such right or power, nor shall any such delay or omission be construed as a waiver of any default or as acquiescence therein. No waiver by Landlord of any default of Tenant shall be implied to affect, and no express waiver shall affect, any default other than the default specified in such waiver and that only for the time and to the extent therein stated. No receipt of money by Landlord from Tenant after the termination of this Lease, the service of any notice, the commencement of any suit or final judgment for possession shall reinstate, continue or extend the term of this Lease or affect any such notice, demand, suit or judgment. The various rights and remedies of Landlord contained in this Lease are reserved to Landlord and shall not be considered as exclusive of any other right or remed y, but shall be construed as cumulative and shall be in addition to every other remedy available to Landlord whether now or at any time hereafter existing at law, in equity, or by statute.

19.8  Landlord's Right to Perform Tenant's Obligations. If at any time during the term of this Lease:

(a) Any damage to the Premises results from any act, omission or neglect of Tenant or of Tenant's contractors, agents or employees (and Tenant fails to repair the same as required in this Lease), Landlord may, at Landlord's option, repair such damage and Tenant shall reimburse Landlord, upon demand, for the total cost of such repairs in excess of the amount, if any, paid to Landlord under insurance, if any, covering such damage; or

(b) Tenant at any time fails to make any payment or perform any other act on its part to be made or performed under this Lease, Landlord may, at Landlord's option, after reasonable notice or demand and without waiving or releasing Tenant from any obligation under this Lease, make such payment or perform such other act to the extent Landlord may deem desirable, and in connection therewith Landlord may pay expenses and employ counsel.

19.9  Landlord's Expenses. All sums paid by Landlord and all costs, charges and expenses incurred by Landlord in connection with (a) the exercise of any of the Landlord's rights under this Lease, (b) the enforcement of Tenant's obligations hereunder, or any litigation, negotiation or transaction in which Tenant causes Landlord, without Landlord's fault, to be involved or concerned (including, but not limited to, reasonable attorneys' fees and costs and interest and penalties for unpaid Impositions or other charges required to be paid or reimbursed by Tenant) shall be payable upon demand, together with interest thereon at the rate of two percent (2%) over the per annum prime rate or corporate base rate announced from time to time by a Chicago bank selected by Landlord from the date such sum was paid or such charge, cost or expense was incurred. Landlord shall have the same rights and remedies f or the nonpayment of any such costs, charges and expenses as in the case of default in the payment of basic rent and additional rent or other charges hereunder.

20. HOLDING OVER

If Tenant retains possession of the Premises or any part thereof after the termination of this Lease by lapse of time or otherwise, Tenant shall pay Landlord, in order to compensate Landlord for Tenant's wrongful withholding of possession, and during such time as Tenant remains in possession, an amount calculated at double the rate of basic rent in effect immediately prior to such termination, plus any additional rent and additional charges determined to be due pursuant hereto.

21. LANDLORD'S TITLE

Landlord's title is and always shall be paramount to the title of Tenant. Nothing herein contained shall empower Tenant to do any act which can, shall or may encumber the title of Landlord.

22. QUIET ENJOYMENT

So long as Tenant observes and performs its covenants and agreements hereunder, Tenant shall, at all times during the term, peacefully and quietly have and enjoy possession of the Premises without any encumbrance or hindrance by, from or through Landlord, its successors or assigns.

23. ASSIGNMENT AND SUBLETTING

Tenant shall not, without the prior written consent of Landlord, which shall not be unreasonably withheld, conditioned or delayed (i) assign, convey or mortgage this Lease or any interest hereunder; (ii) suffer to occur or permit to exist any assignment of this Lease, or any lien upon Tenant's interest, voluntarily, involuntarily or by operation of law; (iii) sublet the Premises or any part thereof; or (iv) permit the use of the Premises by any person other than Tenant and its employees. Landlord's consent to any assignment, subletting or transfer shall not constitute a waiver of Landlord's right to withhold its consent to any future assignment, subletting or transfer.

24. MORTGAGES AND SECURITY INTERESTS

24.1  Lease Subordinate. This Lease is subject and subordinate to the lien of any present and future mortgages and security interests, now and hereafter in force against the Premises and to all renewals, modifications, consolidations, replacements and extensions of such mortgages or security interests and to all advances made or hereafter to be made upon the security of such mortgages and security interests. Tenant agrees to promptly execute such further instruments as shall be reasonably requested by Landlord in confirmation of such subordination.

24.2  Attornment. Tenant covenants and agrees that, in the event any proceedings are brought for the foreclosure of any mortgages or security interests, then at the option of any purchaser at a foreclosure sale or under a deed in lieu of foreclosure (to be evidenced by written notice or election to Tenant), Tenant will attorn to such purchaser and recognize such purchaser as the landlord under this Lease to the same extent as the original landlord named hereunder. While this provision shall be self-executing and shall not require any further writing to be effective, Tenant agrees to execute and deliver, at any time and from time to time, upon the request of Landlord or of any such holder, any instrument which, in the reasonable judgment of Landlord, may be necessary or appropriate in any of such events to evidence such attornment. Tenant further waives the provisions of any statute or rule of law, now and hereafter in effect, which may give or purport to give Tenant any right or election to terminate or otherwise adversely affect this Lease and the obligations of Tenant hereunder in the event any such foreclosure proceeding is brought or such ground or underlying lease is terminated.

25. ESTOPPEL CERTIFICATE

Tenant agrees that, from time to time upon not less than ten (10) days prior notice by Landlord, Tenant will deliver to Landlord or to such other person or persons as Landlord shall designate in such notice, a statement in writing certifying (to the extent the following statements are true and correct at such time) (a) that this Lease is unmodified and in full force and effect, and contains the full agreement between Landlord and Tenant (or, if there have been modifications or additional agreements, that the Lease is in full force and effect as modified and identifying the modifications thereof or additional agreements), (b) the dates to which the basic rent, additional rent and other charges due under this Lease have been paid, and (c) that, insofar as Tenant knows, Landlord is not in default under any provision of this Lease and has performed all of the obligations to be performed by Landlord to date (or, if Tenant has knowledge of any default by Landlord or of any unperformed obligation by Landlord, a statement of the nature thereof).

26. BROKERAGE

Landlord and Tenant represent and warrant to each other that they have had no dealings with any broker or agent in connection with this Lease and both Landlord and Tenant hereby agree to hold harmless and indemnify each other from and against all claims for costs (including reasonable attorneys' fees), expense or liability for any compensation, commissions and charges claimed by any other broker or agent who claims to have dealt with the other of them with respect to this Lease or the negotiation thereof.

27. NOTICES

Any notice or demand from Landlord to Tenant or from Tenant to Landlord shall be in writing and shall be deemed to have been duly given if delivered personally or mailed (by registered or certified mail) or sent by nationally recognized overnight courier delivery service, in any case, addressed, if to Tenant, at the address of Tenant set forth hereinabove with a courtesy copy to: Schiff Hardin & Waite, 6600 Sears Tower, Chicago, IL 60606, Attention: Gary Mowder, Esq.), or such other address as Tenant shall have last designated by notice in writing to Landlord; and, if to Landlord, to the place then established for the payment of rent, or such other address as Landlord shall have last designated by notice in writing to Tenant. Notices shall be deemed to have been given, in the case of personal delivery, on the date of delivery; in the case of mailing, on the date which is three days after the date mailing thereof; and in the case of courier delivery service, on the day after the date of deposit for delivery with said courier delivery service.

28. TENANT'S RIGHT OF FIRST OFFER/REFUSAL

28.1  Right of First Offer. If Landlord at any time during the term of this Lease determines it wishes to sell or otherwise transfer the Real Estate, Landlord must first provide Tenant with a notice ("Notice of Sale") of the proposed terms under which Landlord intends to offer the Real Estate for sale or upon which Landlord intends to accept an offer for purchase, including purchase price, closing date and other material business terms. Tenant shall have thirty (30) days following the date of Landlord's Notice of Sale within which to give a notice ("Notice of Purchase") to Landlord of Tenant's election to purchase the Real Estate upon all of the terms set forth in the Notice of Sale. In the event Tenant does provide Landlord with a Notice of Purchase, then Landlord shall sell the Real Estate to Tenant upon the terms set forth in the Notice of Sale (and at the purchase price set forth in the N otice of Sale) and such other terms and conditions as are set forth in the Chicago Title Insurance Company (Form B) Real Estate Sales Contract (for commercial or industrial properties) or such other similar standard form of agreement as may be then in use in the Hartford, CT metropolitan area, except that any such form agreement shall be modified to provide that (x) in the event of a default by either party thereunder, the non-defaulting party shall be entitled to pursue any and all of its legal and equitable remedies, and (y) Landlord's conveyance of the Premises shall be by special warranty or trustee's deed, as appropriate. Any sale by Landlord to Tenant pursuant to this Section 28.1 or Section 28.2 below shall be "as is" and Landlord shall not be required to make any representation or warranty whatsoever as to the condition of the Real Estate or as to any other matter. If Tenant has not given Landlord a Notice of Purchase during the thirty-day period referred to above, Tenant's rights under this Sectio n 28.1 shall be deemed waived and of no further force or effect and Landlord shall be free to sell or otherwise transfer the Real Estate to any third party on the same terms contained in the Notice of Purchase. If Landlord and such third party fail to execute a valid and enforceable contract for the sale of the Premises on the same terms contained in the Notice of Sale within one hundred eighty (180) days of the Notice of Purchase or if Landlord enters into such contract with such third party and fails to consummate the sale , then Tenant=s right of first offer under this Section 28.1 shall automatically be reinstated.

28.2  Exempted Sales or Transfers. Notwithstanding the provisions of Sections 28.1: (x) Landlord shall, at all times after having given a Notice of Sale to Tenant, be entitled to offer the Real Estate for sale or to solicit offers to purchase the Real Estate, subject to Tenant's rights hereunder, whether such offer is for a sale by means of a deed given pursuant to an outright sale, articles of agreement for deed, a Landlord-financed sale with a purchase money mortgage or otherwise; and (y) Tenant's right of first offer to purchase the Real Estate in accordance with Section 28.1 shall not apply to any sale or other transfer of all or any portion of the Premises or the Real Estate by Landlord to any affiliate of Landlord or to any shareholder or shareholders of Landlord (or if Landlord is a Trustee, to any shareholder or shareholders of any corporate beneficiary of said Trustee).

29. SUCCESSORS AND ASSIGNS

29.1  Binding Nature. The covenants, agreements and obligations herein contained, except as herein otherwise provided, shall bind, extend to and inure to the benefit of Landlord and Tenant and their respective successors and assigns, but nothing contained in this Section 29.1 shall be deemed or construed to release Tenant from its obligation under Section 23 to first obtain Landlord's written consent to any assignment or sublease.

29.2  Transfer by Landlord. In the event of any transfer of the interest of Landlord in the Premises, Landlord shall be relieved and fully released of and from all covenants, agreements and obligations of Landlord contained in this Lease.

30. GENERAL PROVISIONS

30.1  No Partnership. Nothing contained in this Lease shall be deemed or construed by the parties hereto or by any third party, to create the relationship of principal and agent, partnership, joint venture or any association between Landlord and Tenant, it being expressly understood and agreed that no provisions contained in this Lease nor any acts of the parties hereto shall be deemed to create any relationship between Landlord and Tenant other than the relationship of Landlord and Tenant.

30.2.  Complete Agreement. All negotiations, considerations, representations and understandings between Landlord and Tenant with respect to the subject matter of this Lease are incorporated herein and may be modified or altered only by an agreement in writing between Landlord and Tenant.

30.3  Severability; Governing Law. The invalidity or unenforceability of any provision of this Lease shall not affect or impair any other provision. The laws of the State of Connecticut shall govern the validity, performance and enforcement of this Lease.

30.4  Headings. The headings contained herein are for convenience only, and shall not be used to define, explain, modify or aid in the interpretation or construction of the contents.

30.5  Plurals; Grammatical Changes. The words "Landlord" and "Tenant" wherever used in this Lease shall be construed to mean "Landlords" or "Tenants" in all cases where there is more than one landlord or tenant, and the necessary grammatical changes required to make the provisions hereof apply either to corporations, partnerships or individuals, men or women, shall in all cases be assumed as though in each case fully expressed.

30.6  Covenants and Conditions. All of the covenants of Tenant hereunder shall be deemed and construed to be "conditions" if Landlord so elects as well as "covenants" as though the words specifically expressing or importing covenants and conditions were used in each separate instance.

30.7 No Set-Off. Tenant shall not have any right of setoff or any similar remedy under this Lease against Landlord arising as a result of any alleged breach by Landlord as seller under the Purchase Agreement with Tenant, as purchaser. Tenant and Landlord both agree that the provisions of the Purchase Agreement shall control with respect to any alleged breaches thereunder, and that the provisions of this Lease shall control with respect to any alleged breaches hereunder.

[The remainder of this page has been intentionally left blank.]

* * SIGNATURES BEGIN ON THE FOLLOWING PAGE * *

IN WITNESS WHEREOF, Landlord and Tenant have, respectively, caused these presents to be signed as of the day, month and year first above written.

LANDLORD:

THE J.M. NEY COMPANY,

a Delaware corporation

By:

Name:

Its:

ATTEST:

By:

Name:

Its: Secretary

TENANT:

DERINGER MFG. COMPANY,

an Illinois corporation

By:

Name:

Its:

ATTEST:

By:

Name:

Its: Secretary

EXHIBIT "A"

Legal Description of Real Estate

LEASE AGREEMENT

BETWEEN

J.M. NEY COMPANY,

AS LANDLORD,

AND

DERINGER MFG. COMPANY,

AS TENANT,

FOR

PREMISES LOCATED AT

2 Douglas Street

Ney Industrial Park

Bloomfield, Connecticut 06002

DATED: ______________ ___, 2002

TERM: 8 years

COMMENCING: ______________ ___, 2002

EXPIRING: ______________ ___, 2010

TABLE OF CONTENTS

1. PREMISES - 1 -

1.1 Identification of Premises - 1 -

2. TERM - 1 -

2.1 Term - 1 -

2.2 Definition of "Term" - 1 -

3. BASIC RENT - 2 -

3.1 During Term - 2 -

3.2 Partial Months - 2 -

3.3 No Set-Off - 2 -

3.4 Late Payment Charge - 2 -

4. ADDITIONAL RENT - 2 -

4.1 Impositions - 2 -

4.2 Proration for Lease Years Not Coinciding With Tax Years - 3 -

4.3 Other Taxes - 3 -

4.4 Other Items - 3 -

4.5 Tenant's Right to Contest Impositions - 3 -

4.6 Landlord's Right to Contest Impositions - 4 -

5. SECURITY DEPOSIT - 4 -

5.1 Amount; Purpose; Application - 4 -

5.2 Obligation to Replenish - 4 -

5.3 Return - 4 -

5.4 Transfer of Deposits by Landlord - 5 -

6. CONDITION OF PREMISES - 5 -

7. INSURANCE - 5 -

7.1 Landlord's Property and Casualty Coverages - 5 -

7.2 Tenant's Property and Casualty, Liability and Business Interruption Coverages - 5 -

7.3 Companies; Forms - 5 -

7.4 Persons and Interests Insured - 6 -

7.5 Cancellation Notices - 6 -

7.6 Evidence of Insurance - 6 -

8. TENANT=S REPRESENTATION AND WARRANTY OF AUTHORITY - 6 -

9. UTILITIES - 6 -

10. RIGHTS RESERVED TO LANDLORD - 6 -

11. REPAIRS AND MAINTENANCE - 7 -

11.1 Landlord's Obligations - 7 -

11.2 Tenant's Obligations - 7 -

12. ALTERATIONS BY TENANT - 8 -

12.1 Landlord's Consent Required - 8 -

12.2 Tenant's Indemnification; Contractor's Insurance - 8 -

12.3 Approved Contractors; Payments; Lien Waivers - 8 -

12.4 Compliance With Legal and Insurance Requirements - 8 -

13. RETURN OF PREMISES - 8 -

13.1 Tenant's Obligations - 8 -

13.2 Failure to Remove Trade Fixtures and Personal Property - 9 -

14. TENANT'S USE OF PREMISES - 9 -

14.1 Uses Permitted - 9 -

14.2 Rules and Regulations - 9 -

15. ENVIRONMENTAL COMPLIANCE AND INDEMNITY - 9 -

15.1 Compliance With Legal Requirements - 9 -

15.2 Environmental Assessments - 10 -

15.3 Disposals or Releases of Hazardous Substances - 10 -

15.4 Remedial Work - 11 -

15.5 Indemnification - 11 -

15.6 Hazardous Substances Defined - 11 -

16. INDEMNITY - 12 -

17. DAMAGE BY FIRE OR OTHER CAUSE - 12 -

17.1 Complete Destruction; Landlord's Right to Terminate - 12 -

17.2 Partial Damage; Obligations to Repair. - 12 -

18. CONDEMNATION - 12 -

18.1 Complete Taking - 12 -

18.2 Partial Taking - 13 -

18.3 Allocation of Award - 13 -

19. LANDLORD'S RIGHTS AND REMEDIES - 13 -

19.1 Tenant's Bankruptcy - 13 -

19.2 Defaults by Tenant - 13 -

19.3 Surrender of Possession - 14 -

19.4 Landlord's Rights After Termination of Lease or Tenant's Right to Possession - 14 -

19.5 Removal of Tenant's Property - 16 -

19.6 Equitable Relief - 16 -

19.7 No Waivers - 16 -

19.8 Landlord's Right to Perform Tenant's Obligations - 16 -

19.9 Landlord's Expenses - 17 -

20. HOLDING OVER - 17 -

21. LANDLORD'S TITLE - 17 -

22. QUIET ENJOYMENT - 17 -

23. ASSIGNMENT AND SUBLETTING - 17 -

24. MORTGAGES AND SECURITY INTERESTS - 18 -

24.1 Lease Subordinate - 18 -

24.2 Attornment - 18 -

25. ESTOPPEL CERTIFICATE - 18 -

26. BROKERAGE - 18 -

27. NOTICES - 18 -

28. TENANT'S RIGHT OF FIRST OFFER/REFUSAL - 19 -

28.1 Right of First Offer - 19 -

28.2 Exempted Sales or Transfers - 19 -

29. SUCCESSORS AND ASSIGNS - 20 -

29.1 Binding Nature - 20 -

29.2 Transfer by Landlord - 20 -

30. GENERAL PROVISIONS - 20 -

30.1 No Partnership - 20 -

30.2. Complete Agreement - 20 -

30.3 Severability; Governing Law - 20 -

30.4 Headings - 20 -

30.5 Plurals; Grammatical Changes - 20 -

30.6 Covenants and Conditions - 20 -

30.7 No Set-Off. . - 20 -

Exhibit "A" Legal Description of Real Estate

Exhibit "B" Portion of Real Estate Comprising the Premises

CHI_DOCS2:CS2\501567.6 12.15.01 06.45

EX-99.A4 OTHER AGRMT

ESCROW AGREEMENT

This Escrow Agreement (this "Agreement"), dated as of __________, 2002, is made and entered into by and among The J. M. Ney Company, a Delaware corporation (the "Seller"), Deringer Acquisition Corp., an Illinois corporation (the A Buyer@), and U.S. Bank, N.A., as Escrow Agent (the "Escrow Agent").

WHEREAS, the Seller, the Buyer, the stockholder of the Seller and the stockholder of Buyer have entered into that certain Asset Purchase Agreement dated as of November 8, 2001 (as amended, modified or supplemented from time to time, the "Asset Purchase Agreement"; capitalized terms used and not defined herein shall have the meanings set forth in the Asset Purchase Agreement to the extent defined therein); and

WHEREAS, the parties have agreed to enter into this Agreement to provide a source to fund and secure the payment of indemnification obligations under the Asset Purchase Agreement;

NOW, THEREFORE, in consideration of the mutual agreements and covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Appointment of Escrow Agent. The Seller and the Buyer hereby appoint U.S. Bank, N.A. to act as Escrow Agent under this Agreement and U.S. Bank, N.A. hereby accepts such appointment.

2. Deposit of Escrow Fund. The Seller and Buyer are delivering and the Escrow Agent acknowledges that it has received $300,000 in cash to secure any indemnification obligations under the Asset Purchase Agreement (such cash and any other property which may be held in escrow pursuant to this Agreement, the "General Indemnification Escrow Fund"). The Seller and Buyer are delivering and the Escrow Agent acknowledges that it has received $300,000 in cash to secure certain indemnification obligations under the Asset Purchase Agreement (such cash and any other property which may be held in escrow pursuant to this Agreement, the AInventory Indemnification Escrow Fund,@ and, together with the General Indemnification Escrow Fund, the AEscrow Funds@). The Escrow Agent will hold the Escrow Funds in escrow upon the terms and conditions set forth in this Agreement.

3. Investments. The Escrow Agent shall invest and reinvest any cash in each Escrow Fund in such savings accounts, certificates of deposit and money market accounts (including without limitation government and other short-term corporate obligations) pursuant to joint written directions given by the Seller and the Buyer, so long as the Escrow Funds are available for disbursement by wire transfer or certified check within ten business days after the Escrow Agent is authorized to release any portion of either Escrow Fund pursuant to this Agreement. In the absence of such directions, the cash in the Escrow Funds will be held by the Escrow Agent as uninvested funds. Any interest or other earnings realized from investment of the cash in either Escrow Fund shall be released, upon request of Seller, to Seller, and shall not be considered part of the related Escrow Fund. Any uninvested funds held hereunder shall not earn or accrue interest.

4. Taxes. The Seller shall pay any and all taxes, assessments and other governmental charges imposed on or with respect to the Escrow Funds, including without limitation any liabilities arising with respect to income or gain generated by the Escrow Funds.

5. Claims.

(a) The Buyer may give written notice (each, an "Indemnification Notice") to the Escrow Agent and the Seller of the assertion of any claim, or the commencement of any suit, action or proceeding, which it discovers or of which it receives notice which might give rise to a claim against the Seller under Section 11.2(a) of the Asset Purchase Agreement (each, a "Claim"). Such notice shall specify the nature of the Claim and, to the extent known, the basis for the Claim and an estimate of the amount of Damages (as defined in Section 5(b) below). The right of the Buyer to indemnification from an Escrow Fund while it is held by the Escrow Agent shall apply only to those Claims as to which the Buyer shall have given an Indemnification Notice to the Escrow Agent and the Seller not later than the Claim Date (as defined in Section 7 below). Any covenant, agreement, representation or warranty which is the subject of a Claim shall continue to survive until such Claim is finally determined as here in provided.

(b) Only Claims with respect to breaches of the representations and warranties contained in Section 3.4(b) of the Asset Purchase Agreement may be satisfied from the Inventory Indemnification Escrow Fund, and recoveries from the Escrow Funds shall be the exclusive remedy for Damages with respect to breaches of Section 3.4(b). Any Claims with respect to breach of any representations, warranties, covenants and agreements may be brought against the General Indemnification Escrow Fund and recoveries from the General Indemnification Escrow Fund shall be a non-exclusive remedy with respect to such breaches, other than breaches of Section 3.4(b) of the Asset Purchase Agreement.

(c) The Seller shall have a period of thirty calendar days from the date an Indemnification Notice is given to object and provide written notice to the Buyer and the Escrow Agent of an objection ("Object" or an "Objection") to a Claim identified in an Indemnification Notice. Any such Objection shall be to the merits or the amount of the Claim or to both the merits and the amount of the Claim. If the Seller fails to furnish notice of an Objection within such thirty calendar day period, the Seller shall be conclusively presumed to have agreed to indemnify and hold the Buyer harmless with respect thereto and the Buyer shall be entitled to be indemnified for all losses, damages, liabilities, costs and expenses (including without limitation reasonable attorneys fees and expenses of investigation) (collectively, "Damages") with respect to such Claim. The Buyer and the Seller may discuss any Claim as to which the Seller Objects. To the extent that the Buyer and the Sell er agree that indemnification with respect to any such Claim is required and agree on the amount of Damages, they shall give joint written notice to the Escrow Agent to that effect. If the Buyer and the Seller fail to agree as to whether indemnification with respect to any such Claim is required and/or the amount of such indemnification within twenty (20) business days (which period may be extended upon the written agreement of the Buyer and the Seller and notice thereof given to the Escrow Agent) after the date the notice of Objection is given to the Buyer and the Escrow Agent, the Seller or the Buyer may thereafter institute legal proceedings to resolve the matters.

6. Release of Escrow Fund.

(a) The Escrow Agent shall release each Escrow Fund from the escrow under this Agreement upon receipt of written directions as set forth as follows:

(i) If, on or prior to the Claim Date, an Indemnification Notice has been provided in accordance with this Agreement, the Escrow Agent shall, (A) in the case of a Claim for which a Final Determination (as defined in Section 6(c) below) has been made, distribute to the Buyer (or to such other person or entity as the Buyer may direct in writing) within ten business days after receipt of the notice of the Final Determination an amount and securities from the relevant Escrow Fund equal in value to the amount of Damages with respect to such Final Determination, and (B) in the case of a Claim for which a Final Determination has not been made, (1) continue to hold an amount and securities from such Escrow Fund equal in value to the amount of Damages specified by the Buyer (including without limitation any additional Damages which the Buyer from time to time notifies the Escrow Agent have been incurred or are expected to be incurred) or, if such amount exceeds such Escrow Fund, all of such Escr ow Fund, in escrow until a Final Determination of such Claim has been made and (2) thereafter upon a Final Determination with respect to such Claim distribute to the Buyer (or to such other person or entity as the Buyer may direct in writing) within ten business days following receipt of the notice of the Final Determination an amount and securities equal in value to the amount of Damages with respect to such Final Determination.

(ii) Within ten business days following the Escrow Termination Date (as defined in Section 7 below) with respect to an Escrow Fund, that portion of such Escrow Fund remaining in escrow on such date shall be released to the Seller.

(b) If any portion of an Escrow Fund is to be delivered to the Buyer, any such delivery obligation shall first be satisfied out of the cash in such Escrow Fund, and, upon depletion of the cash in such Escrow Fund, out of the other property in such Escrow Fund. The portion of an Escrow Fund delivered to the Buyer out of an Escrow Fund which is other than cash shall be in such proportions of the securities and other property included therein as the Buyer may direct in writing. In addition, if the portion of an Escrow Fund which the Buyer directs the Escrow Agent in writing to deliver consists of securities or other property which because of the need to deliver a whole number of securities or entire items of property has a value, as determined pursuant to this Agreement, in excess of the amount required to be delivered to the Buyer, the Buyer, at its option, may:

(i) to the extent such securities consist of capital stock, exchange or arrange for the exchange of certificates of capital stock held by the Escrow Agent for a certificate or certificates of different denominations, including a certificate or certificates for fractions of a share;

(ii) require delivery of a whole number of such securities or items of property with a value, as determined pursuant to this Agreement, which is less than the amount required to be delivered, while reserving its rights against such Escrow Fund with respect to any deficiency; or

(iii) require delivery of a whole number of such securities or items of property and in exchange deliver to the Escrow Agent an amount of cash equal to the amount by which the value of the securities or other property delivered to the Buyer, as determined pursuant to this Agreement, exceeds the amount required to be delivered to the Buyer and any such cash shall be held and deemed to be part of such Escrow Fund for all purposes under this Agreement.

(c) Within five business days of the end of the second full calendar month after the date of Closing, and at the end of every other calendar month thereafter, Buyer shall deliver a certificate to the Seller and Escrow Agent setting forth the "Soft Inventory Release Amount" (as defined in the Asset Purchase Agreement) and the amount of any actual Damages or Damages specified by Buyer with respect to Claims, regardless of whether a Final Determination has been made. Upon receipt of such certificate, an amount equal to the Soft Inventory Release Amount less the Damages specified in the certificate shall be released from the Inventory Indemnification Escrow Fund to Seller. In the event that at the Claim Date (as defined in Section 7 below), the cumulative Soft Inventory Release Amounts are less $300,000, the difference, to the extent not greater than the actual balance in the Inventory Indemnification Escrow Fund, shall be released to Buyer, notwithstanding paragraph (a)(ii) above.

(d) For the purpose of this Agreement with respect to any Claim, a "Final Determination" shall mean receipt by the Escrow Agent of (i) an Indemnification Notice pursuant to Section 5(a) hereof as to which the Seller fails to Object in a timely basis pursuant to Section 5(c) of this Agreement and notice from the Buyer setting forth an amount of Damages, (ii) a copy of a writing in which the Seller acknowledges that indemnification is required without regard to the amount of Damages or of up to a particular amount of Damages and notice from the Buyer setting forth an amount of Damages, (iii) a notice of a written agreement signed by the Buyer and the Seller setting forth the amount of Damages, or (iv) a copy of a final arbitration award or final order, judgment or decree reflecting the right of the Buyer to indemnification and a notice from the Buyer setting forth an amount of Damages which the Buyer represents is consistent with such award or final order, judgment or decree.

7. Term. The term of this Agreement shall expire at 11:59 p.m. (central time) on ________________, 2003 (the "Claim Date"), or, if as of the Claim Date a Claim (or Claims) made pursuant to this Agreement is (or are) pending against an Escrow Fund, upon the resolution and payment of all such Claims as certified jointly by the Buyer and the Seller with respect to such Escrow Fund (the "Escrow Termination Date").

8. Escrow Agent.

(a) The Escrow Agent shall be entitled to receive such fees as set forth on Annex A hereto, and shall be reimbursed for all reasonable out-of-pocket expenses incurred by the Escrow Agent in the performance of its duties hereunder. Except for fees and expenses relating to the investment of the Escrow Funds which shall be deducted from earnings, any such fees and reimbursements shall be paid fifty percent (50%) by the Seller and fifty percent (50%) by the Buyer.

(b) The Escrow Agent may resign at any time by giving notice of such resignation to the Buyer and the Seller specifying a date not earlier than thirty (30) days later, when such resignation is desired. The Seller and the Buyer by mutual agreement may at any time and with or without cause remove the Escrow Agent upon at least ten days written notice to the Escrow Agent. If the Escrow Agent resigns, is removed or is unable to serve or fails to serve as the Escrow Agent, the Buyer and the Seller shall appoint a successor Escrow Agent by mutual agreement. If the Escrow Agent resigns and the Buyer and the Seller are unable to agree upon a successor Escrow Agent within thirty (30) days after such notice of resignation, the Escrow Agent shall be entitled to appoint its successor. The Escrow Agent shall continue to serve until its successor accepts the escrow and receives the Escrow Funds. Any successor Escrow Agent shall execute an instrument accepting the appointment as Escrow Agent here under and agreeing to be bound by the provisions of this Agreement.

(c) The Escrow Agent undertakes to perform such duties as are specifically set forth herein and may conclusively rely, and shall be protected in acting or refraining from acting, on any written notice, instrument, or signature believed by it to be genuine and to have been signed or presented by the proper party or parties duly authorized to do so.

(d) The Escrow Agent shall not be liable for any action taken or omitted by it in good faith and believed by it in good faith to be authorized hereby or within the rights or powers conferred upon it hereunder, nor for action taken or omitted by it in good faith and in accordance with advice of counsel (which counsel may be of the Escrow Agent's own choosing), and the Escrow Agent shall not be liable for any mistake of fact or error of judgment or for any acts or omissions of any kind unless caused by its willful misconduct or gross negligence.

(e) The Escrow Agent shall be obligated to perform only such duties as are expressly set forth in this Agreement. No implied covenants or obligations shall be inferred from this Agreement against the Escrow Agent.

(f) Each of the Buyer and the Seller, jointly and severally, hereby indemnifies and holds harmless the Escrow Agent from and against any and all loss, liability, cost, damage and expense, including, without limitation, reasonable counsel fees, which the Escrow Agent may suffer or incur by reason of any action, claim or proceeding brought against the Escrow Agent arising out of or relating in any way to this Agreement or any transaction to which this Agreement relates unless such action, claim or proceeding is the result of the willful misconduct, gross negligence or bad faith of the Escrow Agent.

9. Miscellaneous.

(a) All notices and other communications hereunder shall be in writing and shall be deemed given: (i) when personally delivered; (ii) when sent by confirmed facsimile if sent on a business day and otherwise on the next succeeding business day; (iii) one business day after being deposited with a nationally recognized overnight courier service for delivery on the next business day, with charges prepaid; or (iv) three business days after being deposited in the United States mail, postage prepaid, registered or certified mail, in each case addressed to the applicable party as follows (or as such other addresses or facsimile number for a party as shall be specified by such party by like notice except that any notice of any such change shall not be deemed given until actually received by the party to whom directed):

(i) if to the Buyer, to:

Deringer Mfg. Company

1250 Town Line Road

Mundelein, Illinois 60060

Attn: John Wallace, President

with a copy to:

Schiff Hardin & Waite

6600 Sears Tower

Chicago, Illinois 60606

Attn: Gary L. Mowder

Telecopier No.: (312) 258-5700

(ii) if to the Seller, to:

Andersen Group, Inc.

515 Madison Avenue

New York, New York 10022

Attn: Oliver R. Grace, Jr.

(iii) if to the Escrow Agent:

U.S. Bank, N.A.

1555 North River Center Drive

Suite 301

Milwaukee, Wisconsin 53212

` Attention: Peter Brennan

Assistant Vice President

Telephone: (414) 905-5003

Facsimile: (414) 905-5049

(b) This Agreement shall be governed by and construed in accordance with the internal laws (and not the conflicts of law provisions) of the State of Illinois.

(c) This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

(d) No party may assign (except by operation of law) any of its rights or obligations under this Agreement without the written consent of all the other parties, which consent shall not be unreasonably withheld.

(e) This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, legal representatives, successors and assigns.

(f) Except as otherwise provided herein, no delay of or omission in the exercise of any right, power or remedy accruing to any party under this Agreement shall impair any such right, power or remedy, nor shall any waiver be construed as a waiver of any other right, power or remedy hereunder or any further exercise thereof.

(g) In case any provision of this Agreement shall be invalid, illegal or unenforceable, it shall, to the extent possible, be modified in such manner as to be valid, legal and enforceable but so as to most nearly retain the intent of the parties, and if such modification is not possible, such provision shall be severed from this Agreement, and in either case the validity, legality and enforceability of the remaining provisions of this Agreement shall not in any way be affected or impaired thereby.

(h) Nothing in this Agreement shall in any way restrict the obligations and rights of any party under the Asset Purchase Agreement. No right, remedy or election given by any term of this Agreement shall be deemed exclusive, but each shall be cumulative with all other rights, remedies and elections available at law or in equity.

(i) The headings contained in this Agreement are for convenience of reference only and shall have no effect on the interpretation or operation thereof.

(j) This Agreement may be amended, modified or supplemented only by a written amendment signed by the Seller, the Buyer and the Escrow Agent, and no waiver of any provision hereof shall be effective unless expressed in a writing signed by the party sought to be bound.

IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement as of the date first above written.

DERINGER ACQUISITION CORP.

By:

THE J. M. NEY COMPANY

By:

U.S. BANK, N.A.

By:

ANNEX A

TO

ESCROW AGREEMENT

Escrow Agent Fees

ACCEPTANCE FEE:
Flat fee payable upon execution of Escrow Agreement:	$1,000
ADMINISTRATION FEE:
Annual Administration Fee with the first year paid up front:	$1,000
SPECIAL OR EXTRAORDINARY SERVICES:
Reimbursement of agent fees and expenses incurred by the Escrow Agent, including but not limited to attorney=s fees and expenses incurred with outside counsel if required.	cost
MISCELLANEOUS:
Out-of-pocket expenses, i.e., postage, stationery, travel expenses, etc.	cost

CHI_DOCS2:CS2\500239.5 12.15.01 06.44

EX-99.A4 OTHER AGRMT

Exhibit 99.1

ASSET PURCHASE AGREEMENT

by and among

Deringer Acquisition Corp.,

Deringer Mfg. Company,

The J.M. Ney Company

and

Andersen Group, Inc.

Dated as of November 8, 2001

TABLE OF CONTENTS

Page

Section 1. Sale of Assets and Assumption of Liabilities 1

1.1. Purchase and Sale of Assets 1

1.2. Excluded Assets 2

1.3. Assumption of Liabilities 4

1.4. Excluded Liabilities 4

Section 2. Closing; Purchase Price 6

2.1. Time and Place of Closing 6

2.2. Deliveries by the Seller and the Stockholder 6

2.3. Deliveries by the Buyer 6

2.4. Purchase Price 7

2.5. Allocation of Purchase Price 7

2.6. Closing Statement 7

2.7. Payment of the Cash Portion of the Purchase Price 7

2.8. Purchase Price Defined Terms 7

Section 3. Representations and Warranties of the Seller and the Stockholder 8

3.1. Organization 8

3.2. Authority 8

3.3. No Conflicts 8

3.4. Financial Statements; Inventory 9

3.5. Absence of Undisclosed Liabilities 9

3.6. Absence of Certain Changes 9

3.7. Title to Purchased Assets 9

3.8. Personal Property 10

3.9. Real Property 10

3.10. Accounts and Notes Receivable 10

3.11. Contracts and Leases 10

3.12. Customer List 10

3.13. Compliance with Law; Licenses 11

3.14. Litigation and Orders 11

3.15. Environmental Matters 11

3.16. Taxes 12

3.17. Insurance 12

3.18. Organized Labor Matters 12

3.19. Employee Plans 12

3.20. Compliance with ERISA 13

3.21. Capitalization and Subsidiaries 14

3.22. Predecessor Status; Etc. 14

3.23. Intellectual Property 14

3.24. Warranty and Sales Return Claims 15

3.25. Names 15

3.26. Adequacy of Purchased Assets 15

Section 4. Representations and Warranties of the Stockholder. 15

4.1. Organization 15

4.2. Authority 15

4.3. No Conflicts 16

4.4. Shareholder Reports 16

Section 5. Representations and Warranties of the Buyer 16

5.1. Organization 16

5.2. Authority 16

5.3. No Conflicts 16

5.4. Full Disclosure 16

Section 6. Employee Matters 17

6.1. Offers of Employment 17

6.2. Obligations of the Seller 17

6.3. Employee Plans 17

Section 7. Covenants Prior to Closing 18

7.1. Access and Cooperation 18

7.2. Best Efforts; Consents 18

7.3. Conduct of Business Pending Closing 18

7.4. Prohibited Activities 19

7.5. No Shop 20

7.6. Stockholder Stockholders Meeting 20

7.7. Agreements to be Terminated 21

7.8. Notification of Certain Matters 21

7.9. Inventory 21

7.10. Further Assurances 22

7.11. Noncompetition By Seller and Stockholder 22

Section 8. Conditions Precedent to the Obligations of the

Stockholder and the Seller 22

8.1. Representations and Warranties; Performance of Obligations 22

8.2. No Litigation 23

8.3. Consents and Approvals 23

8.4. Certificates of Incorporation; Good Standing Certificates 23

8.5. Secretary's Certificates 23

8.6. Closing Deliveries 23

8.7. Approval of the Stockholders 23

Section 9. Conditions Precedent to Obligations of the Buyer 23

9.1. Representations and Warranties; Performance of Obligations 23

9.2. No Litigation 24

9.3. Consents and Approvals 24

9.4. No Material Adverse Effect 24

9.5. Charters and Good Standing Certificates 24

9.6. Secretary's Certificate 24

9.7. Closing Deliveries 24

9.8. Updated Schedules 24

9.9. Approval of the Stockholders 24

Section 10. Additional Agreements 24

10.1. Turnover of Payments 24

10.2. Warranty, Customer Returns and Accounts Receivable 25

10.3. Tax Returns 25

10.4. Cooperation 25

10.5. Finished Goods Inventory Margin 25

10.6. Post Closing Adjustments 26

10.7. Insurance 26

10.8. Soft Inventory 26

10.9. Ney Name 26

Section 11. Indemnification 27

11.1. Survival 27

11.2. Indemnification 27

11.3. Third Person Claims 27

11.4. Escrow 28

Section 12. Termination of Agreement 28

12.1. Termination 28

12.2. Liabilities in Event of Termination 29

Section 13. Miscellaneous 29

13.1. Expenses and Taxes 29

13.2. No Brokers or Finders 29

13.3. Notices 29

13.4. Severability 30

13.5. Interpretation 30

13.6. Exercise of Rights and Remedies 30

13.7. Remedies Cumulative 30

13.8. Governing Law 31

13.9. Assignment, Binding Effect and Entire Agreement 31

13.10. No Third Party Beneficiaries 31

13.11. Counterparts 31

13.12. Captions 31

13.13. Parent Guarantee 31

ASSET PURCHASE AGREEMENT

This Asset Purchase Agreement (this "Agreement"), dated as of November 8, 2001, is among Deringer Acquisition Corp., an Illinois corporation (the "Buyer"), Deringer Mfg. Company, an Illinois corporation ("Parent"), the J.M. Ney Company, a Delaware corporation (the "Seller"), and Andersen Group, Inc. (the "Stockholder").

RECITALS:

WHEREAS, the Seller is engaged in the business of custom engineering, design and manufacturing of precision metal contacts and insert molded contact assemblies and connectors for various automotive, medical, industrial electronics, telecommunications and military market applications and related services and goods (the "Business"); and

WHEREAS, the Buyer desires to purchase from the Seller, and the Seller desires to sell to the Buyer, substantially all of the assets (other than the Excluded Assets as defined below) of the Seller, including without limitation those used in connection with the Business, on the terms and subject to the conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the mutual agreements contained herein, the parties hereby agree as follows:

Section 1. Sale of Assets and Assumption of Liabilities.

1.1. Purchase and Sale of Assets. Subject to the conditions set forth below, at the Closing (as defined in Section 2.1), the Seller will sell and deliver to the Buyer, and the Buyer will purchase from the Seller, all of the Seller's right, title and interest in and to the Purchased Assets. As used in this Agreement, the term "Purchased Assets" shall mean all of the assets, properties, rights and interests of the Seller (other than the Excluded Assets described in Section 1.2, which list of Excluded Assets will take precedence over the list of Purchased Assets contained in paragraphs (a) through (n) of this Section 1.1 below), including without limitation any used in or held for use by the Business, of whatever kind or nature, real or personal, tangible or intangible and wherever located, as such assets may exist at the time of the Closing. The Purchased Assets shall include the fo llowing:

(a) All rights under contracts, agreements, instruments, understandings, leases for personal property, commitments and other arrangements, whether oral or written, including without limitation contracts or orders for the sale or lease of goods and services and further including without limitation any and all warranties (express or implied) or product agreements of any manufacturer, supplier, vendor or other person or entity relating to any Purchased Assets;

(b) All Inventory (as defined in Section 3.4(b));

(c) All rights in connection with deposits, prepayments and prepaid expenses identified on Schedule 1.2(k);

(d) All machinery, equipment, attachments and parts therefor, tools, computer hardware, fixtures, office furniture, supplies and tangible personal property of every kind and nature, excluding the Dodge Ram Truck;

(e) All Intellectual Property (as defined in Section 3.23), including all patents, trademarks, service marks, trade names and trade styles (including, without limitation, all applications with respect thereto and the names "The J.M. Ney Company" and "Ney" and all variations thereof), and all logos, drawings, technical data, product specifications, computer software, source codes, object codes, computer files, programs, blueprints, know-how, trade secrets and other proprietary rights and all goodwill associated therewith;

(f) All rights in incomplete or unfilled contracts, commitments and orders issued for the purchase or lease of inventory or other goods or services by the Seller, including without limitation parts, components and supplies;

(g) All rights against suppliers of inventory or other goods or services, including without limitation any express or implied warranties and any entitlement to discounts or rebates;

(h) All authorizations, permits, franchises and licenses;

(i) All claims, refunds, causes of action, choses in action, rights of recovery and rights of set-off or offset of every kind and nature;

(j) ll proceeds and other rights and benefits relating to insurance coverages with respect to the Purchased Assets and the Assumed Liabilities, excluding any unearned or prepaid insurance premiums or any dividends on insurance policies in effect as of the Closing Date;

(k) All goodwill and all other intangible property;

(l) All construction in process;

(m) All marketing plans, marketing manuals, sales materials, promotional materials, catalogues and advertising and marketing literature and materials;

(n) All business records and files relating to the Purchased Assets and Assumed Liabilities, including without limitation customer lists and other identifications of former, existing and potential customers and suppliers, mailing lists, sales information, customer and supplier records, cost and pricing information, billing records, employment and personnel records and other records (including without limitation those maintained in computer tapes, disks or other computer retrievable formats), in each case whether maintained by the Seller or by others for the Seller, and the Seller's main telephone number and post office boxes at which the Seller receives correspondence or remittances from customers, but excluding tax returns and any communication sent or received by Seller, Stockholder or their respective attorneys or other professional representatives relating to this transaction to the extent not previously provided to Buyer; and

(o) All lockbox addresses and related lockbox accounts for the payment of accounts receivable (but not including any other bank accounts, and subject to the provisions of Section 10.2(b).)

1.2. Excluded Assets. Notwithstanding Section 1.1, the Purchased Assets will not include the following (collectively, the "Excluded Assets"):

(a) The Seller's rights under this Agreement;

(b) The Seller's cash, cash equivalents, short-term investments and marketable securities;

(c) The Seller's corporate minute books, corporate seal, charter documents, and stock records;

(d) Furniture used in the offices of Andersen Group Inc. personnel located in the Bloomfield, Connecticut facility;

(e) All leasehold and ownership interests in trucks, cars, trailers and other vehicles of any kind, including the Dodge Ram Truck;

(f) Contracts to acquire precious metals and contracts with sales agents, representatives and distributors;

(g) Any refinery or factory lot precious metal inventory owned by Seller in the custody of third parties;

(h) Artwork, including, but not limited to, those items listed on Schedule 1.2(h);

(i) Any recoveries from or related to or in connection with the misappropriation of monies by Les Evan Rockmael, including but not limited to recoveries of monies from Les Evan Rockmael, any insurance company, the Ohio Supreme Court Client Recovery Fund, any bank from which the misappropriated monies were initially deposited or recoveries from any other source;

(j) Any rights to receive or subscribe for any shares of capital stock as the result of being the owner and/or the holder of any insurance policy or annuity contract and any rights to subscribe for shares of stock of mutually owned savings banks, thrift institutions, insurance companies or any comparable or analogous financial institutions that is involved in the conversion from a mutual form of ownership to a stock form of ownership and all deposits at, or the cash surrender values of, any monies held by such financial institutions for or on behalf of Seller;

(k) Any deposits, prepayments and prepaid expenses not specifically identified on Schedule 1.2 (k);

(l) The annuity contract relating to Frank Wilson and the life insurance policies insuring the lives of Denton Smith and Neil Swanson;

(m) Any rights under any insurance contracts maintained by the Seller to the extent related to the Excluded Assets or the Excluded Liabilities (as defined in Section 1.4);

(n) Any real property, and any buildings and improvements thereon, of the Seller, and any related rights and authorizations associated with fee ownership thereof, including Seller's rights as lessor under the lease attached hereto as Exhibit C;

(o) Any refund of any taxes which have been paid by the Seller and net operating or capital loss carryforwards;

(p) Any business records and files to the extent related to only the foregoing Excluded Assets or the Excluded Liabilities;

(q) All accounts and accounts receivable, promissory notes of other parties and other rights to receive payments from any person or entity, including the Stockholder and its affiliates, including without limitation rights to payments arising from the sale or lease of goods and services (whether current or non-current) with respect to goods or services sold by Seller prior to the Closing Date and including related security interests; and

(r) Any and all insurance policies, annuity contracts, trust funds and other assets relating to Employee Plans as defined in Section 3.19; and

(s) Any unearned or prepaid issuance premiums or any dividends on insurance policies in effect as of the Closing.

1.3. Assumption of Liabilities. Subject to the conditions set forth below, at the Closing the Buyer will assume and become responsible for the following liabilities and obligations of the Seller arising from operation of the Business (the "Assumed Liabilities") and no others:

(a) Liabilities and obligations of the Seller for unpaid accrued vacation benefits recorded in the books and records of the Seller as of the Closing Date plus current year vacation benefits effective March 1, 2001, to the extent accrued in accordance with the Seller's personnel policies, regardless of whether recorded on the books and records of the Seller as of the Closing Date, in each case for employees of Seller hired by Buyer. Schedule 1.3(a) is a complete schedule of employees at signing of this Agreement. Buyer shall deliver to Seller, no later than 20 business days after the delivery of such schedule, a schedule of names of employees of Seller to be hired by Buyer. After receipt by Seller of the schedule of names of employees of Seller to be hired by Buyer, Seller shall provide to Buyer, no later than five (5) business days prior to the expected Closing Date, the value of the accrued vacation benefits determined in accordance with Section 2.8 as of the Closing Date for such employees;

(b) Liabilities and obligations of the Seller from and after the Closing Date under the contracts and agreements listed on Schedule 1.3(b) which are other than warranty arrangements (but not any liability or obligation resulting from any breach or violation thereof on or prior to the Closing);

(c) Liabilities and obligations for payment of the remaining amounts due under the capitalized leases set forth on the Closing Statement and listed on Schedule 1.3(c); and

(d) Liabilities and obligations of the Seller for "customer pool balances." For the purpose of this Section 1.3(d) "customer pool balances" means precious metal inventories that are owned by customers of Seller at or prior to the time of Closing, held by the Seller or a third party and listed on Schedule 1.3(d).

1.4. Excluded Liabilities. Except as specifically assumed pursuant to Section 1.3, the Buyer will not assume or be responsible for any obligation or liability of the Seller or Stockholder, and the Seller will continue to be responsible for all its obligations and liabilities, whether known or unknown, fixed or contingent, liquidated or unliquidated and secured or unsecured, whether arising prior to, at or subsequent to the Closing, whether or not related to the Business and whether or not disclosed to the Buyer (collectively, the "Excluded Liabilities"). Without limiting the generality of the foregoing, the Excluded Liabilities shall include any obligations or liabilities of the Seller:

(a) Arising out of or relating to this Agreement or the transactions contemplated hereby, including without limitation the preparation, negotiation or execution of this Agreement and any attorneys', accountants' or other fees or expenses incurred in connection therewith, except for 50% of the expenses incurred in performing the appraisal performed by The Eshak Group (the "Appraisal");

(b) Constituting indebtedness, including without limitation obligations or liabilities on account of borrowed money, the deferred purchase price of any property, letters of credit or guarantees;

(c) For federal, state, local or foreign taxes arising out of or relating to the operation of the Business by the Seller or any activity or event occurring or condition or state of facts existing at or prior to the Closing Date or arising out of, resulting from or incident to the consummation of the transactions contemplated by this Agreement;

(d) Arising out of or relating to any actual or alleged breach or failure to perform by the Seller, or any other person or entity for which the Seller may be liable, under any contract, commitment, arrangement or understanding;

(e) Resulting from any violation by the Seller, or any other person or entity for which the Seller may be liable, of any legal duty or any applicable federal, state, local or foreign law, statute, ordinance, rule, regulation, judgment, order or decree, including without limitation any Environmental Laws (as defined in Section 3.15(a));

(f) Relating to any condition, event, action or situation occurring or existing prior to the Closing for which liability under any Environmental Law may arise;

(g) To any present or former stockholder, option holder, officer or director of the Seller;

(h) To any present or former employee of the Seller (or their dependents or beneficiaries), including without limitation, (i) liabilities and obligations relating to Employee Plans, (ii) vacation benefits accrued through the Closing Date for employees other than employees hired by Buyer or as provided in the last sentence of this Section 1.4 below, (iii) all medical and other benefit obligations to retirees from employment with the Seller, and their dependents and beneficiaries, (iv) medical and other benefit obligations to employees of the Seller and their dependents and beneficiaries that relate to events or activities occurring, or conditions or states of fact existing, at or prior to the Closing Date, (v) severance benefits or payments payable to employees upon the termination of their employment with the Seller under any severance or similar contract, agreement, plan, program, policy arrangement or understanding maintained by the Seller, or to which the Seller is a party, ex cept as provided in the last sentence of this Section 1.4, (vi) obligations for wages, bonuses, fringe benefits or worker's compensation, or (vii) other obligations under any federal, state, local or foreign law, statute, ordinance, rule or regulation, relating to employment;

(i) Relating to any accounts payable, note payable or other payable to any affiliate of the Seller or the Stockholder or any affiliate of the Stockholder;

(j) Relating to any litigation pending or threatened against the Seller;

(k) Resulting from any product liability claims, warranty claims or other claims with respect to products sold or leased or services rendered by the Seller or any of its predecessors;

(l) Relating to any activities or businesses of the Seller or any of its predecessors other than the Business; or

(m) Relating to any Excluded Asset.

The Seller agrees to pay and discharge all Excluded Liabilities in accordance with the terms thereof. In the event that Buyer deviates from the headcount reduction set forth on Schedule 1.4, Buyer shall assume the liability with respect to any incremental severance costs in excess of $5,000, as calculated in accordance with the severance policy described on Schedule 3.19 and assuming in each department that those employees terminated shall be those resulting in the highest severance cost.

Section 2. Closing; Purchase Price.

2.1. Time and Place of Closing. The consummation of the purchase and sale of the Purchased Assets is called the "Closing." The Closing will take place at the offices of Stockholder on the Tuesday after the date on which the last of the conditions set forth in Section 8 or 9 is satisfied, or at such other place or on such other date as the parties may agree in writing. For all purposes of this agreement, the Closing shall be deemed effective as of the close of business Friday immediately preceding the Closing (the "Closing Date").

2.2. Deliveries by the Seller and the Stockholder. At the Closing, the Seller and the Stockholder will deliver to the Buyer:

(a) A Bill of Sale and General Assignment in the form attached hereto as Exhibit A, duly executed by the Seller (the "Bill of Sale") and transferring the Purchased Assets to the Buyer, free and clear of all liens, security interest, charges, claims and other encumbrances of any kind;

(b) An Escrow Agreement in the form attached hereto as Exhibit B, duly executed by the Seller and the Escrow Agent (the "Escrow Agreement");

(c) A certificate executed by the Seller setting forth the computation of the Purchase Price, together with the Closing Statement described in Section 2.6;

(d) Any other instruments of transfer and assignment of the Purchased Assets that the Buyer may reasonably request to vest the Purchased Assets in the Buyer, free and clear of all liens, security interests, charges, claims and other encumbrances of any kind, in accordance with the terms of this Agreement;

(e) A copy of a written consent executed by the Stockholder approving this Agreement and the transactions contemplated hereby;

(f) Documents evidencing the change in the Seller's corporate name and the release of any assumed name of the Seller in favor of the Buyer in form and substance satisfactory to the Buyer;

(g) Evidence satisfactory to Buyer that all liabilities for accrued vacation benefits for employees of Seller not hired by Buyer have been satisfied by payment in cash; and

(h) A lease with respect to the premises commonly known as 2 Douglas Street, Ney Industrial Park, Bloomfield, Connecticut 06002 and occupied by the Seller in connection with the Business prior to the Closing Date, duly executed by Andersen Group, Inc. and in the form attached hereto as Exhibit C (the "Lease").

2.3. Deliveries by the Buyer. At the Closing, the Buyer will deliver to the Seller:

(a) The cash consideration referred to in Section 2.7(a), payable by wire transfer to the account or accounts specified in writing by the Seller, together with the amount to be deposited with the Escrow Agent referred to in Section 2.7(b);

(b) The Escrow Agreement, duly executed by the Buyer and the Escrow Agent;

(c) An Assumption Agreement in the form attached hereto as Exhibit D, duly executed by the Buyer (the "Assumption Agreement"); and

(d) The Lease, duly executed by the Buyer and in form and substance acceptable to the Seller.

2.4. Purchase Price. The aggregate consideration to be delivered in consideration of the sale of the Purchased Assets to the Buyer (the "Purchase Price") shall be the sum of (i) $5,269,100 plus (ii) the value of fixed asset additions subsequent to February 28, 2001 plus (iii) the value of Purchased Inventory plus (iv) the value of Purchased Prepaid Expenses less (v) the value of the principal component of liabilities assumed under Section 1.3(c) less (vi) the value of the Hired Employee Vacation Accrual.

2.5. Allocation of Purchase Price. The aggregate consideration delivered pursuant to Section 2.4 will be allocated among the Purchased Assets and the Assumed Liabilities as determined by the Buyer as of the Closing Date. Buyer will allocate at least $600,000 to goodwill and $5,000 to the non-compete contained in Section 7.11. Each party will reflect such allocation in any filings required pursuant to Section 1060 of the Code or any similar provisions of state, local or foreign law, and in all tax returns.

2.6. Closing Statement. The Seller and the Stockholder shall prepare and deliver to the Buyer at the Closing a closing statement as of the Closing Date (the "Closing Statement") which shows in reasonable detail the calculation of the purchase price and shall be acceptable to the Buyer, including the calculation of Purchased Inventory, in the form of Schedule 2.6. In addition, the Closing Statement shall include a detailed list of all open shop orders identifying cumulative cost for material, labor, and overhead. The precious metal cost, labor and overhead will be determined based on Seller's frozen standard used in the ordinary course of business. In addition, the Closing Statement shall include a schedule of Soft Inventory (as defined in Section 10.8) as of the Closing Date.

2.7. Payment of the Cash Portion of the Purchase Price. The cash portion of the Purchase Price set forth in Section 2.1(a) shall be payable as follows:

(a) The Purchase Price, less $600,000, shall be paid to the Seller at the Closing; and

(b) Six hundred thousand dollars ($600,000) shall be deposited with a bank or trust company, as escrow agent (the "Escrow Agent") under the Escrow Agreement, which amount shall be distributed in accordance with the provisions of the Escrow Agreement.

2.8. Purchase Price Defined Terms. For purposes of this Agreement, the following terms shall have the meanings set forth below:

"Hired Employee Vacation Accrual" shall mean the value of accrued vacation as reflected on the books and records of the Company as of February 28, 2001, plus (i) a portion of the accrual effective March 1, 2001, regardless of whether recorded on the books and records of the Company, equal to such March accrual times a fraction, the numerator of which is actual number of days elapsed since March 1 to the Closing Date, and the denominator of which is 365, less (ii) any days of vacation taken.

"Precious Metal Adjustment" means, with respect to any Inventory (other than Inventory subject to any fixed price contract), the positive or negative difference between the value of precious metal content thereof set forth in the books of account of the Seller based on Seller's frozen standard less the value of precious metal content determined at the second London Fix as of the Closing Date and with respect to any order for which the price has been fixed and is not subject to change based on changes in fluctuation in precious metal prices ("Fixed Price Contract") as listed on Schedule 1.3(b), the positive or negative difference between the value of precious metal content determined at the second London Fix as of the Closing Date of any such item of Inventory, less the value of precious metal content thereof set forth in such contracts. In the event a Fixed Price Contract does not contain a specific amount of goods to be delivered, the amount of precious metal content will be a good faith estimate jointly agreed to Buyer and Seller based on past purchases by the customer. For the purposes of this definition, the second London Fix means the London Fix price set in the afternoon, London, U.K. time, for the relevant precious metal as stated in United States dollars and found on the Internet site www.kitco.com under the headings "Historical London Fixings" "PM" for the day preceding the Closing Date.

"Purchased Inventory" means the value of Inventory as determined pursuant to clause (iv) of Section 3.4(b), plus (i) any LIFO reserves and obsolescence reserves, less (ii) the value of any refinery or factory lot precious metal inventory (net of any reserves) in the custody of third parties, less (iii) the Precious Metal Adjustment, in each case as adjusted by the physical inventory taken pursuant to Section 7.9 hereof and set forth on the Closing Statement.

"Purchased Prepaid Expenses" means prepaid expenses as set forth on the books and records of the Seller in accordance with generally accepted accounting principles as of the Closing Date, but only if listed on Schedule 1.2(k).

Section 3. Representations and Warranties of the Seller and the Stockholder.

Each of the Seller and the Stockholder jointly and severally represents and warrants to the Buyer as follows:

3.1. Organization. The Seller is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation and has all requisite corporate power and authority to own, lease and operate its properties and assets and to conduct the Business as currently conducted or proposed to be conducted. The Seller is not required to be qualified to do business as a foreign corporation in any jurisdiction. Except as set forth on Schedule 3.1, no part of the Business is conducted through any agent, subsidiary or affiliate of the Seller.

3.2. Authority. The Seller has all requisite power and authority to execute, deliver and perform its obligations under this Agreement and the other agreements being executed and delivered by the Seller to the Buyer in connection with this Agreement (collectively, together with this Agreement, the "Transaction Documents") and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance of this Agreement and the other Transaction Documents by the Seller and the consummation of the transactions contemplated by the Transaction Documents have been duly authorized by all requisite corporate action on the part of the Seller. This Agreement and the other Transaction Documents to which either the Seller or the Stockholder is a party constitute the legal, valid and binding obligation of the Seller or the Stockholder, as the case may be, enforceable against the Seller and t he Stockholder in accordance with their respective terms, except to the extent enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws now or hereafter in effect relating to creditors rights generally, and general principles of equity.

3.3. No Conflicts. Except as set forth on Schedule 3.3, the execution, delivery and performance of this Agreement and the other Transaction Documents by the Seller and the Stockholder and the consummation of the transactions contemplated by the Transaction Documents (a) do not require the Seller to file any notice with or obtain any consent, approval, authorization or exemption from any person or entity, including without limitation any government or governmental agency or instrumentality, other than the affirmative vote of the stockholders of the Stockholder, (b) will not violate any writ, injunction, decree, order, judgment, law, statute, ordinance, rule or regulation, (c) will not constitute a default or breach under any agreement or commitment to which the Seller is a party or by which the Seller or any of its properties (including without limitation the Purchased Assets) may be bound and (d) wil l not result in the imposition of any security interest, lien, charge or other encumbrance on any of the Purchased Assets.

3.4. Financial Statements; Inventory.

(a) The Seller has delivered to the Buyer copies of the financial statements set forth on Schedule 3.4 (collectively, the "Financial Statements"). The Financial Statements fairly present the financial condition of the Seller at the dates indicated and the results of operations and cash flows of the Seller for the periods indicated in accordance with generally accepted accounting principles consistently applied.

(b) All inventory of the Business (whether or not allocated to contracts in process), including raw materials, work in process and finished products, displays, advertising materials, packaging, items purchased for distribution or resale and items of the foregoing types which have been ordered or purchased by Seller for the Business, including inventory shown on the Financial Statements, or acquired thereafter, but excluding refinery and factory lot precious metal inventory in the custody of third parties ("Inventory"), (i) was acquired or manufactured in the ordinary course of business, (ii) is not damaged, defective, or Soft Inventory (as defined in Section 10.8 hereof), (iii) meets the current specifications and standards of Seller as well as all government and industry specifications and standards for the particular product, (iv) is valued on the books of account and Financial Statements at standard (on a last-in, first-out (LIFO) basis)) in which the standard cost less reserves is no greater than individual market value (sales price less direct selling and direct distribution costs), in accordance with generally accepted accounting principles consistently applied throughout the periods reported upon, and (v) all adjustments described in the definition of Purchased Inventory were made correctly.

3.5. Absence of Undisclosed Liabilities. The Seller has no material liabilities (whether known or unknown, fixed or contingent, liquidated or unliquidated or secured or unsecured) other than as and to the extent reflected or reserved against in the most recent balance sheet included in the Financial Statements and other than those incurred by the Seller in the ordinary course of business since such most recent balance sheet date (none of which liabilities are for breach of contract, tort, infringement or violation of any law, statute, ordinance, rule or regulation).

3.6. Absence of Certain Changes. Since September 30, 2001, (a) the Business has been conducted only in the ordinary course; (b) the Business has not experienced any change which, individually or in the aggregate, has had or may have a material adverse effect on the Purchased Assets or the operations, affairs, condition (financial or otherwise) or prospects of the Business; (c) there has not been any damage, destruction or loss (whether or not covered by insurance) materially and adversely affecting the properties or business of the Seller; (d) there has not been any declaration or payment of any dividend or distribution in respect of the Seller's capital stock or any direct or indirect purchase, or redemption or other acquisition or retirement of, any of the capital stock of the Seller; (e) there has not been any sale or transfer, or any agreement to sell or transfer, any material assets, of the Seller to a ny person or entity (other than sales of inventory in the ordinary course of business or the sale contemplated by this Agreement); (f) there has not been any plan, agreement or arrangement granting any preferential rights to purchase or acquire any interest in any of the assets, property or rights of the Seller or requiring consent of any party to the transfer and assignment of any such assets, property or rights; (g) there has not been any waiver of any material rights or claims of the Seller, other than the negotiation and adjustment of bills made by the Seller in the ordinary course of business in the course of good faith disputes with customers and in a manner consistent with past practice; and (h) there has not been any amendment or termination, or to the knowledge of the Seller, threatened termination, of any material contract, commitment, agreement, license, permit, authorization or other right to which the Seller is a party.

3.7. Title to Purchased Assets. The Seller is the sole legal and beneficial owner of the Purchased Assets (other than assets leased pursuant to contracts scheduled on Schedule 1.3(b)) with good and marketable title thereto, and the Bill of Sale will transfer good and marketable title in the Purchased Assets to the Buyer, in each case free and clear of all security interests, liens, charges, claims and other encumbrances of any kind (but subject, in the case of leased properties, to the rights of the other parties under the applicable leases).

3.8. Personal Property.

(a) Schedule 3.8 lists, in reasonable detail all personal property owned by the Seller with an individual book value or market value in excess of $500, all leased property and all leases in respect of personal property. Except as set forth on Schedule 3.8, (i) all of the tangible personal property (other than inventory) owned by the Seller or leased by the Seller pursuant to any lease has been well maintained and is in good working order and condition, ordinary wear and tear excepted, and, in addition, in the case of leased property is in the condition required by the applicable lease; and (ii) all leases are in full force and effect and constitute legal, valid and binding agreements of the parties (and their successors) thereto in accordance with their respective terms.

(b) All inventory of the Seller is saleable or useable in the ordinary course of business consistent with past practice and all damaged, obsolete or slow moving inventory or inventory in excess of the amount reasonably required for the operation of its business has been written off or down to its net realizable value on the Financial Statements and the books and records of the Seller.

3.9. Real Property. There are no pending or threatened appropriation, condemnation, eminent domain or like proceedings relating to all of the real property used exclusively in the operation and conduct of the Business (including buildings, structures and other improvements located thereon) (the "Owned Real Property"). All easements, rights, interests, and appurtenances relating to the Owned Real Property, are free and clear of all title defects, except for the liens set forth on Schedule 3.9. Schedule 3.9 lists all real property leased, subleased, used or otherwise occupied by the Seller in the conduct of its business and all leases or other agreements in respect of such real property. All leased property is in the condition required by the applicable lease and all leases and other agreements included on Schedule 3.9 are in full force and effect and constitute legal, valid an d binding agreements of the parties (and their successors) thereto in accordance with their respective terms.

3.10. Accounts and Notes Receivable. Schedule 3.10 lists all of the accounts, notes and other receivables of the Seller (other than those receivables of the Seller arising after the most recent month end as a result of sales in the ordinary course of business to persons or entities who are not affiliated with the Stockholder or the Seller). Buyer acknowledges that such receivables are Excluded Assets.

3.11. Contracts and Leases. Schedule 3.11 lists all material agreements, contracts instruments or commitments to which Seller is a party or by which it or any of its assets are bound. Except for agreements and commitments set forth on Schedule 3.11, the Seller is not a party to any agreement or other commitment (including without limitation any lease, employment agreement or consulting agreements) relating to the Business (x) under which the Seller is obligated to make payments in excess of $20,000 in any year and which is not cancelable at the option of the Seller without penalty upon not more than 30 days notice, (y) with any person who is (or who controls, is controlled by or is under common control with) a director or officer of the Seller or the Stockholder or (z) which prohibits or restricts the Seller or any other owner of the Purchased Assets from freely using or disclosing any inform ation or other asset, from freely providing goods or services to any person or entity or which restricts the types of business or geographical territory in which any business may be engaged. The Seller is not in default in any material respect under any agreement or commitment relating to the Business.

3.12. Customer List. The Seller has delivered to the Buyer a copy of its customer list. This customer list accurately sets forth the current customers of the Business and all former customers of the Seller during the past three years. No customer whose individual account represented more than two percent (2%) of the gross sales of the Business during the twelve (12) month period ended on April 30, 2001 has, on or after September 30, 2001, terminated or materially and adversely altered or given the Seller notice of intention to terminate or materially and adversely alter, its previous or existing arrangements with the Seller. A list of each customer which was responsible for more than two percent (2%) of the gross sales of the Business during the twelve (12) month period referred to above, along with gross sales for each such customer from the period from May 1, 2001 to September 30, 2001, is set forth on Schedule 3.12.

3.13. Compliance with Law; Licenses. The Purchased Assets and the operation of the Business are in compliance in all material respects with all applicable laws, statutes, ordinances, rules, regulations, permits, licenses and authorizations including without limitation those concerning labor and employment (but subject, in the case of Environmental Laws and tax matters, to the specific provisions of Sections 3.15 and 3.16, respectively). The Seller holds the permits, licenses and authorizations set forth on Schedule 3.13 with respect to the Business, which are all of the permits, licenses and authorizations required to conduct the Business and all of which are included in the Purchased Assets (other than licenses which are required by law to be held by individuals in order to conduct the Business). Neither the Seller nor the Stockholder has received any notice that any governmental auth ority intends to cancel, terminate or not renew any such permit, license or authorization.

3.14. Litigation and Orders. There is no action, suit, proceeding or investigation in any court or before any arbitrator or government agency or instrumentality pending or, to the knowledge of the Seller or the Stockholder, threatened against or affecting the Seller or any of the Seller's properties (including without limitation any of the Purchased Assets) or the Business. There are no judgments, orders, writs, injunctions or decrees binding upon or applicable to the Seller or its property and the Seller not in violation of any of the foregoing.

3.15. Environmental Matters.

(a) The Seller has complied with and is in compliance in all material respects with all applicable federal, state and local laws, statutes, ordinances, regulations, rules, judgments, orders, writs, injunctions and decrees relating to environmental protection (collectively "Environmental Laws"), including without limitation Environmental Laws relating to substances or materials that are deemed under Environmental Laws to be hazardous or toxic, including without limitation asbestos, lead-based paints and petroleum and petroleum products (including crude oil or any fraction thereof) (collectively, "Hazardous Materials").

(b) The Seller has obtained and Schedule 3.15 sets forth, all licenses, franchises, permits and other governmental authorizations and approvals (collectively, the "Authorizations") required by Environmental Laws for the conduct of the Business as currently conducted, and Seller is in compliance with all such Authorizations.

(c) To the knowledge of the Seller, there have been no events, situations or conditions, including releases or threats of releases of Hazardous Materials, at, from, in or on any property owned or operated by the Seller which (i) were, or which were required to be, reported under any Environmental Law, or (ii) were given or could give rise to liabilities under Environmental Laws.

(d) Except as set forth on Schedule 3.15, neither the Seller nor anyone acting on behalf of the Seller has transported Hazardous Materials, disposed of Hazardous Materials, or arranged for the transportation of Hazardous Materials to a site which is the subject of any federal, state or local enforcement action or any other investigation, which, may lead to a claim for any clean-up cost, fines, remedial work, recovery for damage to natural resources, property damage or personal injury, including, but not limited to, any claim under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, or any state counterpart thereof.

(e) The transactions contemplated by this Agreement do not require disclosure or other compliance activities under any Environmental Law which are triggered by transfers or transactions of the type contemplated herein.

(f) Seller has provided to Buyer copies of all environmental audits, assessments, studies or analytical data prepared for or within the possession or control of the Seller or the Stockholder with respect to any property or facility owned, operated or leased by the Seller.

(g) The indemnity provisions of Section 11 shall be the sole remedy for breaches of this representation.

3.16. Taxes. The Seller has properly completed and filed, within the time and in the manner prescribed by law, all tax returns and other documents required to be filed in respect of federal, state, local and foreign taxes, and all such returns and other documents are true, correct and complete. The Seller has paid all taxes then due and payable and established reserves on its books that are adequate for the payment of all taxes not yet due and payable. There are no liens for taxes upon any of the Purchased Assets, except liens arising by law for taxes not yet due and payable. There are no examinations in progress or claims against the Seller for taxes (including without limitation penalties and interest) for any period or periods and no notice of any claim for taxes, whether pending or threatened, has been received by the Seller or the Stockholder. The indemnity provisions of Section 11 shall be the sole remedy for breaches of this representation.

3.17. Insurance. The Seller has delivered to Buyer as of a recent date an accurate list of all insurance loss runs or workers' compensation claims received by it for the last three years, and true, complete and correct copies of all insurance policies currently in effect. Such insurance is sufficient to comply with all requirements of applicable law and all agreements and commitments relating to the Business. All such policies are in full force and effect and the premiums have been paid when due. There are no claims, actions, suits or proceedings arising out of or based upon any of such policies of insurance and, to the knowledge of the Seller and the Stockholder, no reasonable basis for any such claim, action, suit or proceeding exists. The Seller is not in default with respect to any provisions contained in any such insurance policies and, to the knowledge of the Seller and the Stockholder, has not fa iled to give any notice or present any material claim under any such insurance policy in due and timely fashion.

3.18. Organized Labor Matters. During the past three years (i) the Seller has not been and is not currently bound by or subject to, and none of its assets or properties is bound by or subject to, any arrangement or agreement with any labor union, (ii) no employees of the Seller have been or are currently represented by any labor union or covered by any collective bargaining agreement, (iii) to the knowledge of the Seller and the Stockholder, no campaign to establish such representation has been commenced or is currently in progress, and (iv) there has not been nor is there currently any pending or, to the knowledge of the Seller or the Stockholder, threatened labor dispute involving the Seller and any group of its employees nor has the Seller experienced any labor interruptions. The Seller believes its relationship with employees to be good.

3.19. Employee Plans.

(a) For purposes of this Agreement, the term Employee Plan includes each employee benefit plan as defined in Section 3(3) of ERISA (other than a Multiemployer Plan as defined in Section 3(37) of ERISA) including terminated plans, and each other bonus, deferred compensation, pension, retirement, profit sharing, thrift, savings, employee stock ownership, stock bonus, stock purchase, change in control, retention, restricted stock, stock option, phantom stock, employment, termination, severance, compensation, medical, health or other plan, agreement, policy, practice or arrangement that covers employees or former employees of the Seller and their dependents and beneficiaries. Schedule 3.19 lists each Employee Plan which currently, or since January 1, 1999, is or has been maintained by the Seller for its employees and their beneficiaries or dependants, or to which the Seller made or was required to make contributions.

(b) Except for the Employee Plans described on Schedule 3.19, (1) the Seller does not sponsor, maintain or contribute to any plan, program, fund or arrangement that constitutes an Employee Plan, nor does the Seller have any obligation to contribute to or accrue or pay any benefits under any such Employee Plan, and (2) the Seller is not required to contribute to any Employee Plan pursuant to the provisions of any collective bargaining agreement establishing the terms and conditions of employment of any of the Seller's employees.

(c) The Seller is not now, nor can as a result of its past activities become, liable to the Pension Benefit Guaranty Corporation ("PBGC") or to any multiemployer employee pension benefit plan under the provisions of Title IV of ERISA. All Employee Plans listed on Schedule 3.19 and the administration thereof are in compliance in all material respects with their terms and all applicable provisions of ERISA, the Code and the regulations issued thereunder, as well as with all other applicable federal, state and local statutes, ordinances and regulations. All accrued contribution obligations of the Seller with respect to any Plan listed on Schedule 3.19 have either been fulfilled in their entirety or are fully reflected on the most recent balance sheet of the Seller included in the Financial Statements.

3.20. Compliance with ERISA. All of the Plans listed on Schedule 3.19 that are intended to qualify under Section 401(a) of the Code (the "Qualified Plans") are, and have been, so qualified and have been determined by the Internal Revenue Service to be so qualified, and true, correct and complete copies of such determination letters have been delivered to the Buyer. Except as disclosed on Schedule 3.20, all reports and other documents required to be filed with any governmental agency or distributed to plan participants or beneficiaries (including, but not limited to, actuarial reports, audits, annual reports (Form 5500) or tax returns) have been timely filed or distributed. Neither the Stockholder, any Plan listed in Schedule 3.19 nor the Seller has engaged in any transaction prohibited under the provisions of Section 4975 of the Code or Section 406 of ERISA or Section 4975 of the Code . No Plan listed in Schedule 3.19 has incurred an accumulated funding deficiency, as defined in Section 412(a) of the Code and Section 302(1) of ERISA; and the Seller has not incurred any liability for excise tax or penalty due to the Internal Revenue Service nor any liability to the PBGC. In addition:

(a) there have been no terminations, partial terminations or discontinuance of contributions to any such Qualified Plan intended to qualify under Section 401(a) of the Code without notice to and approval by the Internal Revenue Service;

(b) no Plan listed in Schedule 3.19 subject to the provisions of Title IV of ERISA has been terminated;

(c) there have been no "reportable events" (as that phrase is defined in Section 4043 of ERISA and the regulations issued thereunder) with respect to any Plan listed in Schedule 3.19;

(d) the Seller has not incurred any liability under Section 4062 of ERISA;

(e) As to each Employee Plan subject to Title IV of ERISA, the value of the assets thereof, as of the date hereof, as determined by such Employee Plan's independent actuaries, exceeds the present value, as of the date hereof, as determined by such actuaries on a termination basis and on an ongoing basis, of all benefits accrued under such Plan;

(f) No waiver from the minimum funding standard requirements of Section 302 of ERISA or Section 412 of the Code has been obtained, applied for or is contemplated with respect to any Employee Plan subject to Title IV of ERISA;

(g) All current and material documents relating to each Multiemployer Plan, to which Seller has, or had since January 1, 1999, any obligation to contribute, have been furnished to the Buyer, including but not limited to collective bargaining agreements, plan and trust documents, plan rules relating to estimates of withdrawal liability and statements of unfunded vested benefits and contribution history. The Seller has made all contributions required in connection with any Multiemployer Plan as of the date hereof. The Seller has not terminated participation in, or withdrawn from, in a complete withdrawal as defined in Section 4203 of ERISA, or a partial withdrawal as defined in Section 4205 of ERISA, any Multiemployer Plan, and is not aware of any withdrawal liability as defined in Section 4201 of ERISA assessed against the Seller, with respect to any Multiemployer Plan;

(h) No matter is pending or relating to any Employee Plan before any court or governmental agency; and

(i) Except as set forth in Schedule 3.19 there are no plans, arrangements or agreements to which the Seller is a party, or by which it is bound, and under which as a result of any particular transaction or transactions (including but not limited to the transactions contemplated by this Agreement), any director, officer, employee or other agent of the Seller or any other party claiming through such a person shall or may acquire rights with respect to any Employee Plan (including the creation, increase or extension of new or existing rights), shall become entitled to a distribution or payment with respect to any Employee Plan at a date earlier than if such transaction had not occurred, or shall otherwise receive or become vested in rights and benefits with respect to any Employee Plan. Except as set forth in Schedule 3.19, the Seller is not a party to any agreement with any director, officer, employee or agent of the Seller pursuant to which any such person will be entitled to any payment by the Seller upon termination of employment with the Seller following a change in control of the Seller.

(j) The indemnity provisions of Section 11 shall be the sole remedy for breaches of this representation.

3.21. Capitalization and Subsidiaries. All of the issued and outstanding shares of the capital stock of the Seller are owned of record by the Stockholder. Except as set forth on Schedule 3.21, no subscription, option, warrant, call, conversion right or commitment of any kind exists which obligates the Seller to issue any of its authorized but unissued equity securities or transfer any of its treasury shares. The Seller has no subsidiaries. The Seller does not own, of record or beneficially, or control, directly or indirectly, any capital stock, securities convertible into capital stock or any other equity interest in any corporation, association or business entity nor is the Seller, directly or indirectly, a participant in any joint venture, partnership or other non-corporate entity.

3.22. Predecessor Status; Etc. Set forth on Schedule 3.22 is a listing of all prior corporate names of the Seller, and all names of all predecessor companies of the Seller during the last five years, including without limitation the names of any entities acquired by the Seller (by stock purchase, merger or otherwise) or owned by the Seller or from whom the Seller previously acquired material assets.

3.23. Intellectual Property. Schedule 3.23 sets forth (a) all trademarks, service marks, trade names, trade styles, copyrights and all registrations or applications therefor, (b) all patents, inventions and all registrations or applications therefor, and (c) all licenses, sublicenses and other agreements to which the Seller is a party, either as licensee or licensor or otherwise, related to any intangible or intellectual property used in the business conducted by the Seller (all intangible or intellectual property used in the business conducted by the Seller, whether or not listed, the "Intellectual Property"). All actions necessary to maintain the registration, application or use of the Intellectual Property have been taken by the Seller, and the Seller has not engaged in any conduct or omitted to perform any necessary act, the result of which would invalidate, abandon or otherwise render the Selle r's rights to any Intellectual Property unenforceable. The Seller is not required to pay any royalty, license, fee or other similar compensation with respect to the Intellectual Property in connection with the current or prior conduct of the business conducted by the Seller. As used in the business of the Seller as currently conducted, none of the Intellectual Property infringes or misappropriates or otherwise violates or has been alleged to infringe, misappropriate or otherwise violate any proprietary rights of any other person or entity, nor is the Seller otherwise in the conduct of its business infringing upon, or alleged to be infringing upon, any proprietary rights of any other person or entity. To the knowledge of the Seller and the Stockholder, no person or entity is engaged in any activity which would constitute infringement of the Seller's rights in the Intellectual Property.

3.24. Warranty and Sales Return Claims. Schedule 3.24 accurately describes all warranty, sales return, allowance and similar policies related to the business conducted by the Seller. Neither the Seller nor the Stockholder has received any notice or are otherwise aware of any claim by any customer or any other person or entity against the Seller based in any way on or related to any theory of product liability or any material defect or problem with respect to any of goods or services provided by the Seller at any time during the past three years.

3.25. Names. No person or entity has been granted the right to use the name "The J.M. Ney Company" and "Ney" or any variation of either thereof by the Seller or by the Stockholder (except pursuant to the Agreement for Use of Name and Logo effective as of March 1, 1998 by and among Ney Ultrasonics Inc., the J.M. Ney Company and CAE (US) Inc., Section 2.2(h) of the Asset Purchase Agreement dated as of August 10, 1995 among Phoenix Shannon p.l.c., Andersen Group, Inc., the J.M. Ney Company and Ney Dental International, Inc. ("Dental") and the Agreement effective November 28, 1995 between the J.M. Ney Company and Dental) nor, to the knowledge of the Seller or the Stockholder, does any other person or entity use such names in the precision metal contacts and insert molded contact assemblies and connectors industries.

3.26. Adequacy of Purchased Assets. The Purchased Assets constitute all of the assets held for use or used in connection with the Business as currently conducted (other than the Excluded Assets) and the Purchased Assets, along with the Real Estate subject to the lease, are adequate to enable the Buyer to conduct after the Closing the Business as currently conducted by the Seller, assuming Buyer provides working capital consistent with past practice and assuming Buyer operates the Business in substantially the same manner as it was operated in the 12 months preceding the date of this Agreement.

Section 4. Representations and Warranties of the Stockholder.

The Stockholder represents and warrants to the Buyer as follows:

4.1. Organization. The Stockholder is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation and has all requisite corporate power and authority to own, lease and operate its properties and assets and to conduct its business as currently conducted or proposed to be conducted.

4.2. Authority. The Stockholder has all requisite power and authority to execute and deliver and, upon approval of its stockholders, perform its obligations under this Agreement and the other Transaction Documents to which it is a party and to consummate the transactions contemplated hereby and thereby. The execution, delivery and, upon approval of its stockholders, performance of this Agreement and the other Transaction Documents by the Stockholder and the consummation of the transactions contemplated by the Transaction Documents have been duly authorized by all requisite corporate action on the part of the Stockholder, except, at the date of this Agreement, for the affirmative vote of its Stockholders. This Agreement and the other Transaction Documents to which the Stockholder is a party constitute the legal, valid and binding obligations of the Stockholder, enforceable against the Stockholder in accordance with their respective terms, except to the extent enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws now or hereafter in effect relating to creditors rights generally, and general principles of equity.

4.3. No Conflicts. The execution, delivery and, upon approval of its stockholders, performance of this Agreement and the other Transaction Documents by the Stockholder and the consummation of the transactions contemplated hereby (a) do not require the Stockholder to file any notice with or obtain any consent, approval, authorization or exemption from any person or entity, including without limitation any government or governmental agency or instrumentality, other than the affirmative vote of its stockholders, (b) will not violate any writ, injunction, decree, order, judgment, law, statute, ordinance, rule or regulation, (c) will not constitute a default or breach under any agreement or commitment to which the Buyer is a party or by which it or any of its properties may be bound and (d) will not result in the imposition of any security interest, lien, charge or other encumbrance on any of the Purchased Asset s.

4.4. Shareholder Reports. The consolidated financial statements of Stockholder and Seller contained in reports filed by the Stockholder with the Securities and Exchange Commission (the "SEC") (collectively, including any amendments of any such reports, the "Stockholder Reports") pursuant to the Securities Exchange Act of 1934, as amended, fairly present the financial condition of Stockholder at the dates indicated, and the results of operation and cash flows of Stockholder for the periods indicated in accordance with generally accepted accounting principles consistently applied. The consolidated financial statements of the Stockholder and the Seller included in such Stockholder Reports comply as to form in all material respects with the applicable rules and regulations of the SEC with respect thereto.

Section 5. Representations and Warranties of the Buyer.

The Buyer represents and warrants to the Seller and the Stockholder as follows:

5.1. Organization. The Buyer is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation and has all requisite corporate power and authority to own, lease and operate its properties and assets and to conduct its business as currently conducted or proposed to be conducted.

5.2. Authority. The Buyer has all requisite power and authority to execute and deliver and perform its obligations under this Agreement and the other Transaction Documents to which it is a party and to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance of this Agreement and the other Transaction Documents by the Buyer and the consummation of the transactions contemplated by the Transaction Documents have been duly authorized by all requisite corporate action on the part of the Buyer. This Agreement and the other Transaction Documents to which the Buyer is a party constitute the legal, valid and binding obligations of the Buyer, enforceable against the Buyer in accordance with their respective terms.

5.3. No Conflicts. The execution, delivery and performance of this Agreement and the other Transaction Documents by the Buyer and the consummation of the transactions contemplated hereby (a) do not require the Buyer to file any notice with or obtain any consent, approval, authorization or exemption from any person or entity, including without limitation any government or governmental agency or instrumentality, (b) will not violate any writ, injunction, decree, order, judgment, law, statute, ordinance, rule or regulation and (c) will not constitute a default or breach under any agreement or commitment to which the Buyer is a party or by which it or any of its properties may be bound.

5.4. Full Disclosure. No representation or warranty made by the Buyer in this Agreement (including any Schedule or Exhibit hereto), any Transaction Document or in any document delivered in accordance with this Agreement, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained herein not misleading.

Section 6. Employee Matters.

6.1. Offers of Employment. The Buyer may offer employment, for such positions and on such terms and conditions as the Buyer in its sole discretion may determine, to such employees of the Seller engaged in the Business as the Buyer may determine, subject to Buyer's obligations for severance to the extent it deviates from the headcount reduction set forth in Schedule 1.4.

6.2. Obligations of the Seller. The Seller will pay to its employees, including without limitation any employee accepting employment with the Buyer, all compensation and employee benefits through the Closing Date and as otherwise are required by applicable law. The Seller will terminate as of the Closing Date the employment of those of its employees who accept the Buyer's offer of employment. Seller will indemnify Buyer for any wages paid by Buyer in a manner consistent with Seller's past practices for any documented sick time for consecutive days not at work in excess of three incurred by any Assumed Employee hired by Buyer during the first 52 weeks after the Closing. Past practices shall include limiting payment to such time banked as of the Closing Date and reducing payment by short term disability insurance benefits.

6.3. Employee Plans. Effective as of the Closing Date, the Seller shall take all necessary action under each of the Employee Plans to provide that those of Seller's employees who as of the Closing Date are participants therein, shall, pursuant to the terms of the applicable Employee Plan, receive from such Employee Plan, at the time or times provided thereunder, the benefits to which they are entitled through the Closing Date under the provisions of the applicable Employee Plan. The Buyer shall not have any liability or obligation of any kind whatsoever with respect to the Employee Plans, including without limitation, for benefits to which participants thereunder or their beneficiaries or dependents may be entitled, whether such benefits accrue before, on or after the Closing Date (other than accrued vacation benefits as set forth in Section 1.3(a) and except that Buyer shall assume United Health Ca re Policy #213612 (the "Health Insurance Plan") if permitted by the insurer thereunder, shall be responsible for all liabilities arising under the continuation coverage requirements of Section 4980B of the Code and Section 601 of ERISA ("COBRA") with respect to all employees (or any beneficiary or dependent of any of such employees) who, as of the Closing Date, have exercised or are eligible to exercise their right to such continuation coverage, and shall provide such health care coverage under the Health Insurance Plan to Oliver R. Grace, Jr., John S. Grace, Dina Gitttings and Andrew M. O'Shea for no more than 3 months, if and to the extent permitted by the insurer thereunder) at the expense of Stockholder. The exclusion of liabilities and obligations of the Buyer as set forth in the preceding sentence includes any and all liabilities or obligations to any party whomsoever, including without limitation, participants under the Employee Plans and their beneficiaries and dependents, the Internal Rev enue Service, the PBGC, any other government authority and any collective bargaining unit which at any time represents any of the Seller's present or former employees. The Stockholder and the Seller hereby jointly and severally agree to indemnify and hold the Buyer and its successors in interest harmless from and against any and all losses, liabilities, claims, demands, judgments, expenses (including legal fees and expenses, but excluding premiums under the Health Insurance Plan), causes of action or suits which arise against the Buyer or any successors in interest in connection with any Employee Plan. On or prior to the Closing Date, Buyer shall establish a plan under Section 401(k) of the Code for the benefit of the hired employees.

Section 7. Covenants Prior to Closing.

7.1. Access and Cooperation. Between the date of this Agreement and the Closing, the Seller will, and the Stockholder will and will cause the Seller to, afford to the officers and authorized representatives of the Buyer and Parent access to all of the Seller's sites, properties, books and records upon reasonable notice and during normal business hours and will furnish the Buyer with such additional financial and operating data and other information as to the business and properties of the Seller as the Buyer may from time to time reasonably request. Stockholder will use its best efforts to, and will cause Seller to use its best efforts to, provide Buyer and Parent with access to personnel of Seller's customers. The Seller and the Stockholder will cooperate with the Buyer and Parent, and their respective representatives, auditors and counsel, in the preparation of any documents or other material which may be required in connection with any documents or materials required by this Agreement. Seller will notify Buyer in advance of its intention to enter into any contract which would result in a negative gross margin as defined in Section 10.5.

7.2. Best Efforts; Consents. Between the date of the Agreement and the Closing:

(a) each of the parties will use its reasonable efforts to take all action and to do all things necessary in order to consummate and make effective the transactions contemplated by this Agreement;

(b) Seller will give any notices to third parties, and shall obtain any third party consents that are required or that the Buyer may reasonably request in connection with the matters referred to in this Agreement; and

(c) each of the parties will give any notices to, make any filings with, and use its best efforts to obtain any authorizations, consents, and approvals of, governments and governmental agencies required in connection with the transactions contemplated by the Agreement.

7.3. Conduct of Business Pending Closing. Between the date of this Agreement and the Closing, the Seller will:

(a) carry on its business in substantially the same manner as it has heretofore and not introduce any material new method of management, operation or accounting;

(b) maintain its properties and facilities, including those held under leases, in as good working order and condition as at present, ordinary wear and tear excepted;

(c) perform in all material respects all of its obligations under agreements relating to or affecting its assets, properties or rights;

(d) keep in full force and effect present insurance policies or other comparable insurance coverage;

(e) use its reasonable efforts to maintain and preserve its business organization intact, retain its present salaried employees (except to extent identified on Schedule 1.4) and maintain its relationships with suppliers, customers and others having business relations with the Seller;

(f) comply in all material respects with all permits, laws, statutes, ordinances, regulations and rules, and judgments, orders and decrees of any court or other governmental department, commission, board, bureau, agency or instrumentality having jurisdiction over it; and

(g) maintain and comply in all material respects with the terms of its present debt and lease instruments and not enter into any amendments thereto or any new debt or lease instruments, without the prior written consent of Buyer.

7.4. Prohibited Activities. Between the date hereof and the Closing, the Seller will not, without prior written consent of the Parent:

(a) make any change in the Seller charter or bylaws (except for the change in the name of the Seller contemplated herein);

(b) issue any securities, subscriptions, options, warrants, calls, conversion rights or commitments relating to its securities of any kind;

(c) declare or pay any dividend, or make any distribution in respect of its capital stock or directly or indirectly purchase, redeem or otherwise acquire or retire for value any shares of its capital stock;

(d) enter into any contract or commitment or incur or agree to incur any liability or make any capital expenditures, except if it is in the normal course of business and consistent with past practice and involves an amount not in excess of $10,000;

(e) create, assume or permit to exist any mortgage, pledge or other lien or encumbrance upon any of its assets or properties whether now owned or hereafter acquired, except (i) with respect to purchase money liens incurred in connection with the acquisition of newly acquired equipment with an aggregate cost not in excess of $25,000 necessary or desirable for the conduct of the businesses of the Seller or (ii) liens for taxes either not yet due or being contested in good faith and by appropriate proceedings (and for which contested taxes adequate reserves have been established and are being maintained), or materialmen's, mechanics', workers', repairmen's or other like liens arising by operation of law and securing amounts not yet due or being contested in good faith by appropriate proceedings (and for which contested amounts adequate reserves have been established and are being maintained) in the ordinary course of business;

(f) sell, assign, lease or otherwise transfer or dispose of any property or equipment except in the normal course of business (except as contemplated by this Agreement);

(g) negotiate or enter into any agreement for the acquisition of any business or the start-up of any new business;

(h) merge or consolidate or agree to merge or consolidate with or into any other corporation or other entity;

(i) waive any material rights or claims of the Seller, provided that the Seller may negotiate and adjust bills in the course of good faith disputes with customers in a manner consistent with past practice;

(j) Increase present salaries, bonuses, incentive compensation and commission levels for any officer, director, employee or agent, except for ordinary and customary salary increases for employees (but not officers, directors or agents) in accordance with past practice, amend any existing Employee Plan so as to provide increased benefits thereunder for any employee of the Seller who participates in such Plan, or his beneficiaries or dependents, or establish any new Employee Plan with respect to employees of the Seller or their beneficiaries or dependents;

(k) make any new hires;

(l) commit a material breach or amend or terminate any material agreement or instrument, license or other right of the Seller;

(m) enter into any agreement with the Stockholder or any Affiliate of the Stockholder; or

(n) enter into any other transaction outside the ordinary course of its business or prohibited hereunder.

7.5. No Shop. None of the Stockholder, the Seller, or any agent, employee, officer, director, trustee or any representative of any of the foregoing will, during the period commencing on the date of this Agreement and ending with the earlier to occur of the Closing or the termination of this Agreement in accordance with its terms, directly or indirectly, solicit or initiate the submission of proposals or offers from any person or entity for, participate in any discussions pertaining to, or furnish any information to any person or entity other than the Buyer, Parent or their authorized agents relating to, any acquisition or purchase of any or all of the assets of, or any equity interest in, the Seller or substantially all the assets of Stockholder or any merger, consolidation or business combination of or involving the Seller or Stockholder (each a "Takeover Proposal"); provided, however, that if, at any time the Board of Directors of Stockholder determines in good f aith, after consultation with outside counsel, that it is necessary to do so in order to act in a manner consistent with its fiduciary duties to Stockholder's stockholders under applicable law, Stockholder may, in response to a Superior Proposal (as defined in Section 7.6(b)) which was not solicited by it or which did not otherwise result from a breach of this Section 7.5 and subject to compliance with Section 7.6(c), following delivery of the required notice (x) furnish information with respect to Stockholder or Seller to any person making a Superior Proposal pursuant to a customary confidentiality agreement (as determined by Seller after consultation with its outside counsel) and (y) participate in discussions or negotiations regarding such Superior Proposal.

7.6. Stockholder Stockholders Meeting; Other Proposals.

(a) Stockholder will take, in accordance with applicable law and its certificate of incorporation and by-laws, all action necessary to call, give notice of, convene and hold a meeting of holders of shares of voting stock of Stockholder, including any adjournment thereof, as promptly as practicable after execution of this Agreement to consider and vote upon the approval of this Agreement and such other matters as may be appropriate. The Board of Directors of Stockholder shall recommend such approval and shall take all lawful action reasonably necessary to solicit such approval.

(b) Except as expressly permitted by this Section 7.6, neither the Board of Directors of Stockholder nor any committee thereof shall (i) withdraw or modify, or propose publicly to withdraw or modify, in a manner adverse to the Company, the approval or recommendation by such Board of Directors of this Agreement, (ii) approve or recommend, or propose publicly to approve or recommend, any Takeover Proposal or (iii) cause Stockholder or Seller to enter into any letter of intent, agreement in principle, acquisition agreement or other similar agreement (each, an "Acquisition Agreement") related to any Takeover Proposal. Notwithstanding the foregoing, in the event that the Board of Directors of Stockholder determines in good faith, after consultation with outside counsel, that in light of a Superior Proposal it is necessary to do so in order to act in a manner consistent with its fiduciary duties to Stockholder's stockholders under applicable law, the Board of Directors of Stockholder may (subject to this and the following sentences) terminate this Agreement in order to concurrently enter into such Acquisition Agreement with respect to a Superior Proposal; provided, however, that Stockholder may not terminate this Agreement pursuant to this Section 7.6 unless and until (i) three business days have elapsed following the delivery to the Buyer of a written notice of such determination by the Board of Directors of Stockholder and (x) Stockholder has delivered to the Buyer the written notice required by Section 7.6(c) below, and (y) during such three business day period, Stockholder otherwise cooperates with the Buyer with respect to the Superior Proposal with the intent of enabling the Buyer to engage in good faith negotiations so that the transactions contemplated hereby may be effected and (ii) at the end of such three business day period the Board of Directors of Stockholder continues reasonably to believe that the Takeover Proposal constitutes a Superior Proposal. Fo r purposes of this Agreement, a "Superior Proposal" means any proposal made by a third party, on or prior to the date of the meeting of the holders of shares of voting stock of the Stockholder, to acquire, directly or indirectly, including pursuant to a tender offer, exchange offer, merger, consolidation, business combination, recapitalization, liquidation, dissolution or similar transaction, for consideration consisting of cash and/or securities, more than 50% of the combined voting power of the shares of Stockholder common stock then outstanding or all or substantially all the assets of Seller or Stockholder and otherwise on terms which the Board of Directors of Stockholder determines in its good faith judgment (based on the advice of a financial advisor of recognized reputation) to be more favorable to Stockholder's stockholders than this Agreement and for which financing, to the extent required, is then committed or which, in the good faith judgment of the Board of Directors of Stockholder, is reasonably capable of being obtained by such third party.

(c) In addition to the obligations of Stockholder set forth in Sections 7.5 and 7.6(a) and (b), Stockholder shall immediately advise Buyer orally and in writing of any request for information or of any proposal, the material terms and conditions of such request or proposal and the identity of the person making such request or proposal. Stockholder will keep Buyer reasonably informed of the status and details (including amendments and proposed amendments) of any such request or proposal.

7.7. Agreements to be Terminated. The Stockholders and the Seller shall terminate, on or prior to the Closing Date, any and all agreements listed on Schedule 7.7. The Seller and the Stockholders shall provide Seller proof of the terminations required pursuant to this Section 7.7. Terminations of options and warrants may provide for a deferred purchase price as long as such termination terminates any right to acquire equity securities of Seller.

7.8. Notification of Certain Matters. From and after the date of this Agreement until the Closing, each party hereto shall promptly notify the other parties hereto of (a) any representation or warranty made by it in connection with this Agreement was untrue or inaccurate when made, (b) the occurrence or non-occurrence of any event the occurrence or non-occurrence of which would be likely to cause any condition to the obligations of any party to effect the purchase of the Purchased Assets or the other transactions contemplated by this Agreement not to be satisfied, or (c) the failure of the Seller or the Stockholder, on the one hand, or the Buyer or Parent, on the other hand, as the case may be, to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it pursuant to this Agreement which would be likely to result in any condition to the obligations of any party to effect the purchase of the Purchased Assets or the other transactions contemplated by this Agreement not to be satisfied; provided, however, that the delivery of any notice pursuant to this Section shall not modify any representations or warranties contained in this Agreement, cure any breach of any representation or warranty requiring disclosure of such matter or otherwise limit or affect the rights and remedies available hereunder to the party receiving such notice. The Stockholders and the Seller shall deliver to the Buyer updated versions of Schedules 1.2(k), 1.3(c) (to reflect payments made only), 1.3(d), 3.8, 3.10, 3.11 and 10.6 as of the Closing Date, solely to reflect events occurring between the date of this Agreement and the Closing Date which are not as a result of any failure of the Stockholders or the Seller to comply with the covenants and agreements under this Agreement, or shall have notified the Buyer in writing that no changes to such Schedules are required.

7.9. Inventory. The Seller shall provide to the Buyer no later than three business days prior to the anticipated Closing Date a schedule listing all Inventory and setting forth its value as determined pursuant to the definition of Purchased Inventory. Such schedule shall be adjusted pursuant to a physical inventory taken by the Buyer with the assistance of Seller immediately prior to the Closing for purposes of the Closing Statement.

7.10. Further Assurances. The parties hereto agree to execute and deliver, or cause to be executed and delivered, such further instruments or documents or take such other action as may be reasonably necessary or convenient to carry out the transactions contemplated hereby.

7.11. Noncompetition By Seller and Stockholder.

(a) For a period of five years after the Closing (the "Restricted Period") neither the Seller, Stockholder nor any affiliate thereof shall engage, directly or indirectly, in any business anywhere in the United States that develops, designs, manufactures, sells or markets products or services of the kind developed, designed, manufactured, sold and marketed by the Business or the Seller as of the Closing Date or, without the prior written consent of the Buyer, directly or indirectly, own an interest in, manage, operate, join, control, lend money or render financial or other assistance to or participate in or be connected with, as an officer, employee, partner, stockholder, consultant or otherwise, any person that competes with the Buyer, Parent, the Business or the Seller in developing, designing, manufacturing, selling or marketing products or services of the kind developed, designed, manufactured, sold or marketed by the Business or the Seller as of the Closing; provided, however , that, for the purposes of this section ownership of securities having no more than five percent (5%) of the outstanding voting power of any competitor which are listed on any national securities exchange or traded actively in the national over-the-counter market shall not be deemed to be in violation of this section so long as the person owning such securities has no other connection or relationship with such competitor.

(b) As a separate and independent covenant, the Seller agrees with the Buyer that, for a period of five years following the Closing, neither the Seller, Stockholder nor any affiliate thereof shall, in any way, directly or indirectly, for the purpose of conducting or engaging in any business that develops, designs, manufactures, sells or markets products or services of the kind developed, designed, manufactured, sold or marketed by the Business or the Seller as of the Closing, call upon, solicit, advise or otherwise do, or attempt to do, business with any customers of the Business or the Seller in order to take away or interfere or attempt to interfere with any custom, trade, business or patronage of the Business or the Seller, or interfere with or attempt to interfere with any officers, employees, representatives or agents of the Business or the Seller, or induce or attempt to induce any of them to leave the employ of the Seller or violate the terms of their contracts, or any employment arrangements, with the Business.

(c) The Restricted Period shall be extended by the length of any period during which the Seller is in breach of the terms of this Section 7.11.

Section 8. Conditions Precedent to the Obligations of the Stockholder and the Seller.

The obligations of the Stockholder and the Seller with respect to actions to be taken at the Closing are subject to the satisfaction or waiver on or prior to the Closing of all of the following conditions. The consummation of the Closing shall constitute a waiver of any conditions not so satisfied. However, no such waiver shall be deemed to affect the survival of the representations and warranties of the Buyer contained in Section 5.

8.1. Representations and Warranties; Performance of Obligations. All representations and warranties of the Buyer contained in Section 5 shall be true and correct as of the date of this Agreement and shall be true and correct as of the Closing as though such representations and warranties had been made on and as of that date; all of the terms, covenants and conditions of this Agreement to be complied with and performed by the Buyer on or before the Closing shall have been duly complied with and performed in all material respects; and a certificate to the foregoing effect dated the actual date of Closing and signed by the Chairman, President, any Vice President, the Chief Financial Officer or the Treasurer of Parent shall have been delivered to the Stockholder.

8.2. No Litigation. No action or proceeding before a court or any other governmental agency or body shall have been instituted or threatened which seeks to restrain or prohibit the transactions contemplated hereby or which seeks to recover substantial damages relating to the transactions contemplated hereby, and no governmental agency or body shall have taken any other action or made any request of the Seller relating to the transactions contemplated hereby as a result of which the Seller deems it inadvisable to proceed therewith.

8.3. Consents and Approvals. All consents listed on Schedule 3.3, including all necessary consents with respect to assumed contracts and consents of and filings with any governmental authority or agency relating to the consummation of the transaction contemplated herein shall have been obtained and made.

8.4. Certificates of Incorporation; Good Standing Certificates. The Buyer shall have delivered to the Seller copies of its articles of incorporation (including amendments thereto), certified as of a recent date by the Secretary of State of Illinois, and a certificate, dated as of a recent date, duly issued by the Secretary of State of Illinois and the Secretary of State (or other appropriate governmental authority) in each other state in which the Buyer is authorized to do business, showing that the Buyer is in good standing and authorized to do business in such jurisdiction.

8.5. Secretary's Certificates. The Seller shall have received a certificate from each of the Buyer and Parent, each dated the Closing Date and signed by the Secretary or an Assistant Secretary of the Buyer and Parent, respectively, certifying as to the completeness and correctness of attached copies of the Buyer's or Parent's, as the case may be, charter (including amendments thereto), by-laws (including amendments thereto), and resolutions of the Board of Directors approving the entering into this Agreement and the consummation of the transactions contemplated hereby.

8.6. Closing Deliveries. The Seller shall have received the deliveries required to be made by the Buyer pursuant to Section 2.3.

8.7. Approval of the Stockholders. The stockholders of Stockholder shall have voted a majority of the issued and outstanding shares of Stockholder in favor of the transaction.

Section 9. Conditions Precedent to Obligations of the Buyer.

The obligations of the Buyer with respect to actions to be taken at the Closing are subject to the satisfaction or waiver on or prior to the Closing of all of the following conditions. The consummation of the Closing shall constitute a waiver of any conditions not so satisfied. However, no such waiver shall be deemed to affect the survival of the representations and warranties of the Seller or the Stockholder contained in this Agreement.

9.1. Representations and Warranties; Performance of Obligations. All the representations and warranties of the Stockholder and the Seller contained in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing as though such representations and warranties had been made on and as of such date, except that those representations and warranties which address matters only as of a particular date only shall be required to be true and correct as of such date; all of the terms, covenants and conditions of this Agreement to be complied with or performed by the Stockholder and the Seller on or before the Closing shall have been duly performed or complied with in all material respects; and certificates to the foregoing effect dated the actual date of Closing and signed by the President of the Stockholder and Seller shall have been delivered to the Buyer.

9.2. No Litigation. No action or proceeding before a court or any other governmental agency or body shall have been instituted or threatened which seeks to restrain or prohibit the transactions contemplated hereby or which seeks to recover substantial damages relating to the transactions contemplated hereby, and no governmental agency or body shall have taken any other action or made any request of the Buyer or Parent relating to the transactions contemplated hereby as a result of which the Buyer deems it inadvisable to proceed therewith.

9.3. Consents and Approvals. All necessary consents of and filings with any governmental authority or agency relating to the consummation of the transactions contemplated herein shall have been obtained and made.

9.4. No Material Adverse Effect. No event or circumstance shall have occurred with respect to the Seller which would constitute a material adverse effect on the business, properties, operations, condition (financial or otherwise) or prospects of the Seller, and the Seller shall not have suffered any material change, loss or damage to any of its properties or assets, whether or not covered by insurance, which change, loss or damage materially affects or impairs the ability of the Seller to conduct its business.

9.5. Charters and Good Standing Certificates. The Seller and the Stockholder shall have delivered to the Buyer copies of their respective certificates of incorporation (including amendments thereto) certified as of a recent date by the Secretary of State of Delaware and in each state in which the Seller and the Stockholder are authorized to do business, showing the Seller and the Stockholder are in good standing and authorized to do business in such jurisdiction.

9.6. Secretary's Certificate. The Buyer shall have received certificates, dated the Closing Date and signed by the Secretary or an Assistant Secretary of each of the Seller and the Stockholder, certifying as to the completeness and correctness of attached copies of the Seller's and the Stockholder's respective certificates of incorporation (including amendments thereto), by-laws (including amendments thereto), and resolutions of the Boards of Directors approving the Seller's and the Stockholder's entering into this Agreement and the consummation of the transactions contemplated hereby.

9.7. Closing Deliveries. Buyer shall have received the deliveries required to be made by the Stockholder and the Seller pursuant to Section 2.2.

9.8. Updated Schedules. The revised versions of Schedules 1.2(k), 1.3(c), 1.3(d), 3.8, 3.10, 3.11 and 10.6 delivered to the Buyer pursuant to Section 7.8 shall not disclose any material adverse effect on the business, properties, operations, condition (financial or otherwise) or prospects of the Seller as compared to such Schedules as of the date of this Agreement.

9.9. Approval of the Stockholders. The stockholders of Stockholder shall have voted a majority of the issued and outstanding shares of Stockholder in favor of the transaction.

Section 10. Additional Agreements.

10.1. Turnover of Payments. In the event that the Seller or the Stockholder receives any payment or amount to which the Buyer is entitled, the Seller and the Stockholder shall deliver the same promptly to the Buyer (with endorsement if necessary but otherwise in the same form as received) and until so delivered hold the same in trust for the Buyer's benefit and as the property of the Buyer. In the event that the Buyer receives any payment or amount to which the Seller is entitled (other than payment of accounts receivable, which shall be remitted to Seller in accordance with Section 10.2), the Buyer shall deliver the same promptly to the Seller (with endorsement if necessary but otherwise in the same form as received) and until so delivered hold the same in trust for the Seller's benefit and as the property of the Seller.

10.2. Warranty, Customer Returns and Accounts Receivable.

(a) The parties agree that it is to the advantage of the Buyer and the Seller as to the goods and services provided by the Seller, to settle claims made by customers with respect to goods and services warranted by the Seller and goods returned to Buyer by customers. As a result the Buyer, shall perform such warranty obligations and provide customer returns only as are expressly described on Schedule 10.2(a).

(b) For a period of 60 days following the Closing Date, the Buyer shall make such efforts to collect accounts receivable of the Seller identified on Schedule 3.10 as have been normal and customary for the Seller, but in no event shall the Buyer be required to institute litigation or refer a receivable to a third party for collection. If any obligor on a receivable incurs further indebtedness to the Buyer after the Closing Date, all payments received from such obligor after the Closing Date shall be credited to the earliest indebtedness still outstanding, unless the obligor denies or disputes its obligation with respect to such indebtedness or otherwise directs allocation of the payment to later indebtedness. For a period of 30 days following the Closing Date, Seller shall retain control of its lockbox account and shall remit any amounts collected with respect to indebtedness incurred after the Closing Date on the first business day of the week following the week of collection. Thereafter, Buyer will have sole control and possession of the lockbox account and Buyer shall remit the collected amounts for the accounts receivable of the Seller to Seller on the first business day of the week following the week of collection. Buyer shall provide Seller with periodic reports of accounts receivable collected. Buyer shall not grant credits to any outstanding accounts receivable with prior written consent of Seller, which consent shall not be unreasonably withheld. Seller hereby agrees that Buyer is not guaranteeing the collection of the accounts receivable or acting as a guarantor of collection of accounts receivable or guaranteeing in any way any accounts receivable.

10.3. Tax Returns. On and after the Closing Date, each party shall, and shall cause each of its affiliates to, provide to each of the other parties hereto such cooperation and information as any of them reasonably may request in filing any tax return, amended tax return or claim for refund, determining any liability for taxes or a right to refund of taxes or in conducting any audit or other proceeding in respect of taxes. Such cooperation and information shall include providing copies of all relevant portions of relevant returns, together with relevant schedules and relevant work papers, relevant documents relating to rulings or other determinations by taxing authorities and relevant records concerning the ownership and tax basis of property, which such party may possess. Each party also shall make its employees reasonably available on a mutually convenient basis at its cost to provide explanation of any documents or information so provided. Subject to the preceding sentence, each party required to file any tax returns shall bear all costs of filing such returns.

10.4. Cooperation. On and after the Closing Date, the Seller, the Stockholder, the Buyer and Parent shall each deliver or cause to be delivered to the other parties hereto such additional documents, releases, assignments and instruments as the other parties may reasonably request for the purpose of carrying out the purposes of this Agreement. The Stockholder and the Seller will cooperate and use reasonable efforts to have the present officers, directors and employees of the Seller cooperate with the Buyer on and after the Closing in furnishing information, evidence, testimony and other assistance in connection with any filing obligations, actions, proceedings, arrangements or disputes of any nature with respect to matters pertaining to all periods prior to the Closing Date.

10.5. Finished Goods Inventory Margin. Seller guarantees that Buyer will realize aggregate gross margins of not less than twenty percent (20%) on the sale of finished goods inventories for which there are open orders booked at the time of Closing, based upon the assumptions that: (a) the sale price that is used is the sale price contained or provided for in the subject customer order (whether a fixed price, a price based on the precious metal costs on the date of order or a price based on precious metal costs on the date of shipment), and (b) the cost accounting utilized by the Buyer for making such determination is identical to the cost accounting utilized by the Seller in making this determination. In the event that Buyer does not realize at least twenty percent (20%) gross margin on the sale of such finished goods inventories in the aggregate, Seller shall pay Buyer on demand the amount necessary to ca use its gross margins on such sales to be twenty percent (20%). For the purposes of this Section 10.5, "gross margin" means the gross margin as is set forth on the ISD718 report "Electronic Cost of Sales Analysis at Value Add Intrinsic Date of Shipment."

10.6. Post Closing Adjustments. At the end of the first full month after the Closing Date and thereafter at the end of the next two succeeding months, Buyer shall review all shop orders identified at Closing by Buyer in the Closing Statement. For all listed shop orders closed during the 90-day period, a labor and overhead variance ("variance") adjustment will be calculated by comparing actual labor and overhead cost to Seller's standard cost. The variance will be allocated between the Seller and Buyer based on the pro rata value of labor and overhead charged to the shop orders pre- and post-closing. The variance allocated to the pre-closing period will result in either a favorable variance in which case Buyer will reimburse the Seller or an unfavorable variance in which case the Seller will reimburse the Buyer. In addition, during such reviews, Buyer shall review all precious metal content in work in pr ocess inventory as of the Closing Date that has subsequently become finished goods inventory. Buyer shall calculate any difference between the actual precious metal content in the finished good inventory plus precious metal scrap amounts resulting therefrom (valued at the second London Fix) less the precious metal content reflected in the open shop orders (valued at the second London Fix). To the extent such difference is a positive number, Buyer will reimburse Seller; to the extent such difference is a negative number, Seller shall reimburse Buyer. Buyer shall account for the precious metal content upon the closing of the open shop order in a manner consistent with Seller's inventory control practices. For the purposes of this section, the second London Fix means the London Fix price set in the afternoon, London, U.K. time, for the relevant precious metal as stated in United States dollars and found on the Internet site www.kitco.com under the headings "Historical London Fixings" "PM " for the day preceding the Closing Date. In the event that any commissions come due to any sales agent or representative of Seller for goods ordered prior to Closing but shipped after Closing, Buyer shall, on demand, pay such commissions to Seller, notwithstanding any agreement being an Excluded Liability.

10.7. Insurance. Seller agrees to keep in force for three years all "claims made" insurance policies, as long as Buyer pays any invoices forwarded to it by Seller.

10.8. Soft Inventory. Within five business days of the end of the second full calendar month after the Closing Date, Buyer will calculate the amount by which $300,000 exceeds 50% of the value of nonprecious material, labor and overhead content of all Soft Inventory and promptly deliver a certificate to Seller setting forth such amount. Thereafter, within five business days of the end of every other calendar month, up to and including such month end most nearly preceding the 18 month anniversary of the Closing, Buyer will determine which Soft Inventory has been shipped or placed into production on a shop order. Buyer will then calculate the amount equal to 50% of nonprecious material, labor and overhead content of the Soft Inventory so shipped or placed in production and promptly deliver a certificate to Seller setting forth such amount (any such amount contained in a certificate provided for in this paragraph, a "Soft Inventory Release Amount".)

"Soft Inventory" is defined as those inventory items for which the balance on hand at Closing exceeds two and one half times the usage during the twelve month period prior to Closing. "Usage" shall mean either shipment to customers or placement into production on a shop order.

10.9. Ney Name. At no time after the Closing will Seller use any name incorporating or similar to the name "Ney", except in connection with transacting checks and other payments on accounts constituting Excluded Assets.

Section 11. Indemnification.

11.1. Survival. The representations, warranties and agreements made by the parties in the Agreement or the other Transaction Documents or any other document or certificate delivered pursuant to this Agreement or any Transaction Document will survive the Closing for 18 months, except for representations contained in Sections 3.15, 3.16 and 3.20, which will survive until the expiration of the applicable statute of limitations.

11.2. Indemnification.

(a) The Seller and the Stockholder will, jointly and severally, indemnify, defend and hold harmless the Buyer from and against all liabilities, losses, claims, demands and damages, including reasonable attorneys' fees (collectively, "Claims") to the extent arising out of or related to (i) any Excluded Liabilities, (ii) any breach of any representation, warranty or agreement made by the Seller or the Stockholder in or pursuant to this Agreement or any of the other Transaction Documents, or (iii) any failure of the parties to have complied with any applicable bulk sales law. Notwithstanding the foregoing provisions of this Section 11.2 (a), with respect to any breaches of the representations and warranties contained in Section 3.4(b), Buyer's sole remedy with respect to breaches of Section 3.4(b) with respect to Soft Inventory shall be pursuant to the procedures set forth in Section 10.8 of this Agreement and Section 6(c) of the Escrow Agreement. On the Claim Date (as defined in the Esc row Agreement) a maximum of 50% of the nonprecious material, labor and overhead content of any remaining Soft Inventory will be permitted to be disbursed to the Buyer pursuant to the Escrow Agreement but only to the extent of the account balance remaining in the Inventory Indemnification Escrow Fund. Notwithstanding the limitation contained in the immediately preceding sentence, any other amounts in the Inventory Indemnification Escrow Fund shall be available to satisfy Claims with respect to breaches of the other representations and warranties contained in Section 3.4(b).

(b) The Buyer will indemnify, defend and hold harmless the Seller and the Stockholder from and against all Claims to the extent arising out of or related to (i) any Assumed Liabilities or (ii) any breach of any representation, warranty or agreement made by the Buyer in or pursuant to this Agreement or any of the other Transaction Documents.

11.3. Third Person Claims.

(a) Promptly after any party hereto (the "Indemnified Party") receives notice of or has knowledge of any claim by a person or entity not a party to this Agreement ("Third Person"), or the commencement of any action or proceeding by a Third Person, for which the Indemnified Party intends to make a claim against any party obligated to provide indemnification pursuant to Section 11.2(a) (the "Indemnifying Party"), the Indemnified Party shall give the Indemnifying Party written notice of such claim or the commencement of such action or proceeding, provided that the failure to give such prompt notice shall not affect the Indemnifying Party's obligation to indemnify absent a showing of actual prejudice to the Indemnifying Party. Such notice shall state the nature and the basis of such claim.

(b) The Indemnifying Party shall have the right to defend and settle, at its own expense and by its own counsel, any such matter so long as the Indemnifying Party pursues the same in good faith and diligently, provided that the Indemnifying Party shall not settle any criminal matter, without the written consent of the Indemnified Party, or any other matter, without the written consent of the Indemnified Party which in the case of matters which are not criminal matters will not be unreasonably withheld or delayed. If the Indemnifying Party undertakes to defend or settle, it shall promptly notify the Indemnified Party of its intention to do so, and the Indemnified Party shall cooperate with the Indemnifying Party and its counsel in the defense thereof and, subject to the preceding sentence, in any settlement thereof. Such cooperation shall include, but shall not be limited to, furnishing the Indemnifying Party with any books, records or information reasonably requested by the Indemnifyi ng Party that are in the Indemnified Party's possession or control. In the event that counsel to the Indemnifying Party shall have a conflict of interest that prevents counsel for the Indemnifying Party from representing the Indemnified Party, or in the event that the Indemnified Party is not reasonably satisfied with the counsel selected by the Indemnifying Party, the Indemnified Party shall have the right to participate in such matter through counsel of its own choosing and the Indemnifying Party will reimburse the Indemnified Party for the reasonable expenses of its counsel. After the Indemnifying Party has notified the Indemnified Party of its intention to undertake to defend or settle any such asserted liability, and for so long as the Indemnifying Party diligently pursues such defense, the Indemnifying Party shall not be liable for any additional legal expenses incurred by the Indemnified Party in connection with any defense or settlement of such asserted liability, except (i) as set forth in the pre ceding sentence, and (ii) to the extent such participation is requested by the Indemnifying Party, in which event the Indemnified Party shall be reimbursed by the Indemnifying Party for reasonable additional legal expenses and out-of-pocket expenses. If the Indemnifying Party notifies the Indemnified Party of its intention to undertake to defend any claim by a Third Person, the Indemnifying Party shall be conclusively presumed to have agreed to indemnify and hold the Indemnified Party harmless with respect thereto and the Indemnified Party shall be entitled to be indemnified for all losses, damages, liabilities, actions, suits, proceedings, demands, assessments, adjustments, costs and expenses (including without limitation reasonable attorneys fees and expenses of investigation) with respect to such claim.

(c) If the Indemnifying Party does not undertake to defend such matter to which the Indemnified Party is entitled to indemnification hereunder, or fails diligently to pursue such defense, the Indemnified Party may undertake such defense through counsel of its choice, at the cost and expense of the Indemnifying Party, and the Indemnified Party may settle such matter, and the Indemnifying Party shall reimburse the Indemnified Party for the amount paid in such settlement and any other liabilities or expenses incurred by the Indemnified Party in connection therewith; provided, however, that under no circumstances shall the Indemnified Party settle any such matter without the written consent of the Indemnifying Party, which consent shall not be unreasonably withheld or delayed.

11.4. Escrow. In the event the Buyer is entitled to receive any amount from the Seller or the Stockholder under this Agreement as an indemnification payment, without prejudice to the rights of the Buyer to seek any recovery from and against the Seller or the Stockholder as provided hereunder, the Buyer shall be entitled to recover all or any portion of such amount in accordance with the terms of the Escrow Agreement to the extent of the cash or other property held in escrow thereunder.

Section 12. Termination of Agreement.

12.1. Termination. This Agreement may be terminated at any time prior to the Closing solely:

(a) by mutual consent of the Buyer, the Stockholder and the Seller;

(b) by the Stockholder or the Seller, on the one hand, or by the Buyer on the other hand, if the transactions contemplated by this Agreement to take place at the Closing shall not have been consummated by February 28, 2002; provided, however, that (i) neither the Stockholder nor the Seller shall be entitled to terminate this Agreement pursuant to this Section 12.1(b) if the failure of such transactions to be consummated is due to the willful failure of the Seller or Stockholder to perform any of their respective obligations under this Agreement required to be performed by any of them prior to or at Closing and (ii) the Buyer shall not be entitled to terminate this Agreement pursuant to this Section 12.1(b) if the failure of such transactions to be consummated is due to the willful failure of the Buyer to perform its obligations under this Agreement required to be performed by it prior to or at Closing;

(c) by the Stockholders or the Seller, on the one hand, or by the Buyer on the other hand, if a material breach or default shall be made by the other parties in the observance or in the due and timely performance of any of the covenants or agreements contained herein, and the curing of such breach or default shall not have been made within ten business days after receipt of notice specifying the breach and requesting that such breach be cured;

(d) by the Buyer in the event that the outcome of the vote of the stockholders of the Stockholder does not result in approval of this Agreement, in which event Seller shall, within two (2) calendar days following such termination, pay to Buyer $75,000, unless such vote follows the withdrawal or modification of the recommendation of the Board made in accordance with Section 7.6, in which case the payment shall be $300,000;

(e) by the Seller in the event the Seller accepts a Superior Proposal in accordance with Section 7.6, in which event Seller shall, within two (2) calendar days following such termination, pay to Buyer $300,000; or

(f) by Buyer within 20 business days of the date of this Agreement, if Buyer or Parent is not provided with access and cooperation under Section 7.1 (including access to Seller's customers) or if Buyer or Parent is not satisfied in its sole discretion with its review of customer relationship or the terms of any fixed price contracts.

12.2. Liabilities in Event of Termination. The termination of this Agreement will in no way limit any obligation or liability of any party based on or arising from a breach or default by such party with respect to any of its representations, warranties, covenants or agreements contained in this Agreement including, but not limited to, legal and audit costs and out of pocket expenses.

Section 13. Miscellaneous.

13.1. Expenses and Taxes. Whether or not the transactions herein contemplated shall be consummated, the Buyer, Parent, the Seller and the Stockholder will each pay their own fees, expenses and disbursements incurred in connection with the subject matter of this Agreement, including all costs and expenses incurred in the performance and compliance with all conditions to be performed by such corporation under this Agreement, except that the Stockholder and the Seller (and not the Buyer or Parent) shall pay all sales, use, transfer, real property transfer, recording, gains, transfer and other similar taxes and fees ("Transfer Taxes") imposed in connection with the purchase contemplated by this Agreement and the Stockholder and Seller, on one hand, and the Buyer and Parent, on the other, shall share the cost of the Appraisal equally. The Stockholder and the Seller shall file, or cause to be filed, all necessar y documentation and tax returns with respect to such Transfer Taxes.

13.2. No Brokers or Finders. Each party represents and warrants that it employed no broker or agent in connection with this transaction, and agrees to indemnify the other parties hereto against all loss, cost, damages or expense arising out of claims for fees or commission of brokers employed or alleged to have been employed by such indemnifying party.

13.3. Notices. All notices required or permitted hereunder shall be in writing and shall be deemed to have been duly given (a) as of the date delivered if delivered personally, by courier or by courier service, or (b) three business days after deposit in the United States mail, registered or certified mail, postage prepaid, return receipt requested, to the parties at the following addresses:

If to the Buyer or Parent, addressed as follows:

Deringer Mfg. Company

1250 Town Line Road

Mundelein, Illinois 60060

Attn: John Wallace

President

with a copy to:

Schiff Hardin & Waite

Suite 6600

Sears Tower

Chicago, Illinois 60606

Attn: Gary Mowder

If to the Seller or the Stockholder, to:

Andersen Group, Inc.

515 Madison Avenue, Suite 2600

New York, New York 10022

Attn: Oliver R. Grace, Jr.

or to such other address or number as any party hereto shall specify for itself by notice given pursuant to this Section 13.3 from time to time; provided, however, that notices of any change in an address or number shall not be effective until receipt.

13.4. Severability. In the event that any of the provisions contained in this Agreement shall, for any reason, be declared or held to be unreasonable, unlawful, unenforceable or otherwise invalid in any respect, such term or provision shall be deemed modified to the extent necessary to make it enforceable, and in no event shall such declaration or holding affect the validity of any other provision of this Agreement, all of which provisions shall continue in effect in accordance with their terms.

13.5. Interpretation. The representations, warranties, agreements and covenants of the parties made in the Transaction Documents shall survive the consummation of the transactions contemplated hereby and the consummation of such transactions shall not be deemed a waiver of a breach of or inaccuracy in any representation, warranty, agreement or covenant or of any party's rights and remedies with regard thereto. No specific representation, warranty, agreement or covenant contained herein shall limit the applicability of a more general representation, warranty, agreement or covenant contained herein.

13.6. Exercise of Rights and Remedies. No delay or omission in the exercise of any right, power or remedy accruing to any party as a result of any breach or default by any other party under this Agreement shall impair any such right, power or remedy, nor shall it be construed as a waiver of or acquiescence in any such breach or default, or of any similar breach or default occurring later; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default occurring before or after that waiver.

13.7. Remedies Cumulative. No right, remedy or election given by any term of this Agreement shall be deemed exclusive but each shall be cumulative with all other rights, remedies and elections available at law or in equity.

13.8. Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Connecticut, without giving effect to the principles of conflict of laws thereof.

13.9. Assignment, Binding Effect and Entire Agreement. This Agreement and the rights and obligations of the parties hereunder may not be assigned (except by operation of law) without the prior written consent of the other parties hereto and shall be binding upon and shall inure to the benefit of the parties hereto, the successors of the Buyer, Parent and the Seller, the heirs and legal representatives of the Stockholder and any permitted assigns of the parties. This Agreement and the Exhibits hereto set forth the entire agreement of the parties hereto concerning the subject matter of this Agreement. This Agreement may only be modified or amended by an agreement in writing executed by each of the parties hereto and any term of this Agreement may be waived only with the written consent of the party sought to be bound.

13.10. No Third Party Beneficiaries. This Agreement is solely for the benefit of the parties hereto and, to the extent provided herein, their successors, heirs, personal representatives and permitted assigns, and no provision of this Agreement shall be deemed to confer upon other third parties any remedy, claim, liability, reimbursement, cause of action or other right.

13.11. Counterparts. This Agreement may be executed in any number of counterparts or using separate signature pages. Each such executed counterpart and each counterpart to which such signature pages are attached will be deemed to be an original instrument, and all such counterparts together will constitute one and the same instrument.

13.12. Captions. The section headings in this Agreement are provided for convenience only and are not to be considered in the interpretation of this Agreement.

13.13. Parent Guarantee. To induce Seller to enter into this Agreement, which Agreement is of material benefit to Parent, Parent hereby unconditionally guarantees to Seller, as a primary obligor and not merely as a surety, the prompt and full payment and performance by Buyer of all of Buyer's obligations and liabilities under this Agreement and the other Transaction Documents in accordance with the terms hereof and thereof ("Parent Guarantee"). Parent hereby agrees that, if Buyer fails to pay and perform promptly any such obligation or liability in accordance with such terms, Parent will forthwith, upon demand, pay and perform the same. The unconditional obligation of Parent hereunder will not be affected, impaired or released by any termination or expiration hereof, or by Closing hereunder, or by any extension, waiver, amendment or other circumstance whatsoever that would affect, impair, release or constitute a defense to any obligation of a guarantor or surety (other than Buyer's full and timely performance). In connection with and to induce Seller and Stockholder to accept this Parent Guarantee and enter into this Agreement, Parent represents and warrants to Seller and Stockholder as follows:

(a) Parent is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation and has all requisite corporate power and authority to own, lease and operate its properties and assets and to conduct its business as currently conducted or proposed to be conducted.

(b) Parent has all requisite power and authority to execute and deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement have been duly authorized by all requisite corporate action on the part of Parent. This Agreement constitutes the legal, valid and binding obligation of Parent, enforceable against Parent in accordance with its terms, except to the extent enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws now or hereafter in effect relating to creditors rights generally, and general principles of equity.

(c) The execution, delivery and performance of this Agreement by Parent and the consummation of the transactions contemplated hereby (a) do not require Parent to file any notice with or obtain any consent, approval, authorization or exemption from any person or entity, including without limitation any government or governmental agency or instrumentality, (b) will not violate any writ, injunction, decree, order, judgment, law, statute, ordinance, rule or regulation and (c) will not constitute a default or breach under any agreement or commitment to which the Parent is a party or by which it or any of its properties may be bound.

IN WITNESS WHEREOF, the undersigned have executed this Agreement on the date first above written.

DERINGER ACQUISITION CORP. THE J.M. NEY COMPANY

By:/s/ John Wallace By:/s/ Andrew M. O'Shea

Name: John Wallace Name: Andrew M. O'Shea

Title: President Title: Chief Financial Officer, Treasurer and Secretary

DERINGER MFG., COMPANY ANDERSEN GROUP, INC., as the

(as to Section 13.13) Stockholder

By:/s/ Roderick W. Lamm By:/s/ Oliver R. Grace, Jr.

Name: Roderick W. Lamm Name: Oliver R. Grace, Jr.

Title: Chairman and Chief Executive Officer Title: President and Chief Executive Officer

SCHEDULES AND EXHIBITS

SCHEDULES:

Schedule 1.2(h) Artwork

Schedule 1.2(k) Deposits, Prepayments and Prepaid Expenses

Schedule 1.3(a) Employees

Schedule 1.3(b) Assumed Contracts

Schedule 1.3(c) Capitalized Lease Obligations

Schedule 1.3(d) Customer Pool Balances

Schedule 1.4 Headcount Reduction

Schedule 2.6 Form of Closing Statement

Schedule 3.1 Business Conducted by Agents, Subsidiaries or Affiliates

Schedule 3.3 Consents

Schedule 3.4 Financial Statements

Schedule 3.8 Personal Property

Schedule 3.9 Real Property

Schedule 3.10 Accounts and Notes Receivable

Schedule 3.11 Contracts and Leases

Schedule 3.12 Customer List

Schedule 3.13 Permits, Licenses and Authorizations

Schedule 3.15 Environmental Matters

Schedule 3.19 Employee Plans

Schedule 3.20 Compliance with ERISA

Schedule 3.21 Capitalization and Subsidiaries

Schedule 3.22 Predecessor Status; Etc.

Schedule 3.23 Intellectual Property

Schedule 3.24 Warranty and Sales Return Claims

Schedule 7.7 Agreements to be Terminated

Schedule 10.2(a) Warranty Claims, Inventory Returns

EXHIBITS:

Exhibit A - Form of Bill of Sale and General Assignment

Exhibit B - Form of Escrow Agreement

Exhibit C - Form of Lease

Exhibit D - Form of Assumption Agreement

EX-99.A4 OTHER AGRMT

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<TITLE>Charter of the Audit Committee of the Board of Directors</TITLE>

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<B><FONT SIZE=6><P ALIGN="CENTER">ANDERSEN GROUP, INC.</P>

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<P ALIGN="CENTER">Charter of the Audit Committee of the Board of Directors</P>

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</B><LI>Audit Committee Purpose</LI></OL>

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<P>The Audit Committee of the Board of Directors of Andersen Group, Inc. (the "Company") is appointed by the Board of Directors (the "Board") to assist the Board in fulfilling its oversight responsibilities. The Audit Committee's primary duties and responsibilities are to:</P>

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<LI>Monitor the integrity of the Company's financial reporting process and systems of internal controls regarding finance, accounting, and legal compliance.</LI></UL>

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<LI>Monitor the independence and performance of the Company's independent auditors.</LI></UL>

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<LI>Provide an avenue of communication among the independent auditors, management, and the Board.</LI></UL>

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<DIR>

<DIR>

<P>The Audit Committee has the authority to conduct an investigation appropriate to fulfilling its responsibilities, and it has direct access to the independent auditors as well as anyone in the organization. The Audit Committee has the ability to retain, at the Company's expense, special legal, accounting, or other consultants or experts it deems necessary in the performance of its duties.</P>

<FONT SIZE=4></DIR>

</DIR>

<OL TYPE="I">

<LI>Audit Committee Composition and Meetings</LI>

</FONT>

<P>Audit Committee members shall meet the requirements for NASDAQ. The Audit Committee shall be comprised of three or more directors as determined by the Board, each of whom shall be independent nonexecutive directors, free from any relationship that would interface with the exercise of his or her independent judgment. All members of the Committee shall have a basic understanding of finance and accounting and be able to read and understand fundamental financial statements, and at least one member of the Committee shall have accounting or related financial management expertise.</P>

<P>Audit Committee members shall be appointed by the Board on recommendation of the Nominating Committee. If an Audit Committee Chair (the "Chair") is not designated or present, the members of the Audit Committee may designate a Chair by majority vote of the Audit Committee membership.</P>

<P>The Audit Committee shall meet privately in executive session at least annually with management, the independent auditors, and as a committee to discuss any matters that the Audit Committee or each of these groups believe should be discussed. In addition, the Audit Committee, or at least its Chair, should communicate with management and the independent auditors quarterly to review the Company's financial statements and significant finding based upon the auditors' limited review procedures.</P>

<FONT SIZE=4><LI>Audit Committee Responsibilities and Duties</LI></OL>

</FONT><DIR>

<DIR>

<U><P>Review Procedures</P>

</DIR>

</DIR>

<OL>

<OL>

</U><LI>Review and reassess the adequacy of this Charter at least annually. Submit the charter to the Board for approval and have the document published at least every three years in accordance with SEC regulations.</LI>

<LI>Review the Company's annual audited financial statements prior to filing or distribution. Review should include discussion with management and independent auditors of significant issues regarding accounting principles, practices, judgments and any items required to be communicated by the independent auditors in accordance with SAS 61 (see item 10).</LI>

<LI>In consultation with the management and the independent auditors, consider the integrity of the Company's financial reporting processes and controls. Discuss significant financial risk exposures and the steps management has taken to monitor, control, and report such exposures. Review significant findings prepared by the independent auditors together with management's responses.</LI>

<LI>Review with financial management and the independent auditors the Company's quarterly financial results prior to the release of earnings and/or the company's quarterly financial statements prior to filing or distribution. Discuss any significant changes to the Company's accounting principles and any items required to be communicated by the independent auditors in accordance with SAS 61 (see item 10). The Chair of the Audit Committee may represent the entire Audit Committee for purposes of this review.</LI>

<U><P>Independent Auditors</P>

</U>

<LI>The independent auditors are ultimately accountable to the Audit Committee and the Board. The Audit Committee shall review the independence and performance of the auditors and annually recommended to the Board the appointment of the independent auditors or approve any discharge of auditors when circumstances warrant.</LI>

<LI>Approve the fees and other compensation to be paid to the independent auditors.</LI>

<LI>On an annual basis, the Audit Committee should review and discuss with the independent auditors all relationships they have with the Company that could impair the auditors' independence. In so doing, the Committee will request from the independent auditor a written affirmation delineating all relationships between the independent auditor and the Company consistent with Independence Standards Board Standard Number 1.</LI>

<LI>Taking or recommending the Board take, appropriate action to oversee the independence of the auditor.</LI>

<LI>Review the independent auditors audit plan and engagement letter - discuss scope, staffing, locations, reliance upon management, and internal audit and general audit approach.</LI>

<LI>Prior to releasing the year-end earnings, discuss the results of the audit with the independent auditors. Discuss certain matters required to be communicated to audit committees in accordance with AICPA SAS 61.</LI>

<LI>Consider the independent auditors' judgments about the quality and appropriateness of the Company's accounting principles as applied in its financial reporting.</LI>

<U>

<P>Legal Compliance</P>

</U>

<LI>On at least an annual basis, review with the Company's counsel, any legal matters that could have a significant impact on the Company's financial statements, the Company's compliance with applicable laws and regulations, and inquiries received from regulators or governmental agencies.</LI>

<U><P>Other Audit Committee Responsibilities</P>

</U>

<LI>Annually prepare a report to shareholders as required by the Securities and Exchange Commission. The report should be included in the Company's annual proxy statement.</LI>

<LI>Perform any other activities consistent with this Charter, the Company's by-laws, and governing law, as the Audit Committee or the Board deems necessary or appropriate.</LI>

<LI>Maintain minutes of meetings and periodically report to the Board on significant results of the foregoing activities.</LI>

<LI> Annually review a summary of director and officers' related party transactions and potential conflicts of interest.</LI></OL>

</OL>

</BODY>

</HTML>

EX-99.15 OTH FIN ST

The J.M. Ney Company

(a wholly-owned subsidiary of Andersen Group, Inc.)

Balance Sheets

(In Thousands)

(Unaudited)

ASSETS	August 31,		February 28,		February 29,
	2001		2001		2000
Current assets:
Cash and cash equivalents	$ (211)	$ 460		$ 660
Marketable securities	-	56		75
Accounts and other receivables less allowances $71, $77, $111 and $110, respectively	3,923	5,346		4,463
Inventories	2,372	6,614		8,019
Prepaid expenses and other assets	722	686		239
Receivable from affiliate
	----------------	-------------------		-----------------
Total current assets	6,806	13,162		13,456
Property, plant and equipment, net	6,817	7,262		7,958
Prepaid pension expense	4,761	4,809		4,917
Other assets	460	538		1,017
	-----------------	-----------------		-----------------
	$ 18,844	$ 25,771		$ 27,348
	==========	===========		==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt	$ 59	$ 96		$ 100
Short term borrowing	1,200	1,500		3,053
Accounts payable	324	651		726
Other current liabilities	572	1,150		1,079
Current deferred income taxes	594	901		1,399
Intercompany payable to parent	289	990		563
	----------------	------------------		----------------
Total current liabilities	$ 3,038	$ 5,288		$ 6,920
Long-term debt, less current maturities	-	9		105
Subordinated note payable, net of unamortized discount	1,481	7,388		7,358
Other liabilities	991	990		1,026
Deferred income taxes	1,712	1,448		824
Note payable and other long term payable to parent	5,182	4,573		4,573
	----------------	------------------		----------------
Total liabilities	12,404	19,696		20,806
	--------------	---------------		-------------
Stockholders' equity:
Common stock	9	9		9
Additional paid-in capital	37	37		62
Accumulated other comprehensive loss	-	(47)		-
Retained earnings	6,394	6,076		6,471
	----------------	-------------------		-----------------
Total stockholders' equity	6,440	6,075		6,542
	----------------	-------------------		----------------
	$ 18,844	$ 25,771		$ 27,348
	==========	============		===========

F-8

THE J.M. NEY COMPANY

(a wholly-owned subsidiary of Andersen Group, Inc.)

Statements of Operations

For the years ended February 28, 2001, February 29, 2000 and February 28, 1999

and for the Six Months ended August 31, 2001

(In thousands, except per share data)

(Unaudited)

		Six Months ended	Year ended	Year ended	Year ended
		August 31,	February 28,	February 29,	February 28,
		2001	2001	2000	1999
Sales and revenues:
	Net sales	$ 15,512	$ 39,462	$ 28,844	$ 26,838
	Investment and other income	(6)	(2)	205	(1)
		--------------	--------------	--------------	--------------
		15,506	39,460	29,049	26,837
		--------------	--------------	--------------	--------------
Costs and expenses:
	Cost of sales	11,331	30,679	21,181	18,255
	Selling, general and administrative	1,547	4,273	4,360	4,136
	Research and development	979	2,348	2,203	1,888
	Restructuring costs	-	256	-	-
	Interest expense	505	1,521	1,300	1,228
	Management fees and interest
	to parent	555	1,020	920	820
		--------------	--------------	--------------	------------
		14,917	40,097	29,964	26,327
		--------------	--------------	--------------	------------
Income (loss) before income taxes		589	(637)	(915)	510
Income tax expense (benefit)		224	(242)	(348)	194
		---------------	---------------	---------------	-------------
Net income before cumulative effect type accounting adjustment		365	(395)	(567)	316
Cumulative effect type accounting
adjustment, net of tax		(47)	-	-	-
		---------------	--------------	--------------	--------------
Net income (loss)		$ 318	$ (395)	$ (567)	$ 316
		=========	=========	=========	========
The accompanying notes are an integral part of these unaudited financial statements.

F-9

THE J.M. NEY COMPANY

(a wholly-owned subsidiary of Andersen Group, Inc.)

Statements of Cash Flows

For the years ended February 28, 2001, February 29, 2000 and February 28, 1999

and for the Six Months ended August 31, 2001

(In thousands, except per share data)

(Unaudited)

	Six months	Year	Year	Year
	ended	ended	ended	ended
	August 31, 2001	February 28, 2001	February 29, 2000	February 28, 1999
Net income (loss)	$ 318	$ (395)	$ (569)	$ 316
Depreciation, amortization and interest accretion	745	1,393	1,316	1,277
Deferred income taxes	(43)	126	(308)	(181)
Loss on disposal of property, plant and equipment	-	31	-	-
Loss (gain) from marketable securities	19	-	(2)	300
Pension expense (income)	48	108	116	(368)
Change in:
Accounts and note receivable	1,423	(883)	(595)	751
Inventory	4,671	1,405	(198)	255
Prepaid expenses and other assets	(460)	(329)	(230)	54
Accounts payable	(327)	(75)	224	(153)
Accrued liabilities and other long-term obligations	(530)	(12)	1	(603)
Intercompany liability to parent	(92)	427	127	167
	----------------	---------------	--------------	--------------
Cash provided by (used in ) operations	5,772	1,796	(118)	1,815
	----------------	----------------	--------------	-------------
Purchase of property and equipment	(134)	(337)	(2,118)	(1,680)
Purchase of short term investments	-	(4)	(22)	(398)
Proceeds from sale of short term investments	37	23	47	-
	----------------	---------------	--------------	--------------
Cash used in investing activities	(97)	(318)	(2,093)	(2,078)
	----------------	---------------	--------------	--------------
Principal payments on long-term debt	(6,046)	(100)	(129)	(154)
Proceeds from (payments of) short-term borrowings	(300)	(1,553)	2,089	268
Payments from exercise of stock options	-	(25)	(16)	-
	----------------	---------------	-------------	-------------
Cash (used in) provided by financing activities	(6,346)	(1,678)	1,944	114
	----------------	---------------	-------------	-------------
Net decrease in cash and cash equivalents	(671)	(200)	(267)	(149)
Cash and cash equivalents, beginning of the period	460	660	927	1,076
	---------------	----------------	---------------	---------------
Cash and cash equivalents, end of the period	$ (211)	$ 460	$ 660	$ 927
	=========	=========	=========	=========

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

F-10

THE J.M. NEY COMPANY

(a wholly-owned subsidiary of Andersen Group, Inc.)

Statements of Changes in Shareholder's Equity

For the years ended February 28, 2001, February 29, 2000 and February 28, 1999

and for the Six Months ended August 31, 2001

(In thousands, except per share data)

(Unaudited)

					Accumulated
	Common Stock	Common Stock	Additional Paid-in	Retained	Other Comprehensive	Total Shareholder's
	Shares	Amount	Capital	Earnings	Loss	Equity
Balance February 28, 1998	850,000	$ 9	$ 78	$ 6,722		$ 6,809
Net income				316		316
	-----------	----------	-----------	---------	------------	---------
Balance February 28, 1999	850,000	$ 9	$ 78	$ 7,038	$ -	$ 7,125
Net loss				(567)		(567)
Payment for settlement of stock options			(16)			(16)
	-----------	----------	-----------	---------	-----------	-----------
Balance February 29, 2000	850,000	$ 9	$ 62	$ 6,471	$ -	$ 6,542
Net loss				(395)		(395)
Payment for settlement of stock options			(25)			(25)
Unrealized losses on precious metals
hedging					(47)	(47)
	----------	----------	----------	--------	-------------	----------
Balance February 28, 2001	850,000	$ 9	$ 37	$ 6,076	$ (47)	$ 6,075
Net income				318		318
Realization of losses through
income statement					47	47
	----------	-----------	-------------	---------	-----------	----------
Balance August 31, 2001	850,000	$ 9	$ 37	$ 6,394	$ -	$ 6,440
	=======	======	=======	======	=======	======
The accompanying notes are an integral part of these unaudited financial statements.

F-11

EX-99.15 OTH FIN ST

The J.M. Ney Company

(a wholly-owned subsidiary of Andersen Group, Inc.)

Notes to Financial Statements

Six Months ended August 31, 2001, and

Years ended February 28, 2001, February 29, 2000, and February 28, 1999

(Unaudited)

(1) Nature of Business

The J.M. Ney Company (the Company) manufactures electronic connectors, components and precious metal materials for sale to the automotive, telecommunications, defense, semiconductor, and medical and dental markets. The Company is wholly-owned by Andersen Group, Inc. (Andersen), a publicly traded diversified holding company which also invests in both marketable and other securities of domestic and foreign-based companies.

(2) Summary of Significant Accounting Policies

Use of Estimates

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

Cash and Cash Equivalents

Cash and cash equivalents include funds held in investments with an original maturity of three months or less.

Marketable Securities

The Company's marketable securities are carried as trading securities at quoted market value in accordance with Statement of Financial Accounting Standards No. 115, "Accounting for Certain Investments in Debt and Equity Securities" (SFAS 115). Any changes in the valuation of the portfolio are reflected in the accompanying Statements of Operations as investment income or losses.

Inventories

Inventories are stated at the lower of cost or market. Cost is determined using the last-in, first-out (LIFO) method for precious metals and at standard costs which approximate the first-in, first-out (FIFO), and average cost methods for the balance of the inventories.

Property, Plant and Equipment

Property, plant and equipment, including those obtained under capital leases, are stated at cost and depreciated using the straight-line method over the estimated useful life of the respective assets, as follows:

F-12

Buildings and improvements	10-30 years
Machinery and equipment	5-10 years
Furniture and fixtures	3-10 years

When fixed assets are sold or retired the cost and accumulated depreciation are eliminated and the resulting gains or losses are reflected in income.

Tooling Costs

The Company capitalizes costs related to certain tooling items in accordance with EITF 99-5, "Accounting for Pre-Production Costs Related to Long-Term Supply Arrangements." The tooling, which amounted to approximately $268,000 as of February 28, 2001, is amortized based on the units-of-production method.

Debt Discounts

Unamortized discounts on subordinated notes payable are being amortized over the term of the notes using the effective interest method.

Revenue

Sales are recognized when title passes to the customer, which is generally when the products are shipped, the price is fixed and determinable, and collectibility is reasonably assured. Investment income (loss) and other income is recognized when earned and based on changes in the fair value of marketable securities and realized gains and losses.

Income Taxes

Income taxes are determined based upon a tax sharing agreement between the Company and Andersen using the estimated effective income tax rate and asset and liability approach. This method gives consideration to the future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities at currently enacted tax rates.

Derivative Transactions

The Company has entered into precious metal forward and futures contracts as hedges against precious metal fluctuations for firm price deliveries within 30 to 90 days. These contracts limit the Company's exposure to both favorable and unfavorable precious metals price fluctuations. For FY01, FY00 and FY99, the Company has qualified for hedge accounting based on criteria set forth in SFAS No. 80, "Accounting for Futures Contracts" and has assessed hedge effectiveness based on the probability that the results of the futures contract will substantially offset the effects of the anticipated transaction. The Company adopted SFAS 133, "Accounting for Derivative Instruments and Hedging Activities", during FY02. See Note 17.

F-13

(3) Inventories

Inventories consist of the following (in thousands):

		August 31, 2001		February 28, 2001		February 29, 2000
Raw materials	$ 829		$ 3,127		$10,474
Work in process	3,515		5,349		3,929
Finished goods	4,378		6,414		6,029
Metals held on consignment	(2,668)		(1,512)		(7,475)
	6,054		13,378		12,957
LIFO Reserve	(3,682)		(6,764)		(4,938)
	$ 2,372		$ 6,614		$ 8,019

At February 28, 2001 and February 29, 2000, inventories valued at LIFO cost comprised 57% and 67% of total inventories, respectively. At August 31, 2001, inventories valued at LIFO consisted of 1,472 troy ounces of gold; 3,535 troy ounces of silver; 1,662 troy ounces of platinum and 3,302 troy ounces of palladium. At February 28, 2001, inventories valued at LIFO consisted of 6,054 troy ounces of gold, 7,150 troy ounces of silver, 2,110 troy ounces of platinum and 8,674 troy ounces of palladium. At February 29, 2000, inventories valued at LIFO consisted of 9,431 troy ounces of gold, 10,197 troy ounces of silver, 3,105 troy ounces of platinum and 8,687 troy ounces of palladium. Such quantities of precious metals exclude precious metals held by The Company subject to leasing arrangements with The Company's primary bank and customer metals held on account. During the six months ended August 31, 2001, FY01 and FY00, The Company recognized LIFO gains (losses) of approximately $1,300,000, ( $75,000) and $1,400,000, respectively, from decreases in certain precious metal LIFO layers.

(4) Property, Plant and Equipment

Property, plant and equipment consist of the following (in thousands):

	August 31, 2001	February 28, 2001	February 29, 2000
Land and improvements	$ 401	$ 401	$ 401
Buildings and improvements	5,993	5,986	5,888
Machinery and equipment	12,170	12,017	13,141
Furniture and fixtures	743	743	857
	19,306	19,147	20,287
Less accumulated depreciation and amortization	12,490	11,885	12,329
	$ 6,817	$ 7,262	$ 7,958

Depreciation and amortization expense was $612,000, $1,316,000, $1,277,000 and $1,205,000 for six months ended August 31, 2001, FY01, FY00, and FY99, respectively.

F-14

At each of February 28, 2001 and February 29, 2000, property, plant and equipment includes $539,000, respectively of machinery and equipment acquired under capital leases, which expire through FY03, with related accumulated amortization of $334,000 and $257,000, respectively.

During the six months ended August 31, 2001, the Company voluntarily prepaid $6,000,000 of the subordinated note payable.

(5) Short-term Borrowings

The Company has an $8.0 million revolving credit and deferred payment sales agreement with a commercial bank which is secured by substantially all of the Company's assets. At February 28, 2001, the Company had unused availability under this line of $6,114,000. At the Company's election, interest is charged at the bank's prime rate, which was 8.5% and 8.75% at February 28, 2001 and February 29, 2000, respectively, at LIBOR plus 1.75% if the borrowing is fixed for a period of time, or at 1.75% over the bank's precious metals leasing rate if the borrowing is represented by deferred payment purchases of precious metals. A fee of 0.25% is charged on the unused balance of the facility. This agreement expires in December 2002 and includes restrictive covenants that limit the amount of dividends and other cash distributions from the Company to Andersen. The agreement also contains certain financial covenants including a requirement for the Company to maintain a specified amount of stockholder' s equity.

(6) Accrued Liabilities

Accrued liabilities consist of the following (in thousands):

		August 31, 2001		February 28, 2001		February 29, 2000
Employee compensation	$279		$634		$ 387
Accrued interest	71		138		197
Other	222		199		485
	$572		$1,150		$1,079

(7) Long-term Debt and Subordinated Notes Payable

Long-term debt and subordinated notes payable consist of the following (in thousands):

			August 31, 2001		February 28, 2001		February 29, 2000
Subordinated note payable due December 2004; secured by a lien on assets; interest at 10.26% payable quarterly		$1,500		$7,500		$7,500
Other	59			105		205
	1,559			7,605		7,705
Less unamortized discounts	19			112		142
	1,540			7,493		7,563
Less current maturities	59			96		100
	$1,481			$7,397		$7,463

F-15

At February 28, 2001, the Company was not in compliance with one of the financial covenants of the subordinated note payable. The bank waived the event of noncompliance and modified the same financial covenant for the following three fiscal quarters

In connection with the issuance of the subordinated note payable in FY98, the Company issued warrants to the lender to acquire 34,000 shares of its common stock at an exercise price of $1.00 per share, and warrants to acquire 6,000 shares at an exercise price of $10.00 per share. These warrants are exercisable at any time until December 2007, or six months after an initial public offering. The estimated fair value of these warrants of $205,000 has been recorded as a discount to the face amount of the note which is being amortized over the life of the note. The lender has an option to put these warrants back to the Company at the earlier of December 2002, or the date of an initial public offering of the Company's common stock on terms as defined in the agreement.

Maturities of long-term debt for each of the next five fiscal years and thereafter are as follows as of February 28, 2001 (in thousands):

2002	$ 96
2003	9
2004	-
2005	7,500
	$ 7,605

8. Income Taxes

As described in Note 19, the Company is party to a tax sharing agreement with Andersen, under which all current taxes payable are paid to the taxing authorities by Andersen. Intercompany allocations of income taxes are recorded on the Company's books.

For the six months ended August 31, 2001, FY01, FY00 and FY99, income tax expense (benefit) consisted of the following (in thousands):

	Six Months Ended August 31, 2001	Year Ended February 28, 2001	Year Ended February 29, 2000	Year ended February 28, 1999
Current	$ 293	$ 33	$ (41)	$ 244
Deferred	(69)	(275)	(307)	(50)
	$ 224	$(242)	$ (348)	$ 194

The principal components of the net deferred tax asset (liability) are as follows (in thousands):

	August 31, 2001	February 28, 2001	February 29, 2000
Deferred tax liabilities:
Fixed asset basis differences	$ (386)	$ (446)	$ (452)
Inventory	(784)	(1,148)	(1,634)
Pension	(1,835)	(1,854)	(1,895)
Total deferred tax liabilities	(3,005)	(3,448)	(3,981)

F-16

Deferred tax assets:
Pension and post-retirement benefits other than pensions	381	392	396
Federal and State credit carry-forwards	1	29	446
Federal and State net operating loss carry- forwards	-	341	357
Accrued expenses	107	154	98
Other	211	193	461
Total deferred tax assets	699	1,099	1,758
Net deferred tax liabilities	$(2,306)	$(2,349)	$(2,223)

(9) Stock Option Plans

The Company's incentive stock option plans provide for option grants to directors and key employees at prices equal to at least 100% of the stock's fair market value at date of grant. Options generally vest over three years and have a maximum term of ten years. All options granted during FY99 through August 31, 2001 had an exercise price equal to the fair market value as of the date of grant. The per share weighted average fair value of stock options granted during FY01 and FY99 under these plans were $2.82 and $2.91, respectively, using the Black Scholes option pricing model with the following weighted average assumptions: expected dividend yield of 0%; risk-free interest rates of 6.0%, expected life of five to seven years; and expected volatility of 0%.

Activity under the Company's plan was as follows:

	Number of	Weighted Average	Range of
Outstanding Options	Shares	Exercise Price	Exercise Prices
Balance February 28, 1998	146,300	$10.10	$10.00 - $10.86
Granted	4,250	$11.47	$11.43 - $11.62
Canceled	(7,750)	$10.25	$10.00 - $10.86
Balance February 28, 1999	142,800	$10.13	$10.00 - $11.62
Exercised	(9,750)	$10.16	$10.00 - $11.43
Canceled	(6,500)	$10.29	$10.00 - $11.43
Balance February 29, 2000	126,550	$10.12	$10.00 - $11.62
Granted	2,000	$11.17	$11.17
Exercised	(21,000)	$10.10	$10.00- $10.86
Canceled	(500)	$10.86	$10.86
	107,050	$10.14	$10.00 - $11.62

The Company has adopted the disclosure provisions of SFAS No. 123, "Accounting for Stock-Based Compensation". Accordingly, no compensation expense has been recognized for the stock option plans. Had compensation cost for the Company's stock option plan been determined based on the fair value on the grant date for awards during FY01, FY00 and FY99 consistent

F-17

with the provisions of SFAS No. 123, the Company's net income (loss) applicable would have adjusted to the pro forma amounts indicated below (amounts in thousands, except per share data):

	2001	2000	1999
(Loss) income applicable to common shareholders:
As reported	$(395)	$(567)	$316
Pro forma	$(400)	$(584)	$261

The Company has reserved 119,250 shares of its common stock for the exercise of stock options, of which 12,200 were available for issuance at February 28, 2001. There presently is no public market for the Company's stock.

(10) Retirement Plans

The Company maintains a noncontributory defined benefit plan and a defined contribution plan, which collectively cover substantially all its full-time employees and those of Andersen Group. The Company defined contribution plan is funded through employee contributions and employer matching contributions. Pension expense for the Company's defined contribution plan totaled $223,000, $208,000, and $189,000, in FY01, FY00 and FY99, respectively

The following table sets forth the changes in benefit obligations, changes in fair value of plan assets, funded status and net amounts recognized in the Consolidated Balance Sheets for the defined benefit plan (in thousands). Such amounts are reported on a two month lag to coincide with the December 31 fiscal year for the plan.

	February 28, 2001	February 29, 2000	February 28, 1999
Changes in Benefit Obligations
Benefit obligation at beginning of year	$11,001	$11,663	$10,212
Service cost	261	397	240
Interest cost	864	791	781
Experience loss	232	138	842
Distributions	(1,010)	(971)	(2,885)
Effect of curtailment (Note 19)	(178)	-	(64)
Effect of early retirement program settlement	-	-	511
Effect of assumption changes	1,134	(1,017)	2,026
Benefit obligation end of year	12,304	11,001	11,663
Change in Fair Value of Plan Assets
Fair value of plan assets at beginning of year	14,069	14,530	18,087
Actual return on assets	2,265	510	(672)
Benefits paid	(1,010)	(971)	(2,885)
Fair value of plan assets at end of year	15,324	14,069	14,530
Funded status	3,020	3,068	2,867
Unrecognized net actuarial loss	1,886	1,953	2,277
Unrecognized past service cost	(97)	(104)	(111)

F-18

Prepaid pension expense $ 4,809 $ 4,917 $ 5,033

For FY01, FY00 and FY99, the projected benefit obligations and pension (expense) income were determined using the following assumptions:

	2001	2000	1999
Discount rate	7.25%	7.75%	7.00%
Future compensation growth rate	5.00%	5.00%	5.00%
Long-term rate of return on plan assets	8.00%	8.00%	8.00%

Net pension expense (income) for the Company's funded defined benefit plan for FY01, FY00 and FY99 includes the following components (in thousands):

	2001	2000	1999
Service cost of benefits accrued	$ 261	$ 397	$ 240
Interest cost on projected benefit obligations	864	791	781
Expected return on plan assets	(1,086)	(1,124)	(1,413)
Unrecognized net gain (loss)	69	52	(42)
Effect of early retirement program	-	-	139
Effect of Ultrasonics curtailment	-	-	(73)
Pension expense (income)	$ 108	$ 116	$ (368)

(11) Post-retirement Benefit Obligations

At February 28, 2001 and 2000, the accumulated benefit obligation for its unfunded retiree health care plan was approximately $697,000 and $736,000, respectively and the net unrecognized actuarial gain was approximately $115,000 and $325,000, respectively. The Company's cost for this plan for FY01, FY00, and FY99 was approximately $2,000, $7,000, and $18,000, respectively, including interest and amortization of unrecognized net actuarial gain. Benefit payments made under this plan for FY01, FY00, and FY99 were approximately $41,000, $40,000, and $52,000 respectively. At February 28, 2001, 35 retirees and their spouses were receiving benefits under this plan.

The accumulated benefit obligation was determined using the unit credit method and assumed discount rates of 7.25% at February 28, 2001, February 29, 2000 and February 28, 1999. At February 28, 2001 and February 29, 2000, the accumulated benefit obligation was compiled using assumed health care cost trend rates of 10%, gradually declining to 6% for the remainder of the projected payout period of the benefits.

The estimated effect on the present value of the accumulated benefit obligation at March 1, 2001 of a 1% increase each year in the health care cost trend rate used would result in an estimated increase of approximately $2,000 in the service and interest cost, and approximately $41,000 in the accumulated benefit obligation. A 1% decrease each year in the health care trend rate would result in a decrease of approximately $2,000 in the service and interest costs, and a decrease of approximately $37,000 in the accumulated benefit obligation.

F-19

(12) Leases

The Company leases various manufacturing and office facilities and equipment under operating lease agreements expiring through December 2005. Lease expense was $259,000, $392,000, $309,000, and $283,000, for the six months ended August 31, 2001, FY01, FY00 and FY99, respectively.

Future minimum lease payments under the terms of the leases for each of the next five years, are as follows as of February 28, 2001(in thousands):

	Lease Payments
2002	$ 694
2003	594
2004	471
2005	405
2006	204
	$2,368

The above amounts include the principal portion of capital lease payments of $96,000 in FY02 and $9,000 in FY03.

(13) Restructuring Costs

In February 2001, the Company announced a restructuring of its operations which involved the reduction of 33 employees from its workforce. The estimated cost of this restructuring which is primarily comprised of several payments and benefits is $256,000, of which $134,000 was paid prior to February 28, 2001. Such costs do not include a curtailment gain from the Company's defined benefit retirement plan, which did not have an effect as such gains were applied against unrecognized net actuarial losses of the plan. The remaining costs were paid by the end of the second quarter of FY02.

(14) Export Sales and Customer Concentration

Export sales for the six months ended August 31, 2001 and for FY01, FY00, and FY99 were $4,430,000, $9,552,000, $5,941,000 and $4,303,000, respectively. Such sales were made primarily to customers in Europe and the Pacific Rim.

During the six months ended August 31, 2001 and FY01, FY00, and FY99 sales to one customer accounted for 11.7%, 14.4%, 17.7%, and 16.1% of net sales, respectively. At August 31, 2001, February 28, 2001 and February 29, 2000 accounts receivable from this customer represented 11.6%, 14.7% and 19.1%, respectively, of consolidated net accounts receivable. In addition, sales to one other customer accounted for 13.9% of net sales during FY99.

F-20

(15) Estimated Fair Value of Financial Instruments

The carrying amount of cash and cash equivalents, accounts receivable, short term borrowings, accounts payable and other accrued liabilities are reasonable estimates of their fair value based upon their current maturities.

The carrying values of long-term debt issued by banks and capital lease obligations approximate fair value based on interest rate and repayment terms, and the extent to which the individual debts are secured.

(16) Litigation

The Company is involved in various legal proceedings generally incidental to its business. While the results of any litigation or regulatory issues contain an element of uncertainty, management believes that the outcome of any known, pending or threatened legal proceeding, or all of them combined, will not have a material adverse effect on the Company's financial position or results of operations.

(17) Derivative Transactions

As of February 28, 2001, the Company held contracts to purchase 486 ounces of palladium over the following three months at an average price of $961 per ounce, a $47,000 loss, net of tax effects of $27,000, based on quoted futures prices. Losses on these contracts have been deferred and included within accumulated other comprehensive income. The losses were recognized during the six months ended August 31, 2000, when the product deliveries being hedged were made.

In June 1998, SFAS No. 133 "Accounting for Derivative Instruments and Hedging Activities" was issued. SFAS No. 133 requires an entity to recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. Gains and losses resulting from changes in the values of those derivatives would be recognized immediately or deferred depending on the use of the derivative, and if the derivative is a qualifying hedge. SFAS No. 133 is effective for the Company for the fiscal year ending February 23, 2002. The Company adopted SFAS No. 133 on March 31, 2001 and accordingly it recorded a cumulative transition adjustment loss of $47,000.

(18) Supplemental Disclosure of Cash Flow Information

The information below supplements the cash flow data presented in the Company's Consolidated Statements of Cash Flows (in thousands):

	Six Months August 31, 2001		FY01		FY00		FY99
Cash paid for:
Interest		$380		$1,264		$1,100		$1,140

F-21

(19) Related Party Transactions

The Company records interest expense on its subordinated note payable to Andersen at the annual rate of 8%. The Company receives certain services, such as human resources, legal, corporate, financial and administrative support, from Andersen Group. The Company is charged for these services in accordance with an agreement between the two companies. As a result, the financial statements presented may not be indicative of the results that would have been achieved had the Company operated as a non-affiliated entity.

The payment of the interest and management fees is limited under terms of the Company's loan agreements with its primary bank.

Under terms of a tax sharing agreement between the Company and Andersen, all income taxes payable or receivable relating to the Company's taxable income are recorded on Andersen's books with corresponding intercompany allocations to the Company.

F-22

EX-99.15 OTH FIN ST

ANDERSEN GROUP, INC.

Unaudited Pro Forma Consolidated Condensed Statements of Operations

For the Year Ended February 28, 1999

(In thousands, except per share data)

(Unaudited)

				Less
		Historical	Less	Discontinued	Pro forma
		Amounts	JM Ney	Real Estate	Adjustments (b)	Pro Forma
Sales and revenues:
	Net sales	$ 26,838	$ (26,838)	$ -	$ -	$ -
	Investment and other income	(3,238)	1	(509)	290	(3,456)
		--------------	-------------	-------------	--------------	------------
		23,600	(26,837)	(509)	290	(3,456)
		--------------	-------------	-------------	--------------	------------
Costs and expenses:
	Cost of sales	18,255	(18,255)			-
	Selling, general and administrative	6,170	(4,136)	(602)	(436)	996
	Research and development	1,888	(1,888)			-
	Interest expense	1,735	(1,228)	(14)		493
		--------------	--------------	--------------	--------------	------------
		28,048	(25,507)	(616)	(436)	1,489
		--------------	--------------	--------------	--------------	-----------
Loss form continuing operations before
income taxes		(4,448)	(1,330)	107	726	(4,945)
Income tax expense (benefit) (c)		(1,484)	(505)	41	1,948	-
		--------------	--------------	--------------	--------------	------------
Net income before cumulative effect accounting adjustment		(2,964)	(825)	66	(1,222)	(4,945)
Loss on sale of discontinued Ultrasonics
segment, net of income tax benefit of $71		(116)				(116)
		--------------	--------------	--------------	--------------	------------
Net income		(3,080)	(825)	66	(1,222)	(5,061)
Preferred dividends		(385)				(385)
		--------------	--------------	--------------	--------------	------------
(Loss) applicable to common shareholders		$ (3,465)	$ (825)	$ 66	$ (1,222)	$ (5,446)
		========	========	=======	========	=======
Loss per Common Share - Basic and Diluted:
	Continuing operations	$ (1.74)	$ (0.43)	$ 0.03	$ (0.63)	$ (2.77)
	Discontinued operations	$ -				$ -
	Loss on sale of discontinued segment	$ (0.06)				$ (0.06)
		--------------	--------------	--------------	--------------	------------
Loss per common share - basic and diluted		$ (1.80)	$ (0.43)	$ 0.03	$ (0.63)	$ (2.83)
		========	========	========	========	======
Weighted average shares outstanding -
	basic and diluted	1,928				1,928
		========	========	========	========	=======

F-6

ANDERSEN GROUP, INC.

Notes to Unaudited Pro Forma Consolidated Condensed

Financial Statements

(In thousands, except per share data)

1. Reflects the proceeds and gain on sale resulting from the sale of JM Ney, and the real estate property being sold by another wholly-owned subsidiary of the Company.

	JM Ney	Real Estate
Proceeds:
Gross proceeds	$ 12,138	$ 1,900
Transaction expenses	1,270	237
	- -----------	-----------
Net proceeds	10,868	1,663
Escrow - long term	600	-
	- -----------	-----------
Net cash proceeds	$ 10,268	$ 1,663
Payment of borrowings	4,564	(1,064)
	------------	-----------
Net cash before income taxes	5,704	599
Income tax payments	2,026	171
	------------	-----------
Net cash proceeds	$3,678	$428
	=======	=======
Estimated gain (loss):
Proceeds, net of transaction expenses	$ 10,868	$ 1,663
Less: Net assets sold	(6,972)	(2,014)
Tax (expense) benefit	(1,378)	133
	------------	-----------
Net gain (loss)	$ 2,518	$ (218)
	=======	=======

b) Reflects pro forma adjustments in investment and other income, general and administrative expenses and interest expense as a result of the sale of JM Ney.

	Six months	Year	Year	Year
	ended	ended	ended	ended
	August 31,	February 28,	February 29,	February 28,
	2001	2001	2000	1999
Investment and other income:
Rental income from lease of JM Ney's property	$ 145	$ 290	$ 290	$ 290
	======	======	======	=====
Selling, general and administrative expenses:
Add back depreciation of real estate being retained	$ 116	$ 232	$ 232	$ 232
pension income after pro forma reduction of employees accruing service benefits	(102)	(192)	(184)	(668)
	-----------	----------	----------	--------
	$ 14	$ 40	$ 48	$ (436)
	======	=====	=====	=====
Interest expense:
Reduction from pro forma repayment of Company Note payable to officer secured by real estate of wholly-owned subsidiary
	$ (43)	$ (85)	$ (1)	-
	======	======	=====	=====

c) Reflects adjustment of provision (benefit) for income taxes as a result of pro forma adjustments. No tax benefit has been recorded, due to valuation allowances against proforma unrealizable net operating loss carryforwards.

F-7

The J.M. Ney Company

(a wholly-owned subsidiary of Andersen Group, Inc.)

Balance Sheets

(In Thousands)

(Unaudited)

ASSETS	August 31,		February 28,		February 29,
	2001		2001		2000
Current assets:
Cash and cash equivalents	$ (211)	$ 460		$ 660
Marketable securities	-	56		75
Accounts and other receivables less allowances $71, $77, $111 and $110, respectively	3,923	5,346		4,463
Inventories	2,372	6,614		8,019
Prepaid expenses and other assets	722	686		239
Receivable from affiliate
	----------------	-------------------		-----------------
Total current assets	6,806	13,162		13,456
Property, plant and equipment, net	6,817	7,262		7,958
Prepaid pension expense	4,761	4,809		4,917
Other assets	460	538		1,017
	-----------------	-----------------		-----------------
	$ 18,844	$ 25,771		$ 27,348
	==========	===========		==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt	$ 59	$ 96		$ 100
Short term borrowing	1,200	1,500		3,053
Accounts payable	324	651		726
Other current liabilities	572	1,150		1,079
Current deferred income taxes	594	901		1,399
Intercompany payable to parent	289	990		563
	----------------	------------------		----------------
Total current liabilities	$ 3,038	$ 5,288		$ 6,920
Long-term debt, less current maturities	-	9		105
Subordinated note payable, net of unamortized discount	1,481	7,388		7,358
Other liabilities	991	990		1,026
Deferred income taxes	1,712	1,448		824
Note payable and other long term payable to parent	5,182	4,573		4,573
	----------------	------------------		----------------
Total liabilities	12,404	19,696		20,806
	--------------	---------------		-------------
Stockholders' equity:
Common stock	9	9		9
Additional paid-in capital	37	37		62
Accumulated other comprehensive loss	-	(47)		-
Retained earnings	6,394	6,076		6,471
	----------------	-------------------		-----------------
Total stockholders' equity	6,440	6,075		6,542
	----------------	-------------------		----------------
	$ 18,844	$ 25,771		$ 27,348
	==========	============		===========

EX-99.15 OTH FIN ST

ANDERSEN GROUP, INC.

UNAUDITED PRO FORMA CONSOLIDATED CONDENSED

FINANCIAL INFORMATION

The unaudited pro forma consolidated condensed financial information of Andersen Group, Inc. ("Andersen" or the "Company") on pages F-2 through F-7 gives effect to the sale of substantially all of the net assets of The J.M. Ney Company ("JM Ney") to Deringer Mfg. Company ("Deringer") and the payment of JM Ney's bank debt. The accompanying unaudited pro forma consolidated condensed financial information also gives effect to the sale of a real estate property owned by the Company's wholly-owned subsidiary, Andersen Realty, Inc. and the related payment of the Company's debt obligations which are secured by the real estate being sold. The sale of Andersen Realty's property is not subject to shareholder vote or approval, but is being presented to provide additional pro forma financial information with respect to the Company's consolidated condensed financial information. The unaudited pro forma condensed financial information should be read in conjunction with the historical consolidated financ ial statements included in the Company's Annual Report on Form 10-K for the year ended February 28, 2001, and the Quarterly Report on Form 10-Q for the six months ended August 31, 2001.

The unaudited pro forma consolidated condensed Statement of Operations for the six months ended August 31, 2001 and for the years ended February 28, 2001, February 29, 2000 and February 28, 1999 give pro forma effect to the sale of both JM Ney and Andersen Realty's real estate property as if they had occurred as of March 1, 1998. The Unaudited Pro Forma Consolidated Condensed Balance Sheet gives pro forma effect to the sales of JM Ney and the real estate property, and the repayment of related debt obligations as if they occurred on August 31, 2001.

No income tax benefit has been reflected in the unaudited proforma consolidated income statements because, based upon the weight of available evidence, it is more likely than not that no income tax benefit would have been realized without the taxable income generated by JM Ney during the periods presented.

The unaudited pro forma consolidated condensed financial statements do not purport to be indicative of the results of operations or the financial position of the Company that would have actually been obtained had such transactions been completed as of the assumed dates and for the periods presented or which may be obtained in the future. The unaudited pro forma financial statements do not reflect any anticipated cost savings or additional costs that may be realized or incurred or are anticipated from the sale of JM Ney or the real estate property, and there can be no assurances that any such cost savings or additional costs may occur. The pro forma adjustments are described in the accompanying notes and are based on available information and certain assumptions that the Company believes are reasonable.

F-1

ANDERSEN GROUP, INC.

Pro Forma Consolidated Balance Sheet

(In thousands, except per share data)

(Unaudited)

			As of August 31, 2001
	Historical	Net Assets	Use of	Sale of
	Balances	Sold	Proceeds (a)	Real Estate (a)	Pro Forma
Cash and cash equivalents	$ 550	$ 11,538	$ (7,860)	$ 428	$ 4,656
Marketable securities	147				147
Accounts and other receivables	3,996				3,996
Inventories	2,372	(2,123)			249
Prepaid expenses and other current assets	763	(160)			603
	------------	----------------	--------------	--------------	-------------
Total current assets	7,828	9,255	(7,860)	428	9,651
Property, plant and equipment, net	8,835	(3,072)		(2,014)	3,749
Prepaid pension expense	4,761				4,761
Investment in Moscow Broadband Communication Ltd.	2,943				2,943
Other assets	1,149	352			1,501
	------------	----------------	--------------	-------------	-------------
Total assets	$ 25,516	$ 6,535	$ (7,860)	$ (1,586)	$ 22,605
	=======	==========	========	=======	=======
Current maturities of long-term debt	$ 497	$ (59)		$ (7)	$ 431
Notes payable to officer, net of unamortized discount	1,000			(1,000)	-
Short-term borrowings	1,200		$ (1,200)
Accounts payable	477				477
Accrued liabilities	1,215	4,724	(4,974)		965
Deferred income taxes	573	(716)			(143)
	------------	----------------	--------------	------------	-------------
Total current liabilities	4,962	3,949	(6,174)	(1,007)	1,730
Long-term debt, less current maturities	2,644			(57)	2,587
Subordinated note payable, net of unamortized discount	1,481		(1,481)		-
Other liabilities	1,846		(205)		1,641
Deferred income taxes	1,425	68		(304)	1,189
	------------	- ---------------	--------------	------------	-------------
	12,358	4,017	(7,860)	(1,368)	7,147
	------------	----------------	--------------	------------	-------------
Stockholders' equity
Cumulative convertible preferred stock	3,634				3,634
Common stock	21				21
Additional paid-in capital	6,427				6,427
Retained earnings	3,076	2,518		(218)	5,376
	------------	---------------	--------------	------------	-------------
Total liabilities	13,158	2,518	-	(218)	15,458
	------------	---------------	--------------	------------	-------------
	$ 25,516	$ 6,535	$ (7,860)	$ (1,586)	$ 22,605
	=======	=========	========	=======	=======
	-	-	-	-	-

F-2

Andersen Group, Inc.

Unaudited Pro Forma Consolidated Condensed Statements of Operations

For the Six Months Ended August 31, 2001

(In thousands, except per share date)

(Unaudited)

			Less	Less
		Historical	Historical	Discontinued	Pro forma
		Amounts	JM Ney	Real Estate	Adjustments (b)	Pro Forma
Sales and revenues:
	Net sales	$ 15,512	(15,512)	$ -	$ -	$ -
	Investment and other income	385	6	(179)	145	357
		--------------	--------------	--------------	--------------	--------------
		15,897	(15,506)	(179)	145	357
		--------------	--------------	--------------	--------------	--------------
Costs and expenses:
	Cost of sales	11,331	(11,331)			-
	Selling, general and administrative	2,408	(1,547)	(309)	14	566
	Research and development	979	(979)			-
	Interest expense	711	(505)	(2)	(43)	161
		--------------	--------------	--------------	--------------	--------------
		15,429	(14,362)	(311)	(29)	727
		--------------	--------------	--------------	--------------	--------------
Income before equity in losses of
unconsolidated subsidiary and income taxes		468	(1,144)	132	174	(370)
Equity in losses of Moscow Broadband		(411)				(411)
		--------------	--------------	--------------	--------------	--------------
Loss before income taxes		57	(1,144)	132	174	(781)
Income tax expense (benefit) (Note (c)		205	(435)	50	180	-
		--------------	--------------	--------------	--------------	--------------
Net income before cum effect accounting adjustment		(148)	(709)	82	(6)	(781)
Cumulative effect type accounting
adjustment, net of tax		(47)	47		-	-
		--------------	--------------	--------------	--------------	--------------
Net income		(195)	(662)	82	(6)	(781)
Preferred dividends		(146)				(146)
		--------------	--------------	--------------	--------------	--------------
(Loss) applicable to common shareholders		$ (341)	$ (662)	$ 82	$ (6)	$ (927)
		========	========	========	========	========
Loss per Common Share - Basic and Diluted:
Net loss before cumulative effect-type
accounting adjustment		$ (0.14)	$ (0.34)	$ 0.04	$ 0.00	$ (0.44)
Cumulative effect-type accounting adjustment		$ (0.02)	$ 0.02			$ 0.00
		--------------	--------------	--------------	--------------	--------------
		$ (0.16)	$ (0.32)	$ 0.04	$ 0.00	$ (0.44)
		========	========	========	========	========
Weighted average shares outstanding -
	basic and diluted	2,075				2,075
		========	========	========	========	========

F-3

ANDERSEN GROUP, INC.

Unaudited Pro Forma Consolidated Condensed Statements of Operations

For the Year Ended February 28, 2001

(In thousands, except per share data)

(Unaudited)

			Less	Less
		Historical	Historical	Discontinued	Pro forma
		Amounts	JM Ney	Real Estate	Adjustments (b)	Pro Forma
Sales and revenues:
	Net sales	$ 39,462	$ (39,462)	$ -	$ -	$ -
	Investment and other income	696	2	(445)	290	543
		------------	------------	---------------	--------------	----------
		40,158	(39,460)	(445)	290	543
		-------------	------------	---------------	--------------	---------
Costs and expenses:
	Cost of sales	30,679	(30,679)			-
	Selling, general and administrative	6,078	(4,273)	(606)	40	1,239
	Research and development	2,348	(2,348)			-
	Restructuring costs	256	(256)			-
	Interest expense	1,971	(1,521)	(4)	(85)	361
		-------------	-------------	---------------	--------------	---------
		41,332	(39,077)	(610)	(45)	1,600
		-------------	------------	---------------	--------------	---------
Income before equity in losses of
unconsolidated subsidiary and income taxes		(1,174)	(383)	165	335	(1,057)
Equity in losses of Moscow Broadband		(730)				(730)
		-------------	------------	--------------	--------------	-----------
Loss before income taxes		(1,904)	(383)	165	335	(1,787)
Income tax expense (benefit) (c)		(281)	(146)	63	364	-
		--------------	---------------	--------------	--------------	----------
Net loss		(1,623)	(237)	102	(29)	(1,787)
Preferred dividends		(304)				(304)
		-------------	--------------	--------------	--------------	----------
(Loss) applicable to common shareholders		$ (1,927)	$ (237)	$ 102	$ (29)	$ (2,091)
		=======	=========	========	========	======
Loss per Common Share - Basic and Diluted:		$ (0.94)	$ (0.12)	$ 0.05	$ (0.01)	$ (1.02)
		========	========	========	========	=======
Weighted average shares outstanding -
	basic and diluted	2,048				2,048
		========	========	========	========	======

F-4

ANDERSEN GROUP, INC.

Unaudited Pro Forma Consolidated Condensed Statements of Operations

For the Year Ended February 29, 2000

(In thousands, except per share data)

(Unaudited)

			Less	Less
		Historical	Historical	Discontinued	Pro forma
		Amounts	JM Ney	Real Estate	Adjustments (b)	Pro Forma
Sales and revenues:
	Net sales	$ 28,844	$ (28,844)	$ -	$ -	$ -
	Investment and other income	1,467	(205)	(376)	290	1,176
		--------------	--------------	--------------	--------------	--------------
		30,311	(29,049)	(376)	290	1,176
		--------------	--------------	--------------	--------------	--------------
Costs and expenses:
	Cost of sales	21,181	(21,181)			-
	Selling, general and administrative	6,815	(4,360)	(606)	48	1,897
	Research and development	2,203	(2,203)			-
	Interest expense	1,725	(1,300)	(5)	(1)	419
		--------------	--------------	--------------	--------------	--------------
		31,924	(29,044)	(611)	47	2,316
		--------------	--------------	--------------	--------------	--------------
Income before equity in losses of
unconsolidated subsidiary and income taxes		(1,613)	(5)	235	243	(1,140)
Income tax expense (benefit) (c)		(626)	(2)	89	539	-
		--------------	--------------	--------------	--------------	--------------
Net loss		(987)	(3)	146	(296)	(1,140)
Preferred dividends		(362)				(362)
		--------------	--------------	--------------	--------------	--------------
(Loss) applicable to common shareholders		$ (1,349)	$ (3)	$ 146	$ (296)	$ (1,502)
		========	========	========	========	========
Loss per Common Share - Basic and Diluted:		$ (0.70)	$ (0.00)	$ 0.07	$ (0.15)	$ (0.78)
		========	========	========	========	========
Weighted average shares outstanding -
	basic and diluted	1,932				1,932
		========	========	========	========	========

F-5