HADCO CORP, S-3/A, 1997-05-13

HADCO CORP
S-3/A, 1997-05-13
PRINTED CIRCUIT BOARDS

Previous: HADCO CORP, 10-Q, 1997-05-13

Next: CML GROUP INC, 10-Q/A, 1997-05-13

<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 13, 1997

REGISTRATION NO. 333-21977
================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------

AMENDMENT NO. 4

FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------

HADCO CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

<TABLE>
<S> <C>
MASSACHUSETTS 04-2393279
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
</TABLE>

12A MANOR PARKWAY
SALEM, NEW HAMPSHIRE 03079
(603) 898-8000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

ANDREW E. LIETZ
CHIEF EXECUTIVE OFFICER
HADCO CORPORATION
12A MANOR PARKWAY
SALEM, NEW HAMPSHIRE 03079
(603) 898-8000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)

COPIES TO

<TABLE>
<S> <C>
STEPHEN A. HURWITZ, ESQ. PETER B. TARR, ESQ.
TESTA, HURWITZ & THIBEAULT, LLP HALE AND DORR, LLP
HIGH STREET TOWER 60 STATE STREET
125 HIGH STREET BOSTON, MA 02109
BOSTON, MA 02110 (617) 526-6000
(617) 248-7000
</TABLE>

------------------------

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable following the effective date of this Registration Statement.

If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following box. [
]

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 of the Securities Act of
1933, check the following box. [ ]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]

------------------------

CALCULATION OF REGISTRATION FEE

<TABLE>
<S> <C> <C> <C> <C>
==============================================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(1) PER SHARE(2) OFFERING PRICE(1) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------
Common Stock, par value $.05 per
share(3)............................ 2,300,000 $54.625 $125,637,500(2) $38,072(4)
==============================================================================================================================
</TABLE>

(1) Includes 300,000 shares of Common Stock which the Underwriters may purchase
to cover over-allotments, if any.

(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) and based on the average of the high and low sales
prices on February 13, 1997, as reported on the Nasdaq National Market.

(3) Includes associated Stock Purchase Rights.

(4) This registration fee was previously paid in connection with the initial
filing of the Registration Statement.

------------------------

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
================================================================================
<PAGE> 2

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.

SUBJECT TO COMPLETION, DATED MAY 13, 1997

LOGO

2,000,000 SHARES

COMMON STOCK

Hadco Corporation ("Hadco" or the "Company") hereby offers 2,000,000 shares
of Common Stock (the "Offering"). The Company's Common Stock is traded on the
Nasdaq National Market under the symbol "HDCO." On May 9, 1997, the last
reported sale price for the Common Stock on the Nasdaq National Market was
$53.50 per share. Each share of Common Stock is accompanied by a Stock Purchase
Right entitling the holder to buy Common Stock at specified prices if certain
events involving the Common Stock should occur. See "Description of Capital
Stock -- Stockholder Rights Plan."

------------------------

THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE OF RISK.

SEE "RISK FACTORS" COMMENCING ON PAGE 7.

------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<S> <C> <C> <C>
=================================================================================================
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS COMPANY(1)
- -------------------------------------------------------------------------------------------------
Per Share........................ $ $ $
- -------------------------------------------------------------------------------------------------
Total(2)......................... $ $ $
=================================================================================================
</TABLE>

(1) Before deducting expenses payable by the Company, estimated at $1,500,000.

(2) The Company and the Selling Stockholders have granted the Underwriters a
30-day option to purchase up to an additional 300,000 shares of Common Stock
solely to cover over-allotments, if any. See "Underwriting." If such option
is exercised in full, the total Price to Public, Underwriting Discounts and
Commissions, and Proceeds to Company will be $ , $ and
$ , respectively, and the total proceeds to the Selling
Stockholders will be $ .

------------------------

The Common Stock is offered by the Underwriters as stated herein, subject
to receipt and acceptance by them and subject to their right to reject any order
in whole or in part. It is expected that delivery of the Common Stock will be
made through the offices of Robertson, Stephens & Company LLC ("Robertson,
Stephens & Company"), San Francisco, California on or about ,
1997.

ROBERTSON, STEPHENS & COMPANY
MERRILL LYNCH & CO.
ADAMS, HARKNESS & HILL, INC.
The date of this Prospectus is , 1997.
<PAGE> 3

HADCO

Where Technology and Time To Market Connect(TM)

Tech Centers Volume Manufacturing

- - Hadco provides development, - Hadco can transition production
design and quick-turn prototype from prototype to full-scale
services to customers. commercial production.

- - Tech Center developments - Hadco volume capabilities
include: include:

- Multilayer printed circuits - Multilayer printed circuits of
of 38+ layers 18+ layers

- Embedded discrete components - BGA and TAB

- Multichip modules (MCM) - MCM and SCC

- Single chip carriers (SCC) - Volume manufacturing facilities
are located in California,
- Planar Magnetics New Hampshire, New York
and Malaysia.
- Advanced surface finishes

- Substrates for high-frequency
markets

- - Tech Centers are located in
California, Massachusetts and
New Hampshire.

Includes pictures of various printed circuits.

CERTAIN PERSONS PARTICIPATING IN THESE OFFERINGS MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE COMMON STOCK AND
THE NOTES, INCLUDING SYNDICATE COVERING TRANSACTIONS OR THE IMPOSITION OF
PENALTY BIDS. FOR A DISCUSSION OF THESE ACTIVITIES, SEE "UNDERWRITING."

<PAGE> 4

NO DEALER, SALES REPRESENTATIVE OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR MAKE ANY REPRESENTATION IN CONNECTION WITH THE OFFERING OTHER
THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO
SELL, OR A SOLICITATION OF AN OFFER TO BUY, ANY SECURITIES OTHER THAN THE
REGISTERED SECURITIES TO WHICH IT RELATES OR AN OFFER TO, OR A SOLICITATION OF,
ANY PERSON IN ANY JURISDICTION WHERE SUCH AN OFFER OR SOLICITATION WOULD BE
UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY OFFER OR SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE
HEREOF.

------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Incorporation of Certain Information by Reference............................... 3
Summary......................................................................... 4
Risk Factors.................................................................... 7
Use of Proceeds................................................................. 14
Dividend Policy................................................................. 14
Price Range of Common Stock..................................................... 15
Capitalization.................................................................. 16
Selected Consolidated Financial Data............................................ 17
Management's Discussion and Analysis of Financial Condition and Results of
Operations.................................................................... 19
Business........................................................................ 26
Management...................................................................... 40
Principal Shareholders.......................................................... 42
Description of Capital Stock.................................................... 45
Underwriting.................................................................... 47
Legal Matters................................................................... 48
Experts......................................................................... 48
Additional Information.......................................................... 49
Available Information........................................................... 49
Index to Consolidated Financial Statements...................................... F-1
</TABLE>

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

The following documents filed with the Securities and Exchange Commission
(the "Commission") under the Securities Exchange Act of 1934, as amended (the
"Exchange Act") are hereby incorporated by reference into this Prospectus:
(1) Annual Report on Form 10-K for the fiscal year ended October 26, 1996, as
amended by Annual Report on Form 10-K/A dated May 12, 1997; (2) Current Report
on Form 8-K dated December 5, 1996; (3) Current Report on Form 8-K dated January
24, 1997, as amended by Form 8-K/A dated February 14, 1997 and Form 8-K/A dated
May 12, 1997; (4) Quarterly Report on Form 10-Q for the period ended January 25,
1997; and (5) Quarterly Report on Form 10-Q for the period ended April 26, 1997.

All documents subsequently filed by Hadco pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act after the date of this Prospectus and
prior to the termination of the Offering shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of filing such documents.
Any statement contained herein or in a document incorporated by reference or
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that such statement is
modified or superseded by any other subsequently filed document which is
incorporated or is deemed to be incorporated by reference herein. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.

This Prospectus incorporates documents by reference which are not presented
herein or delivered herewith. Hadco hereby undertakes to provide without charge
to each person, including any beneficial owner, to whom this Prospectus has been
delivered, on the written or oral request of such person, a copy of any or all
of the documents referred to above which have been or may be incorporated into
this Prospectus and deemed to be part hereof, other than exhibits to such
documents, unless such exhibits are specifically incorporated by reference in
such documents. These documents are available upon request from Timothy P.
Losik, Vice President, Chief Financial Officer and Treasurer, Hadco Corporation,
12A Manor Parkway, Salem, New Hampshire 03079, (603) 898-8000.

3
<PAGE> 5

SUMMARY

This Prospectus contains forward-looking statements which involve risks and
uncertainties. The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including, without limitation, those set forth under "Risk Factors" and
elsewhere in this Prospectus. The following summary is qualified in its entirety
by, and should be read in conjunction with, the more detailed information,
including "Risk Factors," and Consolidated Financial Statements and Notes
thereto, appearing elsewhere in this Prospectus or incorporated by reference
herein. Unless otherwise indicated, all information in this Prospectus assumes
no exercise of the Underwriters' over-allotment option.

As used herein, the terms "Company" and "Hadco," unless otherwise indicated
or the context otherwise requires, refer to Hadco Corporation and its
subsidiaries, including Zycon Corporation ("Zycon"). However, all financial
information for periods ended prior to January 10, 1997, unless otherwise
indicated or the context otherwise requires, is for Hadco Corporation alone and
does not include Zycon.

THE COMPANY

Hadco is the largest manufacturer of advanced electronic interconnect
products in North America. The Company offers a wide array of sophisticated
manufacturing, engineering and systems integration services to meet its
customers' electronic interconnect needs. The Company's principal products are
complex multilayer rigid printed circuits and backplane assemblies. Hadco's
largest customers include many of the leading and fastest growing companies in
the electronics industry, such as Cabletron Systems, Cisco Systems, Intel,
Solectron, Sun Microsystems and U.S. Robotics.

Hadco's advanced manufacturing and assembly facilities are designed to meet
the accelerated time-to-market and time-to-volume requirements of its customers
whose markets and products are characterized by high growth rates, rapid
technological advances and short product life-cycles. To this end, Hadco
(including Zycon) has invested approximately $235 million in state-of-the-art
production facilities and new technologies during the past five fiscal years.
Hadco provides customers with a range of products and services that includes
development, design, quick-turn prototype, pre-production, volume production,
and backplane assembly. Hadco is one of a small number of printed circuit
manufacturers with the technology and advanced production facilities necessary
to offer all of these services. The Company believes its combination of a broad
product offering and advanced technology facilitates long-term relationships
with existing customers, attracts new customers, helps customers meet their
time-to-market and time-to-volume needs, and satisfies a larger share of
customers' electronic interconnect requirements.

Hadco's customers are a diverse group of electronics original equipment
manufacturers ("OEMs") and contract manufacturers in the computing (mainly
workstations, servers, mainframes, storage and notebooks), data
communications/telecommunications and industrial automation industries,
including process controls, automotive, medical and instrumentation. Hadco
(including Zycon) supplied its products and services to a diverse base of
approximately 500 customers in fiscal 1996, including 77 customers with
purchases in excess of $1 million. The Company's ten largest customers accounted
for approximately 43% of net sales in fiscal 1996 on a pro forma basis including
Zycon.

Industry sources estimate that the number of U.S. interconnect
manufacturers has decreased from over 2,100 in 1978 to approximately 700 in 1995
during a period when the market size increased to $8.3 billion for rigid printed
circuits and backplane assemblies. In large part, this decrease in manufacturers
resulted from the increasingly advanced technology and services required by
sophisticated electronics OEMs to meet their needs for complex products and
shorter time-to-market cycles in their industries. As OEMs have narrowed their
supply base, the increased investment necessary for state-of-the-art production
facilities and advanced technologies has accelerated consolidation in the
printed circuit industry and the exit of smaller companies.

4
<PAGE> 6

To capitalize on this consolidation trend and to gain increased economies
of scale, Hadco acquired Zycon on January 10, 1997. This acquisition increased
Hadco's net sales significantly, added approximately 600,000 square feet of
manufacturing space (approximately a 100% increase) and substantially expanded
the Company's manufacturing capabilities and geographic reach. The new
manufacturing capabilities consist of state-of-the-art West Coast facilities for
volume production of complex printed circuits and backplane assemblies, a
quick-turn prototype and design facility on the East Coast, and a newly
constructed facility for volume production in Malaysia. The acquisition of Zycon
has also broadened the Company's customer base, expanded its involvement in many
fast growing industry sectors, added new proprietary technologies, and increased
its sales force.

The Company's strategy takes advantage of other major industry trends such
as the increased customer demand for a single source of integrated services,
accelerating time-to-market and time-to-volume product requirements, and the
increased demand for complex electronic products and new interconnect
technologies. The principal components of Hadco's strategy are size, financial
strength, investment in state-of-the-art facilities and technologies, and a
broad and integrated offering (from development and design through volume
production and backplane assembly). The Company believes this strategy is
responsible for its emergence as the largest manufacturer of advanced electronic
interconnect products in North America.

The Company was incorporated in Massachusetts in 1966. The Company's
principal executive offices are located at 12A Manor Parkway, Salem, New
Hampshire 03079, and its telephone number is (603) 898-8000.

Hadco(TM), Zycon(TM), ResistAIR(TM), Buried Capacitance(TM) and
MicroPath(TM) are trademarks of the Company. This Prospectus also includes the
trademarks of other companies.

THE OFFERING

<TABLE>
<S> <C>
Common Stock Offered by the Company................................. 2,000,000 shares
Common Stock to be Outstanding after the Offering................... 12,471,163 shares(1)
Nasdaq National Market Symbol....................................... HDCO
</TABLE>

- ------------

(1) Based on shares outstanding on April 26, 1997. Excludes options outstanding
as of April 26, 1997 to acquire 1,206,869 shares of Common Stock at a
weighted average exercise price of $16.52 per share and an additional
974,500 shares of Common Stock reserved for issuance under the Company's
stock option plans. See Note 10 of Notes to the Company's Consolidated
Financial Statements.

5
<PAGE> 7

SUMMARY CONSOLIDATED FINANCIAL DATA

(In thousands, except per share data)

<TABLE>
<CAPTION>
FISCAL YEAR ENDED, SIX MONTHS
------------------------------------------------------------------- ENDED,
OCTOBER OCTOBER ----------
OCTOBER 29, OCTOBER 28, OCTOBER 26, 26, 26, APRIL 27,
1994 1995 1996 1996 1996 1996
----------- ----------- ----------- ------------ -------------- ----------
PRO FORMA
PRO FORMA(2) AS ADJUSTED(3)
<S> <C> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENTS OF
OPERATIONS:
Net sales..................................... $ 221,570 $ 265,168 $ 350,685 $570,345 $570,345 $164,574
Gross profit.................................. 45,518 67,440 90,455 124,901 124,901 43,413
Write-off of acquired in-process research and -- -- -- -- --
development.................................. --
Income (loss) from operations................. 16,482 33,906 51,532 62,331 62,331 24,234
Net income (loss)............................. $ 9,943 $ 21,374 $ 32,014 $ 27,222 $ 31,325 $ 15,085
Net income (loss) per share(4)................ $ .93 $ 1.98 $ 2.89 $ 2.46 $ 2.39 $ 1.36
Weighted average shares outstanding(4)........ 10,720 10,806 11,084 11,084 13,084 11,125
OTHER DATA:
Capital expenditures.......................... 19,510 28,865 54,998 107,154 107,154 31,890
Interest expense.............................. 891 537 338 16,197 9,061 190

APRIL 26, APRIL 26, APRIL 26,
1997(1) 1997 1997
---------- ------------ --------------
PRO FORMA
PRO FORMA(2) AS ADJUSTED(3)
<S> <<C> <C> <C>
CONSOLIDATED STATEMENTS OF
OPERATIONS:
Net sales..................................... $292,198 $353,209 $353,209
Gross profit.................................. 64,840 73,201 73,201
Write-off of acquired in-process research and 78,000 --
development.................................. --
Income (loss) from operations................. (41,979) 38,441 38,441
Net income (loss)............................. $(59,212) $ 17,849 $ 19,972
Net income (loss) per share(4)................ $ (5.67) $ 1.63 $ 1.54
Weighted average shares outstanding(4)........ 10,435 10,947 12,947
OTHER DATA:
Capital expenditures.......................... 29,611 36,539 36,539
Interest expense.............................. 5,251 8,987 5,419
</TABLE>

<TABLE>
<CAPTION>
APRIL 26, 1997
---------------------------
ACTUAL AS ADJUSTED(3)
-------- --------------
<S> <C> <C>
CONSOLIDATED BALANCE SHEET DATA:
Working capital............................................................... $ 34,766 $ 34,766
Total assets.................................................................. 466,277 466,277
Long-term debt and capital lease obligations, net of current portion.......... 236,730 136,580
Stockholders' investment...................................................... 81,515 181,665
</TABLE>

- ------------

(1) Net loss for the six months ended April 26, 1997 includes a non-recurring
write-off relating to the acquisition of Zycon for in-process research and
development. Before deducting the non-recurring write-off, income from
operations was $36,021,000, net income was $18,788,000, and net income per
share was $1.72 (based on weighted average shares outstanding of
approximately 10,947,000).

(2) Gives effect to the acquisition of Zycon assuming such transaction had
occurred on October 29, 1995. See the Company's unaudited Pro Forma
Condensed Consolidated Financial Statements beginning on page F-23 and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations." In connection with the acquisition, Hadco eliminated nine
executive positions at Zycon, which resulted in pre-tax annual savings of
$2,637,000. Taking these savings into account for the year ended October 26,
1996, pro forma net income and pro forma net income, as adjusted, would have
been $28,700,000 and $32,841,000, respectively, and pro forma net income per
share and pro forma net income per share, as adjusted, would have been $2.59
and $2.51, respectively. Taking these savings into account for the six
months ended April 26, 1997, pro forma net income and pro forma net income,
as adjusted, would have been $18,634,000, and $20,757,000, respectively, and
pro forma net income per share and pro forma net income per share, as
adjusted, would have been $1.70 and $1.60, respectively.

(3) Adjusted to reflect (i) the sale by the Company of 2,000,000 shares of
Common Stock (at an assumed public offering price of $53.50 per share) in
the Offering, less estimated underwriting discounts and commissions and
offering expenses payable by the Company, and (ii) the application of the
net proceeds from the Offering. See "Use of Proceeds."

(4) See Note 1 of Notes to the Company's Consolidated Financial Statements for

an explanation of the basis used to calculate net income (loss) per share.

6
<PAGE> 8

RISK FACTORS

This Prospectus contains forward-looking statements which involve risks and
uncertainties. The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including, without limitation, those set forth in the following risk factors and
elsewhere in this Prospectus. In addition to the other information included or
incorporated by reference in this Prospectus, the following risk factors should
be considered carefully in evaluating the Company and its business before
purchasing shares of Common Stock offered hereby.

DEPENDENCE ON ELECTRONICS INDUSTRY

The Company's principal customers are electronics OEMs and contract
manufacturers in the computing (mainly workstations, servers, mainframes,
storage and notebooks), data communications/telecommunications and industrial
automation industries, including process controls, automotive, medical and
instrumentation. These industry segments, and the electronics industry as a
whole, are characterized by intense competition, relatively short product
life-cycles and significant fluctuations in product demand. In addition, the
electronics industry is generally subject to rapid technological change and
product obsolescence. Discontinuance or modifications of products containing
components manufactured by the Company could have a material adverse effect on
the Company's business, financial condition and results of operations. Further,
the electronics industry is subject to economic cycles and has in the past
experienced, and is likely in the future to experience, recessionary periods. A
recession or any other event leading to excess capacity or a downturn in the
electronics industry would likely result in intensified price competition,
reduced gross margins and a decrease in unit volume, all of which would have a
material adverse effect on the Company's business, financial condition and
results of operations. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations," "Business -- Industry Overview and Trends"
and "-- Markets and Customers."

FLUCTUATIONS IN QUARTERLY OPERATING RESULTS

The Company's quarterly operating results have varied and may continue to
fluctuate significantly. At times in the past, the Company's net sales and net
income have decreased from the prior quarter. Operating results are affected by
a number of factors, including the timing and volume of orders from and
shipments to customers relative to the Company's manufacturing capacity, level
of product and price competition, product mix, the number of working days in a
particular quarter, trends in the electronics industry and general economic
factors. In recent years, the Company's gross margins have varied primarily as a
result of capacity utilization, product mix, lead times, volume levels and
complexity of customer orders. There can be no assurance that the Company will
be able to manage the utilization of manufacturing capacity or product mix in a
manner that would maintain or improve gross margins or the Company's business,
financial condition and results of operations. The timing and volume of orders
placed by the Company's customers vary due to customer attempts to manage
inventory, changes in customers' manufacturing strategies and variation in
demand for customer products. An interruption in manufacturing resulting from
shortages of parts or equipment, fire, earthquake or other natural disaster,
equipment failure or otherwise would have a material adverse effect on the
Company's business, financial condition and results of operations. The Company's
expense levels are relatively fixed and are based, in part, on expectations of
future revenues. Consequently, if revenue levels are below expectations, this
occurrence is likely to materially adversely affect the Company's business,
financial condition and results of operations. Results of operations in any
period are not necessarily indicative of the results to be expected for any
future period. Due to all of the foregoing factors, it is possible that in some
future quarter the Company's operating results may be below the expectations of
public market analysts and investors. Such an event could have a material
adverse effect on the price of the Company's Common Stock. See "Management's
Discussion and Analysis of Financial Condition and Results of Operations."

7
<PAGE> 9

VARIABILITY OF ORDERS

The level and timing of orders placed by the Company's customers vary due
to a number of factors, including customer attempts to manage inventory, changes
in the customers' manufacturing strategies and variation in demand for customer
products due to, among other things, technological change, new product
introductions, product life-cycles, competitive conditions or general economic
conditions. Since the Company generally does not obtain long-term purchase
orders or commitments from its customers, it must anticipate the future volume
of orders based on discussions with its customers. A substantial portion of
sales in a given quarter may depend on obtaining orders for products to be
manufactured and shipped in the same quarter in which those orders are received.
The Company relies on its estimate of anticipated future volumes when making
commitments regarding the level of business that it will seek and accept, the
mix of products that it intends to manufacture, the timing of production
schedules and the levels and utilization of personnel and other resources. A
variety of conditions, both specific to the individual customer and generally
affecting the customer's industry, may cause customers to cancel, reduce or
delay orders that were previously made or anticipated. A significant portion of
the Company's released backlog at any time may be subject to cancellation or
postponement without penalty. The Company cannot assure the timely replacement
of canceled, delayed or reduced orders. Significant or numerous cancellations,
reductions or delays in orders by a customer or group of customers could
materially adversely affect the Company's business, financial condition and
results of operations. See "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Business -- Released Backlog."

ACQUISITIONS

The Company acquired 100% of the capital stock of Zycon, a manufacturer of
electronic interconnect products, on January 10, 1997 (the "Zycon acquisition").
Zycon currently operates as a wholly-owned subsidiary of the Company. The
Company has limited experience in integrating acquired companies or technologies
into its operations. Therefore, there can be no assurance that the Company will
operate the acquired business profitably during the next year or in the future.
Contemporaneous with the Zycon acquisition, nine senior management personnel of
Zycon were terminated. There can be no assurance that the Company will not be
materially adversely affected by such terminations or that the Company will be
able to retain key personnel at Zycon. Accordingly, operating expenses
associated with the acquired business may have a material adverse effect on the
Company's business, financial condition and results of operations in the future.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations" and "Business -- General."

The Company may from time to time pursue the acquisition of other
companies, assets, products or technologies. The Company may incur additional
indebtedness in connection with a future business acquisition, and the
incurrence of substantial amounts of debt in connection with future acquisitions
could increase the risk of the Company's operations. If the Company's cash flow
and existing working capital are not sufficient to fund its general working
capital requirements or to service its indebtedness, the Company would have to
raise additional funds through the sale of its equity securities, the
refinancing of all or part of its indebtedness or the sale of assets or
subsidiaries. There can be no assurance that any of these sources of funds would
be available in amounts sufficient for the Company to meet its obligations. The
cost of debt financing may also impair the ability of the Company to maintain
adequate working capital or to make future acquisitions. In addition, the
issuance of additional shares of Common Stock in connection with future
acquisitions could be dilutive to existing investors. Acquisitions involve a
number of operating risks that could materially adversely affect the Company's
operating results, including the diversion of management's attention to
assimilate the operations, products and personnel of the acquired companies, the
amortization of acquired intangible assets, and the potential loss of key
employees of the acquired companies. Furthermore, acquisitions may involve
businesses in which the Company lacks experience. There can be no assurance that
the Company will be able to manage one or more acquisitions successfully, or
that the Company will be able to integrate the operations, products or personnel
gained through any such acquisitions without a

8
<PAGE> 10

material adverse effect on the Company's business, financial condition and
results of operations. See "Business -- The Hadco Strategy."

COMPETITION

The electronic interconnect industry is highly fragmented and characterized
by intense competition. The Company believes that its major competitors are the
large U.S. and international independent and captive producers that also
manufacture multilayer printed circuits and provide backplane and other
electronic assemblies. Some of these competitors have significantly greater
financial, technical and marketing resources, greater name recognition and a
larger installed customer base than the Company. In addition, these competitors
may have the ability to respond more quickly to new or emerging technologies,
may adapt more quickly to changes in customer requirements and may devote
greater resources to the development, promotion and sale of their products than
the Company.

During periods of recession or economic slowdown in the electronics
industry and other periods when excess capacity exists, electronics OEMs become
more price sensitive, which could have a material adverse effect on interconnect
pricing. In addition, the Company believes that price competition from printed
circuit manufacturers in Asia and other locations with lower production costs
may play an increasing role in the printed circuit markets in which the Company
competes. The Company's basic interconnect technology is generally not subject
to significant proprietary protection, and companies with significant resources
or international operations may enter the market. Increased competition could
result in price reductions, reduced margins or loss of market share, any of
which could materially adversely affect the Company's business, financial
condition and results of operations.

The demand for printed circuits has continued to be affected by the
development of smaller, more powerful electronic components requiring less
printed circuit area. Expansion of the Company's existing products or services
could expose the Company to new competition. Moreover, new developments in the
electronics industry could render existing technology obsolete or less
competitive and could potentially introduce new competition into the industry.
There can be no assurance that the Company will continue to compete successfully
against present and future competitors or that competitive pressures faced by
the Company will not have a material adverse effect on the Company's business,
financial condition and results of operations. See "Business -- Industry
Overview and Trends."

TECHNOLOGICAL CHANGE, PROCESS DEVELOPMENT AND PROCESS DISRUPTION

The market for the Company's products and services is characterized by
rapidly changing technology and continuing process development. The future
success of the Company's business will depend in large part upon its ability to
maintain and enhance its technological capabilities, develop and market products
and services that meet changing customer needs and successfully anticipate or
respond to technological changes, on a cost-effective and timely basis. In
addition, the electronic interconnect industry could in the future encounter
competition from new technologies that render existing electronic interconnect
technology less competitive or obsolete, including technologies that may reduce
the number of printed circuits required in electronic components. There can be
no assurance that the Company will effectively respond to the technological
requirements of the changing market. To the extent the Company determines that
new technologies and equipment are required to remain competitive, the
development, acquisition and implementation of such technologies and equipment
are likely to continue to require significant capital investment by the Company.
There can be no assurance that capital will be available for this purpose in the
future or that investments in new technologies will result in commercially
viable technological processes or that there will be commercial applications for
these technologies. Moreover, the Company's business involves highly complex
manufacturing processes that have in the past and could in the future be subject
to periodic failure or disruption. Process disruptions can result in delays in
certain product shipments. There can be no assurance that failures or
disruptions will not occur in the future. The loss of revenue and earnings to
the Company from such a technological change, process development or process
disruption, as well as any disruption of the Company's operations resulting from
a natural disaster such as an earthquake, fire

9
<PAGE> 11

or flood, could have a material adverse effect on the Company's business,
financial condition and results of operations. See "Business -- Industry
Overview and Trends," "-- The Hadco Strategy" and "-- Products and Services."

MALAYSIA FACILITY

Zycon recently completed construction of a volume manufacturing facility
for printed circuits in Malaysia. Hadco's management has no experience in
operating foreign manufacturing facilities, and there can be no assurance that
the Company will be able to operate the new facility on a profitable basis. The
Company expects that the Malaysia facility will incur operating losses during
future quarters of operations as a result of various factors, including, without
limitation, initial operating inefficiencies, other start-up costs, and price
competition for the products which the Company intends to produce at the new
facility. Losses incurred in its Malaysia operations will not be deductible for
United States income tax purposes. International operations are also subject to
a number of risks, including unforeseen changes in regulatory requirements,
exchange rates, tariffs and other trade barriers, misappropriation of
intellectual property, currency fluctuations, and political and economic
instability.

CUSTOMER CONCENTRATION

During the past several years, the Company's sales to a small number of its
customers have accounted for a significant percentage of the Company's annual
net sales. During fiscal 1994, 1995 and 1996, the Company's ten largest
customers accounted for approximately 48%, 46% and 48% of net sales,
respectively, and 43% in fiscal 1996 on a pro forma basis including Zycon. In
fiscal 1996, Sun Microsystems accounted for approximately 10% of the net sales
of the Company (including Zycon). The Company generally does not obtain
long-term purchase orders or commitments from its customers, and the orders
received by the Company generally require delivery within 90 days. See " --
Variability of Orders." Given the Company's strategy of developing long-term
purchasing relationships with high growth companies, the Company's dependence on
a number of its most significant customers may increase. There can be no
assurance that the Company will be able to identify, attract and retain
customers with high growth rates or that the customers that it does attract and
retain will continue to grow. Although there can be no assurance that the
Company's principal customers will continue to purchase products and services
from the Company at current levels, the Company expects to continue to depend
upon its principal customers for a significant portion of its net sales. The
loss of or decrease in orders from one or more major customers could have a
material adverse effect on the Company's business, financial condition and
results of operations. See "Business -- Markets and Customers."

MANUFACTURING CAPACITY

The Company believes its long-term competitive position depends in part on
its ability to increase manufacturing capacity. The Company may obtain such
additional capacity through acquisitions or expansion of its current facilities.
Either approach would require substantial additional capital, and there can be
no assurance that such capital will be available from cash generated by current
operations. Further, there can be no assurance that the Company will be able to
acquire sufficient capacity or successfully integrate and manage such additional
facilities. In addition, the Company's expansion of its manufacturing capacity
has significantly increased and will continue to significantly increase its
fixed costs, and the future profitability of the Company will depend on its
ability to utilize its manufacturing capacity in an effective manner. The
failure to obtain sufficient capacity or to successfully integrate and manage
additional manufacturing facilities could adversely impact the Company's
relationships with its customers and materially adversely affect the Company's
business, financial condition and results of operations. The Company has a large
manufacturing facility in Santa Clara, California, and an earthquake or other
natural disaster in that area that results in an interruption of manufacturing
at such facility would have a material adverse effect on the Company's business,
financial condition and results of operations. See "Business -- Manufacturing
and Facilities."

10
<PAGE> 12

MANAGEMENT OF GROWTH

The Company has initiated significant expansion, including geographic
expansion, of its operations, which has placed, and will continue to place,
significant demands on the Company's management, operational, technical and
financial resources. These demands are compounded by the Zycon acquisition. See
"-- Acquisitions." The Company expects that expansion will require additional
management personnel and the development of further expertise by existing
management personnel. The Company's ability to manage growth effectively,
particularly given the increasing scope of its operations, will require it to
continue to implement and improve its operational, financial and management
information systems as well as to further develop the management skills of its
managers and supervisors and to train, motivate and manage its employees. The
Company's failure to effectively manage future growth, if any, could have a
material adverse effect on the Company's business, financial condition and
results of operations. Competition for personnel is intense, and there can be no
assurance that the Company will be able to attract, assimilate or retain
additional highly qualified employees in the future, especially engineering
personnel. The failure to hire and retain such personnel could have a material
adverse effect on the Company's business, financial condition and results of
operations.

ENVIRONMENTAL MATTERS

The Company is subject to a variety of local, state and federal
environmental laws and regulations relating to the storage, use, discharge and
disposal of chemicals, solid waste and other hazardous materials used during its
manufacturing process, as well as air quality regulations and restrictions on
water use. When violations of environmental laws occur, the Company can be held
liable for damages and the costs of remedial actions and can also be subject to
revocation of permits necessary to conduct its business. Any such revocations
could require the Company to cease or limit production at one or more of its
facilities, which could have a material adverse effect on the Company's
business, financial condition and results of operations. Moreover, the Company's
failure to comply with present and future regulations could restrict the
Company's ability to expand its facilities or could require the Company to
acquire costly equipment or to incur other significant expenses to comply with
environmental regulations.

Environmental laws could become more stringent over time, imposing greater
compliance costs and increasing risks and penalties associated with violation.
The Company operates in several environmentally sensitive locations and is
subject to potentially conflicting and changing regulatory agendas of political,
business and environmental groups. Changes or restrictions on discharge limits,
emissions levels, or material storage or handling might require a high level of
unplanned capital investment and/or relocation. There can be no assurance that
compliance with new or existing regulations will not have a material adverse
effect on the Company's business, financial condition and results of operations.
See "Business -- Environmental Matters," "-- Legal Proceedings" and Note 9 of
Notes to the Company's Consolidated Financial Statements.

AVAILABILITY OF RAW MATERIALS AND COMPONENTS

While the Company has not entered into any supply agreements and does not
have any guaranteed sources of raw materials or components, it routinely
purchases raw materials and components from several key material suppliers.
Although alternative material suppliers are currently available, a significant
unplanned event at a major supplier could have a material adverse effect on the
Company's operations. Zycon has experienced shortages of certain types of raw
materials in the past. The potential exists for shortages of certain types of
raw materials or components and any such future shortages or price fluctuations
in raw materials could have a material adverse effect on the Company's
manufacturing operations and future unit costs, thereby materially adversely
affecting the Company's business, financial condition and results of operations.
Product changes and the overall demand for electronic interconnect products
could increase the industry's use of new laminate materials, standard laminate
materials, multilayer blanks, electronic components and other materials, and
therefore such

11
<PAGE> 13

materials may not be readily available to the Company in the future. Electronic
components used by the Company in producing backplane assemblies are purchased
by the Company and, in certain circumstances, the Company may bear the risk of
component price fluctuations. There can be no assurance that shortages of
certain types of electronic components will not occur in the future. Component
shortages or price fluctuations could have a material adverse effect on the
Company's backplane assembly business, thereby materially adversely affecting
the Company's business, financial condition and results of operations. To the
extent that the Company's backplane assembly business expands as a percentage of
the Company's net sales, component shortages and price fluctuations could, to a
greater extent, materially adversely affect the Company's business, financial
condition and results of operations. See "Business -- Supplier Relationships."

DEPENDENCE ON KEY PERSONNEL

The Company's future success depends to a large extent upon the continued
services of key managerial and technical employees, none of whom, except for the
President/Chief Executive Officer, is bound by an employment agreement or a
non-competition agreement. The President/Chief Executive Officer's
non-competition agreement is for one year after the termination of his
employment with the Company. The loss of the services of any of the Company's
key employees could have a material adverse effect on the Company. The Company
believes that its future success depends on its continuing ability to attract
and retain highly qualified technical, managerial and marketing personnel.
Competition for such personnel is intense, especially for engineering personnel,
and there can be no assurance that the Company will be able to attract,
assimilate or retain such personnel. If the Company is unable to hire and retain
key personnel, the Company's business, financial condition and results of
operations may be materially adversely affected. See "Management."

INTELLECTUAL PROPERTY

The Company's success depends in part on its proprietary techniques and
manufacturing expertise, particularly in the area of complex multilayer printed
circuits. The Company has few patents and relies primarily on trade secret
protection of its intellectual property. There can be no assurance that the
Company will be able to protect its trade secrets or that others will not
independently develop substantially equivalent proprietary information and
techniques or otherwise gain access to the Company's trade secrets. In addition,
litigation may be necessary to protect the Company's trade secrets, to determine
the validity and scope of the proprietary rights of others or to defend against
claims of patent infringement. If any infringement claim is asserted against the
Company, the Company may seek to obtain a license of the other party's
intellectual property rights. There is no assurance that a license would be
available on reasonable terms or at all. Litigation with respect to patents or
other intellectual property matters could result in substantial costs and
diversion of management and other resources and could have a material adverse
effect on the Company's business, financial condition and results of operations.

VOLATILITY OF STOCK PRICE

The Company's Common Stock has experienced significant price volatility
historically, and such volatility may continue to occur in the future. Factors
such as announcements of large customer orders, order cancellations, new product
introductions by the Company or competitors or general conditions in the
electronics industry, as well as quarterly variations in the Company's actual or
anticipated results of operations, may cause the market price of the Company's
Common Stock to fluctuate significantly. Furthermore, the stock market has
experienced extreme price and volume fluctuations in recent years, which has had
a substantial effect on the market price for securities issued by many
technology companies, often for reasons unrelated to the operating performance
of the specific companies. These broad market fluctuations may materially
adversely affect the price of the Company's Common Stock. There can be no
assurance that the market price of the Company's

12
<PAGE> 14

Common Stock will not experience significant fluctuations in the future,
including fluctuations that are unrelated to the Company's performance.

ANTI-TAKEOVER PROVISIONS

The Company's Stockholder Rights Plan and certain provisions of the
Company's Restated Articles of Organization and By-Laws and of Massachusetts
Law, including Massachusetts General Laws Chapter 110D, entitled "Regulation of
Control Share Acquisitions" and Chapter 110F, the so-called Business Combination
Statute, could discourage potential acquisition proposals and could delay or
prevent a change in control or sale of the Company. Each and all of the above
provisions and statutes could diminish the opportunities for a stockholder to
participate in tender offers, including tender offers at a price above the then
current market value of Common Stock and may render more difficult or discourage
a merger, consolidation or tender offer (even if such transaction is supported
by the Company's Board of Directors or is favorable to the stockholders), the
assumption of control by a holder of a large block of the Company's shares, and
the removal of incumbent management. See "Description of Capital Stock."

13
<PAGE> 15

USE OF PROCEEDS

The net proceeds to the Company from the sale of 2,000,000 shares of Common
Stock (at an assumed public offering price of $53.50 per share), less estimated
underwriting discounts and commissions and offering expenses payable by the
Company, are estimated to be approximately $100.2 million ($105.1 million if the
Underwriters' over-allotment option is exercised in full).

The Company expects to use between 80% and 100% of the net proceeds to
repay a portion of the outstanding balance on its senior revolving credit loan
facility with The First National Bank of Boston (the "Credit Facility"). The
Company obtained the Credit Facility (i) primarily to finance the purchase of
the shares of Common Stock of Zycon pursuant to the tender offer completed by
the Company on January 10, 1997, (ii) to refinance Zycon's existing bank credit
agreements, and (iii) for working capital and other general corporate purposes.
As of April 26, 1997, the amount outstanding under the Credit Facility was $225
million. Interest on loans outstanding under the Credit Facility is, at the
Company's election, payable at either (i) the higher of the lender's base rate,
or a floating rate equal to 1.5% over the prevailing U.S. federal funds rate, or
(ii) a Eurodollar Rate, which is a fixed rate equal to an applicable Eurodollar
rate margin plus the prevailing Eurodollar rate for interest periods of one,
two, three or six months. As of April 26, 1997, the weighted average interest
rate on loans outstanding under the Credit Facility was 6.64%. The Credit
Facility matures in January 2002. The remaining net proceeds will be used for
general corporate purposes, including working capital, product development and
capital expenditures. A portion of the net remaining proceeds, if any, may also
be used for the acquisition of companies, assets, products or technologies. As
of the date of this Prospectus, the Company has no commitments or agreements
with respect to any significant acquisitions, and no portion of the net proceeds
has been allocated for any specific acquisition.

DIVIDEND POLICY

The Company has never declared or paid a cash dividend on its Common Stock,
and it is currently anticipated that the Company will continue to retain its
earnings for use in its business and not pay cash dividends. The Company's
Credit Facility currently contains a covenant prohibiting the Company from
paying a cash dividend.

14
<PAGE> 16

PRICE RANGE OF COMMON STOCK

The Company's Common Stock is traded on the Nasdaq National Market under
the symbol "HDCO." The following table sets forth, for the periods indicated,
the range of high and low sale prices for the Company's Common Stock on the
Nasdaq National Market.

<TABLE>
<CAPTION>
HIGH LOW
------ -----
<S> <C> <C>
Fiscal 1995
First Quarter................................................... $ 9 5/8 $ 8
Second Quarter.................................................. 18 1/8 8 7/8
Third Quarter................................................... 32 1/8 15 3/8
Fourth Quarter.................................................. 33 1/4 22 1/2
Fiscal 1996
First Quarter................................................... 34 15/16 21 1/4
Second Quarter.................................................. 35 3/4 23 3/4
Third Quarter................................................... 30 3/4 18 1/4
Fourth Quarter.................................................. 34 1/8 18 1/2
Fiscal 1997
First Quarter................................................... 59 1/8 27 3/8
Second Quarter.................................................. 57 1/8 33 1/8
Third Quarter (through May 9, 1997)............................. 55 41
</TABLE>

As of May 9, 1997, there were approximately 344 holders of record of the
Common Stock. On May 9, 1997, the last sale price reported on the Nasdaq
National Market for the Company's Common Stock was $53.50 per share.

15
<PAGE> 17

CAPITALIZATION

The following table sets forth the actual capitalization of the Company as
of April 26, 1997, and as adjusted to reflect (i) the sale by the Company of
2,000,000 shares of Common Stock (at an assumed public offering price of $53.50
per share) in the Offering, less estimated underwriting discounts and
commissions and offering expenses payable by the Company, and (ii) the
application of the net proceeds from the Offering:

<TABLE>
<CAPTION>
APRIL 26, 1997
------------------------
ACTUAL AS ADJUSTED
-------- -----------
(In thousands)
<S> <C> <C>
Short-term debt and current portion of long-term debt and capital
lease obligations.................................................. $ 7,027 $ 7,027
======== ========
Long-term debt:
Long term debt and capital lease obligations, net of current
portion......................................................... 236,730 136,580
Stockholders' investment:
Common Stock, $0.05 par value, 25,000,000 shares authorized;
10,471,163 shares issued; 12,471,163 shares issued, as
adjusted(1)..................................................... 525 625
Paid-in capital.................................................... 32,755 132,805
Deferred compensation.............................................. (174) (174)
Retained earnings.................................................. 48,409 48,409
-------- --------
Total stockholders' investment................................ 81,515 181,665
-------- --------
Total capitalization....................................... $318,245 $ 318,245
======== ========
</TABLE>

- ------------

(1) Excludes options outstanding as of April 26, 1997 to acquire 1,206,869
shares of Common Stock at a weighted average exercise price of $16.52 per
share and an additional 974,500 shares of Common Stock reserved for issuance
under the Company's stock option plans. See Note 10 of Notes to the
Company's Consolidated Financial Statements.

16
<PAGE> 18

SELECTED CONSOLIDATED FINANCIAL DATA

The following table presents selected consolidated financial data for Hadco
and subsidiaries. The selected consolidated financial data for each of the years
ended October 31, 1992, October 30, 1993, October 29, 1994, October 28, 1995 and
October 26, 1996 have been derived from the Company's Consolidated Financial
Statements, which have been audited by Arthur Andersen LLP, independent public
accountants. The selected consolidated financial data for the six months ended
April 27, 1996 and April 26, 1997 have been derived from the Company's unaudited
Consolidated Financial Statements, which reflect in the opinion of management,
all adjustments, consisting only of normal recurring adjustments, necessary for
a fair presentation of the results for such periods. The results for the six
months ended April 26, 1997 are not necessarily indicative of results for any
future period. The pro forma statements of operations data for the year ended
October 26, 1996 and the six months ended April 26, 1997 have been derived from
the Pro Forma Condensed Consolidated Financial Statements included elsewhere in
this Prospectus. The pro forma statements of operations data are not necessarily
indicative of the actual results that would have been achieved had the Zycon
acquisition occurred at the beginning of the respective periods nor do they
purport to indicate the results of future operations of the Company. The
selected consolidated financial data should be read in conjunction with the
Company's and Zycon's Consolidated Financial Statements and the Notes thereto
appearing elsewhere in this Prospectus and "Management's Discussion and Analysis
of Financial Condition and Results of Operations."

<TABLE>
<CAPTION>
FISCAL YEAR ENDED, SIX MONTHS ENDED,
-------------------------------------------------------------------------------- --------------------
OCT. 31, OCT. 30, OCT. 29, OCT. 28, OCT. 26, OCT. 26, OCT. 26, APRIL 27, APRIL 26,
1992 1993 1994 1995 1996 1996 1996 1996 1997(1)
-------- -------- -------- -------- -------- -------------- -------------- --------- ---------
PRO FORMA
PRO FORMA(2) AS ADJUSTED(3)
(In thousands, except per share data)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENTS
OF OPERATIONS:
Net sales................ $183,408 $189,494 $221,570 $265,168 $350,685 $570,345 $570,345 $164,574 $292,198
Gross profit............. 35,282 36,645 45,518 67,440 90,455 124,901 124,901 43,413 64,840
Write-off of acquired in-
process research and
development............. -- -- -- -- -- -- -- -- 78,000
Income (loss) from
operations.............. 13,404 13,710 16,482 33,906 51,532 62,331 62,331 24,234 (41,979)
Net income (loss)........ $ 8,075 $ 8,227 $ 9,943 $ 21,374 $ 32,014 $ 27,222 $ 31,325 $ 15,085 $(59,212)
Net income (loss) per
share(4)................ $ .75 $ .76 $ .93 $ 1.98 $ 2.89 $ 2.46 $ 2.39 $ 1.36 $ (5.67)
Weighted average shares
outstanding(4).......... 10,808 10,819 10,720 10,806 11,084 11,084 13,084 11,125 10,435
OTHER DATA:
Capital expenditures..... 10,854 10,978 19,510 28,865 54,998 107,154 107,154 31,890 29,611
Interest expense......... 2,045 1,402 891 537 338 16,197 9,061 190 5,251

APRIL 26, APRIL 26,
1997 1997
-------------- --------------
PRO FORMA
PRO FORMA(2) AS ADJUSTED(3)

<S> <C> <C>
CONSOLIDATED STATEMENTS
OF OPERATIONS:
Net sales................ $353,209 $353,209
Gross profit............. 73,201 73,201
Write-off of acquired in-
process research and
development............. -- --
Income (loss) from
operations.............. 38,441 38,441
Net income (loss)........ $ 17,849 $ 19,972
Net income (loss) per
share(4)................ $ 1.63 $ 1.54
Weighted average shares
outstanding(4).......... 10,947 12,947
OTHER DATA:
Capital expenditures..... 36,539 36,539
Interest expense......... 8,987 5,419
</TABLE>

<TABLE>
<CAPTION>
APRIL 26, 1997
OCT. 31, OCT. 30, OCT. 29, OCT. 28, OCT. 26, -------------------------
1992 1993 1994 1995 1996 ACTUAL AS ADJUSTED(3)
-------- -------- -------- -------- -------- -------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
CONSOLIDATED BALANCE SHEET DATA:
Working capital................................ $ 25,215 $ 30,593 $ 31,829 $ 41,043 $ 43,561 $ 34,766 $ 34,766
Total assets................................... 104,035 110,782 126,326 162,991 219,501 466,277 466,277
Long-term debt and capital lease obligations,
net of current portion....................... 11,046 9,382 4,526 2,387 1,515 236,730 136,580
Stockholders' investment....................... 59,363 68,431 77,440 100,774 138,841 81,515 181,665
</TABLE>

17
<PAGE> 19

- ------------

(2) Gives effect to the acquisition of Zycon assuming such transaction had
occurred on October 29, 1995. See the Company's unaudited Pro Forma
Condensed Consolidated Financial Statements beginning on page F-23 and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations." In connection with the acquisition, Hadco eliminated nine
executive positions at Zycon, which resulted in pre-tax annual savings of
$2,637,000. Taking these savings into account for the year ended October 26,
1996, pro forma net income and pro forma net income, as adjusted, would have
been $28,700,000 and $32,841,000, respectively and pro forma net income per
share and pro forma net income per share, as adjusted, would have been $2.59
and $2.51, respectively. Taking these savings into account for the six
months ended April 26, 1997, pro forma net income and pro forma net income,
as adjusted, would have been $18,634,000 and $20,757,000, respectively, and
pro forma net income per share and pro forma net income per share, as
adjusted, would have been $1.70 and $1.60, respectively.

(4) See Note 1 of Notes to the Company's Consolidated Financial Statements for

an explanation of the basis used to calculate net income (loss) per share.

18
<PAGE> 20

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

The following discussion contains forward-looking statements which involve
risks and uncertainties. The Company's actual results could differ materially
from those anticipated in these forward-looking statements as a result of
certain factors, including, without limitation, those set forth under "Risk
Factors" and elsewhere in this Prospectus.

As used herein, the terms "Company" and "Hadco," unless otherwise indicated
or the context otherwise requires, refer to Hadco Corporation and its
subsidiaries, including Zycon. However, all financial information for periods
ended prior to January 10, 1997, unless otherwise indicated or the context
otherwise requires, is for Hadco Corporation alone and does not include Zycon.

OVERVIEW

Hadco is the largest manufacturer of advanced electronic interconnect
products in North America. The Company offers a wide array of sophisticated
manufacturing, engineering and systems integration services to meet its
customers' electronic interconnect needs. The Company's principal products are
complex multilayer printed circuits and backplane assemblies. Hadco's customers
are a diverse group of electronics OEMs and contract manufacturers in the
computing (mainly workstations, servers, mainframes, storage and notebooks),
data communications/telecommunications and industrial automation industries,
including process controls, automotive, medical and instrumentation.

The Company was incorporated in 1966 and began operations in Cambridge,
Massachusetts as a manufacturer of single and double-sided printed circuits. A
16,000 square foot printed circuit facility was constructed in 1969 in Derry,
New Hampshire, and the Company added multilayer printed circuits to its product
offering in 1975. In 1979, the Company acquired a 33,000 square foot printed
circuit facility in Owego, New York. In 1981, the Company added to its
double-sided and multilayer printed circuit product offerings with the
construction of Tech Center One in Salem, New Hampshire, a quick-turn prototype
operation to serve the prototype printed circuit needs of OEMs. In 1982, the
Company began backplane assembly operations in Salem, New Hampshire. In 1983,
the Company expanded further by adding a second Tech Center in the Silicon
Valley area. In 1984, the Company completed an initial public offering of its
Common Stock.

By fiscal 1991, net sales of the Company were $153 million and grew to $351
million in fiscal 1996, $570 million on a pro forma basis including Zycon.
During this period, the printed circuit industry experienced an increasing
demand for complex products that required a significant investment in
facilities. The Company (including Zycon) has invested approximately $235
million in state-of-the-art production facilities and new technologies during
the past five fiscal years.

ZYCON ACQUISITION

On January 10, 1997, the Company purchased Zycon. The acquisition added
state-of-the-art facilities for volume production of complex printed circuits
and backplane assemblies in the Silicon Valley area, a quick-turn prototype and
design facility in Massachusetts, and a newly constructed facility for volume
production of printed circuits in Malaysia. With this acquisition, Hadco became
the largest manufacturer of advanced electronic interconnect products in North
America. Hadco acquired Zycon for $212 million and recorded the acquisition
under the purchase method of accounting. As a result, a purchase price premium
of $187 million was recorded on the transaction. Approximately $78 million of
the premium was written off as acquired in-process research and development with
no alternative future use as a non-recurring write-off to net income for the six
months ended April 26, 1997. The remaining premium of $109 million was allocated
to identifiable intangibles and goodwill, and will be written off over 12 to 30
years, with an average amortization period of 17 years. The acquisition was
financed from a $250 million senior revolving credit facility, plus existing
cash and short-term investments.

19
<PAGE> 21

The gross profit margin for Hadco for the fiscal year ended October 26,
1996 was 25.8%. The gross profit margin for Zycon for the fiscal year ended
December 31, 1996 was 15.7%. As a result of the Zycon acquisition, the Company
expects that its gross profit margin will be lower in future quarters than has
historically been the case for Hadco.

RESULTS OF OPERATIONS

The following table sets forth certain Consolidated Statements of
Operations data and other data as a percentage of net sales. The table and the
discussion below should be read in conjunction with the Company's and Zycon's
Consolidated Financial Statements and Notes thereto, that appear elsewhere in
this Prospectus.

<TABLE>
<CAPTION>
FISCAL YEAR ENDED, SIX MONTHS ENDED,
---------------------------------------------------------- --------------------------------------------------
OCT. 29, OCT. 28, OCT. 26, OCT. 26, APRIL 27, APRIL 26, APRIL 26,
1994 1995 1996 OCT. 26, 1996 1996 1997(1) APRIL 26, 1997
-------- -------- -------- 1996 -------------- --------- --------- 1997 --------------
------------ PRO FORMA ------------ PRO FORMA
PRO FORMA(2) AS ADJUSTED(3) PRO FORMA(2) AS ADJUSTED(3)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CONSOLIDATED
STATEMENTS OF
OPERATIONS:
Net sales........ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of sales.... 79.5 74.6 74.2 78.1 78.1 73.6 77.8 79.3 79.3
----- ----- ----- ----- ----- ----- ----- ----- -----
Gross profit..... 20.5 25.4 25.8 21.9 21.9 26.4 22.2 20.7 20.7
Operating
expenses....... 13.1 12.6 11.1 9.9 9.9 11.7 9.3 8.9 8.9
Write-off of
acquired in-
process
research and
development.... -- -- -- -- -- -- 26.7 -- --
Amortization of
acquired
intangible
assets......... -- -- -- 1.1 1.1 -- .6 .9 .9
----- ----- ----- ----- ----- ----- ----- ----- -----
Income (loss)
from
operations..... 7.4 12.8 14.7 10.9 10.9 14.7 (14.4) 10.9 10.9
Interest income
(expense),
net............ -- .4 .3 (2.6) (1.3) .3 (1.5) (2.4) (1.4)
----- ----- ----- ----- ----- ----- ----- ----- -----
Income (loss)
before
provision for
income taxes... 7.4 13.2 15.0 8.3 9.6 15.0 (15.9) 8.5 9.5
Provision for
income taxes... 2.9 5.1 5.9 3.5 4.1 5.8 (4.4) 3.4 3.8
----- ----- ----- ----- ----- ----- ----- ----- -----
Net income
(loss)......... 4.5% 8.1% 9.1% 4.8% 5.5% 9.2% (20.3)% 5.1% 5.7%
===== ===== ===== ===== ===== ===== ===== ===== =====
OTHER DATA:
Capital
expenditures... 8.8 10.9 15.7 18.8 18.8 19.3 10.1 10.3 10.3
Interest
expense........ .4 .2 .1 2.8 1.6 .1 1.8 2.5 1.5
</TABLE>

- ---------------

(1) Net loss for the six months ended April 26, 1997 includes a non-recurring
write-off relating to the acquisition of Zycon for in-process research and
development. As a percentage of net sales, income from operations was 12.3%,
income before provision for income taxes was 10.8%, and net income was 6.4%,
all before deducting the non-recurring write-off.

(3) Adjusted to reflect (i) the sale by the Company of 2,000,000 shares of
Common Stock (at an assumed public offering price of $53.50 per share) in
the Offering, less estimated underwriting discounts and commissions and
offering expenses payable by the Company and (ii) the application of the net
proceeds from the Offering. See "Use of Proceeds."

20
<PAGE> 22

SIX MONTHS ENDED APRIL 26, 1997 AND APRIL 27, 1996

Net sales for the six months ended April 26, 1997 increased 77.5% over net
sales for the six months ended April 27, 1996. The increase resulted from
several factors including the acquisition of Zycon, which added $81.4 million in
printed circuit net sales after January 10, 1997, and an increase in both
backplane assembly and printed circuit net sales excluding Zycon. Backplane
assembly net sales increased due to higher product volume and shipments. Printed
circuit net sales increased due to higher production volume and shipments and a
shift towards products with more layers and greater densities. In addition,
average pricing for printed circuits increased 1.1% for the first six months of
fiscal 1997 over the same period in fiscal 1996. Net sales from backplane
assemblies increased to 15.6% of total net sales excluding Zycon, from 12.4% in
the first six months of fiscal 1996.

The gross profit margin decreased to 22.2% in the six months ended April
26, 1997 from 26.4% in the comparable period in fiscal 1996. The decrease
resulted from increased investment in new capacity and technologies at certain
facilities, lower overall gross margins from the Zycon operations (including
ongoing start-up expenses associated with the volume production facility in
Malaysia) and the change in product mix related to the increase in backplane
assembly operations.

Operating expenses, as a percent of net sales, decreased to 9.9% in the six
months ended April 26, 1997 from 11.7% in the comparable period in fiscal 1996,
due to increased net sales and the fixed nature of the Company's operating
expenses. The decrease was partially offset by goodwill and purchased
intangibles amortization of $1,864,000.

Income from operations for the six months ended April 26, 1997 was reduced
by $78 million due to a non-recurring write-off relating to acquired in-process
research and development recorded in connection with the Zycon acquisition. The
remaining goodwill and purchased intangibles will be amortized over 12 to 30
years, with an average amortization period of 17 years, which will reduce income
from operations by approximately $1.6 million per fiscal quarter.

Excluding the non-recurring write-off of $78 million for acquired
in-process research and development, operating margins decreased to 12.3% for
the six months ended April 26, 1997 from 14.7% in the comparable period in
fiscal 1996, primarily as a result of the same factors affecting gross profit
margins, and of goodwill amortization from the Zycon acquisition.

Interest income decreased in the six months ended April 26, 1997 as
compared to the six months ended April 27, 1996, due to lower daily average cash
balances available for investing. Interest expense increased in the six months
ended April 26, 1997 as compared to the six months ended April 27, 1996, due to
an increase in outstanding debt as a result of the Zycon acquisition.

In accordance with generally accepted accounting principles, the Company
provides for income taxes on an interim basis, using its effective annual income
tax rate. Although the Company has incurred a loss before income taxes during
the six months ended April 26, 1997, the Company has recorded an income tax
provision because the write-off of acquired in-process research and development
is not deductible for income tax purposes. Without taking into consideration the
write-off of acquired in-process research and development, the Company
anticipates an effective annual income tax rate for fiscal 1997 of 40.5%, which
is approximately equal to the combined federal and state statutory rates. The
effective rate was increased by amortization of goodwill and acquired
intangibles which is not tax deductible, and this item was offset by the tax
benefit of the Company's foreign sales corporation and various state investment
tax credits. The effective tax rate for fiscal 1997 is based on current tax
laws.

The Company includes in operating expenses charges for actual expenditures
and accruals, based on estimates, for environmental matters. To the extent and
in amounts Hadco believes circumstances warrant, it will continue to accrue and
charge to operating expenses cost estimates relating to environmental matters.
The Company believes the ultimate disposition of known environmental matters
will not have a material adverse effect upon the liquidity, capital resources,
business or

21
<PAGE> 23

consolidated financial position of the Company. However, one or more of such
environmental matters could have a significant negative impact on the Company's
consolidated financial results for a particular reporting period. See
"Business -- Environmental Matters," "-- Legal Proceedings" and Note 9 of Notes
to the Company's Consolidated Financial Statements.

The Company believes that excess capacity may exist in the printed circuit
and electronic assembly industries, as well as fluctuating growth rates in the
electronics industry as a whole. Both factors could have a material adverse
effect on future orders and pricing. Despite these beliefs regarding the
electronics industry as a whole, it should be noted that the Company has
historically needed to increase its own manufacturing capacity to maintain and
expand its market position. However, the Company's manufacturing capacity needs
could change at any time or times in the future. The Company also believes that
the potential exists for a shortage of materials in such industries, which could
have a material adverse effect on future unit costs. In response to such
concerns, the Company engages in the normal industry practices of maintaining
primary and secondary vendors and diversifying its customer base. There can be
no assurances, however, that such measures would be sufficient to protect the
Company against any shortages of materials.

FISCAL YEARS ENDED OCTOBER 26, 1996 AND OCTOBER 28, 1995

Net sales during 1996 increased 32.3% over 1995. The change was due to a
15.1% increase in the volume of production and shipments and a shift in product
mix to higher layer, higher density products, as compared to 1995. Average
pricing per unit increased 6.1% compared to 1995. Sales of backplane and other
electronic assemblies increased to 17% of the Company's net sales in 1996,
versus 7% for 1995.

The gross profit margin increased to 25.8% in 1996 from 25.4% in 1995. The
increase was a direct result of higher volume of shipments, an increase in the
technology level of product mix, and improved pricing. These increases have been
partially offset by increased costs relating to the implementation of new
production lines and materials and the shift in mix to a higher level of
value-added products.

Operating expenses, as a percent of net sales, decreased to 11.1% during
1996 from 12.6% during 1995, due to increased revenue. Operating expenses
increased to $38.9 million in 1996 from $33.5 million in 1995, primarily as a
result of increased variable costs directly attributable to increased net sales.
Included in operating expenses are charges for actual expenditures and accruals,
based on estimates, for environmental matters. During 1996 and 1995, the Company
made, and charged to operating expenses, actual payments of approximately
$680,000 and $1,111,000 respectively, for environmental matters. In 1996 and
1995, the Company also accrued and charged to operating expenses approximately
$1,825,000 and $2,740,000, respectively, as cost estimates relating to known
environmental matters.

In 1996, interest income decreased as a result of lower cash balances
available for investment. Interest expense decreased in 1996 from 1995 due to
decreased average debt balances during the year.

The annual effective tax rate for 1996 and 1995 was 39.0%, which was less
than the then current combined federal and state statutory rates. This
difference was caused primarily by tax advantaged investments and the tax
benefits of a foreign sales corporation.

FISCAL YEARS ENDED OCTOBER 28, 1995 AND OCTOBER 29, 1994

Net sales during 1995 increased 19.7% over the same period in 1994. The
change was due to an 8.2% increase in the volume of production and shipments and
a shift in product mix to higher layer, higher density products, as compared to
fiscal 1994. Average pricing per unit increased 3.1% compared to the prior year.

The gross profit margin increased to 25.4% in 1995 from 20.5% in 1994. The
increase was a direct result of higher volume of shipments, an increase in the
technology level of product mix, improved pricing and improvements in operating
efficiencies. Continued productivity improvements led to increased unit volume
and lower unit costs.

22
<PAGE> 24

Operating expenses, as a percent of net sales, decreased to 12.6% during
1995 from 13.1% during 1994, due to increased revenue. Operating expenses
increased to $33.5 million in 1995 from $29.0 million in 1994, as a result of
increased variable costs directly attributable to increased net sales and
charges for environmental related matters. Included in operating expenses are
charges for actual expenditures and accruals, based on estimates, for
environmental matters. During 1995 and 1994, the Company made, and charged to
operating expenses, actual payments of approximately $1,111,000 and $1,040,000,
respectively, for environmental matters. In 1995 and 1994, the Company also
accrued and charged to operating expenses approximately $2,740,000 and
$2,100,000, respectively, as cost estimates relating to known environmental
matters.

In 1995, interest income increased as a result of higher rates of return
earned on investments, and higher cash balances available for investment.
Interest expense decreased in 1995 from 1994 due to decreased average debt
balances during the year.

The annual effective tax rate was 39.0% and 39.5% in 1995 and 1994,
respectively, which was less than the then current combined federal and state
statutory rates. This difference was caused primarily by tax advantaged
investments and the tax benefits of a foreign sales corporation.

QUARTERLY RESULTS

The following table presents certain unaudited consolidated financial
information for each of the Company's ten fiscal quarters for the period ended
April 26, 1997, as well as certain of such information expressed as a percentage
of net sales for the same period. Information for the three months ended January
25, 1997 includes the results of operations for Zycon from January 10, 1997, the
date of the Zycon acquisition. In the opinion of management, this information
has been prepared on the same basis as the audited Consolidated Financial
Statements of the Company appearing elsewhere in this Prospectus and includes
all adjustments, consisting only of normal recurring adjustments, necessary to
present fairly the quarterly results when read in conjunction with the Company's
Consolidated Financial Statements. The Company's operating results have been
subject to fluctuations, and thus results for any quarter are not necessarily
indicative of results for any future period.

<TABLE>
<CAPTION>
THREE MONTHS ENDED
---------------------------------------------------------------------------------------------------
JAN. APRIL JULY OCT. JAN. APRIL JULY OCT. APRIL
28, 29, 29, 28, 27, 27, 27, 26, JAN. 25, 26,
1995 1995 1995 1995 1996 1996 1996 1996 1997(1) 1997
------- ------- ------- ------- ------- ------- ------- ------- -------- --------
(In thousands, except percentages and per share data)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
CONSOLIDATED
STATEMENTS OF
OPERATIONS:
Net sales...... $56,825 $67,637 $67,752 $72,954 $76,481 $88,096 $88,225 $97,883 $111,536 $180,662
Gross profit... 11,776 16,772 18,866 20,026 20,463 22,951 22,419 24,623 26,377 38,463
Income (loss)
from
operations... 4,770 8,342 9,821 10,973 11,534 12,703 12,910 14,385 (62,443) 20,464
Net income
(loss)....... 3,003 5,193 6,152 7,026 7,191 7,895 7,994 8,934 (69,161) 9,953
Net income
(loss) per
share........ $.29 $.49 $.56 $.63 $.65 $.71 $.72 $.81 $(6.64) $.91
AS A PERCENTAGE
OF NET SALES:
Gross profit... 20.7% 24.8% 27.8% 27.5% 26.8% 26.1% 25.4% 25.2% 23.6% 21.3%
Income (loss)
from
operations... 8.4 12.3 14.5 15.0 15.1 14.4 14.6 14.7 (56.0) 11.3
Net income
(loss)....... 5.3 7.7 9.1 9.6 9.4 9.0 9.1 9.1 (62.0) 5.5
</TABLE>

23
<PAGE> 25

- ------------
(1) Net loss for the three months ended January 25, 1997 includes a
non-recurring write-off relating to the acquisition of Zycon for in-process
research and development. Income from operations was $15,557,000, net income
was $8,839,000, net income per share was $.81 (based on weighted average
shares outstanding of approximately 10,944,000), and, as a percentage of net
sales, income from operations was 13.9% and net income was 7.9%, all before
deducting the non-recurring write-off.

The Company's results of operations have fluctuated and may continue to
fluctuate from period to period, including on a quarterly basis. Variations in
quick-turn prototype and volume production orders, in the average number of
layers per printed circuit, and in the mix of products sold by the Company have
significantly affected both net sales and gross profit. Gross profit declined to
21.3% in the three months ended April 26, 1997 from 27.8% in the three months
ended July 29, 1995 primarily as a result of (i) costs related to increases in
manufacturing capacity, (ii) an increase in backplane assembly net sales as a
percentage of net sales, and (iii) factors related to the Zycon acquisition.
Operating results generally may also be affected by other factors, including the
receipt and shipment of large orders, plant utilization, product mix,
manufacturing process yields, the timing of expenditures in anticipation of
future sales, raw material availability, product and price competition, the
length of sales cycles and economic conditions in the electronics industry. Many
of these factors are outside the control of the Company.

The Company does not obtain long term purchase orders or commitments from
its customers, and a substantial portion of sales in a given quarter may depend
on obtaining orders for products to be manufactured and shipped in the same
quarter in which those orders are received. Sales for future quarters may not be
predictable. The Company relies on its estimate of anticipated future volumes
when making commitments regarding the level of business that it will seek and
accept, the mix of products that it intends to manufacture, the timing of
production schedules and the levels and utilization of personnel and other
resources. A variety of conditions, both specific to the individual customer and
generally affecting the customer's industry, may cause customers to cancel,
reduce or delay orders that were previously made or anticipated. A significant
portion of the Company's released backlog at any time may be subject to
cancellation or postponement without penalty. The Company cannot assure the
timely replacement of canceled, delayed or reduced orders. Significant or
numerous cancellations, reductions or delays in orders by a customer or group of
customers could materially adversely affect the Company's business, financial
condition and results of operations. The Company's expense levels are relatively
fixed and are based, in part, on expectations of future revenues. Consequently,
if revenue levels are below expectations, the Company's business, financial
condition and results of operations are likely to be materially adversely
affected. Due to all of the foregoing factors, it is likely that in some future
quarter or quarters the Company's operating results may be below the
expectations of securities analysts and investors. In such event, the price of
the Company's Common Stock could likely be materially adversely affected. See
"Risk Factors -- Fluctuations in Quarterly Operating Results."

LIQUIDITY AND CAPITAL RESOURCES

In fiscal 1996, the Company's financing requirements were satisfied
principally from cash flows from operations. Cash provided by operating
activities was approximately $55.6 million in fiscal 1996. These funds were
sufficient to meet increased working capital needs, capital expenditures of
approximately $54.0 million, and debt and lease payments of approximately $2.1
million in fiscal 1996. Cash provided by operating activities was approximately
$14.0 million in the six months ended April 26, 1997.

At April 26, 1997, the Company had working capital of approximately $34.8
million and a current ratio of 1.32, compared to working capital of
approximately $38.5 million and a current ratio of 1.78 at April 27, 1996. Cash,
cash equivalents and short-term investments at April 26, 1997 were approximately
$7.1 million, a decrease of $14.8 million from approximately $21.9 million at
April 27, 1996.

The Company currently anticipates that its capital expenditures for fiscal
1997 will be in excess of $65 million, of which approximately $21.2 million
represents commitments to purchase manufacturing

24
<PAGE> 26

equipment and leasehold improvements. The majority of these capital expenditures
is expected to be completed by the end of fiscal 1997. The amount of these
anticipated capital expenditures will frequently change based on future changes
in business plans and conditions of the Company and changes in economic
conditions.

In January 1997, the Company obtained a senior revolving credit loan
facility for up to $250 million from The First National Bank of Boston (the
"Credit Facility") (i) primarily to finance the purchase of the shares of Common
Stock of Zycon pursuant to the tender offer commenced by the Company on December
11, 1996, (ii) to refinance Zycon's existing bank credit agreements, and (iii)
for working capital and other general corporate purposes. Interest on loans
outstanding under the Credit Facility is, at the Company's election, payable at
either (1) the higher of the lender's base rate or a floating rate equal to 1.5%
over the prevailing U.S. federal funds rate, or (2) a Eurodollar Rate, which is
a fixed rate equal to an applicable Eurodollar rate margin plus the prevailing
Eurodollar rate for interest periods of one, two, three or six months. At April
26, 1997, $225 million was outstanding under the Credit Facility. The Credit
Facility will terminate in five years. The Company currently expects that
between 80% and 100% of the net proceeds of the Offering will be used to repay a
portion of the outstanding balance on the Credit Facility.

The Company believes its existing working capital and borrowing capacity,
coupled with the funds generated from the Company's operations, and the net
proceeds from the Offering, will be sufficient to fund its anticipated working
capital, capital expenditure and debt payment requirements through fiscal 1997.
Because the Company's capital requirements cannot be predicted with certainty,
however, there is no assurance that the Company will not require additional
financing during this period. There is no assurance that any additional
financing will be available on terms satisfactory to the Company or not
disadvantageous to the Company's securityholders, including those purchasing
Common Stock in the Offering.

25
<PAGE> 27

BUSINESS

The following Business section contains forward-looking statements which
involve risks and uncertainties. The Company's actual results could differ
materially from those anticipated in these forward-looking statements as a
result of certain factors, including, without limitation, those set forth under
"Risk Factors" and elsewhere in this Prospectus.

GENERAL

Hadco's advanced manufacturing and assembly facilities are designed to meet
the accelerated time-to-market and time-to-volume requirements of its customers
whose markets and products are characterized by high growth rates, rapid
technological advances and short product life-cycles. To this end, Hadco
(including Zycon) has invested approximately $235 million in state-of-the-art
production facilities and new technologies during the past five fiscal years.
Hadco provides customers with a range of products and services that includes
development, design, quick-turn prototype, pre-production, volume production and
backplane assembly. Hadco is one of a small number of printed circuit
manufacturers with the technology and advanced production facilities necessary
to offer all of these services. The Company believes its combination of a broad
product offering and advanced technology facilitates long-term relationships
with existing customers, attracts new customers, helps customers meet their
time-to-market and time-to-volume needs, and satisfies a larger share of
customers' electronic interconnect requirements.

Hadco's customers are a diverse group of electronics OEMs and contract
manufacturers in the computing (mainly workstations, servers, mainframes,
storage and notebooks), data communications/telecommunications and industrial
automation industries, including process controls, automotive, medical and
instrumentation. Hadco (including Zycon) supplied its products and services to a
diverse base of approximately 500 customers in fiscal 1996, including 77
customers with purchases in excess of $1 million. The Company's ten largest
customers accounted for approximately 43% of net sales in fiscal 1996 on a pro
forma basis including Zycon.

Hadco acquired Zycon on January 10, 1997. This acquisition increased
Hadco's net sales significantly, added approximately 600,000 square feet of
manufacturing space (approximately a 100% increase) and substantially expanded
the Company's manufacturing capabilities and geographic reach. The new
manufacturing capabilities include state-of-the-art West Coast facilities for
volume production of complex printed circuits and backplane assemblies, a
quick-turn prototype and design facility on the East Coast, and a newly
constructed facility for volume production in Malaysia. The acquisition of Zycon
has also broadened the Company's customer base, expanded its involvement in many
fast growing industry sectors, added new proprietary technologies, and increased
its sales force.

INDUSTRY OVERVIEW AND TRENDS

Printed circuits are the basic platforms used to interconnect
microprocessors, integrated circuits and other components essential to the
functioning of electronic products. Printed circuits consist of a pattern of
electrical traces etched from copper laminated on an insulated base that is
typically composed of rigid fiberglass or thin flexible circuits. To meet the
increasing requirements of OEMs and contract manufacturers, printed circuit
manufacturers have developed more complex multilayer designs with surface mount
and other attachment technologies, narrower widths and separations of copper
traces, advanced materials, and smaller diameters of vias and through-holes to
connect internal circuitry. Backplane assemblies are generally larger and
thicker printed circuits on which connectors

26
<PAGE> 28

are mounted to receive and interconnect printed circuits, integrated circuits
and other electronic components.

Electronic interconnect products are customized for specific electronic
applications and are sold to OEMs and contract manufacturers in volumes that
range from several units for prototypes and small quantities for pre-production
to large quantities for volume production. In the 1980s, the electronic
interconnect market was largely comprised of military and personal computer
applications. However, the proliferation of electronics and the emergence of new
technologies have significantly broadened this market and reduced the amplitude
of interconnect industry cycles in the 1990s. Electronic interconnects such as
rigid printed circuits, flexible circuits and backplane assemblies are now used
in a wide variety of industries and products, including data
communications/telecommunications, workstations, servers, personal computers,
peripherals, industrial automation, instrumentation, medical, transportation and
defense.

As electronic products have become smaller and more complex, the
manufacture of interconnect products has required increasingly sophisticated
engineering and manufacturing expertise and substantial capital investment.
These advanced manufacturing process and technology requirements have caused
OEMs to rely more heavily on independent manufacturers and to reduce dependence
on their internal captive facilities. Industry sources estimate that 85% of the
domestic printed circuit market was served by independent manufacturers in 1996
(compared to 66% in 1991). Captive manufacturing facilities serve the remaining
15% of the market. Historically, electronics OEMs used independent printed
circuit manufacturers as offload capacity for their captive facilities. During
economic downturns, independent facilities lost production orders as captives
produced a greater percentage of demand internally. However, as a result of
outsourcing of OEM printed circuit production, the Company believes independents
are less affected by unused captive capacity during market downturns than was
previously the case.

Industry sources estimate that in 1996 the world-wide market for rigid
printed circuits was approximately $28.2 billion, and the domestic market for
rigid printed circuits was approximately $7.1 billion. In addition, industry
sources estimate that the market for more complex multilayer printed circuits
(six layers and above) comprised approximately 45% of the total market in 1996,
and has increased an average of 16% per year over the past two years. Despite
its large size, the market for printed circuits remains highly fragmented. The
Company believes that 9 North American rigid printed circuit manufacturers had
annual sales in excess of $100 million in 1996, which together would represent
approximately 32% of the rigid printed circuit market.

According to industry sources, the domestic market for backplane assemblies
was approximately $1.1 billion in 1995. This market is less fragmented than that
of printed circuits. The Company estimates that the ten largest producers of
backplane assemblies accounted for a majority of the backplane assembly
production in 1996. As in the printed circuit market, OEMs have increasingly
come to rely on independent producers of backplane assemblies, allowing OEMs to
reduce their capital investments, improve inventory management and purchasing
power and take advantage of the process technology expertise of manufacturing
specialists.

The Company considers the following trends important in understanding the
electronic interconnect industry:

Industry Consolidation. The Company believes the industry will continue to
consolidate as a result of the substantial capital investment for advanced
production facilities, engineering and manufacturing expertise and technology
required to make increasingly sophisticated electronic interconnect products.
The increased investment requirement for state-of-the-art production facilities
has accelerated consolidation in the electronic interconnect industry and the
exit of smaller companies. In addition, OEMs and contract manufacturers
increasingly recognize that only a few suppliers of interconnect products can
consistently provide timely delivery of required volumes of highly sophisticated
electronic interconnect products. As a result, Hadco believes that companies
with lesser

27
<PAGE> 29

financial and technical resources are likely to exit the industry and larger
interconnect companies with sufficient resources will continue to gain market
share.

Increasing Demand for Single Sourcing. To avoid delays and costs during
the product life-cycle, OEMs are increasingly turning to suppliers capable of
producing electronic interconnect products from development, design, quick-turn
prototype and pre-production through volume production and backplane assembly.
The accelerated time-to-market and time-to-volume needs of OEMs have resulted in
increased collaboration with qualified suppliers capable of providing a broad
and integrated offering. To meet their rapidly changing electronic interconnect
requirements, many OEMs have moved to limit their vendor base to a smaller
number of technically qualified suppliers capable of providing both quick-turn
prototype and pre-production quantities as well as cost-competitive volume
production quantities.

New and Emerging Markets. The markets for electronic products are growing
as a result of new product introductions, technological change, demands for a
wider variety of electronic product features, and increasingly powerful and less
expensive electronic components. New markets have emerged in computing, data
communications/telecommunications and multimedia. Moreover, existing industries
have significantly expanded applications in areas such as computer networking
and peripherals, digital and mobile communications, video-on-demand, the
Internet/World Wide Web, instrumentation and industrial controls. The Company
believes these new and emerging electronic product markets and applications have
also contributed to the reduction in the amplitude of the electronic
interconnect industry cycles.

Greater Demand for Complex Electronic Products. Advanced communication
equipment, as well as next-generation computer chips and microprocessors,
require interconnect systems that operate at greater speeds and higher
frequencies with minimal signal loss and distortion. Further, electronics OEMs
are designing more compact and portable high performance products. The
complexity of these new products requires higher performance, smaller size,
greater circuit and component density, and increased reliability. These
requirements necessitate greater sophistication in printed circuit manufacturing
and process technologies, including advanced materials, more layers, narrower
line widths and spacing, smaller vias to connect internal circuitry, and more
precise positioning of traces and pads to accommodate a greater density of
surface mount components. These products require increasingly advanced packaging
technologies, such as Multichip Module (MCM), Tape Automated Bonding (TAB),
Direct Chip Attach (DCA) and Ball Grid Array (BGA), and high frequency
materials. The trend toward increasingly sophisticated products also requires
greater engineering support and investment in manufacturing and process
technology for suppliers to produce high-quality electronic interconnect
products on-time, in volume, and at acceptable cost.

Shorter Product Life-Cycles for Electronic Products. Rapid changes in
technology have significantly shortened the life-cycle of complex electronic
products and placed increased pressure on OEMs to develop new products as
quickly as possible. The time-to-market considerations of OEMs have increased
emphasis on the engineering and quick-turn production of small unit volumes of
electronic interconnects in the prototype development stage. In addition, the
success of first-to-market products has heightened the emphasis on volume
manufacturing expertise and technologically advanced manufacturing
infrastructure.

THE HADCO STRATEGY

The Company's strategy is to increase sales and profitability by providing
a wide range of electronic interconnect solutions and services to a broad and
diversified customer base. Hadco assists customers in meeting their
time-to-market and time-to-volume requirements by providing a broad and
integrated offering (from development, design, quick-turn prototype and
pre-production through volume production and backplane assembly). The Company
believes this integrated offering gives it an important competitive advantage.

28
<PAGE> 30

The Company's strategy is to capitalize on major industry trends as
follows:

Serve Diversified Customer Base in High Growth Segments. The Company
concentrates its marketing efforts on OEMs and contract manufacturers in
segments of the electronics market characterized by high growth, rapid
technological advances, short product development cycles and accelerated
time-to-market and time-to-volume requirements, such as the computing (mainly
workstations, servers, mainframes, storage and notebooks), data
communications/telecommunications and industrial automation industries,
including process controls, automotive, medical and instrumentation. Hadco
(including Zycon) supplied its products and services to a diverse base of
approximately 500 customers in fiscal 1996, including 77 customers with
purchases in excess of $1 million. The Company's ten largest customers accounted
for approximately 43% of net sales in fiscal 1996 on a pro forma basis including
Zycon.

Provide a Broad and Integrated Offering. Hadco develops and maintains
long-term customer relationships by providing a full range of integrated
services, from development, design, quick-turn prototype and pre-production
through volume production and backplane assembly. The Company believes its broad
range of integrated services adds significant value to its customers by
shortening their new product development cycles, helping them to meet their
time-to-market and time-to-volume requirements, lowering manufacturing costs,
and providing concentrated expertise. By offering development and design
services, the Company also gains early access to volume production sales
opportunities, and its relationships with volume production customers create
additional quick-turn and development and design sales opportunities.

Expand Backplane Assembly Operations. To extend its integrated offering,
the Company expanded backplane assembly operations. The Company believes this
investment will facilitate a broader range of manufacturing services, reduce
customer costs and improve product quality. With this backplane assembly
expansion, the Company intends to position itself to capture an increasing share
of the interconnect requirements of its customers.

Maintain High Levels of Investment. Hadco believes its financial strength
allows it to maintain leadership positions in advanced materials, process
technologies and packaging through both its development activities and
acquisitions. The Company (including Zycon) has invested approximately $235
million in state-of-the-art production facilities and new technologies during
the past five fiscal years. These investments have increased capacity and
operating efficiencies, improved management control and provided more consistent
product quality. As a result, the Company believes it has become one of the few
interconnect manufacturers capable of satisfying volume production,
time-to-market, time-to-volume, and technology requirements of customers in the
electronic interconnect industry.

Develop Advanced Manufacturing and Process Technologies. The Company is
committed to being a leader in the manufacture of advanced materials and the
development of sophisticated process technologies in the electronic interconnect
industry. The Company has invested in leading process technologies that enable
it to cost-effectively produce high quality and technologically advanced
products, thereby attracting fast growing technology customers. The Company
believes its manufacturing and process capabilities provide a competitive
advantage in the manufacture of complex interconnect products.

Increase Geographic Reach. Hadco believes it is the only independent North
American printed circuit manufacturer with a full service offering of quick-turn
and volume printed circuit manufacturing and backplane assembly on both the East
and West Coasts. In addition, its volume production facility in Malaysia, which
recently commenced operations, is intended to provide the Company with access to
U.S. customers expanding into Asian markets. The Company also intends to broaden
its European and other international sales.

Pursue Strategic Acquisitions. The January 1997 acquisition of Zycon
provided Hadco with state-of-the-art volume printed circuit manufacturing and
backplane assembly facilities on the West Coast, a new volume production
facility in Malaysia, a quick-turn prototype and design facility on the East

29
<PAGE> 31

Coast, a broader customer base, new proprietary technologies, and additional
sales personnel. The Company will consider other strategic acquisitions of
companies and technologies that enhance its competitive position.

PRODUCTS AND SERVICES

The Company's products and services are designed to meet its customers'
interconnect needs for complex multilayer printed circuits and backplane
assemblies. Hadco offers complementary processes and capabilities that span the
period from product conception through delivery of volume products. The
Company's offering includes the following:

Development. Through development groups located at various facilities,
Hadco identifies, develops and markets new technologies that benefit its
customers. These development groups work closely with customers during all
stages of product life-cycles. For instance, process design changes and
refinements required for volume production are identified and implemented prior
to production. The development groups also focus on the special requirements of
the Company's customers, including increasing printed circuit densities,
electronic packaging and advanced materials and products. When appropriate, the
development groups have coordinated the acquisition of technology licenses,
filed patent disclosures and applications, and registered trademarks on behalf
of the Company.

Design. The Company provides design and engineering assistance in the
early stages of product development which assures both mechanical and electrical
considerations are integrated to achieve a high quality and cost effective
product. The Company also evaluates customer designs for manufacturability and,
when appropriate, recommends design changes to reduce manufacturing costs or
lead times or to increase manufacturing yields or the quality of finished
printed circuits. The Company believes that this long-term view of manufacturing
and customer relationships distinguishes the Company from many manufacturers
which compete primarily in the quick-turn market. By working closely with its
customers, the Company also gains a better understanding of the future
requirements of OEMs. This cooperative process shortens the time in transition
from the development of the prototype design to volume manufacturing and
facilitates the delivery of high quality products to customer premises in a
timely fashion.

Quick-Turn Prototype. Prototypes typically require lead times of three to
seven days, and as short as 24 hours. The Company provides quick-turn prototype
services to the product development groups of customers that require small test
quantities. Hadco offers these services through its Tech Centers in
Massachusetts, New Hampshire and California. Prototype development at these
Centers has included multilayer printed circuits of up to 38 layers, embedded
discrete components, Multichip Modules (MCM), Single Chip Carriers (SCC), planar
magnetics, advanced surface finishes, and various high performance substrates
for the high frequency microwave market. The Tech Centers also support advanced
attachment technologies such as Tape Automated Bonding (TAB) and Direct Chip
Attach (DCA). In combining the design of a printed circuit with the manufacture
of the prototype, Hadco can reduce the length of the design/manufacture cycle.
By working closely with customers at the design and prototype stage, the Company
believes it strengthens long-term relationships with its customers and gains an
advantage in securing a preferred vendor status when customers begin volume
production.

Pre-Production. Pre-production is the manufacture of limited quantities of
electronic interconnects during the transition period from prototype to volume
production. Pre-production generally requires quick-turn delivery to accommodate
time-to-volume pressures or as a temporary solution for unforeseen customer
demands. Pre-production is done in the Tech Centers and in volume production
facilities.

Volume Production. Volume production is characterized by longer lead times
and increased emphasis on lower cost as the product moves to full-scale
commercial production. As customers increasingly demand a quick transition from
prototype to volume production, few independent manufacturers can provide
complex printed circuits of 18 or more layers in the volume provided by

30
<PAGE> 32

Hadco's larger facilities. During 1996, the Tech Centers transitioned chip
attachment technologies such as Ball Grid Array (BGA), Tape Automated Bonding
(TAB) and Direct Chip Attach (DCA), and other technologies including Multichip
Module (MCM) and Single Chip Carriers (SCC) to volume production. The Company
operates five facilities located in California, New York, New Hampshire and
Malaysia for medium and high-volume printed circuit production.

Backplane Assembly. Backplane assemblies are generally larger and thicker
printed circuits on which connectors are mounted to interconnect printed
circuits, integrated circuits and other electronic components. Hadco
incorporates its own printed circuits in backplane assemblies to provide
customers with a high level of printed circuit technology on a quick-turn and
volume basis. Net sales of backplane assemblies accounted for 6%, 7% and 17% of
total Company net sales during fiscal 1994, 1995 and 1996, respectively, and for
10% on a pro forma basis including Zycon during fiscal 1996. With its backplane
assembly operations, Hadco is one of a few companies that provides its customers
with the strategic advantage of an integrated offering to meet their needs from
development and design through volume production and backplane assembly.

The Company's advanced process capabilities enhance each of the above
services and include:

Manufacture of High Performance Printed Circuits. The Company produces
technologically advanced printed circuits primarily for the high performance
market at the Tech Centers and its volume production facilities. These printed
circuits, used principally in the data communications and telecommunications
industries, are designed to function in high temperature environments and at
higher frequencies. Materials used by the Company for these products include
Teflon(R), cyanate ester, GETEK(R), liquid crystal polymers, polymides, and
bismaleimide triazine epoxies.

Development of Emerging Technologies. The Company undertakes projects to
develop advanced or improved processes, materials and product lines. Buried
Capacitance(TM) and buried resistance are advanced materials being developed by
the Company to provide improved electrical performance and greater interconnect
densities. Sales of Buried Capacitance(TM) products by the Company (including
Zycon) in fiscal 1996 totaled $24.0 million, and the Company believes that
buried resistance materials (ResistAIR(TM)) may generate additional future
revenue. In addition, the Company is developing the MicroPath(TM) family of
micro via processes, which include liquid imaging, dry film imaging, plasma
etching, and laser drilling. Micro vias provide a significant increase in
printed circuit density. During fiscal 1996, the Company also began to produce
rigid flex printed circuit products utilizing licensed HVRFlex(TM) technology.
These products enable customers to fold a printed circuit and reduce the need
for cable connectors in the portable computer and telecommunications markets.
See "-- Manufacturing and Facilities."

31
<PAGE> 33

MARKETS AND CUSTOMERS

Hadco's customers are a diverse group of OEMs and contract manufacturers in
the computing (mainly workstations, servers, mainframes, storage and notebooks),
data communications/telecommunications and industrial automation industries,
including process controls, automotive, medical and instrumentation. The
following table shows, for the periods indicated, the Company's net sales and
percentage of its net sales to the principal end-user markets it serves. Except
for the information under the column "Fiscal Year Ended October 26, 1996 (Pro
Forma)," the information reflected in the table does not include Zycon.

<TABLE>
<CAPTION>
FISCAL YEAR ENDED,
-------------------------------------------------------------------------
OCTOBER 29, OCTOBER 28, OCTOBER 26, OCTOBER 26,
MARKETS 1994 1995 1996 1996
- -------------------------- -------------- ---------------- -------------- --------------
Pro Forma
(Dollars in millions)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Computing................. $ 79.8 36% $ 84.9 32% $119.2 34% $148.3 26%
Contract Assembly......... 46.5 21 69.0 26 112.2 32 193.9 34
Data Communications/
Telecommunications...... 82.0 37 90.2 34 94.7 27 193.9 34
Industrial Automation..... 11.1 5 15.9 6 17.5 5 28.5 5
Other..................... 2.2 1 5.2 2 7.1 2 5.8 1
------ --- ------ --- ------ --- ------ ---
Total Net Sales........... $221.6 100% $265.2 100% $350.7 100% $570.4 100%
====== === ====== === ====== === ====== ===
</TABLE>

The Company (including Zycon) supplied its products and services to a
diverse base of approximately 500 customers in fiscal 1996, including 77
customers with purchases in excess of $1 million. The Company attempts to market
its products to customers who currently have, or have the potential to achieve,
significant market share in their respective industries. The following list sets
forth the Company's largest customers during fiscal 1996:

<TABLE>
<S> <C>
Bay Networks SCI Systems
Cabletron Systems Solectron
Cisco Systems Storage Technology
Compaq Computer Sun Microsystems
Jabil Circuits U.S. Robotics
</TABLE>

During fiscal 1994, 1995 and 1996, no customer accounted for more than 7%,
7% and 15%, respectively, of Hadco's net sales and the Company's ten largest
customers together accounted for approximately 48%, 46% and 48%, respectively,
during the same periods, and 43% in fiscal 1996 on a pro forma basis including
Zycon. In fiscal 1996, one customer, Sun Microsystems, accounted for
approximately 10% of the net sales of the Company (including Zycon).

The Company generally does not obtain long-term purchase orders or
commitments from its customers, and the orders received by the Company generally
require delivery within 90 days. However, many of the Company's customers have
maintained long-term purchasing relationships with the Company. For example, in
1996 the top ten customers of Hadco (not including Zycon) had purchasing
relationships with the Company ranging from four to 15 years.

SALES AND MARKETING

The Company markets its products through its own sales and marketing
organization and independent manufacturers' representatives. As of April 26,
1997, the Company employed 112 sales and marketing employees, of which 50 are
direct sales representatives at nine locations. The Company is also represented
by 13 independent manufacturers' representatives at 25 locations in North
America, Europe, Mexico, Asia, Australia and the Middle East. Regional direct
sales offices are located in the states of Arizona, California, Colorado,
Georgia, Minnesota, New Hampshire, North Carolina, Oregon, Pennsylvania, Texas
and the Province of Ontario, Canada. The Company's sales organization is divided

32
<PAGE> 34

into four territories, and each direct sales representative and each
manufacturer's representative works within one of the four territories. Each
territory also has a support staff of sales engineers and technical service
personnel responsible for technical liaison and problem solving, development of
product and market opportunities, market research and marketing communications.

The Company focuses on developing close relationships with customers
beginning at the earliest development and design phases and continuing
throughout all stages of product production. The Company's Advanced Packaging
Development Group identifies, develops and markets new technologies that benefit
its customers and is intended to position the Company as an important source for
these solutions. This group also assists marketing efforts by hosting the
Regional Technology Symposiums at which the Company's technical capabilities are
presented to, and industry technical trends are discussed with, customers of the
Company. These Symposiums attract engineers and designers from electronics OEMs
and facilitate an interactive discussion of the latest technologies in the
manufacture of complex printed circuits.

MANUFACTURING AND FACILITIES

The need for high volume production of dense multilayer printed circuits
has transformed the electronic interconnect industry into one that increasingly
requires complex manufacturing processes and necessitates high levels of
investment in facilities, advanced materials, production processes and product
design capabilities. The Company has invested in production technology to
manufacture large volumes of dense multilayer printed circuits utilizing
advanced attachment strategies such as Surface Mount Technology (SMT), Tape
Automated Bonding (TAB) and Ball Grid Array (BGA). The Company employs numerous
advanced manufacturing techniques and systems, including Computer Aided
Manufacturing (CAM) systems, Computer Integrated Manufacturing (CIM) systems,
computer controlled drilling and routing, dry-film imaging, multi-purpose metals
plating, high volume surface coating, dual-access electrical testing, automated
optical inspection, high-volume photoimageable solder mask processing, and
computer controlled high-volume lamination systems. These techniques enable
Hadco to manufacture complex printed circuits of consistent quality, in high
volume and on a timely basis. All of the Company's North American production
facilities are ISO9002 certified. See "-- Products and Services."

Hadco is able to provide a broad and integrated offering through a focused
manufacturing strategy for each facility. The Company manufactures its products
in ten facilities, consisting of five volume production facilities (in
California, New Hampshire, New York and Malaysia), two backplane assembly
facilities (in California and New Hampshire) and three quick-turn prototype
facilities (in Massachusetts, New Hampshire and California). The production
expertise of some facilities overlap, enabling Hadco to allocate production
based on product type and available capacity. Each facility can focus on
particular product types and respond quickly to customers' specific
requirements.

Hadco has pursued a strategy of expanding the capacity and geographic scope
of its manufacturing facilities to better serve high growth segments of the
electronics industry in key geographic markets. With the acquisition of Zycon,
the Company added a 310,000 square foot volume production facility in
California, a 180,000 square foot volume production facility in Malaysia, a
71,000 square foot quick-turn prototype facility in Massachusetts, and a 29,000
square foot backplane assembly facility in California. During fiscal 1996, the
Company also expanded its backplane assembly facility from 40,000 to 60,000
square feet, and added two additional SMT lines, in-circuit testing capability,
and numerous pieces of assembly equipment.

33
<PAGE> 35

In total, the Company leases or owns approximately 1.2 million square feet
of manufacturing space. The Company's significant facilities are as follows:

<TABLE>
<CAPTION>
FUNCTION LOCATION SQUARE FEET
- ------------------------------------------------------------ ------------------ -----------
<S> <C> <C>
Volume Production........................................... Santa Clara and
San Jose, CA 310,000
Owego, NY 282,000*
Derry, NH 199,000
Kuching, Malaysia 180,000
Hudson, NH 52,000
Quick-Turn Prototype........................................ Haverhill, MA 71,000
Watsonville, CA 35,000
Salem, NH 27,000
Backplane Assembly.......................................... Salem, NH 60,000
Santa Clara, CA 29,000
Administrative.............................................. Salem, NH 35,000
Santa Clara, CA 29,000**
</TABLE>

- ------------
* 27,200 feet of which is under renovation

** Under construction

The Company owns its volume production facilities in Owego, New York and
Derry, New Hampshire. The Company leases its volume production and backplane
assembly facilities in Santa Clara and San Jose, California, which are located
in four adjacent buildings; the leases for these four buildings expire in March
2009 and contain options to extend for up to two additional periods of five
years each. The Company completed construction in calendar 1996 of its volume
production facility in Kuching, Malaysia and leases the land on which this
facility is located for a period of 60 years, expiring in November 2055. The
Hudson, New Hampshire operations are located in two separate buildings, and
their leases expire in December 1997 with options to extend until December 2000.

Leases for the Company's quick-turn prototype facility in Haverhill,
Massachusetts expire in December 2003, with options on two of the leases to
extend for an additional five years and options on the third lease to extend for
an additional ten years. The lease for the Watsonville, California quick-turn
prototype facility expires in December 1999, with options to extend until
December 2011. The lease for the quick-turn prototype facility in Salem, New
Hampshire expires in May 1999, with an option to extend until May 2004.

The lease for the backplane assembly facility in Salem, New Hampshire
expires in March 2000, with options to extend until March 2006. The leases for
the Santa Clara, California buildings include the 29,000 square feet of
backplane assembly operations.

The administrative and corporate offices in Salem, New Hampshire are
located in two separate buildings, which are covered by leases that expire in
October 2000, with options to extend until October 2006. The leases for the
Santa Clara, California buildings include the 29,000 square feet of
administrative space.

The Company also owns approximately six acres of land in Salem, New
Hampshire, approximately five acres of land in Derry, New Hampshire, and
approximately ten acres of land in Owego, New York.

In fiscal 1996, the Company's capital expenditures relating to its
environmental control facilities and equipment totaled approximately $1 million.
The Company estimates that it will make capital expenditures with respect to its
environmental control facilities and equipment of approximately $1.8 million and
$700,000 in fiscal 1997 and 1998, respectively.

SUPPLIER RELATIONSHIPS

Historically, the majority of raw materials used in the Company's
manufacture of printed circuits and components used in backplane assemblies have
been readily available. However, product changes

34
<PAGE> 36

and the overall demand for electronic interconnect products could increase the
industry's use of new laminate materials, standard laminate materials,
multilayer blanks, electronic components and other materials, and therefore such
materials may not be readily available to the Company in the future. Zycon has
experienced shortages of certain types of raw materials in the past. There can
be no assurance that shortages of certain types of raw materials or components
will not occur in the future. To date, material shortages or price fluctuations
have not had a materially adverse effect on the Company, but there can be no
assurance that material shortages or price fluctuations will not have a material
adverse effect on the Company in the future.

The Company works with its suppliers to develop just-in-time supply systems
which reduce inventory carrying costs. The Company also maintains a Supplier
Certification Program which evaluates potential vendors on the basis of such
factors as quality, on-time delivery, cost, technical capability, and potential
technical advancement. Certification is based on both actual performance and
audits of vendors' manufacturing sites. Key suppliers are reviewed quarterly to
preserve strong relationships with these suppliers and maintain regular dialogue
on quality, cost and technical advancement issues. Many suppliers attend the
Company's Supplier Symposium, where the Company's goals and objectives are
discussed with vendors.

COMPETITION

Hadco competes on the basis of product quality, timeliness of delivery,
price, customer technical support and its integrated offering, from development
and design through volume production and backplane assembly.

PRODUCT PROTECTION

The Company has obtained four United States and one foreign patent with
respect to its buried capacitance technology. Although Hadco seeks to protect
certain proprietary technology and other

35
<PAGE> 37

intangible assets through patents and trademark filings, it has relatively few
patents and relies primarily on trade secret protection. There can be no
assurance that the Company will be able to protect its trade secrets or that
others will not independently develop substantially equivalent proprietary
information and techniques or otherwise gain access to the Company's trade
secrets. The future success of the Company will depend on the continued
development of processes and capabilities. The Company believes that its
accumulated experience with respect to materials and process technology is also
important to its operations.

RELEASED BACKLOG

The Company's released backlog as of April 26, 1997 was $144.4 million
(including Zycon), compared with $80.8 million (excluding Zycon) as of April 27,
1996. The Company anticipates delivering approximately 77% of its released
backlog during its third quarter of fiscal 1997. Released backlog consists of
orders for which artwork has been received, a delivery date has been scheduled
and the Company anticipates it will manufacture and deliver the order.
Cancellation and postponement charges, to the extent they exist with respect to
released backlog, generally vary depending upon the time of cancellation or
postponement, and a significant portion of the Company's released backlog at any
time may be subject to cancellation or postponement without penalty. Variations
in the size, timing and delivery schedules of purchase orders received by the
Company, as well as changes in customers' delivery requirements, may result in
substantial fluctuations in released backlog from period to period. Accordingly,
the Company believes that released backlog is not a meaningful indicator of
future quarterly or annual financial results.

EMPLOYEES

As of April 26, 1997, the Company had 5,611 employees, compared to 2,659
employees as of April 27, 1996. The employees are not represented by a union,
and the Company has never experienced any labor problems resulting in a work
stoppage.

ENVIRONMENTAL MATTERS

The Company is required to comply with all federal, state, county and
municipal regulations regarding protection of the environment. There can be no
assurance that more stringent environmental laws will not be adopted in the
future and, if adopted, the costs of compliance with more stringent
environmental laws could be substantial. Waste treatment and disposal are major
considerations for printed circuit manufacturers. The Company uses chemicals in
the manufacture of its products that are classified by the Environmental
Protection Agency (EPA) as hazardous substances. The Company is aware of certain
chemicals that exist in the ground at certain of its facilities. The Company has
notified various governmental agencies and continues to work with them to
monitor and resolve these matters. During March 1995, the Company received a
Record Of Decision (ROD) from the New York State Department of Environmental
Conservation (NYSDEC), regarding soil and groundwater contamination at its
Owego, New York facility. Based on a Remedial Investigation and Feasibility
Study (RIFS) for apparent on-site contamination at that facility and a Focused
Feasibility Study (FFS), each prepared by environmental consultants of the
Company, the NYSDEC has approved a remediation program of groundwater withdrawal
and treatment and iterative soil flushing. The Company recently executed a
Modification of the Order on Consent to implement the approved ROD. The cost,
based upon the FFS, to implement this remediation is estimated to be $4.6
million, and is expected to be expended as follows: $260,000 for capital
equipment and $4.3 million for operation and maintenance costs which will be
incurred and expended over the estimated life of the program of 30 years. NYSDEC
has requested that the Company consider taking additional samples from a wetland
area near the Company's Owego facility. Analytical reports of earlier sediment
samples indicated the presence of certain inorganics. There can be no assurance
that the Company and/or other third parties will not be required to conduct
additional investigations and remediation at that location, the costs of which
are

36
<PAGE> 38

currently indeterminable due to the numerous variables described in the fifth
paragraph of this "-- Environmental Matters" section.

From 1974 to 1980, the Company operated a printed circuit manufacturing
facility in Florida as a lessee of property that is now the subject of a pending
lawsuit ("the Florida Lawsuit") and investigation by the Florida Department of
Environmental Protection (FDEP). On June 9, 1992, the Company entered into a
Cooperating Parties Agreement in which it and Gould, Inc., another prior lessee
of the site have agreed to fund certain assessment and feasibility study
activities at the site, and an environmental consultant has been retained to
perform such activities. The cost of such activities is not expected to be
material to the Company. In addition to the Cooperating Parties Agreement, Hadco
and others are participating in alternative dispute resolution regarding the
site with an independent mediator. In connection with the mediation, in February
1992 the FDEP presented computer-generated estimates of remedial costs, for
activities expected to be spread over a number of years, that ranged from
approximately $3.3 million to $9.7 million. Mediation sessions were conducted in
March 1992 but have been suspended during the ongoing assessment and feasibility
activities. Management believes it is likely that it will participate in
implementing a continuing remedial program for the site, the costs of which are
currently unknown. In June 1995, Hadco was named a third-party defendant in the
Florida Lawsuit. See "-- Legal Proceedings."

The Company has commenced the operation of a groundwater extraction system
at its Derry, New Hampshire facility to address certain groundwater
contamination and groundwater migration control issues. Because of the
uncertainty regarding both the quantity of contaminants beneath the building at
the site and the long-term effectiveness of the groundwater migration control
system the Company has installed, it is not possible to make a reliable estimate
of the length of time remedial activity will have to be performed. However, it
is anticipated that the groundwater extraction system will be operated for at
least 30 years. There can be no assurance that the Company will not be required
to conduct additional investigations and remediation relating to the Derry
facility. The total costs of such groundwater extraction system and of
conducting any additional investigations and remediation relating to the Derry
facility are not fully determinable due to the numerous variables described in
the fifth paragraph of this "-- Environmental Matters" section.

The City of Santa Clara has adopted an ordinance that, as of April 1, 1997,
significantly reduces the amount of waste, including copper and nickel, that
companies such as the Company may discharge into the city sanitary sewer. The
new ordinance provides for substantial penalties for intentional or negligent
violations. These penalties include fines ranging from $10,000 to $50,000 per
day, revocation of required business permits, the issuance of a cease and desist
order and, under certain circumstances, up to nine months imprisonment. Under
the new ordinance, the Company is subject to stringent requirements on the
amount of water it can discharge and is required to substantially reduce the
concentrations of certain chemicals, including copper and nickel, which it
currently discharges. Under the new ordinance, the concentration limit for
Hadco's copper discharge is reduced from 2.70 milligrams per liter to 1.02
milligrams per liter, and the concentration limit for Hadco's nickel discharge
is reduced from 2.60 milligrams per liter to 0.02 milligrams per liter. The
Company believes it is currently in compliance with the new copper discharge
limit which became effective April 1, 1997. On March 31, 1997, the San
Jose/Santa Clara Water Pollution Control Plant (the "SJ/SC POTW") issued a new
compliance schedule for the Company with respect to the nickel discharge limit,
in part to allow the Company to complete a new Mass Audit Study for nickel. The
new compliance date is July 31, 1997, and the Company anticipates filing the
updated Mass Audit Study with the SJ/SC POTW by May 31, 1997. Management
believes the Company will be in compliance as of July 31, 1997 through the
implementation of additional changes in technology and raw materials and/or as a
result of the SJ/SC POTW's reconsideration and upward revision of the Company's
nickel discharge limit following completion of the new Mass Audit Study.
However, there can be no assurances that the Company will be able to so comply
or that the costs of complying will not exceed the Company's current estimate.
The Company estimates that the total equipment cost of complying with the new
ordinance will be

37
<PAGE> 39

between $220,000 and $320,000. In addition, the Company anticipates an annual
cost of approximately $110,000 to dispose of spent electroless nickel plating
baths off-site.

The Company accrues estimated costs associated with known environmental
matters, when such costs can be reasonably estimated. The cost estimates
relating to future environmental clean-up are subject to numerous variables, the
effects of which can be difficult to measure, including the stage of the
environmental investigations, the nature of potential remedies, possible joint
and several liability, the magnitude of possible contamination, the difficulty
of determining future liability, the time over which remediation might occur,
and the possible effects of changing laws and regulations.

Management believes the ultimate disposition of above known environmental
matters described in this "-- Environmental Matters" section will not have a
material adverse effect upon the liquidity, capital resources, business or
consolidated financial position of the Company. However, one or more of such
environmental matters could have a significant negative impact on the Company's
consolidated financial results for a particular reporting period. See
"Management's Discussion and Analysis of Results of Operations and Financial
Condition" and Note 9 of Notes to the Company's Consolidated Financial
Statements.

The Company plans additional capital expenditures during fiscal 1997 to
further reduce air emissions and reduce waste generation. See discussion under
"-- Manufacturing and Facilities" concerning the Company's capital expenditures
relating to environmental control facilities and equipment, and under "-- Legal
Proceedings" relating to lawsuits regarding environmental matters.

LEGAL PROCEEDINGS

The Company is one of 33 entities which have been named as potentially
responsible parties in a lawsuit pending in the federal district court of New
Hampshire concerning environmental conditions at the Auburn Road, Londonderry,
New Hampshire landfill site. Local, state and federal entities and certain other
parties to the litigation seek contribution for past costs, totaling
approximately $20 million, allegedly incurred to assess and remediate the Auburn
Road site. In December 1996, following publication and comment period, the EPA
amended the ROD to change the remedy at the Auburn Road site from active
groundwater remediation to future monitoring. Other parties to the lawsuit also
allege that future monitoring will be required. The Company is contesting
liability, but is participating in mediation with 27 other parties in an effort
to resolve the lawsuit.

In connection with the Florida Lawsuit pending in the Circuit Court for
Broward County, Florida, Hadco and Gould, Inc., another prior lessee of the site
of the printed circuit manufacturing facility in Florida, was each served with a
third-party complaint in June 1995, as third-party defendants in such pending
Florida Lawsuit by a party who had previously been named as a defendant when the
Florida Lawsuit was commenced in 1993 by the FDEP. The Florida Lawsuit seeks
damages relating to environmental pollution and FDEP costs and expenses, civil
penalties, and declaratory and injunctive relief to require the parties to
complete assessment and remediation of soil and groundwater contamination. The
other parties include alleged owners of the property and Fleet Credit
Corporation, a secured lender to a prior lessee of the property. "See
Business -- Environmental Matters."

In March 1993, the EPA notified Zycon of its potential liability for
maintenance and remediation costs in connection with a hazardous waste disposal
facility operated by Casmalia Resources, a California Limited Partnership, in
Santa Barbara County, California. The EPA identified Zycon as one of the 65
generators which had disposed the greatest amounts of materials at the site.
Based on the total tonnage contributed by all generators, Zycon's share is
estimated at approximately 0.2% of the total weight.

The Casmalia site was regulated by the EPA during the period when the
material was accepted. There is no allegation that Zycon violated any law in the
disposal of material at the site, rather the EPA's actions stemmed from the fact
that Casmalia Resources may not have the financial means to implement a closure
plan for the site and because of Zycon's status as a generator of hazardous
waste.

38
<PAGE> 40

In September 1996, a Consent Decree among the EPA and 48 entities
(including Zycon) acting through the Casmalia Steering Committee (CSC) was
lodged with the United States District Court in Los Angeles, California, which
must approve the agreement. Although this approval is pending, work to be
performed by the settling parties under the Consent Decree has commenced and is
ongoing pursuant to the provisions of an interim Administrative Order on Consent
among the settling parties and the EPA. The Consent Decree sets forth the terms
and conditions under which the CSC will carry out work aimed at final closure of
the site. Certain closure activities will be performed by the CSC. Later work
will be performed by the CSC, if funded by other parties. Under the Consent
Decree, the settling parties will work with the EPA to pursue the non-settling
parties to ensure they participate in contributing to the closure and long-term
operation and maintenance of the facility.

The EPA will continue as the lead regulatory agency during the final
closure work. Because long-term maintenance plans for the site will not be
determined for a number of years, it has not yet been decided which regulatory
agency will oversee this phase of the work plan or how the long-term costs will
be funded. However, the agreement provides a mechanism for ensuring that an
appropriate federal, state or local agency will assume regulatory responsibility
for long-term maintenance.

The future costs in connection with the lawsuits described in the preceding
paragraphs are currently indeterminable due to such factors as the unknown
timing and extent of any future remedial actions which may be required, the
extent of any liability of the Company and of other potentially responsible
parties, and the financial resources of the other potentially responsible
parties.

39
<PAGE> 41

MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

The executive officers and directors of the Company are as follows:

<TABLE>
<CAPTION>
NAME AGE POSITION
- ------------------------------------ --- ------------------------------------------------------
<S> <C> <C>
Horace H. Irvine II(3).............. 59 Chairman of the Board of Directors
Andrew E. Lietz..................... 58 President, Chief Executive Officer and Director
Timothy P. Losik.................... 38 Vice President, Chief Financial Officer and Treasurer
James R. Griffin.................... 46 Vice President
Richard P. Saporito................. 43 Vice President
James C. Hamilton................... 59 Clerk
Lawrence Coolidge(3)................ 60 Director
J. Stanley Hill(1)(2)............... 82 Director
John F. Smith(1)(3)................. 62 Director
Oliver O. Ward(1)(2)................ 61 Director
Patrick Sweeney..................... 61 Director
John E. Pomeroy(2).................. 55 Director
James C. Taylor(2).................. 59 Director
</TABLE>

- ------------

(1) Member of Audit Committee.

(2) Member of Joint Stock Option and Compensation Committee.

(3) Member of Nominating Committee.

Mr. Horace H. Irvine II is a founder of the Company and has been its
Chairman of the Board since the Company was incorporated in 1966, and its Chief
Executive Officer from 1966 until 1986. He was President of the Company from
1966 until 1980 and Treasurer of the Company from 1966 until 1984. He is
Chairman of the Nominating Committee of the Board of Directors.

Mr. Lietz joined the Company in 1984 and has been President and Chief
Executive Officer of the Company since October 1995. From July 1991 to October
1995 Mr. Lietz was the Chief Operating Officer and a Vice President of the
Company. He has been a director of the Company since February 1993. Prior to
joining the Company, Mr. Lietz spent 20 years employed by IBM where he held
various sales, marketing and management positions.

Mr. Losik joined the Company in 1986 and has been the Chief Financial
Officer, Vice President and Treasurer of the Company since March 1994. He was
the Controller of the Company from June 1992 to March 1994 and a Corporate
Accounting Manager from March 1988 to June 1992. Mr. Losik is a certified public
accountant. From 1979 to 1986, Mr. Losik held various positions, including
partner, in public accounting firms.

Mr. Griffin joined the Company in 1979 and has been a Vice President of the
Company since August 1991. He was the Director of Marketing Programs of the
Company from 1989 to 1991.

Mr. Saporito joined the Company in 1987 and has been a Vice President of
the Company since December 1991. He was the Director of Human Resources of the
Company from 1989 to 1991.

Mr. Hamilton has been the Clerk of the Company since 1966. He is a partner
in the law firm of Berlin, Hamilton & Dahmen, LLP, general counsel to the
Company.

Mr. Coolidge has been a director of the Company since 1995. He has been the
president and a private trustee of Loring, Wolcott & Coolidge Office, a
fiduciary services provider, since 1962. On August 1, 1994, Mr. Coolidge became
an associate of Loring, Wolcott & Coolidge Fiduciary Advisors, a registered
investment advisor.

40
<PAGE> 42

Mr. Hill has been a director of the Company since 1981. He is Chairman of
the Audit Committee of the Board of Directors. During the past 27 years, he has
been president of Digiplan Inc., a private consultant to the computer users'
industry.

Mr. Smith has been a director of the Company since 1995. He is Chairman of
the Long-Term Planning and Strategy Committee of the Board of Directors. He has
been the president of MYCOS International, Inc., a property development
corporation, since April 1993, and president of PerSeptive Biosystems, Inc., a
biotechnology company, since July 1996. In April 1993, Mr. Smith retired as
Senior Vice President and Chief Operating Officer of Digital Equipment
Corporation, a computer company, in which capacities he had served since 1991.
He began his career at Digital Equipment Corporation in 1958 and served in
various other senior management positions from 1976 to 1991. Mr. Smith is also a
director of Ansys Corporation, Instron Corporation, PerSeptive Biosystems, Inc.
and Sequoia Systems, Inc.

Mr. Ward has been a director of the Company since 1987. He is Chairman of
the Executive and Finance Committees of the Board of Directors. He was a founder
and has served as chairman of the board, chief executive officer and president
of Germanium Power Devices Corp., a manufacturer and marketer of germanium
semiconductors, since 1973.

Mr. Sweeney has been a director of the Company since 1991. He was President
and Chief Executive Officer of the Company from 1991 until October 1995, and
Chief Operating Officer from July 1990 to July 1991. He is currently a
consultant to the Company.

Mr. Pomeroy has been a director of the Company since September 1996. He has
been president and chief executive officer of Dover Technologies, a group of
manufacturing companies and a subsidiary of Dover Corporation, since 1987. Mr.
Pomeroy is also a director of Adept Technologies, Inc.

Mr. Taylor has been a director of the Company since December 1996. He is
Chairman of the Joint Stock Option and Compensation Committee of the Board of
Directors. He has been an advisory director at Downer and Company, an investment
banking firm, since 1995. He was a managing director of Burns Fry Limited, an
investment banking firm, from 1988 to 1994.

Directors are elected annually and hold office until the next annual
meeting of stockholders and until their successors are duly elected and
qualified, or until their earlier removal or resignation. Executive officers are
elected to serve at the pleasure of the Board of Directors. There are no family
relationships among any of the directors and executive officers of the Company.

41
<PAGE> 43

PRINCIPAL SHAREHOLDERS

The following table sets forth certain information with respect to
beneficial ownership of the Company's outstanding Common Stock as of April 26,
1997, and as adjusted to reflect the sale of the Common Stock offered hereby, by
(i) each person who is known by the Company to beneficially own more than 5% of
the Company's Common Stock, (ii) each director and executive officer of the
Company, (iii) the Chief Executive Officer, and (iv) all the directors and
executive officers of the Company as a group. Except as otherwise provided
below, the address of each person listed below is c/o Hadco Corporation, 12A
Manor Parkway, Salem, New Hampshire 03079.

<TABLE>
<CAPTION>
PERCENT OF SHARES
BENEFICIALLY OWNED
NUMBER OF SHARES -------------------------
BENEFICIALLY PRIOR TO AFTER
NAMES OR GROUP OWNED(1) OFFERING OFFERING(14)
- ---------------------------------------------- ---------------- -------- ------------
<S> <C> <C> <C>
Horace H. Irvine II........................... 920,762(2) 8.8% 7.4%
J&W Seligman & Co. Incorporated............... 702,100+ 6.7 5.6
100 Park Avenue
New York, NY 10017
FMR Corp...................................... 675,800(3) 6.5 5.4
82 Devonshire Street
Boston, MA 02109
Nicholas Applegate Capital Management......... 528,200+ 5.0 4.2
600 West Broadway, 29th Floor
San Diego, CA 03079
Andrew E. Lietz............................... 165,146(4) 1.6 1.3
Patrick Sweeney............................... 27,000 * *
Timothy P. Losik.............................. 26,775(5) * *
James R. Griffin.............................. 39,746(6) * *
Richard P. Saporito........................... 23,650(7) * *
J. Stanley Hill............................... 35,250(8) * *
Oliver O. Ward................................ 3,000(9) * *
Lawrence Coolidge............................. 240,158(10) 2.3 1.9
John F. Smith................................. 9,000(11) * *
John E. Pomeroy............................... 3,000(12) * *
James C. Taylor............................... 3,000(12) * *
James C. Hamilton............................. 241,408(10) 2.3 1.9
All directors and executive officers as a
group (13 persons).......................... 1,508,737(13) 14.1% 11.9%
================= ======== ============
</TABLE>

- ------------
* Represents less than 1% of the outstanding shares of the Company's Common
Stock.

+ Information obtained from a Schedule 13G filed February 4, 1997.

(1) Except as indicated in footnotes to this table, the persons named in this
table have sole voting and investment power with respect to all shares of
Common Stock owned.

(2) Includes 124,855 shares held in a voting trust for the benefit of Andrea P.
Irvine. Horace H. Irvine II, who is the sole trustee of such trust and
retains sole voting power with respect to the shares held in such trust,
disclaims beneficial ownership of such shares. Does not include 229,158
shares held in irrevocable trusts for the benefit of members of Horace H.
Irvine II's family. Horace H. Irvine II, who is not a trustee of such
trusts, disclaims beneficial ownership of such 229,158 shares. James C.
Hamilton, Clerk and a partner in Berlin, Hamilton & Dahmen, LLP, which is
general counsel to the Company, Lawrence Coolidge, a Director of the
Company, and

42
<PAGE> 44

Gilbert M. Roddy, Jr. are co-trustees of these irrevocable trusts. Horace
H. Irvine II retains no voting or dispositive power with respect to these
shares. All voting rights under these trusts reside in Messrs. Hamilton,
Coolidge and Roddy, who have the right to dispose of such shares. Messrs.
Coolidge and Hamilton own 11,000 and 12,250 shares, respectively, as
individuals, in addition to the shares they hold as co-trustees. Mr.
Coolidge's 11,000 shares include 6,000 shares issuable upon the exercise of
stock options that will become exercisable within 60 days after April 26,
1997.

(3) According to information provided to the Company by FMR Corp., as of
January 24, 1997, FMR Corp. beneficially owned 675,800 shares of the Common
Stock of the Company. Includes 608,200 shares beneficially owned by
Fidelity Management & Research Company, as a result of its serving as an
investment adviser to various investment companies registered under Section
8 of the Investment Company Act of 1940 and as an investment adviser to
certain other funds which are generally offered to limited groups of
investors. Also includes 67,600 shares beneficially owned by Fidelity
Management Trust Company as a result of its serving as trustee or managing
agent for various private investment accounts, primarily employee benefit
plans, and as an investment adviser to certain other funds which are
generally offered to limited groups of investors. FMR Corp. has sole voting
power with respect to 11,600 shares and sole dispositive power with respect
to 675,800 shares.

(4) Includes 134,746 shares issuable upon the exercise of stock options granted
to Mr. Lietz that are currently exercisable or will become exercisable
within 60 days after April 26, 1997 and 30,000 shares held by a trust of
which Mr. Lietz is the sole trustee and sole beneficiary.

(5) Includes 20,775 shares issuable upon the exercise of stock options granted
to Mr. Losik that are currently exercisable or will become exercisable
within 60 days after April 26, 1997 and 6,000 shares held jointly with Mr.
Losik's spouse.

(6) Includes 35,700 shares issuable upon the exercise of stock options granted
to Mr. Griffin that are currently exercisable or will become exercisable
within 60 days after April 26, 1997.

(7) Includes 23,450 shares issuable upon the exercise of stock options granted
to Mr. Saporito that are currently exercisable or will become exercisable
within 60 days after April 26, 1997.

(8) Includes 3,000 shares issuable upon the exercise of stock options granted
to Mr. Hill that are currently exercisable or will become exercisable
within 60 days after April 26, 1997. Does not include 20,000 shares owned
by Mr. Hill's wife, as to which Mr. Hill disclaims beneficial ownership.

(9) Consists of 3,000 shares issuable upon the exercise of stock options
granted to Mr. Ward that are currently exercisable or will become
exercisable within 60 days after April 26, 1997.

(10) See footnote (2) above.

(11) Consists of 9,000 shares issuable upon the exercise of stock options
granted to Mr. Smith that are currently exercisable or will become
exercisable within 60 days after April 26, 1997.

(12) Consists of 3,000 shares issuable upon the exercise of stock options
granted to each of Messrs. Pomeroy and Taylor that are currently
exercisable or will become exercisable within 60 days after April 26, 1997.

(13) Includes 229,158 shares held by Mr. Coolidge, Mr. Hamilton, and Gilbert M.
Roddy, Jr., as co-trustees and 124,855 shares held by Horace H. Irvine II
as trustee. Includes 6,000 shares issuable upon the exercise of stock
options granted to Mr. Coolidge that are currently exercisable or will
become exercisable within 60 days after April 26, 1997. See footnote (2)
above. Includes 134,746 shares issuable upon the exercise of stock options
granted to Andrew E. Lietz, that are currently exercisable or will become
exercisable within 60 days after April 26, 1997. See footnote (4) above.
Includes 20,775 shares issuable upon the exercise of stock options granted
to Mr. Losik

43
<PAGE> 45

that are currently exercisable or will become exercisable within 60 days
after April 26, 1997. See footnote (5) above. Includes 35,700 shares
issuable upon the exercise of stock options granted to Mr. Griffin that are
currently exercisable or will become exercisable within 60 days after April
26, 1997. See footnote (6) above. Includes 23,450 shares issuable upon the
exercise of stock options granted to Mr. Saporito that are currently
exercisable or will become exercisable within 60 days after April 26, 1997.
See footnote (7) above. Includes 3,000 shares issuable upon the exercise of
stock options granted to Mr. Hill. See footnote (8) above. Includes 3,000
shares issuable upon the exercise of stock options granted to Mr. Ward. See
footnote (9) above. Includes 9,000 shares issuable upon the exercise of
stock options granted to Mr. Smith that are currently exercisable or will
become exercisable within 60 days after April 26, 1997. See footnote (11)
above. Includes an aggregate of 6,000 shares issuable upon the exercise of
currently exercisable stock options granted to each of Messrs. Pomeroy and
Taylor. See footnote (12) above.

(14) The above table assumes no exercise of the over-allotment option. If the
Underwriters exercise their over-allotment option in full, the number of
shares offered, the number of shares beneficially owned after the Offering,
and the percent of shares beneficially owned after the Offering for each of
the Selling Stockholders would be: (a) Horace H. Irvine II -- 100,000,
820,762, 6.5%; (b) certain trusts for the benefit of members of Horace H.
Irvine II's family -- 35,000, 194,158, 1.5%; (c) Andrew E. Lietz -- 40,000,
125,146, 1.0%; (d) J. Stanley Hill -- 10,000, 25,250,*%; (e) James C.
Hamilton -- 3,000, 203,408, 1.6%; and (f) Kenneth Ogle -- 14,600,16,400,*%;
and the percent of shares beneficially owned after the Offering by all
directors and executive officers as a group will be 10.3% if the
Underwriters exercise their over-allotment option in full.

44
<PAGE> 46

DESCRIPTION OF CAPITAL STOCK

The Company's authorized capital stock consists of 25,000,000 shares of
Common Stock, $.05 par value. As of April 26, 1997, there were 10,471,163 shares
of Common Stock of the Company outstanding held by approximately 345 holders of
record.

COMMON STOCK

Each outstanding share of Common Stock is entitled to one vote on all
matters submitted to a vote of stockholders. Voting rights are not cumulative,
so that the holders of a majority of the voting power of the Company could elect
all the Directors standing for election at any annual or special meeting of
stockholders, and the holders of the remaining shares may not be able to elect
any Director. Dividends may be paid to the holders of Common Stock only when and
if declared by the Board of Directors out of funds legally available therefor.
No cash dividends have ever been paid by the Company on its Common Stock. See
"Dividend Policy." Holders of Common Stock have no preemptive, conversion or
other rights to subscribe for additional shares of stock or other securities of
the Company. Shares of Common Stock are not subject to any redemption
provisions. No share of Common Stock outstanding on the date hereof or sold in
the Offering is or will be subject to any call or assessment. In the event of
any liquidation, dissolution or winding up of the affairs of the Company, the
holders of Common Stock will be entitled to share ratably in all assets
remaining after provision for payment of creditors.

MASSACHUSETTS LAW

The Company is subject to the provisions of Chapter 110F of the
Massachusetts General Laws, the so-called Business Combination Statute. Under
Chapter 110F, a Massachusetts corporation with over 200 stockholders, such as
the Company, may not engage in a "business combination" with an "interested
stockholder" for a period of three years after the date of the transaction in
which the person becomes an interested stockholder, unless (i) the interested
stockholder obtains the approval of the Board of Directors prior to becoming an
interested stockholder, (ii) the interested stockholder acquires 90% of the
outstanding voting stock of the corporation (excluding shares held by certain
affiliates of the corporation) at the time it becomes an interested stockholder,
or (iii) the business combination is approved by both the Board of Directors and
the holders of two-thirds of the outstanding voting stock of the corporation
(excluding shares held by the interested stockholder). An "interested
stockholder" is a person who, together with affiliates and associates, owns (or
at any time within the prior three years did own) 5% or more of the outstanding
voting stock of the corporation. A "business combination" includes a merger, a
stock or assets sale, and other transactions resulting in a financial benefit to
the stockholder.

The Company is subject to the provisions of Chapter 110D of the
Massachusetts General Laws, entitled "Regulation of Control Share Acquisitions."
In general, this statute provides that any stockholder of a corporation subject
to this statute who acquires 20% or more of the outstanding voting stock of a
corporation (except in certain transactions) may not vote such stock unless the
stockholders of the corporation so authorize. The statute specifically excludes
situations where any person acquires the triggering 20% ownership "solely by
virtue of a revocable proxy conferring the right to vote." The Board of
Directors may amend the Company's By-laws at any time to exclude the Company
from this statute prospectively.

On April 18, 1990, Massachusetts enacted Chapter 156B sec.50A of the
Massachusetts General Laws which, in general, requires that publicly held
Massachusetts corporations have a classified board of directors consisting of
three classes as nearly equal in size as possible. Once the corporation is
subject to the classified board provisions of this statute, directors may be
removed by a majority vote of the stockholders only for cause. This statute
provides that a corporation may elect to be exempt from the classified board
provisions by a vote of its directors. By vote of the Board of Directors, the
Company has elected to be exempt from the classified board provisions of this
statute.

45
<PAGE> 47

STOCKHOLDER RIGHTS PLAN

On August 22, 1995, the Company's Board of Directors adopted a Stockholder
Rights Plan (the "Rights Plan"), the adoption of which did not require
stockholder approval, under which Common Stock Purchase Rights (the "Rights")
were distributed as a Rights dividend on September 11, 1995 at the rate of one
Right for each share of Common Stock held as of the close of business on that
date.

The Rights Plan is designed to prevent an acquirer from gaining control of
the Company without offering a fair price to all of the Company's stockholders.
The Rights Plan was not adopted by the Board in response to any specific offer
or threat, but rather is intended to protect the interests of stockholders in
the event the Company is confronted in the future with takeover tactics.

Each Right will entitle holders of Common Stock to buy one share of Common
Stock of the Company at an exercise price of $130. The Rights will be
exercisable only after 10 days following a public announcement that a person or
group has acquired more than 20% (exempting the stock ownership of Horace H.
Irvine II, the founder and Chairman of the Board of the Company, and certain
related persons and entities) of the Common Stock (the "Stock Acquisition
Date"), or 10 business days after such person or group announces a tender or
exchange offer which would result in its ownership of 25% or more of the Common
Stock, or 10 business days after a person owning 10% or more of the Common Stock
is determined by the Board to be an "Adverse Person," as defined in the Rights
Plan. The more-than-20% stockholder threshold described above is not triggered
by revocable proxies. Under the Rights Plan, an Acquiring Person is defined as a
Beneficial Owner of more than 20% of Common Stock; however, such definition
excludes any security the ownership of which arises solely from a revocable
proxy given in response to a public proxy or consent solicitation in accordance
with the provisions of the Exchange Act and not also reportable on Schedule 13D.

If any person or group becomes the beneficial owner of 25% or more of the
Company's Common Stock except pursuant to a tender offer for all shares at a
price that a majority of the independent directors determines to be fair; if a
more-than-20% stockholder engages in a merger with the Company in which the
Company survives and its Common Stock remains outstanding and unchanged; if
certain other events involving the Company and a more-than-20% stockholder
occur; or, if under certain circumstances, the Board determines a 10% or more
stockholder to be an Adverse Person, then each Right not owned by such person or
related parties will entitle its holder to purchase, at the then current
exercise price of the Right, Common Stock of the Company (or, in certain
circumstances as determined by the Board, a combination of cash, property,
Common Stock or other securities or a reduction in the exercise price) having a
value of twice the Right's exercise price. In such circumstances, the Company
may also exchange one share of Common Stock for each Right outstanding. In
addition, if the Company is involved in a merger or other business combination
transaction with another person in which its Common Stock is changed or
converted, or sells or transfers more than 50% of its assets or earning power to
another person, each Right that has not previously been exercised will entitle
its holder to purchase, at the then current exercise price of the Right, shares
of Common Stock of such other person having a value of twice the Right's
exercise price.

In general, the Company can redeem the Rights at $0.01 per Right at any
time prior to ten days following the Stock Acquisition Date. The Rights will
expire on September 11, 2005, unless earlier redeemed or exchanged.

The Rights have certain anti-takeover effects, in that they can cause
substantial dilution to a person or group that attempts to acquire a significant
interest in the Company on terms not approved by the Board of Directors.

TRANSFER AGENT AND REGISTRAR

The Transfer Agent and Registrar for the Company's Common Stock is The
First National Bank of Boston.

46
<PAGE> 48

UNDERWRITING

The Underwriters named below, acting through their representatives,
Robertson, Stephens & Company LLC, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, and Adams, Harkness & Hill, Inc. (the "Representatives"), have
severally agreed with the Company, subject to the terms and conditions of the
Underwriting Agreement, to purchase from the Company the number of shares of
Common Stock set forth opposite their respective names below. The Underwriters
are committed to purchase and pay for all such shares if any are purchased.

<TABLE>
<CAPTION>
NUMBER
UNDERWRITER OF SHARES
-------------------------------------------------------------------------- ---------
<S> <C>
Robertson, Stephens & Company LLC.........................................
Merrill Lynch, Pierce, Fenner & Smith
Incorporated................................................
Adams, Harkness & Hill, Inc...............................................

---------
Total................................................................ 2,000,000
=========
</TABLE>

The Representatives have advised the Company that the Underwriters propose
to offer the shares of Common Stock to the public at the public offering price
set forth on the cover page of this Prospectus and to certain dealers at such
price, less a concession of not more than $ per share, of which
$ may be reallowed to other dealers. After the public offering, the
public offering price, concession and reallowance to dealers may be reduced by
the Representatives. No such reduction shall change the amount of proceeds to be
received by the Company as set forth on the cover page of this Prospectus.

The Company and the Selling Stockholders have granted to the Underwriters
an option, exercisable during the 30-day period after the date of this
Prospectus, to purchase up to 97,400 and 202,600 shares of Common Stock,
respectively, at the same price per share as the Company receives for the
2,000,000 shares of Common Stock that the Underwriters have agreed to purchase
from the Company. The first 202,600 shares of Common Stock purchased by the
Underwriters pursuant to this option will be sold by the Selling Stockholders
and the subsequent 97,400 shares, if any, purchased by the Underwriters pursuant
to this option will be sold by the Company. To the extent that the Underwriters
exercise such option, each of the Underwriters will have a firm commitment to
purchase approximately the same percentage of such additional shares as the
number of shares of Common Stock to be purchased by it shown in the above table
represents as a percentage of the 2,000,000 shares offered hereby. If purchased,
such additional shares will be sold by the Underwriters on the same terms as
those on which the 2,000,000 shares of Common Stock are being sold.

The Underwriting Agreement contains covenants of indemnity among the
Underwriters, the Company and, the Selling Stockholders against certain civil
liabilities, including liabilities under the Securities Act of 1933, as amended
(the "Securities Act").

Pursuant to the terms of Lockup Agreements, all executive officers and
Selling Stockholders, and certain directors, of the Company have agreed with the
Representatives that, for a period 90 days after the date of the Offering (the
"Lock-Up Period"), they will not offer to sell, contract to sell or otherwise
sell, dispose of or grant any rights with respect to any shares of Common Stock,
any options or warrants to purchase shares of Common Stock or any securities
convertible into or exchangeable for shares of Common Stock now owned or
hereafter acquired directly by such holders or with respect to

47
<PAGE> 49

which they have the power of disposition, otherwise than with the prior written
consent of Robertson Stephens & Company LLC which may, in its sole discretion
and at any time, without notice, release all or any portion of the securities
subject to Lockup Agreements. The Company has also agreed not to offer, sell,
contract to sell or otherwise dispose of any shares of Common Stock or any
securities convertible into or exercisable or exchangeable for Common Stock or
any options or warrants to purchase Common Stock other than shares or options
issued under the Company's stock option plans and stock issued upon the exercise
of outstanding options and warrants during the Lock-Up Period except with the
prior written consent of Robertson, Stephens & Company LLC.

The Representatives have advised the Company that the Underwriters do not
intend to confirm any sales to accounts over which they exercise discretionary
authority.

The offering price of the Common Stock will be determined by negotiations
among the Company and the Representatives, based largely upon the market price
for the Common Stock as reported on the Nasdaq National Market.

The Representatives have advised the Company that certain persons
participating in the Offering may engage in transactions, including syndicate
covering transactions or the imposition of penalty bids, which may involve the
purchase of Common Stock on the Nasdaq National Market, the over-the-counter
market or otherwise. Such transactions may stabilize or maintain the market
price of the Common Stock at levels above that which might otherwise prevail in
the open market. A stabilizing bid means the placing of any bid or effecting of
any purchase, for the purpose of pegging, fixing or maintaining the price of the
Common Stock. A syndicate covering transaction means the placing of any bid on
behalf of the underwriting syndicate or the effecting of any purchase to reduce
a short position created in connection with the offering. A penalty bid means an
arrangement that permits the Underwriters to reclaim a selling concession from a
syndicate member in connection with the offering when shares of Common Stock
sold by the syndicate member are purchased in syndicate covering transactions.
Such transactions may be effected on the Nasdaq Stock Market, in the
over-the-counter market, or otherwise. Such stabilizing, if commenced, may be
discontinued at any time.

LEGAL MATTERS

The validity of the shares of Common Stock offered hereby will be passed
upon for the Company by Testa, Hurwitz & Thibeault, LLP, Boston, Massachusetts,
special counsel to the Company. The validity of the shares of Common Stock
offered hereby by the Selling Stockholders will be passed upon for the Selling
Stockholders by Berlin, Hamilton & Dahmen, LLP, Boston, Massachusetts. A member
of Testa, Hurwitz & Thibeault, LLP is the beneficial owner of 100 shares of
Common Stock of the Company. James C. Hamilton, a partner at Berlin, Hamilton &
Dahmen, LLP, which is general counsel to the Company, is the Company's Clerk. He
is the beneficial owner of 12,250 shares of Common Stock of the Company. He is
also the co-trustee of certain irrevocable trusts for the benefit of members of
the family of Horace H. Irvine II, Chairman of the Board of the Company. See
"Principal Shareholders."

Certain legal matters relating to the Offering will be passed upon for the
Underwriters by Hale and Dorr, LLP, Boston, Massachusetts.

EXPERTS

The Company's audited consolidated financial statements and schedule
included in this Prospectus and elsewhere in the Registration Statement have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in its reports with respect thereto, and are included herein in
reliance upon the authority of said firm as experts in giving said reports.

The consolidated financial statements of Zycon Corporation included in this
Prospectus have been audited by Arthur Andersen LLP, independent public
accountants, as of December 31, 1996 and for the one-year period ended December
31, 1996 to the extent indicated in its report, and are included

48
<PAGE> 50

herein in reliance upon the authority of such firm as experts in giving said
report. The consolidated financial statements of Zycon Corporation as of
December 31, 1995 and for each of the years in the two-year period ended
December 31, 1995, have been included herein and in the Registration Statement
in reliance upon the report of KPMG Peat Marwick LLP, independent certified
public accountants, appearing elsewhere herein, and upon the authority of said
firm as experts in accounting and auditing.

ADDITIONAL INFORMATION

The Company has filed with the Commission a Registration Statement on Form
S-3 under the Securities Act with respect to the securities offered hereby (the
"Registration Statement"). This Prospectus, which constitutes part of the
Registration Statement, does not contain all the information set forth in the
Registration Statement and the exhibits and schedules thereto, certain parts of
which are omitted in accordance with the rules and regulations of the
Commission. Statements contained in this Prospectus as to the contents of any
contract or any other document referred to are not necessarily complete.
Reference is made to such contract or other document filed, or incorporated by
reference, as an exhibit to the Registration Statement, and each such statement
is qualified in all respects by such reference. For further information
pertaining to the Company and the Common Stock, reference is made to the
Registration Statement and the exhibits and schedules thereto, which may be
inspected without charge at the office of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549; and at the following Regional Offices of the
Commission: Seven World Trade Center, New York, New York, 10048; and 500 West
Madison Avenue, Suite 1400, Chicago, Illinois 60621.

AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Exchange
Act, and in accordance therewith files reports, proxy statements and other
information with the Commission. All such reports, proxy statements and other
information can be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the following regional offices of the
Commission: 90 Devonshire Street, Suite 700, Boston, Massachusetts 02109; 7
World Trade Center, 13th Floor, New York, New York 10048; and Northwestern
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such material may also be obtained from the Public
Reference Section of the Commission at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at its public reference facilities at
Boston, Massachusetts, New York, New York and Chicago, Illinois at prescribed
rates. In addition, the aforementioned materials may also be inspected at the
offices of the Nasdaq National Market at 1735 K Street, N.W., Washington, D.C.
20006. The Commission maintains a World-Wide Web site that contains reports,
proxy and information statements and other information regarding registrants
that file electronically with the Commission. The address of the Commission's
Web site is http.//www.sec.gov.

49
<PAGE> 51

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
HADCO CORPORATION:
Report of Independent Public Accountants........................................... F-2
Consolidated Balance Sheets at October 28, 1995, October 26, 1996 and April 26,
1997 (Unaudited)................................................................ F-3
Consolidated Statements of Operations for the Years Ended October 29, 1994, October
28, 1995 and October 26, 1996 and for the Six Months Ended April 27, 1996
(Unaudited) and April 26, 1997 (Unaudited)...................................... F-4
Consolidated Statements of Stockholders' Investment for the Years Ended October 29,
1994, October 28, 1995 and October 26, 1996 and for the Six Months Ended April
26, 1997 (Unaudited)............................................................ F-5
Consolidated Statements of Cash Flows for the Years Ended October 29, 1994, October
28, 1995 and October 26, 1996 and for the Six Months Ended April 27, 1996
(Unaudited) and April 26, 1997 (Unaudited)...................................... F-6
Notes to Consolidated Financial Statements......................................... F-7
PRO FORMA FINANCIAL STATEMENTS:
Pro Forma Condensed Consolidated Financial Statements.............................. F-23
Pro Forma Condensed Consolidated Statement of Operations for the Fiscal Year Ended
October 26, 1996 (Unaudited).................................................... F-24
Pro Forma Condensed Consolidated Statement of Operations for the Six Months Ended
April 26, 1997 (Unaudited)...................................................... F-25
ZYCON CORPORATION:
Report of Independent Public Accountants (Arthur Andersen LLP)..................... F-26
Independent Auditors' Report (KPMG Peat Marwick LLP)............................... F-27
Consolidated Balance Sheets as of December 31, 1995 and 1996....................... F-28
Consolidated Statements of Income for the Years Ended December 31, 1994, 1995 and
1996............................................................................ F-29
Consolidated Statements of Stockholders' Equity for the Years Ended December 31,
1994, 1995 and 1996............................................................. F-30
Consolidated Statements of Cash Flows for the Years Ended December 31, 1994, 1995
and 1996........................................................................ F-31
Notes to Consolidated Financial Statements......................................... F-32
</TABLE>

F-1
<PAGE> 52

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Hadco Corporation:

We have audited the accompanying consolidated balance sheets of Hadco
Corporation (a Massachusetts corporation) and subsidiaries as of October 28,
1995 and October 26, 1996, and the related consolidated statements of
operations, stockholders' investment and cash flows for each of the three years
in the period ended October 26, 1996. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Hadco Corporation as of
October 28, 1995 and October 26, 1996, and the results of their operations and
their cash flows for each of the three years in the period ended October 26,
1996, in conformity with generally accepted accounting principles.

ARTHUR ANDERSEN LLP

Boston, Massachusetts
November 15, 1996 (except for the
matter discussed in Note 2, as to
which the date is January 10, 1997)

F-2
<PAGE> 53

HADCO CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
(In thousands, except per share information)

<TABLE>
<CAPTION>
OCTOBER 28, OCTOBER 26, APRIL 26,
1995 1996 1997
----------- ----------- ------------
(UNAUDITED)
<S> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents......................... $ 21,307 $ 32,786 $ 7,106
Short-term investments............................ 15,167 9,401 --
Accounts receivable, net of allowance of $850 in
1995, $1,100 in 1996 and $2,330 in 1997........ 35,797 40,622 85,139
Inventories....................................... 13,304 21,786 37,297
Deferred tax asset................................ 6,288 7,483 8,283
Prepaid and other expenses........................ 1,696 1,483 4,674
-------- -------- --------
Total current assets...................... 93,559 113,561 142,499
PROPERTY, PLANT AND EQUIPMENT, NET.................. 67,692 103,735 212,370
DEFERRED TAX ASSET.................................. 1,646 2,117 --
ACQUIRED INTANGIBLE ASSETS, NET..................... -- -- 107,105
OTHER ASSETS........................................ 94 88 4,303
-------- -------- --------
$ 162,991 $ 219,501 $466,277
======== ======== ========
LIABILITIES AND STOCKHOLDERS' INVESTMENT
CURRENT LIABILITIES:
Short-term debt, current portion of long-term debt
and capital lease obligations.................. $ 2,143 $ 1,907 $ 7,027
Accounts payable.................................. 27,002 42,265 68,041
Accrued payroll and other employee benefits....... 16,030 17,592 23,086
Other accrued expenses............................ 7,341 8,236 9,579
-------- -------- --------
Total current liabilities................. 52,516 70,000 107,733
-------- -------- --------
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS, NET OF
CURRENT PORTION................................... 2,387 1,515 236,730
-------- -------- --------
DEFERRED TAX LIABILITY.............................. -- -- 31,085
-------- -------- --------
OTHER LONG-TERM LIABILITIES......................... 7,314 9,145 9,214
-------- -------- --------
COMMITMENTS AND CONTINGENCIES (Note 9)
STOCKHOLDERS' INVESTMENT:
Common stock, $.05 par value;
Authorized -- 25,000 shares
Issued and outstanding -- 9,939 shares in 1995,
10,382 in 1996 and 10,471 shares in 1997....... 497 521 525
Paid-in capital................................... 25,077 30,939 32,755
Deferred compensation............................. (407) (240) (174)
Retained earnings................................. 75,607 107,621 48,409
-------- -------- --------
Total stockholders' investment............ 100,774 138,841 81,515
-------- -------- --------
$ 162,991 $ 219,501 $466,277
======== ======== ========
</TABLE>

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

F-3
<PAGE> 54

HADCO CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)

<TABLE>
<CAPTION>
FOR THE YEARS ENDED, SIX MONTHS ENDED,
------------------------------------- ------------------------
OCTOBER 29, OCTOBER 28, OCTOBER 26, APRIL 27, APRIL 26,
1994 1995 1996 1996 1997
----------- ----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Net Sales.................................................. $ 221,570 $ 265,168 $ 350,685 $ 164,574 $ 292,198
Cost of Sales.............................................. 176,052 197,728 260,230 121,161 227,358
-------- -------- -------- ------- --------
Gross Profit............................................... 45,518 67,440 90,455 43,413 64,840
Operating Expenses......................................... 29,036 33,534 38,923 19,179 28,819
Write-off of Acquired in-Process Research and
Development.............................................. -- -- -- -- 78,000
-------- -------- -------- ------- --------
Income (Loss) From Operations.............................. 16,482 33,906 51,532 24,234 (41,979)
Interest and Other Income.................................. 843 1,669 1,287 683 806
Interest Expense........................................... (891) (537) (338) (190) (5,251)
-------- -------- -------- ------- --------
Income (Loss) Before Provision for Income Taxes............ 16,434 35,038 52,481 24,727 (46,424)
Provision for Income Taxes................................. 6,491 13,664 20,467 9,642 12,788
-------- -------- -------- ------- --------
Net Income (Loss).......................................... $ 9,943 $ 21,374 $ 32,014 $ 15,085 $ (59,212)
======== ======== ======== ======= ========
Net Income (Loss) Per Share................................ $ .93 $ 1.98 $ 2.89 $ 1.36 $ (5.67)
======== ======== ======== ======= ========
Weighted Average Shares Outstanding........................ 10,720 10,806 11,084 11,125 10,435
======== ======== ======== ======= ========
</TABLE>

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

F-4
<PAGE> 55

HADCO CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' INVESTMENT
(In thousands)

<TABLE>
<CAPTION>
COMMON STOCK
--------------------
NUMBER $.05 PAR PAID-IN DEFERRED RETAINED
OF SHARES VALUE CAPITAL COMPENSATION EARNINGS
--------- -------- ------- ------------ --------
<S> <C> <C> <C> <C> <C>
BALANCE, OCTOBER 30, 1993.................... 9,734 $487 $21,953 $ (1,316) $ 47,307
Terminated stock options................... -- -- (225) 225 --
Exercise of stock options.................. 332 16 837 -- --
Tax benefit of exercise of nonqualified
stock options........................... -- -- 319 -- --
Compensation expense associated with
granting nonqualified stock options..... -- -- -- 360 --
Purchase and retirement of common stock.... (328) (16) (121) -- (2,329)
Net income................................. -- -- -- -- 9,943
------ ---- ------- ------- --------
BALANCE, OCTOBER 29, 1994.................... 9,738 487 22,763 (731) 54,921
Terminated stock options................... -- -- (37) 37 --
Exercise of stock options.................. 529 16 1,079 -- --
Tax benefit of exercise of nonqualified
stock options........................... -- -- 1,597 -- --
Compensation expense associated with
granting nonqualified stock options..... -- -- -- 287 --
Purchase and retirement of common stock.... (328) (6) (325) -- (688)
Net income................................. -- -- -- -- 21,374
------ ---- ------- ------- --------
BALANCE, OCTOBER 28, 1995.................... 9,939 497 25,077 (407) 75,607
Terminated stock options................... -- -- (13) 13 --
Exercise of stock options.................. 443 24 1,714 -- --
Tax benefit of exercise of nonqualified
stock options........................... -- -- 4,161 -- --
Compensation expense associated with
granting nonqualified stock options..... -- -- -- 154 --
Net income................................. -- -- -- -- 32,014
------ ---- ------- ------- --------
BALANCE, OCTOBER 26, 1996.................... 10,382 521 30,939 (240) 107,621
Exercise of stock options (unaudited)...... 89 4 433 -- --
Tax benefit of exercise of nonqualified
stock options (unaudited)............... -- -- 1,383 -- --
Compensation expense associated with
granting nonqualified stock options
(unaudited)............................. -- -- -- 66 --
Net loss (unaudited)....................... -- -- -- -- (59,212)
------ ---- ------- ------- --------
BALANCE, APRIL 26, 1997 (Unaudited).......... 10,471 $525 $32,755 $ (174) $ 48,409
====== ==== ======= ======= ========
</TABLE>

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

F-5
<PAGE> 56

HADCO CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

<TABLE>
<CAPTION>
FOR THE YEARS ENDED, SIX MONTHS ENDED,
--------------------------------------- ---------------------------
OCTOBER 29, OCTOBER 28, OCTOBER 26, APRIL 27, APRIL 26,
1994 1995 1996 1996 1997
----------- ----------- ----------- ----------- -----------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)....................................... $ 9,943 $ 21,374 $ 32,014 $ 15,085 $ (59,212)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities--
Write-off of acquired in-process research and
development......................................... -- -- -- -- 78,000
Depreciation, amortization, deferred compensation and
deferred taxes...................................... 12,708 11,218 17,330 8,479 17,996
Gain on sale of fixed assets.......................... (81) (415) (205) (255) --
Changes in assets and liabilities, net of acquisition
of Zycon Corporation--
Increase in accounts receivable................... (2,739) (10,485) (4,825) (5,273) (19,698)
Increase in inventories........................... (288) (3,009) (8,482) (3,890) (4,122)
(Increase) decrease in prepaid taxes and other
expenses........................................ (685) (364) 213 (254) 1,215
Decrease (increase) in other assets............... 55 25 33 (83) (584)
Increase in accounts payable and accrued
expenses........................................ 8,661 15,291 17,720 (2,299) 325
Increase in long-term liabilities................. 1,710 2,714 1,831 1,251 70
-------- -------- -------- -------- ---------
Net cash provided by operating activities....... 29,284 36,349 55,629 12,761 13,990
-------- -------- -------- -------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of short-term investments..................... (19,437) (15,464) (8,402) (3,131) --
Maturities of short-term investments.................... 9,391 12,796 14,168 10,128 9,401
Sales of short-term investments......................... 5,951 -- -- -- --
Purchases of property, plant and equipment.............. (19,510) (28,865) (53,966) (31,890) (29,611)
Proceeds from sale of property, plant and equipment..... 177 429 290 255 --
Acquisition of Zycon Corporation, net of cash acquired
of $2,824............................................. -- -- -- -- (209,661)
-------- -------- -------- -------- ---------
Net cash used in investing activities........... (23,428) (31,104) (47,910) (24,638) (229,871)
-------- -------- -------- -------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments under capital lease obligations...... (4,447) (2,584) (2,047) (1,227) (816)
Principal payments of long-term debt.................... (92) (2,091) (92) (46) (35,805)
Proceeds from issuance of long-term debt................ -- -- -- -- 225,000
Proceeds from exercise of stock options................. 853 1,095 1,738 5,658 435
Tax benefit from exercise of options.................... 319 1,597 4,161 -- 1,387
Purchase and retirement of common stock................. (2,466) (1,019) -- -- --
-------- -------- -------- -------- ---------
Net cash (used in) provided by financing
activities.................................... (5,833) (3,002) 3,760 4,385 190,201
-------- -------- -------- -------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS...... 23 2,243 11,479 (7,492) (25,680)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD............ 19,041 19,064 21,307 21,307 32,786
-------- -------- -------- -------- ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD.................. $ 19,064 $ 21,307 $ 32,786 $ 13,815 $ 7,106
======== ======== ======== ======== =========
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING
ACTIVITIES:
Machinery and equipment acquired under capital
lease obligations..................................... $ -- $ -- $ 1,032 $ -- $ --
======== ======== ======== ======== =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for--
Interest.............................................. $ 859 $ 576 $ 279 $ 155 $ 4,282
======== ======== ======== ======== =========
Income taxes (net of refunds)......................... $ 8,939 $ 13,609 $ 16,794 $ 7,730 $ 9,070
======== ======== ======== ======== =========
ACQUISITION OF ZYCON CORPORATION--
Fair value of assets acquired........................... $ 212,509
Liabilities assumed..................................... (114,993)
Cash paid............................................... (204,885)
Acquisition costs incurred.............................. (7,600)
Write-off of acquired in-process research and
development........................................... 78,000
---------
Goodwill................................................ $ (36,969)
=========
</TABLE>

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

F-6
<PAGE> 57

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Hadco Corporation's (the "Company") principal products are complex
multilayer rigid printed circuits and backplane assemblies. The consolidated
financial statements reflect the application of certain accounting policies as
described in this note and elsewhere in the accompanying notes to consolidated
financial statements.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of
the Company and its wholly owned subsidiaries. All significant intercompany
balances and transactions have been eliminated in consolidation.

Management Estimates

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

Cash Equivalents and Short-Term Investments

The Company considers all highly liquid investment instruments purchased
with a maturity of three months or less to be cash equivalents. Short-term
investments are carried at cost, which approximates market, and have maturities
of less than one year.

The Company classifies its investments in corporate and government debt
securities as held-to-maturity given the Company's intent and ability to hold
the securities to maturity. In accordance with the statement, held-to-maturity
securities are carried at amortized cost.

The Company's investments in held-to-maturity securities are as follows:

<TABLE>
<CAPTION>
1995 1996
----------------- ---------------
FAIR FAIR
MARKET MARKET
COST VALUE COST VALUE MATURITY
------- ------- ------ ------ -------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
US Government Securities..................... $ 6,039 $ 6,058 $1,000 $ 999 within 1 year
State and Local Securities................... 1,000 1,000 5,270 5,271 within 1 year
Corporate Debt Securities.................... 8,128 8,064 3,131 3,069 within 1 year
------- ------- ------ ------
$15,167 $15,122 $9,401 $9,339
======= ======= ====== ======
</TABLE>

The Company has no financial instruments requiring disclosure under
Financial Accounting Standards Board issued Statement of Financial Accounting
Standard (SFAS) No. 119, Disclosure About Derivative Financial Instruments and
Fair Value of the Financial Instruments.

Concentration of Credit Risk

SFAS No. 105, Disclosure of Information About Financial Instruments with
Off-Balance-Sheet Risk and Financial Instruments with Concentrations of Credit
Risk, requires disclosure of any significant off-balance-sheet and credit risk
concentration. The Company has no significant off-balance-sheet

F-7
<PAGE> 58

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

concentrations of credit risk such as foreign currency exchange contracts or
other hedging arrangements. Financial instruments that subject the Company to
credit risk consist of cash and cash equivalents, short-term investments and
trade accounts receivable. The Company maintains the majority of its cash and
investment balances with financial institutions. The Company has not experienced
any losses on these investments to date. Substantially all of the Company's
accounts receivable are concentrated in the high technology and electronics
industry. The Company has not experienced significant losses related to
receivables from individual customers or groups of customers in the high
technology and electronics industry or by geographic region. Due to these
factors, no additional credit risk beyond amounts provided for collection losses
is believed by management to be inherent in the Company's accounts receivable.

Depreciation and Amortization of Property, Plant and Equipment

The Company provides for depreciation and amortization by charges to
operations in amounts that allocate the cost of property, plant and equipment on
a straight-line basis over the following estimated useful lives:

<TABLE>
<CAPTION>
ESTIMATED
ASSET CLASSIFICATION USEFUL LIFE
----------------------------------------------------------------------- -----------
<S> <C>
Land betterments....................................................... 10-18 Years
Buildings and improvements............................................. 10-40 Years
Machinery and equipment................................................ 3-10 Years
Furniture and fixtures................................................. 5-7 Years
Computer software...................................................... 3 Years
Vehicles............................................................... 3-5 Years
Capital leases......................................................... Lease term
</TABLE>

Net Income (Loss) per Share

Net income (loss) per share was computed based on the weighted average
number of common and common equivalent shares outstanding during each period.
Common equivalent shares include outstanding stock options and are included when
dilutive. Fully diluted net income (loss) per share has not been separately
presented as it would not be materially different from net income (loss) per
share as presented.

Revenue Recognition

The Company recognizes revenue at the time products are shipped.

Research and Development Expenses

The Company charges research and development expenses to operations as
incurred. For the fiscal years ended October 1994, 1995 and 1996 and the six
months ended April 26, 1997, research and development expenses were
approximately $1,545,000, $2,945,000, $4,307,000, and $3,401,000, respectively,
and are included in operating expenses.

New Accounting Standard

The Company accounts for its stock-based compensation plans under
Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to
Employees. The Company is required to adopt SFAS No. 123, Accounting for
Stock-Based Compensation, in fiscal 1997. SFAS No. 123 defines a fair-

F-8
<PAGE> 59

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

value-based method of accounting for employee stock options and other
stock-based compensation. The compensation expense arising from this method of
accounting can be reflected in the financial statements or, alternatively, the
pro forma net income and earnings per share effect of the fair-value-based
accounting can be disclosed in the financial footnotes. The Company will adopt
the disclosure-only alternative.

Foreign Currency Translation

The functional currency of the Company's Malaysian subsidiary is the United
States dollar. Accordingly, all remeasurement gains and losses resulting from
transactions denominated in currencies other than United States dollars are
included in the consolidated statements of operations. To date, the resulting
gains and losses have not been material.

Reclassification

The Company has reclassified certain prior year information to conform with
the current year's presentation.

Interim Financial Statements

The accompanying consolidated balance sheet as of April 26, 1997, the
consolidated statements of operations and cash flows for the six-month periods
ended April 27, 1996 and April 26, 1997 and the statement of stockholders'
investment for the six-month period ended April 26, 1997 are unaudited but, in
the opinion of management, include all adjustments (consisting of normal,
recurring adjustments) necessary for a fair presentation of results for these
interim periods. The results of operations for the six months ended April 26,
1997 are not necessarily indicative of results to be expected for the entire
year.

(2) ACQUISITION OF ZYCON

On January 10, 1997, the Company acquired substantially all of the
outstanding common stock of Zycon Corporation ("Zycon"). The acquisition was
financed by a new bank credit facility of up to $250,000,000, of which the
Company borrowed approximately $215,000,000, upon consummation of the
acquisition (see Note 7). The acquisition is being accounted for as a purchase
in accordance with APB Opinion No. 16, and accordingly, Zycon's operating
results since January 10, 1997 are included in the accompanying consolidated
financial statements.

In accordance with APB Opinion No. 16, the Company has allocated the
purchase price based on the fair value of assets acquired and liabilities
assumed. A significant portion of the purchase price, as described below, has
been identified in an independent appraisal as intangible assets using proven
valuation procedures and techniques, including approximately $78,000,000 of
in-process research and development ("in-process R&D"). Acquired intangibles
include developed technology, customer relationships, assembled workforce and
trade names/trademarks. These intangibles are being amortized over their
estimated useful lives of 12 to 30 years. The portion of the purchase price
allocated to the in-process R&D projects that did not have a future alternative
use totaled $78,000,000 and was charged to expense as of the acquisition date.
Due to a difference in the bases of certain assets for financial statement and
income tax purposes, deferred income taxes of $28,800,000 have been provided as
part of the purchase price allocation in accordance with SFAS No. 109.

F-9
<PAGE> 60

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

The aggregate purchase price of $212,485,000, including acquisition costs,
was allocated as follows:

<TABLE>
<CAPTION>
(IN THOUSANDS)
--------------
<S> <C>
Current assets........................................................ $ 41,790
Property, plant and equipment......................................... 95,193
Acquired intangibles.................................................. 72,000
In-process R&D........................................................ 78,000
Other assets.......................................................... 3,526
Goodwill.............................................................. 36,969
Liabilities assumed................................................... (114,993)
---------
$ 212,485
=========
</TABLE>

Unaudited pro forma operating results for the Company, assuming the
acquisition of Zycon occurred on October 29, 1995 are as follows:

<TABLE>
<CAPTION>
SIX MONTHS ENDED
YEAR ENDED -----------------------
OCTOBER APRIL 27, APRIL 26,
26, 1996 1996 1997
---------- --------- ---------
(IN THOUSANDS EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Net sales........................................ $570,345 $ 273,063 $ 353,209
Net income....................................... 27,222 15,594 17,849
Net income per share............................. $ 2.46 $ 1.40 $ 1.63
</TABLE>

For purposes of these pro forma operating results, the in-process R&D was
assumed to have been written off prior to October 29, 1995, so that the
operating results presented include only recurring costs.

(3) INVENTORIES

Inventories are stated at the lower of cost, first-in, first-out (FIFO), or
market and consist of the following:

<TABLE>
<CAPTION>
1995 1996 1997
------- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Raw materials......................................... $ 6,318 $ 8,008 $ 8,939
Work-in-process....................................... 6,986 13,778 28,358
------- ------- -------
$13,304 $21,786 $37,297
======= ======= =======
</TABLE>

The work-in-process consists of materials, labor and manufacturing
overhead.

F-10
<PAGE> 61

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

(4) PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consist of the following:

<TABLE>
<CAPTION>
1995 1996 1997
--------- --------- ---------
(IN THOUSANDS)
<S> <C> <C> <C>
Land betterments................................ $ 1,838 $ 1,991 $ 2,174
Buildings and improvements...................... 42,885 52,961 101,725
Construction-in-progress........................ 15,173 22,543 25,314
Machinery and equipment......................... 94,611 126,878 241,220
Furniture and fixtures.......................... 11,721 14,082 16,923
Computer software............................... 2,343 2,662 2,922
Vehicles........................................ 141 159 584
Capital leases.................................. 15,048 14,972 13,989
--------- --------- ---------
183,760 236,248 404,851
Accumulated depreciation and amortization....... (116,068) (132,513) (192,481)
--------- --------- ---------
$ 67,692 $ 103,735 $ 212,370
========= ========= =========
</TABLE>

(5) INTANGIBLE ASSETS

The Company assesses the realizability of intangible assets in accordance
with SFAS No. 121, Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be Disposed of. Under SFAS No. 121, the Company is required
to assess the valuation of its long-lived assets, including intangible assets,
based on the estimated cash flows to be generated by such assets. Intangible
assets are amortized on a straight-line basis, based on their estimated lives,
as follows:

<TABLE>
<CAPTION>
ESTIMATED APRIL 26,
LIFE 1997
---------- --------------
(IN THOUSANDS)
<S> <C> <C>
Developed technology..................................... 12 years $ 30,000
Customer relationships................................... 25 years 19,000
Assembled workforce...................................... 12 years 10,000
Trade names/trademarks................................... 30 years 13,000
Goodwill................................................. 20 years 36,969
--------
108,969
Less -- Accumulated amortization......................... (1,864)
--------
$107,105
========
</TABLE>

(6) INCOME TAXES

The Company accounts for income taxes in accordance with SFAS No. 109,
Accounting for Income Taxes.

F-11
<PAGE> 62

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

The provision for income taxes shown in the accompanying consolidated
statements of operations is comprised of the following:

<TABLE>
<CAPTION>
YEARS ENDED OCTOBER
---------------------------
1994 1995 1996
------- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Federal --
Current................................................. $ 6,566 $14,331 $18,341
Deferred................................................ (1,224) (2,954) (1,206)
------- ------- -------
5,342 11,377 17,135
------- ------- -------
State --
Current................................................. 1,440 2,928 3,611
Deferred................................................ (291) (641) (279)
------- ------- -------
1,149 2,287 3,332
------- ------- -------
$ 6,491 $13,664 $20,467
======= ======= =======
</TABLE>

The tax rate used in the computation of the provision for federal and state
income taxes differs from the statutory federal and state rates due to the
following:

<TABLE>
<CAPTION>
1994 1995 1996
---- ---- ----
<S> <C> <C> <C>
Provision for statutory rate................................. 34.0% 34.0% 34.0%
Increase (decrease) in tax resulting from --
State income taxes, net of federal tax benefit............. 4.6 4.5 4.4
Tax-exempt interest income................................. (0.4) (0.5) (0.4)
Other, net................................................. 1.3 1.0 1.0
---- ---- ----
Provision for income taxes.............................. 39.5% 39.0% 39.0%
==== ==== ====
</TABLE>

In accordance with generally accepted accounting principles, the Company
provides for income taxes on an interim basis, using its effective annual income
tax rate. Although the Company has incurred a loss before income taxes during
the six months ended April 26, 1997, the Company has recorded an income tax
provision because the write-off of in-process R&D is not deductible for income
tax purposes. Without taking into consideration the write-off of in-process R&D,
the Company anticipates that the effective annual income tax rate for fiscal
1997 will be 40.5%, which is approximately equal to the expected combined
federal and state statutory rates. The effective rate is increased by
amortization of goodwill and acquired intangibles which is not tax deductible,
and this item was offset by the tax benefit of the Company's Foreign Sales
Corporation and various state investment tax credits.

F-12
<PAGE> 63

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

The deferred provision for income taxes results from the following:

<TABLE>
<CAPTION>
1994 1995 1996
------- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Difference between book and tax depreciation........ $ (352) $ (144) $ (46)
Deferred compensation............................... 143 73 266
Reserves and expenses recognized in different
periods for book and tax purposes................. (1,288) (3,506) (1,658)
Other, net........................................ (18) (18) (47)
------- ------- -------
$(1,515) $(3,595) $(1,485)
======= ======= =======
</TABLE>

The tax effects of temporary differences that give rise to significant
portions of the current and long-term deferred tax assets and liabilities at
October 28, 1995 and October 26, 1996 are as follows:

<TABLE>
<CAPTION>
1995 1996
------- -------
(IN THOUSANDS)
<S> <C> <C>
Deferred Tax Assets --
Not currently deductible reserves............................ $ 6,184 $ 7,475
Not currently deductible environmental accruals.............. 3,197 3,907
Deferred compensation from issuance of nonqualified stock
options................................................... 579 275
------- -------
Total gross deferred tax assets...................... 9,960 11,657
Less -- valuation allowance.................................. 290 137
------- -------
9,670 11,520
Deferred Tax Liability --
Property, plant and equipment, principally due to differences
in depreciation........................................... (1,736) (1,920)
------- -------
Net deferred tax asset............................... $ 7,934 $ 9,600
======= =======
</TABLE>

Due to the uncertainty relating to the actual value of the favorable tax
benefits of deferred compensation from stock options, the Company has recorded a
valuation allowance of approximately $290,000 and $137,000 as of October 28,
1995 and October 26, 1996, respectively. The reduction of this allowance for the
year ended October 26, 1996 is a result of the decrease in the deferred tax
asset relating to deferred compensation.

(7) LINES OF CREDIT

Prior to the acquisition of Zycon discussed in Note 2, the Company had an
unsecured Revolving Credit and Term Loan Agreement with a bank. The agreement
provided for up to $15,000,000 in revolving credit until June 30, 1997. The
Company could designate the rate of interest at either the Eurodollar Rate plus
0.6%, or the bank's base rate. As of October 26, 1996, no amounts were
outstanding under this line of credit.

In connection with the Zycon acquisition discussed in Note 2, the Company
entered into a $250,000,000 unsecured Revolving Credit Agreement (the
"Agreement") with a bank, replacing the previous $15,000,000 agreement described
above. The Agreement provides for direct borrowings or letters of credit and
expires January 8, 2002. Borrowings under the Agreement bear interest, at the
Company's option, at either; (i) the Eurodollar rate plus a margin ranging
between .5% and 1.125%, based on a certain financial ratio of the Company, or
(ii) the Base Rate, as defined. The Company is

F-13
<PAGE> 64

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

required to pay a quarterly commitment fee ranging from .2% to .375%, based on a
certain financial ratio of the Company, of the unused commitment under the
Agreement. If the Company obtains certain debt financing, as defined, the bank
may require the Company to repay up to $150,000,000 of amounts outstanding under
the Agreement. At April 26, 1997, borrowings of $225,000,000 were outstanding
under the Agreement at a weighted average interest rate of 6.64%.

The Agreement places several restrictions on the Company, including
limitations on mergers, acquisitions and sales of a substantial portion of its
assets, as well as certain limitations on liens, guarantees, additional
borrowings, changes in the Company's capitalization, as defined, and
investments. The Agreement also requires the Company to maintain certain
financial covenants, including minimum levels of consolidated net worth, a
maximum ratio of funded debt to EBITDA, maximum capital expenditures and
interest coverage, as defined, during the term of the Agreement. At April 26,
1997, the Company was in compliance with all loan covenants.

The Company has a line of credit arrangement with a Malaysian bank
denominated in Malaysian ringgits and U.S. dollars for aggregate borrowings of
approximately $4.0 million for the purpose of acquiring land, facilities and
equipment for the Company's Malaysian subsidiary. The arrangement is renewable
annually. At April 26, 1997, there was $1,380,000 outstanding under this
arrangement at a weighted average interest rate of approximately 10%.

(8) LONG-TERM DEBT

Long-term debt consists of the following:

<TABLE>
<CAPTION>
OCTOBER
----------------- APRIL
1995 1996 1997
------ ------ --------
(IN THOUSANDS)
<S> <C> <C> <C>
Loan agreements in connection with the expansion of a building. The
loans bear interest at rates from 1% to 7% through March 2011 and are
collateralized by property and an irrevocable letter of credit.
Payments of principal and interest are due quarterly................. $1,008 $ 916 $ 870
Revolving credit agreement (Note 7).................................... -- -- 225,000
Loan agreements in connection with the purchase of manufacturing
equipment. The loans bear interest at 7.17% to 11.37%, are payable in
monthly installments of principal and interest through June 2001, and
are collateralized by machinery and equipment........................ -- -- 14,816
Line of credit arrangement with a Malaysia bank (Note 7)............... -- -- 1,380
Obligations under capital leases....................................... 3,522 2,506 1,691
------ ------ --------
4,530 3,422 243,757
Less -- Current portion................................................ 2,143 1,907 7,027
------ ------ --------
$2,387 $1,515 $236,730
====== ====== ========
</TABLE>

F-14
<PAGE> 65

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

Maturities of long-term debt and capital lease obligations are as follows
as of October 26, 1996:

<TABLE>
<CAPTION>
AMOUNT
------
<S> <C>
Year Ending October--
1997............................................................. $1,907
1998............................................................. 401
1999............................................................. 474
2000............................................................. 92
2001............................................................. 92
2002 and thereafter.............................................. 456
------
$3,422
======
</TABLE>

(9) COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company leases manufacturing equipment and space under noncancelable
operating leases with terms expiring through 2009. Future minimum lease payments
under these leases as of April 26, 1997 (in thousands) are as follows:

<TABLE>
<CAPTION>
REAL
EQUIPMENT ESTATE TOTAL
--------- ------- -------
(IN THOUSANDS)
<S> <C> <C> <C>
Year Ending October --
1997 (six months)................................. $22 $ 3,427 $ 3,449
1998.............................................. 17 6,177 6,194
1999.............................................. 5 5,969 5,974
2000.............................................. -- 5,546 5,546
2001.............................................. -- 5,099 5,099
Thereafter........................................ -- 39,468 39,468
--- ------- -------
Future minimum lease payments................ $44 $65,686 $65,730
=== ======= =======
</TABLE>

Total rental expense of approximately $1,317,000, $1,447,000, $1,434,000
and $2,596,000 was incurred for the fiscal years ended October 1994, 1995, 1996
and for the six months ended April 26, 1997, respectively.

These operating leases include office and manufacturing space leased from a
partnership in which the Chairman of the Board has an interest. Two of the
leases are for terms of five years, and expire in October 2000 with options to
extend until October 2006. The remaining lease expires in March 2000 with
options to extend until 2006. For the fiscal years ended October 1994, 1995 and
1996 and the six months ended April 26, 1997, the related rental expense was
approximately $571,000, $479,000, $529,000 and $280,000, respectively.

Environmental Matters

During March 1995, the Company received a Record of Decision ("ROD") from
the New York State Department of Environmental Conservation ("NYSDEC"),
regarding soil and groundwater contamination at its Owego, New York facility.
Based on a Remedial Investigation and Feasibility Study ("RIFS") for apparent
on-site contamination at that facility and a Focused Feasibility Study ("FFS"),
each prepared by environmental consultants of the Company, the NYSDEC has
approved a

F-15
<PAGE> 66

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

remediation program of groundwater withdrawal and treatment and interactive soil
flushing. The Company recently executed a Modification of the Order on Consent
to implement the approved ROD. The cost, based upon the FFS, to implement this
remediation is estimated to be $4.6 million, and is expected to be expended as
follows: $260,000 for capital equipment and $4.3 million for operation and
maintenance costs which will be incurred and expended over the estimated life of
the program of 30 years. NYSDEC has requested that the Company consider taking
additional samples from a wetland area near the Company's Owego facility.
Analytical reports of earlier sediment samples indicated the presence of certain
inorganics. There can be no assurance that the Company and/or other third
parties will not be required to conduct additional investigations and
remediation at that location, the costs of which are currently indeterminable
due to the numerous variables described in the fifth paragraph of this
Environmental Matters note.

From 1974 to 1980, the Company operated a printed circuit manufacturing
facility in Florida as a lessee of property that is now the subject of a pending
lawsuit (the "Florida Lawsuit") and investigation by the Florida Department of
Environmental Protection ("FDEP"). On June 9, 1992, the Company entered into a
Cooperating Parties Agreement in which it and Gould, Inc., another prior lessee
of the site, have agreed to fund certain assessment and feasibility study
activities at the site, and an environmental consultant has been retained to
perform such activities. The cost of such activities is not expected to be
material to the Company. In addition to the Cooperating Parties Agreement, Hadco
and others are participating in alternative dispute resolution regarding the
site with an independent mediator. In connection with the mediation, in February
1997 the FDEP presented computer-generated estimates of remedial costs, for
activities expected to be spread over a number of years, that ranged from
approximately $3.3 million to $9.7 million. Mediation sessions were conducted in
March 1992 but have been suspended during the ongoing assessment and feasibility
activities. Management believes it is likely that it will participate in
implementing a continuing remedial program for the site, the costs of which are
currently unknown. Also see the seventh paragraph of this Environmental Matters
note relating to the Company's having been named as a third-party defendant in
the Florida Lawsuit.

The Company has commenced the operation of a groundwater extraction system
at its Derry, New Hampshire facility to address certain groundwater
contamination and migration control issues. Because of the uncertainty regarding
both the quantity of contaminants beneath the building at the site and the
long-term effectiveness of the groundwater migration control system the Company
has installed, it is not possible to make a reliable estimate of the length of
time remedial activity will have to be performed. However, it is anticipated
that the groundwater extraction system will be operated for at least 30 years.
There can be no assurance that the Company will not be required to conduct
additional investigations and remediation relating to the Derry facility. The
total costs of such groundwater extraction system and of conducting any
additional investigations and remediation relating to the Derry facility are not
fully determinable due to the numerous variables described in the fifth
paragraph of this Environmental Matters note.

Included in operating expenses are charges for actual expenditures and
accruals, based on estimates, for environmental matters. During fiscal 1994,
1995, 1996 and for the six months ended April 26, 1997, the Company made, and
charged to operating expenses, actual payments of approximately $1,040,000,
$1,111,000, $680,000 and $249,000, respectively, for environmental matters. In
1994, 1995 and 1996, the Company also accrued and charged to operating expenses
approximately $2,100,000, $2,740,000 and $1,825,000, respectively, as cost
estimates for environmental matters.

The Company accrues estimated costs associated with known environmental
matters, when such costs can be reasonably estimated. The cost estimates
relating to future environmental clean-up are

F-16
<PAGE> 67

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

subject to numerous variables, the effects of which can be difficult to measure,
including the stage of the environmental investigations, the nature of potential
remedies, possible joint and several liability, the magnitude of possible
contamination, the difficulty of determining future liability, the time over
which remediation might occur, and the possible effects of changing laws and
regulations. The total reserve for environmental matters currently identified by
the Company amounted to $8.2 million at October 28, 1995, $10.0 million at
October 26, 1996, and $10.6 million at April 26, 1997. The current portion of
these costs amounted to approximately $900,000 as of October 26, 1995 and
October 26, 1996, and $1,400,000 as of April 26, 1997, and is included in Other
accrued expenses. The long-term portion of these costs amounted to approximately
$7.3 million, $9.1 million and $9.2 million as of October 28, 1995, October 26,
1996 and April 26, 1997, respectively, and is reported under the caption Other
Long-Term Liabilities. Based on its assessment at the current time, management
estimates the cost of ultimate disposition of the above known environmental
matters to range from approximately $7.0 million to $12.0 million, and is
expected to be spread over a number of years. Management believes the ultimate
disposition of the above known environmental matters will not have a material
adverse effect on the liquidity, capital resources, business or consolidated
financial position of the Company. However, one or more of such environmental
matters could have a significant negative impact on the Company's consolidated
financial results for a particular reporting period.

The Company is one of 33 entities which have been named as potentially
responsible parties in a lawsuit pending in the federal district court of New
Hampshire concerning environmental conditions at the Auburn Road, Londonderry,
New Hampshire landfill site. Local, state and federal entities and certain other
parties to the litigation seek contribution for past costs, totaling
approximately $20 million, allegedly incurred to assess and remedy the Auburn
Road site. In December 1996, following publication and comment period, the U.S.
Environmental Protection Agency (EPA) amended the ROD to change the remedy at
the Auburn Road site from active groundwater remediation to future monitoring.
Other parties to the lawsuit also allege that future monitoring will be
required. The Company is contesting liability, but is participating in mediation
with 27 other parties in an effort to resolve the lawsuit.

In connection with the Florida Lawsuit (as described in the second
paragraph of this Environmental Matters section), pending in the Circuit Court
of Broward County, Florida, Hadco and Gould, Inc., another prior lessee of the
site of the printed circuit manufacturing facility in Florida, was each served
with a third-party complaint in June 1995, as third-party defendants in such
pending Florida Lawsuit by a party who had previously been named as a defendant
when the Florida Lawsuit was commenced in 1993 by the FDEP. The Florida Lawsuit
seeks damages relating to environmental pollution and FDEP costs and expenses,
civil penalties, and declaratory and injunctive relief to require the parties to
complete assessment and remediation of soil and groundwater contamination. The
other parties include alleged owners of the property and Fleet Credit
Corporation, a secured lender to a prior lessee of the property.

The Casmalia site was regulated by the EPA during the period when the
material was accepted. There is no allegation that Zycon violated any law in the
disposal of material at the site, rather the

F-17
<PAGE> 68

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

EPA's actions stemmed from the fact that Casmalia Resources may not have the
financial means to implement a closure plan for the site and because of Zycon's
status as a generator of hazardous waste.

In September 1996, a Consent Decree among the EPA and 48 entities
(including Zycon) acting through the Casmalia Steering Committee ("CSC") was
lodged with the United States District Court in Los Angeles, California, which
must approve the agreement. Although this approval is pending, work to be
performed by the settling parties under the Consent Decree has commenced and is
ongoing pursuant to the provisions of an interim Administrative Order on Consent
among the settling parties and the EPA. The Consent Decree sets forth the terms
and conditions under which the CSC will carry out work aimed at final closure of
the site. Certain closure activities will be performed by the CSC. Later work
will be performed by the CSC, if funded by other parties. Under the Consent
Decree, the settling parties will work with the EPA to pursue the non-settling
parties to ensure they participate in contributing to the closure and long-term
operation and maintenance of the facility.

The future costs in connection with the lawsuits described in the above
paragraphs are currently indeterminable due to such factors as the unknown
timing and extent of any future remedial actions which may be required, the
extent of any liability of the Company and of other potentially responsible
parties, and the financial resources of the other potentially responsible
parties. Management currently believes, based on the facts currently known to
it, that it is probable that the ultimate dispositions of the above lawsuits
will not have a material adverse effect on the Company's business and financial
condition; however, there can be no assurance that this will be the case.

Purchase Commitments

The Company had commitments to purchase approximately $19,908,000 of
manufacturing equipment, approximately $300,000 of leasehold improvements, and
approximately $2,684,000 of production supplies and services as of April 26,
1997. The majority of these commitments is expected to be completed by the end
of fiscal 1997.

F-18
<PAGE> 69

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

(10) STOCKHOLDERS' INVESTMENT

Stock Options

The following table summarizes stock option activity with respect to the
nonqualified stock options:

NUMBER EXERCISE
OF SHARES PRICE RANGE
-------------- ---------------
(IN THOUSANDS)
<S> <C> <C> <C>
Outstanding, October 30, 1993.......................... 1,921 $2.00 - $ 9.00
Options granted...................................... 340 8.00 - 8.81
Options exercised.................................... (332) 2.00 - 4.94
Options canceled..................................... (239) 2.00 - 9.00
----- ---------------
Outstanding, October 29, 1994.......................... 1,690 2.00 - 9.00
Options granted...................................... 223 8.50 - 25.69
Options exercised.................................... (320) 2.00 - 11.06
Options canceled..................................... (147) 2.10 - 8.81
----- ---------------
Outstanding, October 28, 1995.......................... 1,446 2.00 - 25.69
Options granted...................................... 150 27.00 - 31.50
Options exercised.................................... (443) 2.00 - 11.06
Options canceled..................................... (45) 2.00 - 31.50
----- ---------------
Outstanding, October 26, 1996.......................... 1,108 2.00 - 31.50
Options granted...................................... 220 45.31 - 47.44
Options exercised.................................... (89) 2.00 - 31.50
Options canceled..................................... (32) 2.40 - 47.44
----- ---------------
Outstanding, April 26, 1997............................ 1,207 $2.10 - $47.44
===== ===============
</TABLE>

The Company has the following nonqualified stock option plans:

DECEMBER 1985 PLAN AND DECEMBER 1986 PLAN

The options under these plans are exercisable immediately, and have various
vesting periods up to 10 years according to each individual option agreement
with an expiration date no later than 10 years and 90 days from the date of
grant. Upon termination of employment under certain circumstances, the Company
may, at its option, repurchase the exercised but unvested shares at the original
purchase price.

DECEMBER 1987 PLAN

The options under this plan become exercisable according to each option
agreement and expire no later than June 30, 1997.

SEPTEMBER 1990 PLAN

This plan provides for the granting of options at a price equal to the fair
market value at the date of grant. The options vest over periods of up to seven
years and become exercisable according to each option agreement, and they expire
no later than 10 years from the date of grant.

F-19
<PAGE> 70

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

DECEMBER 1991 DIRECTOR PLAN

This plan originally provided for the granting of options to purchase up to
150,000 shares of common stock at a price equal to the fair market value at the
date of grant. These options are exercisable ratably over a five-year period and
expire no later than seven years from the date of grant. This plan has been
amended to (i) increase the number of shares available to 300,000, (ii) provide
that any current non-employee director who will have five years of service in
such capacity on February 26, 1997 be automatically granted, on such date and on
each anniversary of service thereafter, a vested option to purchase 3,000 shares
and (iii) provide that any current non-employee director who does not have five
years of service in such capacity on March 15, 1997 and any future non-employee
director each be automatically granted, on the date such non-employee director
achieves five years of service in such capacity and on each anniversary of
service thereafter, a vested option to purchase 3,000 shares.

NOVEMBER 1995 PLAN

This plan provides for the granting of options to purchase up to 1,000,000
shares of common stock at a price equal to fair market value at the date of
grant. The options vest according to each option agreement and they expire no
later than 10 years from the date of grant.

The status of the stock option plans at April 26, 1997 is as follows:

<TABLE>
<CAPTION>
AVERAGE
OPTIONS OPTIONS EXERCISE
PLAN OUTSTANDING EXERCISABLE PRICE
------------------------------------------------ ----------- ----------- --------
(IN THOUSANDS)
<S> <C> <C> <C>
*December 1985 and 1986 Plans................... 187 187 $ 2.96
*December 1987 Plan............................. 75 75 3.00
*September 1990 Plan............................ 683 268 11.98
December 1991 Director Plan.................... 63 27 26.78
November 1995 Plan............................. 199 -- 46.60
----- --- ------
1,207 557 $16.52
===== === ======
</TABLE>

- ------------
* The Board of Directors has determined to make no further grants under the
December 1985 Plan, December 1986 Plan, December 1987 Plan and September 1990
Plan.

The Company had reserved as of April 26, 1997, a total of 2,181,369 shares
of common stock for issuance under the nonqualified stock option plans listed in
the above chart. During fiscal 1994, 1995 and 1996 and the six months ended
April 26, 1997, approximately $360,000, $287,000, $154,000 and $67,000,
respectively, were charged against income as compensation expense associated
with the granting of these options.

The Company adopted a Stockholder Rights Plan in August 1995 pursuant to
which the Company declared the distribution of one Common Stock Purchase Right
("Right") for each share of outstanding common stock. Under certain conditions,
each Right may be exercised for one share of common stock at an exercise price
of $130, subject to adjustment. Under circumstances defined in the Stockholder
Rights Plan, the Rights entitle holders to purchase stock having a value of
twice the exercise price of the Rights. Until they become exercisable, the
Rights are not transferable apart from the common stock. The Rights may be
redeemed by the Company at any time prior to the occurrence of certain events at
$.01 per Right. The Stockholder Rights Plan will expire on September 11, 2005,
unless the Rights are earlier redeemed by the Company.

F-20
<PAGE> 71

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

(11) RETIREMENT PLAN

The Hadco Corporation Retirement Plan (the "Plan"), as amended, covers all
employees with at least six months of continuous service, as defined. Annual
profit sharing contributions are determined at the discretion of the Board of
Directors but cannot exceed the amount allowable for federal income tax
purposes. The Company made profit sharing contributions of $1,074,000,
$2,285,000 and $3,335,000 to the Plan for the years ended October 1994, 1995 and
1996, respectively. The Company has provided $2,622,000 for the six months ended
April 26, 1997 for profit sharing contributions.

The Plan permits participants to elect to have contributions made to the
Plan in the form of reductions in salary under Section 401(k) of the Internal
Revenue Code subject to limitations set out in the Plan. Under the Plan, the
Company will match employee contributions up to a set percentage. Employee
contributions become vested when made, and Company contributions become vested
at the rate of 33 1/3 for each year of service with the Company. The Company
matched employee contributions in the amount of approximately $500,000, $600,000
and $736,000 during fiscal 1994, 1995 and 1996, respectively. The Company has
provided $388,000 for matching contributions during the six months ended April
26, 1997.

(12) QUARTERLY RESULTS (UNAUDITED)

The following summarized unaudited results of operations for the fiscal
quarters in the years ended October 1995 and 1996 have been accounted for using
generally accepted principles for interim reporting purposes and include
adjustments (consisting of normal recurring adjustments) that the Company
considers necessary for the fair presentation of results for these interim
periods.

F-21
<PAGE> 72

HADCO CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(INCLUDING DATA APPLICABLE TO UNAUDITED PERIODS)

<TABLE>
<CAPTION>
1995 1996 1997
------- ------- --------
(IN THOUSANDS, EXCEPT PER SHARE
DATA)
<S> <C> <C> <C>
First Fiscal Quarter --
Net sales.................................................. $56,825 $76,481 $111,536
Gross profit............................................... 11,776 20,463 26,377
Net income................................................. 3,003 7,191 (69,161)
Net income per share....................................... .29 .65 (6.64)
Weighted average shares outstanding........................ 10,446 11,104 10,413
Second Fiscal Quarter --
Net sales.................................................. $67,637 $88,096 $180,662
Gross profit............................................... 16,772 22,951 38,463
Net income................................................. 5,193 7,895 9,953
Net income per share....................................... .49 .71 .91
Weighted average shares outstanding........................ 10,626 11,135 10,956
Third Fiscal Quarter --
Net sales.................................................. $67,752 $88,225
Gross profit............................................... 18,866 22,419
Net income................................................. 6,152 7,994
Net income per share....................................... .56 .72
Weighted average shares outstanding........................ 11,034 11,100
Fourth Fiscal Quarter --
Net sales.................................................. $72,954 $97,883
Gross profit............................................... 20,026 24,623
Net income................................................. 7,026 8,934
Net income per share....................................... .63 .81
Weighted average shares outstanding........................ 11,124 11,008
</TABLE>

(13) CUSTOMERS

During fiscal years 1994, 1995 and 1996 and the six months ended April 26,
1997, no customer accounted for more than 7%, 7%, 15% and 14% of consolidated
net sales, respectively. The Company's five largest customers accounted for 28%,
28%, 34% and 33% of consolidated net sales during fiscal 1994, 1995 and 1996 and
the six months ended April 26, 1997, respectively. For the first six months of
fiscal 1997 and the 1996 fiscal year, one customer accounted for more than 10%
of consolidated net sales.

F-22
<PAGE> 73

PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

In January 1997, Hadco purchased substantially all of Zycon's common stock
for approximately $205 million in cash. The Company also incurred approximately
$7.5 million in acquisition related costs resulting in a total purchase price of
approximately $212.5 million. The acquisition was financed by a new Credit
Facility of up to $250 million. The Company borrowed approximately $215 million
under the new Credit Facility, upon consummation of the transaction.

This acquisition is being accounted for as a purchase, and due to the
different bases in certain assets for book and tax purposes, deferred taxes have
been provided for as part of the purchase price allocation in accordance with
Statement of Financial Accounting Standards (SFAS) No. 109. A significant
portion of the purchase price, as outlined in the attached notes to these pro
forma financial statements, has been identified in an appraisal as intangible
assets, including approximately $78 million of in-process R&D (see discussion in
Note 1 to October 26, 1996 Pro Forma Condensed Consolidated Statement of
Operations).

The accompanying Pro Forma Condensed Consolidated Statements of Operations
for the year ended October 26, 1996 and the six months ended April 26, 1997
assume that the acquisition of Zycon took place on October 29, 1995, the
beginning of Hadco's fiscal year ended October 26, 1996. The Pro Forma Condensed
Consolidated Statements of Operations do not include the effect of any non-
recurring write-offs directly attributable to the acquisition.

The accompanying pro forma information is presented for illustrative
purposes only and is not necessarily indicative of the financial position or
results of operations which would actually have been reported had the
acquisition been in effect during the periods presented, or which may be
reported in the future.

The accompanying Pro Forma Condensed Consolidated Financial Statements
should be read in conjunction with the historical financial statements and
related notes thereto for Hadco and Zycon.

F-23
<PAGE> 74

HADCO CORPORATION

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED OCTOBER 26, 1996
(Unaudited)
(In thousands, except per share data)

<TABLE>
<CAPTION>
HISTORICAL
------------------------------------
HADCO ZYCON PRO FORMA PRO FORMA
YEAR ENDED YEAR ENDED PRO FORMA PRO FORMA EFFECTS OF COMBINED
OCTOBER 26, 1996 DECEMBER 31, 1996 ADJUSTMENTS COMBINED THE OFFERING AS ADJUSTED
---------------- ----------------- ----------- --------- --------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net Sales....................... $350,685 $ 219,660 $570,345 $ 570,345
Cost of Sales................... 260,230 185,214 445,444 445,444
-------- --------- -------- ---------
Gross Profit.................... 90,455 34,446 124,901 124,901
Operating Expenses, Excluding
Amortization.................. 38,923 17,179 56,102 56,102
Amortization of Acquired
Intangible Assets............. -- -- 6,468(2) 6,468 6,468
-------- --------- -------- ------- ---------
Income from Operations.......... 51,532 17,267 (6,468) 62,331 62,331
Interest and Other Income....... 1,287 726 (805)(3) 1,208 1,208
Interest Expense................ (338) (2,567) (13,292)(4) (16,197) 7,136(6) (9,061)
Other Expense................... -- (6,019) 6,019(1) -- -- --
-------- --------- --------- -------- ------- ---------
Income Before Provisions for
Income Taxes.................. 52,481 9,407 (14,546) 47,342 7,136 54,478
Provision for Income Taxes...... 20,467 6,518 (6,865)(5) 20,120 3,033(7) 23,153
-------- --------- --------- -------- ------- ---------
Net Income (Loss)............... $ 32,014 $ 2,889 $ (7,681) $ 27,222 $ 4,103 $ 31,325
======== ========= ========= ======== ======= =========
Net Income per Share............ $ 2.89 $ 2.46 $ 2.39
======== ======== =========
Weighted Average Shares
Outstanding................... 11,084 11,084 2,000(8) 13,084
======== ======== ======= =========
</TABLE>

NOTE 1:

For purpose of this Pro Forma Condensed Consolidated Statement of
Operations, the acquired in-process R&D was assumed to have been written off
prior to the period presented herein, so that the statement of operations
includes only recurring costs.

NOTE 2: PRO FORMA ADJUSTMENTS

The following is a description of each of the pro forma adjustments.
(1) Eliminate non-recurring acquisition costs incurred by Zycon.
(2) Amortization of acquired intangible assets over lives ranging from 12 to
30 years.
(3) Reduce interest income as a result of utilizing cash for acquisition.
(4) Interest expense on debt issued to finance acquisition, at an assumed
weighted average rate of 7.5%.
(5) Related tax effect of adjustments (1) through (4).

NOTE 3: PRO FORMA EFFECTS OF THE OFFERING

The following is a description of each of the pro forma adjustments to
reflect the effects of the Offering.

(6) Reduction of interest expense of $7,136,000 due to the pay down of bank
debt from the sale of 2,000,000 shares of common stock.

(7) Related tax effect of adjustment (6).

(8) Issuance of 2,000,000 shares offered hereby for purposes of calculating
net income per share.

NOTE 4:

In connection with the acquisition of Zycon, Hadco eliminated nine
executive positions at Zycon, which resulted in pre-tax annual savings of
$2,637,000. Taking these savings into account for the year ended October 26,
1996, pro forma net income and pro forma net income, as adjusted, would have
been $28,700,000 and $32,841,000, respectively and pro forma net income per
share and pro forma net income per share, as adjusted, would have been $2.59 and
$2.51, respectively.

F-24
<PAGE> 75

HADCO CORPORATION

PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

FOR THE SIX MONTHS ENDED APRIL 26, 1997

(Unaudited)
(In thousands, except per share data)

<TABLE>
<CAPTION>
HISTORICAL
----------------------------------
HADCO
SIX MONTHS ZYCON PRO FORMA PRO FORMA
ENDED QUARTER ENDED PRO FORMA PRO FORMA EFFECTS OF COMBINED
APRIL 26, 1997 DECEMBER 31, 1996 ADJUSTMENTS COMBINED THE OFFERING AS ADJUSTED
-------------- ----------------- ----------- --------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Net Sales............................. $292,198 $61,011 $353,209 $ 353,209
Cost of Sales......................... 227,358 52,650 280,008 280,008
--------- ------- -------- ---------
Gross Profit.......................... 64,840 8,361 73,201 73,201
Operating Expenses, Excluding
Amortization........................ 26,955 4,617 31,572 31,572
Amortization of Acquired Intangible
Assets.............................. 1,864 136 1,188(3) 3,188 3,188
Write-off of In-process Research and
Development......................... 78,000 -- (78,000)(1) -- --
--------- ------- --------- -------- ------- ---------
Income (Loss) From Operations......... (41,979) 3,608 76,812 38,441 38,441
Interest and Other Income............. 806 167 (496)(4) 477 477
Interest Expense...................... (5,251) (1,033) (2,703)(5) (8,987) 3,568(7) 5,419

Other Expense......................... -- (6,019) 6,019(2) -- --
--------- ------- --------- -------- ------- ---------
Income (Loss) Before Provision for
Income Taxes........................ (46,424) (3,277) 79,632 29,931 3,568 33,499
Provision for Income Taxes............ 12,788 1,247 (1,953)(6) 12,082 1,445(8) 13,527
--------- ------- --------- -------- ------- ---------
Net Income (Loss)..................... $(59,212) $(4,524) $ 81,585 $ 17,849 $ 2,123 $ 19,972
========= ======= ========= ======== ======= =========
Net Income per Share.................. $ (5.67) $ 1.63 $ 1.54
========= ======== =========
Weighted Average Shares Outstanding... 10,435 10,947 2,000(9) 12,947
========= ======== ======= =========
</TABLE>

NOTE 1: PRO FORMA ADJUSTMENTS

The following is a description of each of the pro forma adjustments:

(1) Eliminate non-recurring write-off of in-process R&D.
(2) Eliminate non-recurring acquisition costs incurred by Zycon.
(3) Amortization of acquired intangible assets over lives ranging from 12 to
30 years.
(4) Reduce interest income as a result of utilizing cash for acquisition.
(5) Interest expense on debt issued to finance acquisition, at an assumed
weighted average rate of 7.5%.
(6) Related tax effect of adjustments (1) through (5).

NOTE 2: PRO FORMA EFFECTS OF THE OFFERING

The following is a description of each of the pro forma adjustments to
reflect the effects of the Offering.

(7) Reduction of interest expense of $3,568,000 due to the pay down of bank
debt from the sale of 2,000,000 shares of common stock.

(8) Related tax effect of adjustment (7).

(9) Issuance of 2,000,000 shares offered hereby for purposes of calculating
primary net income per share and an additional 1,951,000 shares for
purposes of calculating fully diluted net income per share.

NOTE 3:

In connection with the acquisition of Zycon, Hadco eliminated nine executive
positions at Zycon, which resulted in pre-tax annual savings of $2,637,000.
Taking these savings into account for the six months ended April 26, 1997, pro
forma net income and pro forma net income, as adjusted, would have been
$18,634,000, and $20,757,000, respectively, and pro forma net income per share
and pro forma net income per share, as adjusted, would have been $1.70 and
$1.60, respectively.

F-25
<PAGE> 76

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To Zycon Corporation:

We have audited the accompanying consolidated balance sheet of Zycon
Corporation (a Delaware corporation) and subsidiaries as of December 31, 1996,
and the related consolidated statements of income, stockholders' equity and cash
flows for the year then ended. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on
these financial statements based on our audit.

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

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Zycon Corporation and
subsidiaries as of December 31, 1996, and the results of their operations and
their cash flows for the year then ended in conformity with generally accepted
accounting principles.

ARTHUR ANDERSEN LLP

San Jose, California
January 17, 1997

F-26
<PAGE> 77

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders
of Zycon Corporation:

We have audited the accompanying consolidated balance sheet of Zycon
Corporation and subsidiary as of December 31, 1995 and the related consolidated
statements of income, stockholders' equity and cash flows for each of the years
in the two-year period ended December 31, 1995. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Zycon
Corporation and subsidiary as of December 31, 1995 and the results of their
operations and their cash flows for each of the years in the two-year period
ended December 31, 1995 in conformity with generally accepted accounting
principles.

KPMG PEAT MARWICK LLP

San Jose, California
January 19, 1996

F-27
<PAGE> 78

ZYCON CORPORATION

CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1995 AND 1996
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)

<TABLE>
<CAPTION>
1995 1996
------- --------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents............................................. $11,264 $ 7,549
Receivables, net of allowances of $250 in 1995 and $255 in 1996....... 20,886 28,430
Inventories........................................................... 6,131 11,343
Prepaid expenses and other current assets............................. 1,734 2,569
-------- -------
Current assets................................................ 40,015 49,891
PLANT AND EQUIPMENT, net................................................ 52,130 95,297
DEPOSITS AND OTHER ASSETS............................................... 2,830 3,304
EXCESS OF COST OVER NET ASSETS ACQUIRED, net of accumulated amortization
of $272 in 1996....................................................... -- 5,396
-------- -------
$94,975 $153,888
======== =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt and bank borrowings................. $ 2,567 $ 9,122
Accounts payable...................................................... 17,624 26,192
Accrued liabilities................................................... 5,021 7,479
Income taxes payable.................................................. 1,770 870
-------- -------
Current liabilities........................................... 26,982 43,663
LONG-TERM DEBT AND LIABILITIES, net of current portion.................. 5,458 43,777
DEFERRED INCOME TAXES................................................... 6,634 7,003
-------- -------
Total liabilities............................................. 39,074 94,443
-------- -------
COMMITMENTS AND CONTINGENCIES (see Note 7)
STOCKHOLDERS' EQUITY:
Preferred stock; $0.001 par value; 20,000,000 shares authorized; none
outstanding........................................................ -- --
Common stock; $0.001 par value; 25,000,000 shares authorized;
11,000,000 and 11,056,600 shares issued and outstanding in 1995 and
1996, respectively................................................. 11 11
Additional paid-in capital............................................ 32,369 33,024
Retained earnings..................................................... 23,521 26,410
-------- -------
Total stockholders' equity.................................... 55,901 59,445
-------- -------
$94,975 $153,888
======== =======
</TABLE>

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

F-28
<PAGE> 79

ZYCON CORPORATION

CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31, 1994, 1995 AND 1996
(IN THOUSANDS)

<TABLE>
<CAPTION>
1994 1995 1996
-------- -------- --------
<S> <C> <C> <C>
Net Sales.................................................. $149,151 $180,944 $219,660
Cost of Sales.............................................. 132,075 152,043 185,214
-------- -------- --------
Gross Profit............................................... 17,076 28,901 34,446
Operating Expenses......................................... 9,318 12,299 17,179
-------- -------- --------
Income from Operations..................................... 7,758 16,602 17,267
-------- -------- --------
Other Income (Expense):
Interest Income............................................ 264 711 726
Interest Expense........................................... (2,250) (2,427) (2,567)
Other Expense.............................................. -- -- (6,019)
-------- -------- --------
Other Income (Expense)..................................... (1,986) (1,716) (7,860)
-------- -------- --------
Income Before Income Taxes................................. 5,772 14,886 9,407
Provision For Income Taxes................................. 97 7,409 6,518
-------- -------- --------
Net Income................................................. $ 5,675 $ 7,477 $ 2,889
======== ======== ========
Pro Forma Net Income Data (Unaudited):
Income Before Income Taxes, as reported.................... $ 5,772 $ 14,886
Pro Forma Provision for Income Taxes....................... 2,333 5,925
-------- --------
Pro Forma Net Income....................................... $ 3,439 $ 8,961
======== ========
</TABLE>

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

F-29
<PAGE> 80

ZYCON CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1994, 1995 AND 1996
(IN THOUSANDS)

<TABLE>
<CAPTION>
NOTES
COMMON STOCK ADDITIONAL RECEIVABLE TOTAL
--------------- PAID-IN FROM RETAINED STOCKHOLDERS'
SHARES AMOUNT CAPITAL STOCKHOLDERS EARNINGS EQUITY
------ ------ ---------- ------------ -------- -------------
<S> <C> <C> <C> <C> <C> <C>
BALANCES AS OF DECEMBER 31, 1993........ 8,000 $ 8 $ 22 $ -- $23,483 $23,513
Stockholder distributions............. -- -- -- -- (3,859) (3,859)
Issuance of stockholder notes......... -- -- -- (575) -- (575)
Collections on stockholder notes...... -- -- -- 45 -- 45
Net income............................ -- -- -- -- 5,675 5,675
------ --- ------- ----- ------- -------
BALANCES AS OF DECEMBER 31, 1994........ 8,000 8 22 (530) 25,299 24,799
Sale of common stock, net of $3,650
issuance costs..................... 3,000 3 32,347 -- -- 32,350
Stockholder distributions............. -- -- -- -- (9,255) (9,255)
Collections on stockholder notes...... -- -- -- 530 -- 530
Net income............................ -- -- -- -- 7,477 7,477
------ --- ------- ----- ------- -------
BALANCES AS OF DECEMBER 31, 1995........ 11,000 11 32,369 -- 23,521 55,901
Issuance of common stock in connection
with Alternate Circuit Technology,
Inc. (ACT) acquisition............. 50 -- 600 -- -- 600
Issuance of common stock pursuant to
the stock option plan.............. 7 -- 55 -- -- 55
Net income............................ -- -- -- -- 2,889 2,889
------ --- ------- ----- ------- -------
BALANCES AS OF DECEMBER 31, 1996........ 11,057 $ 11 $ 33,024 $ -- $26,410 $59,445
====== === ======= ===== ======= =======
</TABLE>

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

F-30
<PAGE> 81

ZYCON CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1994, 1995 AND 1996
(IN THOUSANDS)

<TABLE>
<CAPTION>
1994 1995 1996
-------- -------- --------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income........................................................... $ 5,675 $ 7,477 $ 2,889
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization..................................... 9,199 9,691 11,016
Deferred income taxes............................................. -- 5,618 38
Changes in operating assets and liabilities, net of effects from
purchase of ACT:
Increase in receivables......................................... (4,234) (5,723) (5,538)
(Increase) decrease in inventories.............................. 156 (1,661) (3,106)
(Increase) decrease in prepaid expenses, deposits and other
assets......................................................... 339 (2,491) 2,134
Increase in accounts payable.................................... 772 7,010 7,862
Increase in accrued liabilities................................. 204 1,708 1,060
Increase (decrease) in income taxes payable..................... -- 1,770 (607)
-------- -------- --------
Net cash provided by operating activities.................... 12,111 23,399 15,748
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of ACT, net of cash acquired................................ -- -- (8,888)
Purchases of plant and equipment..................................... (13,060) (22,365) (52,156)
Sale of short-term investments....................................... 2,026 -- --
-------- -------- --------
Net cash used for investing activities....................... (11,034) (22,365) (61,044)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Bank borrowings, net................................................. 1,000 (7,000) 2,543
Proceeds from long-term debt......................................... 11,378 1,761 46,206
Repayment of long-term debt.......................................... (7,685) (14,863) (7,223)
Proceeds from sale of common stock................................... -- 32,350 55
Issuance of stockholder notes........................................ (575) -- --
Collections on stockholder notes..................................... 45 530 --
Distribution paid to stockholders.................................... (3,185) (10,765) --
-------- -------- --------
Net cash provided by financing activities.................... 978 2,013 41,581
-------- -------- --------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS....................... 2,055 3,047 (3,715)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR......................... 6,162 8,217 11,264
-------- -------- --------
CASH AND CASH EQUIVALENTS AT END OF YEAR............................... $ 8,217 $ 11,264 $ 7,549
======== ======== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest............................................... $ 2,149 $ 2,427 $ 2,351
Cash paid for income taxes........................................... $ 20 $ 60 $ 6,357
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:
Issuance of common stock in connection with ACT acquisition.......... $ -- $ -- $ 600
Assets of $8,802 acquired, net of related liabilities of $4,961
assumed from ACT.................................................. $ -- $ -- $ 3,841
Stockholder distributions declared but not paid...................... $ 1,510 $ -- $ --
</TABLE>

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

F-31
<PAGE> 82

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 1996

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

The Company and Consolidation

Zycon Corporation (the "Company") manufactures multilayer printed circuit
boards for original equipment manufacturers and contract manufacturers of
sophisticated electronic equipment. The Company's principal customers serve
diverse market segments, including data communications, telecommunications,
advanced storage systems, workstation, servers and personal computers.

The accompanying consolidated financial statements include the accounts of
the Company and its wholly owned subsidiaries. All intercompany accounts and
transactions have been eliminated in consolidation.

Use of Estimates

Management of the Company has made a number of estimates and assumptions
relating to the reporting of assets and liabilities and the disclosure of
contingent assets and liabilities to prepare these consolidated financial
statements in conformity with generally accepted accounting principles. Actual
results could differ from those estimates.

Cash Equivalents

Cash equivalents consist primarily of money market funds and highly liquid
debt instruments with original maturity dates up to 90 days.

Short-Term Investments

In 1994, the Company adopted Statement of Financial Accounting Standards
("SFAS") No. 115, "Accounting for Certain Investments in Debt and Equity
Securities." Short-term investments are classified as available for sale under
the provisions of SFAS No. 115 and are stated at fair value. Any unrealized
gains and losses are reported as a separate component of stockholders' equity,
but to date have not been significant.

Inventories

Inventories are stated at the lower of first-in, first-out cost or market.
The Company periodically reviews its inventories for potential slow-moving and
obsolete items and writes down impaired items to net realizable value.

Plant and Equipment

Plant and equipment are stated at cost. Depreciation is computed using the
straight-line method over the estimated useful lives of the assets, ranging from
3 to 40 years. Leasehold improvements are amortized over the shorter of the
respective lease terms, ranging from 10 to 20 years, or their estimated useful
lives.

Intangible Assets

Excess of cost over net assets acquired (goodwill) from the ACT acquisition
(see Note 5) is amortized using the straight-line method over ten years. In
order to comply with Statement of Financial Accounting Standards ("SFAS") No.
121, "Accounting for the Impairment of Long-Lived

F-32
<PAGE> 83

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Assets and for Long-Lived Assets to be Disposed of," the realizability is
evaluated periodically by management as events or circumstances indicate a
possible inability to recover its carrying amount. Such evaluation is based on
various analyses, including cash flow and profitability projections that
incorporate, as applicable, the impact on existing lines of business. The
analysis necessarily involves significant management judgment to evaluate the
ability of an acquired business to perform within projections.

Revenue Recognition

Sales are recognized upon shipment. Product returns and warranty costs have
been insignificant.

Research and Development Expenses

The Company charges research and development expenses to operations as
incurred. For the years ended December 31, 1994, 1995 and 1996, research and
development expenses were approximately $968,000, $1,066,000 and $1,100,000,
respectively, and are included in operating expenses.

Other Expense

The Company incurred other expense of $6,019,000 during the year ended
December 31, 1996 relating to the acquisition of the Company by Hadco
Corporation (see Note 8).

Income Taxes

The Company accounts for income taxes using the liability method under
Statement of Financial Accounting Standards No. 109, Accounting for Income
Taxes. Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect on deferred
income tax assets and liabilities of changes in tax rates is recognized in
income in the period that includes the enactment date.

The Company was an S corporation for Federal and state income tax reporting
purposes prior to the initial public offering on September 26, 1995. Federal and
state income taxes on the income of an S corporation are generally payable by
the individual stockholders rather than the corporation. Accordingly, only the
California S corporation franchise tax was provided while the Company was as S
corporation.

Upon termination of the Company's S corporation status, the Company
established its net deferred tax liability and recorded an accompanying charge
of $4.5 million to income tax expense in 1995. The accompanying consolidated
statements of income for the years ended December 31, 1994 and 1995 include
provisions for income taxes on an unaudited pro forma basis, using the asset and
liability method, as if the Company had been a C corporation, fully subject to
Federal and state income taxes.

Environmental Remediation Costs

The Company accrues for expenses associated with environmental remediation
obligations when such expenses are probable and can be reasonably estimated.
Accruals for estimated expenses for environmental remediation obligations
generally are recognized no later than completion of the remedial feasibility
study. Such accruals are adjusted as further information becomes available or

F-33
<PAGE> 84

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

circumstances change. Estimates of future expenditures for environmental
remediation obligations are not discounted to their present value.

Concentration of Credit Risk

Financial instruments potentially subjecting the Company to concentration
of credit risk consist primarily of cash equivalents and accounts receivable. By
policy, the Company limits the amounts invested in any one type of investment.
Management believes the financial risks associated with such investments are
minimal. Substantially all of the Company's accounts receivable are derived from
domestic sales to original equipment manufacturers and contract assemblers of
workstations, networking products, computers, telecommunications equipment and
instrumentation devices. A significant percentage of the Company's receivables
are concentrated with a few customers. Historically, the Company has not
incurred material credit-related losses.

Foreign Currency Translation

The functional currency of the Company's Malaysian subsidiary is the United
States dollar. Accordingly, all translation gains and losses resulting from
transactions denominated in currencies other than United States dollars are
included in the consolidated statements of income. To date, the resulting gains
and losses have not been material.

Reclassifications

Certain 1994 and 1995 balances have been reclassified to conform with the
1996 consolidated financial statement presentation.

2. BALANCE SHEET COMPONENTS:

Cash Equivalents

Cash equivalents include certain investments classified as
available-for-sale securities as follows as of December 31 (in thousands):

<TABLE>
<CAPTION>
1995 1996
------- ------
<S> <C> <C>
Money market funds................................................ $ -- $3,574
U.S. governmental treasury bills.................................. 1,995 1,975
Commercial paper.................................................. 11,000 2,000
------- ------
$12,995 $7,549
======= ======
</TABLE>

These securities all have original maturity dates of 90 days or less, with
fair values approximating their cost.

Inventories

A summary of inventories follows as of December 31 (in thousands):

<TABLE>
<CAPTION>
1995 1996
------ -------
<S> <C> <C>
Raw materials..................................................... $1,392 $ 5,599
Work in process................................................... 4,739 5,744
------ -------
$6,131 $11,343
====== =======
</TABLE>

F-34
<PAGE> 85

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Plant and Equipment

A summary of plant and equipment follows as of December 31 (in thousands):

<TABLE>
<CAPTION>
1995 1996
------- --------
<S> <C> <C>
Machinery and equipment......................................... $61,975 $ 98,699
Leasehold improvements.......................................... 23,704 25,744
Building and building improvements.............................. -- 15,458
Office furniture and equipment.................................. 520 553
Construction in progress........................................ 3,250 813
Other........................................................... 580 --
------- --------
90,029 141,267
Less -- Accumulated depreciation and amortization............... (37,899) (45,970)
------- --------
$52,130 $ 95,297
======= ========
</TABLE>

Plant and equipment with a cost of approximately $32 million are located at
the Company's wholly owned subsidiary in Malaysia.

Accrued Liabilities

Accrued liabilities consisted of the following as of December 31 (in
thousands):

<TABLE>
<CAPTION>
1995 1996
------ ------
<S> <C> <C>
Vacation........................................................... $1,883 $2,120
Payroll............................................................ 1,099 1,764
Bonuses............................................................ 1,170 1,104
Health care and workers compensation............................... 530 1,150
Other.............................................................. 339 1,341
------ ------
$5,021 $7,479
====== ======
</TABLE>

Long-Term Debt and Liabilities and Bank Borrowings

Long-term debt and liabilities and bank borrowings consisted of the
following as of December 31 (in thousands):

<TABLE>
<CAPTION>
1995 1996
------- -------
<S> <C> <C>
Line of credit arrangement with a U.S. bank...................... $ -- $16,136
Line of credit arrangement with a Malaysian bank................. -- 2,543
Notes payable to financial lending companies and banks........... 8,025 32,857
Long-term liabilities............................................ -- 1,363
------- -------
8,025 52,899
Less -- Current maturities....................................... (2,567) (9,122)
------- -------
Long-term debt and liabilities................................... $ 5,458 $43,777
======= =======
</TABLE>

The Company has available a revolving bank line of credit arrangement with
a U.S. bank aggregating the lesser of $28,000,000 or a specified percentage of
eligible accounts receivable. As of December 31, 1996, there was $16,136,000
outstanding under the line of credit agreement. The line of credit agreement
expires on July 1, 1998. Borrowings under the line of credit agreement incur
interest at the bank's prime rate (8.25% as of December 31, 1996) and are
secured by receivables, inventories

F-35
<PAGE> 86

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

and machinery and equipment. The maximum balance outstanding during the year
under this arrangement was $20,752,000, and the average outstanding balance
during the year was $10,490,000.

The Company also has a line of credit arrangement with a Malaysian bank for
aggregate borrowings of approximately $4.3 million for the purpose of acquiring
land, facilities and equipment for the Company's Malaysian subsidiary. The
arrangement is renewable annually. As of December 31, 1996, there was $2,543,000
outstanding under this arrangement and the weighted average interest rate was
10%.

Notes payable to financial lending companies and banks are secured by
machinery and equipment and are generally payable in equal monthly installments,
bearing interest ranging from approximately 7.2% to 11.4% (8.3% weighted
average).

Annual maturities of the notes payable are as follows (in thousands):

<TABLE>
<CAPTION>
YEAR ENDING
DECEMBER 31,
-------------------------------------------------------------------
<S> <C>
1997.......................................................... $ 6,450
1998.......................................................... 6,788
1999.......................................................... 6,125
2000.......................................................... 5,260
2001.......................................................... 8,234
------
$32,857
======
</TABLE>

In connection with the acquisition of the Company by Hadco Corporation (see
Note 8), approximately $33.5 million of these notes payable and borrowings under
the line of credit arrangement with the U.S. bank were repaid subsequent to year
end.

The Company has a commitment from a bank for a $15.5 million term loan
facility which expires in 2005 for the purpose of acquiring equipment and for
working capital to be invested in the Company's Malaysia subsidiary. Borrowings
are to be repaid over five years with interest payable at either a fixed rate
equal to the bank's cost of funds at the time of borrowing plus 3.25% or an
adjustable rate equal to the bank's prime rate plus 1.75%. As of December 31,
1996, there were no borrowings outstanding under this facility. Upon the
acquisition of the Company by Hadco (see Note 8), the commitment under this
facility was decreased to $4.4 million.

3. STOCKHOLDERS' EQUITY:

Stockholder Distributions

On September 26, 1995, the Company elected C corporation status for Federal
and state income tax reporting purposes. Simultaneously with the election of C
corporation status, the Company declared a distribution payable to existing
stockholders of the Company. This distribution represented undistributed S
corporation earnings of the Company through the completion of the Company's
initial public offering and the amount of the stockholders' S corporation tax
bases.

Stock-Based Compensation Plan

In 1993, the Company adopted the 1993 Long-Term Equity Incentive Plan (the
"Stock Plan"). The Company accounts for this Stock Plan under APB Opinion No.
25, Accounting for Stock Issued to Employees, under which no compensation
expense has been recognized. Had compensation expense for the Stock Plan been
determined consistent with Statement of Financial Accounting Standards

F-36
<PAGE> 87

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

(SFAS) No. 123, Accounting for Stock-Based Compensation, the Company's net
income would have been reduced to the following pro forma amounts (in
thousands):

<TABLE>
<CAPTION>
1995 1996
------ ------
<S> <C> <C>
As Reported........................................................ $7,477 $2,889
Pro Forma.......................................................... $6,975 $1,579
</TABLE>

The Company may grant up to 1,100,000 shares of stock to its employees and
consultants under the Stock Plan. The Company grants options with an exercise
price at least equal to the fair market price at date of grant. Options granted
under the Stock Plan vest between 20% and 60% at the end of the first year and
ratably thereafter for a period of four years.

There was no activity under the Stock Plan during 1994. A summary of the
activity under the Stock Plan during 1995 and 1996 follows:

<TABLE>
<CAPTION>
WEIGHTED
AVERAGE
NUMBER OF EXERCISE
OPTIONS PRICE
--------- --------
<S> <C> <C>
Outstanding at December 31, 1994............................. -- $ --
Granted.................................................... 707,600 10.36
------- ------
Outstanding at December 31, 1995............................. 707,600 10.36
Granted.................................................... 105,200 10.50
Exercised.................................................. (6,600) 8.36
Cancelled.................................................. (36,900) 11.54
------- ------
Outstanding at December 31, 1996............................. 769,300 $10.35
======= ======
</TABLE>

As of December 31, 1996, 765,800 of the 769,300 options outstanding have
exercise prices between $8 and $12.00, with a weighted average exercise price of
$10.34 and a weighted average remaining contractual life of 3.7 years. 230,200
of these options are exercisable as of December 31, 1996. The remaining 3,500
options have an exercise price and a weighted average exercise price of $13.25
and a weighted average remaining contractual life of 3.88 years. 700 of these
options are exercisable as of December 31, 1996. There was no options
exercisable as of December 31, 1995.

The fair value of each option grant is estimated on the date of grant using
the Black-Scholes option pricing model with the following weighted average
assumptions used for grants in 1995 and 1996; risk-free interest rate of 6
percent; expected dividend yields of 0 percent; expected lives of 7 years;
expected volatility of 35 percent. Weighted average fair values of options
granted in 1995 and 1996 were $4.30 and $3.00, respectively.

In connection with the acquisition of the Company by Hadco Corporation (see
Note 8), the vesting for all outstanding options as of January 9, 1997 was
immediately accelerated pursuant to the terms of the Stock Plan and then
redeemed for cash equal to the difference between the exercise price of the
vested option and $18.00 per share.

4. INCOME TAXES

The components of income tax expense, as presented in the accompanying
consolidated statements of income, comprise California S corporation franchise
taxes for 1994 and through September 26, 1995, and Federal and state taxes for
the remainder of 1995 and all of 1996. The pro forma provision for income taxes
reflects the income tax expense that would have been reported if the

F-37
<PAGE> 88

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Company had been a C corporation in 1994 and all of 1995. The components of the
provision for income taxes and unaudited pro forma provision for income taxes
are as follows (in thousands):

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
------------------------------------------------
ACTUAL PRO FORMA
-------------------------- -----------------
1994 1995 1996 1994 1995
---- ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Current
Federal..................................... $-- $1,349 $4,835 $1,431 $3,547
State....................................... 97 342 483 453 975
--- ------ ------ ------ ------
Total current....................... 97 1,691 5,318 1,884 4,522
--- ------ ------ ------ ------
Deferred
Federal..................................... -- 1,123 928 368 1,271
State....................................... -- 116 272 81 132
Termination of S corporation status......... -- 4,479 -- -- --
--- ------ ------ ------ ------
Total deferred...................... -- 5,718 1,200 449 1,403
--- ------ ------ ------ ------
Net tax provision............................. $97 $7,409 $6,518 $2,333 $5,925
=== ====== ====== ====== ======
</TABLE>

The following table reconciles the expected Federal income tax expense to
the Company's actual income tax expense and unaudited pro forma income tax
expense (in thousands):

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31
---------------------------------------------------
ACTUAL PRO FORMA
----------------------------- -----------------
1994 1995 1996 1994 1995
------ ------- ------ ------ ------
<S> <C> <C> <C> <C> <C>
Expected Federal income tax expense.......... $1,962 $ 5,061 $3,292 $1,962 $5,061
State income taxes, net of Federal tax
benefit.................................... 97 337 569 352 776
Nondeductible foreign subsidiary loss........ -- -- 721 -- --
Nondeductible acquisition costs.............. -- -- 2,107 -- --
Termination of S corporation status.......... -- 4,479 -- -- --
Effect of S corporation earnings taxable to
stockholders............................... (1,962) (2,557) -- -- --
Other, net................................... -- 89 (171) 19 88
------ ------- ------ ------ ------
$ 97 $ 7,409 $6,518 $2,333 $5,925
====== ======= ====== ====== ======
</TABLE>

The tax effects of temporary differences that give rise to significant
portions of the deferred income tax assets and liability are presented below as
of December 31 (in thousands):

<TABLE>
<CAPTION>
1995 1996
------- -------
<S> <C> <C>
Deferred income tax assets:
Reserves and accruals.................................................. $ 749 $ 1,013
State income taxes..................................................... 167 234
------- -------
Total deferred income tax assets............................... 916 1,247
Deferred income tax liability:
Depreciation and amortization.......................................... (6,634) (7,003)
------- -------
Net deferred income tax liability........................................ $(5,718) $(5,756)
======= =======
</TABLE>

Deferred income tax assets are classified in other current assets in the
accompanying consolidated balance sheets.

F-38
<PAGE> 89

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

5. ACQUISITION OF ALTERNATIVE CIRCUIT TECHNOLOGY, INC.:

On June 7, 1996, the Company completed the acquisition of the assets of
Alternate Circuit Technology, Inc. (ACT). ACT was in the business of owning,
operating and managing a quick turnaround printed circuit board manufacturing
facility in Massachusetts. The purchase price consisted of cash of $8,641,000,
50,000 shares of the Company's common stock with a total market value of
$600,000 and a covenant not to compete arrangement to two ACT shareholders
amounting to $200,000. The acquisition has been recorded using the purchase
method of accounting. The excess of the aggregate purchase price over the fair
market value of net assets acquired was $5,668,000, and this goodwill is being
amortized over ten years. The operating results of ACT have been included in the
Company's consolidated financial statements since the date of acquisition.

The following unaudited pro forma financial information shows the results
of operations for the years ended December 31, 1995 and 1996 as if the ACT
acquisition had occurred at the beginning of each period presented. The results
are not necessarily indicative of what would have occurred had the acquisition
actually been made at the beginning of each of the respective periods presented
or of future operations of the combined companies.

<TABLE>
<CAPTION>
YEARS ENDED
DECEMBER 31,
---------------------
1995 1996
--------
(IN THOUSANDS)
<S> <C> <C>
Net sales...................................................... $196,304 $226,657
Net income..................................................... 8,027 2,529
</TABLE>

6. CUSTOMERS:

In 1994, one customer accounted for 15%, one for 11% and one for 10% of
consolidated net sales. In 1995, one customer accounted for 13% and two
companies each accounted for 10% of the Company's consolidated net sales. These
three customers comprised 35% of accounts receivable at December 31, 1995. In
1996, one customer accounted for 12% of the Company's consolidated net sales. Of
the accounts receivable balance at December 31, 1996, 9% is related to this
customer.

7. COMMITMENTS AND CONTINGENCIES:

Operating Leases

The Company occupies its facilities under various operating lease
agreements. In addition, the Company leases certain machinery and equipment
under operating leases. Future minimum lease payments required under operating
leases in the years subsequent to December 31, 1996 will be as follows (in
thousands):

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31,
-----------------------------------------------------------
<S> <C>
1997.................................................. $ 3,984
1998.................................................. 3,830
1999.................................................. 3,926
2000.................................................. 4,022
2001.................................................. 4,091
2002 and thereafter................................... 26,175
-------
$46,028
=======
</TABLE>

F-39
<PAGE> 90

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Facility and equipment rent expense was approximately $4,452,000,
$4,566,000 and $4,609,000 for the years ended December 31, 1994, 1995 and 1996,
respectively. Approximately $360,000 and $135,000 of these amounts in 1994 and
1995, respectively were paid to a partnership whose partners were also
stockholders of the Company.

Purchase Commitments

Purchase commitments aggregated $4,126,000 as of December 31, 1996,
primarily for the acquisition of machinery and equipment.

Stockholders' Benefit and Deferred Compensation Plan

The Company has agreements with its original four stockholders providing
for payment aggregating two years salary per stockholder in the event of death
in service or disability and for payments in the event of an adjustment of the
Company's taxable income for any period the corporation was subject to S
corporation status under the Federal or state income tax laws. To date, no
payments have been required under these agreements.

Subsequent to the year end and upon the acquisition of the Company by Hadco
Corporation, the Company entered into a deferred compensation plan with key
executive employees (none of whom was a director of the Company). The plan will
provide these key executive employees with certain deferred compensation under
certain circumstances.

Workers' Compensation

The Company self-insures its workers' compensation plan and accrues for
incurred claims development and estimated incurred but not reported claims. If
future incurred claims development substantially exceeds historical claim
patterns used to estimate the accrual, the Company could incur significant
additional obligations.

Environmental Matters

In March 1993, the U.S. Environmental Protection Agency (EPA) notified
Zycon of its potential liability for maintenance and remediation costs in
connection with a hazardous waste disposal facility operated by Casmalia
Resources, a California Limited Partnership, in Santa Barbara County,
California. The EPA identified Zycon as one of the 65 generators which had
disposed the greatest amounts of materials at the site. Based on the total
tonnage contributed by all generators, Zycon's share is estimated at
approximately 0.2% of the total weight.

F-40
<PAGE> 91

ZYCON CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

settling parties will work with the EPA to pursue the non-settling parties to
ensure they participate in contributing to the closure and long-term operation
and maintenance of the facility.

8. ACQUISITION BY HADCO CORPORATION:

In December 1996, Hadco Corporation ("Hadco") agreed to acquire all of the
outstanding shares of the Company's common stock at a purchase price of $18.00
per share upon the terms and subject to the conditions set forth in the Tender
Offer Statement. The Tender Offer Statement was made pursuant to an Agreement
and Plan of Merger dated as of December 4, 1996 between Hadco and the Company.
The offer expired on January 9, 1997 after which substantially all of the
outstanding shares of the Company's common stock were acquired by Hadco. The
Company incurred costs aggregating $2,869,000 which represented investment
banking, financial advisory and legal fees incurred relating to the acquisition
by Hadco. These costs have been expensed in the accompanying consolidated
statement of income for the year ended December 31, 1996 as other expense. The
Company paid approximately $2,100,000 of the total costs incurred to a financial
advisory firm in which the president of such firm was also a member of the
Company's Board of Directors.

Prior to entering into the Agreement and the Plan of Merger with Hadco, the
Company and certain of its principal shareholders had entered into an agreement
to sell all of the outstanding shares of the Company's common stock at $16.25
per share to an unrelated party, but the Company subsequently terminated this
agreement. In connection with this termination, the Company incurred break-up
fees and legal costs amounting to approximately $3,150,000, which was expensed
in the accompanying consolidated statement of income for the year ended December
31, 1996 as other expense.

F-41
<PAGE> 92

HADCO

The Largest Interconnect Manufacturer in North America

Backplane Assembly

- Hadco provides backplane assembly services
utilizing advanced automated manufacturing
systems.

- Advanced systems include split axis assembly,
"smart" feeder systems, and optical centering
for high density electronic packages.

- Hadco's backplane assembly facilities are
located in California and New Hampshire.

Includes pictures of various assembled backplane products and a backplane
assembly line.

<PAGE> 93

HADCO

<PAGE> 94

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following statement sets forth the amounts of expenses in connection
with the offering of the Common Stock pursuant to this Registration Statement,
all of which shall be borne by the Company.

<TABLE>
<S> <C>
SEC Registration Fee..................................................... $ 72,921
NASD Fee................................................................. 25,064
Nasdaq Listing Fee....................................................... 25,000
Blue Sky Fees and Expenses............................................... 30,000
Printing and Engraving Expenses.......................................... 250,000
Accounting Fees and Expenses............................................. 275,000
Legal Fees and Expenses.................................................. 525,000
Transfer Agent and Registrar Fees........................................ 10,000
Miscellaneous Expenses................................................... 287,015
--------
Total.......................................................... $1,500,000
========
</TABLE>

All of the expenses listed above, except the SEC Registration Fee and NASD
Fee, represent estimates only.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Reference is made to Article V, Section 2 of the By-Laws of the Registrant
and to Section 67 of the Massachusetts Business Corporation Law.

Article V, Section 2 of the Company's By-Laws provides:

"2. Indemnification. Each Director, officer, employee and other agent
of the corporation, and any person who, at the request of the corporation,
serves as a director, officer, employee or other agent of another
organization in which the corporation directly or indirectly owns shares or
of which it is a creditor shall be indemnified by the corporation against
any cost, expense (including attorney's fees), judgment, liability and/or
amount paid in settlement reasonably incurred by or imposed upon him in
connection with any action, suit or proceeding (including any proceeding
before any administrative or legislative body or agency), to which he may
be made a party or otherwise involved or with which he shall be threatened,
by reason of his being, or related to his status as, a director, officer,
employee or other agent of the corporation or of any other organization in
which the corporation directly or indirectly owns shares or of which the
corporation is a creditor, which other organization he serves or has served
as director, officer, employee or other agent at the request of the
corporation (whether or not he continues to be an officer, director,
employee or other agent of the corporation or such other organization at
the time such action, suit or proceeding is brought or threatened), unless
such indemnification is prohibited by the Business Corporation Law of the
Commonwealth of Massachusetts. The foregoing right of indemnification shall
be in addition to any rights to which any such person may otherwise be
entitled and shall inure to the benefit of the executors or administrators
of each such person. The corporation may pay the expenses incurred by any
such person in defending a civil or criminal action, suit or proceeding in
advance of the final disposition of such action, suit or proceeding, upon
receipt of an undertaking by such person to repay such payment if it is
determined that such person is not entitled to indemnification hereunder.
This section shall be subject to amendment or repeal only by action of the
stockholders."

II-1
<PAGE> 95

Section 67 of the Massachusetts Corporation Law provides:

"Indemnification of directors, officers, employees and other agents of a
corporation, and persons who serve at its request as directors, officers,
employees or other agents of another organization, or who serve at its request
in any capacity with respect to any employee benefit plan, may be provided by it
to whatever extent shall be specified in or authorized by (i) the articles of
organization or (ii) a by-law adopted by the stockholders or (iii) a vote
adopted by the holders of a majority of the shares of stock entitled to vote on
the election of directors. Except as the articles of organization or by-laws
otherwise require, indemnification of any persons referred to in the preceding
sentence who are not directors of the corporation may be provided by it to the
extent authorized by the directors. Such indemnification may include payment by
the corporation of expenses incurred in defending a civil or criminal action or
proceeding in advance of the final disposition of such action or proceeding,
upon receipt of an undertaking by the person indemnified to repay such payment
if he shall be adjudicated to be not entitled to indemnification under this
section which undertaking may be accepted without reference to the financial
ability of such person to make repayment. Any such indemnification may be
provided although the person to be indemnified is no longer an officer,
director, employee or agent of the corporation or of such other organization or
no longer serves with respect to any such employee benefit plan.

No indemnification shall be provided for any person with respect to any
matter as to which he shall have been adjudicated in any proceeding not to have
acted in good faith in the reasonable belief that his action was in the best
interest of the corporation or to the extent that such matter relates to service
with respect to any employee benefit plan, in the best interests of the
participants or beneficiaries of such employee benefit plan.

The absence of any express provision for indemnification shall not limit
any right of indemnification existing independently of this section.

A corporation shall have power to purchase and maintain insurance on behalf
of any person who is or was a director, officer, employee or other agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or other agent of another organization or with
respect to any employee benefit plan, against any liability incurred by him in
any such capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liability."

The Registrant's Restated Articles of Organization, as amended, provide:

"The Corporation eliminates the personal liability of each director to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director notwithstanding any statutory provision or other law imposing
such liability; provided, that nothing in this paragraph shall eliminate or
limit the liability of a director (i) for any breach of the director's duty of
loyalty to the Corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or knowing violation of
law, (iii) under Section sixty-one or sixty-two of Chapter 156B of the
Massachusetts General Laws, or (iv) for any transaction from which the director
derived an improper personal benefit."

II-2
<PAGE> 96

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

This Registration Statement includes the following exhibits:

<TABLE>
<CAPTION>
EXHIBIT NO.
- -----------
<C> <S>
1.1+ Form of Underwriting Agreement by and among Registrant, certain stockholders of
the Company and Robertson, Stephens & Company LLC, Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Adams, Harkness & Hill, Inc., as
representatives of the several Underwriters.
3.1+ Restated Articles of Organization of Registrant.
3.2+ By-laws, as amended, of Registrant.
5 Opinion of Testa, Hurwitz & Thibeault, LLP as to the legality of the Common
Stock to be offered.
10.1+ Leases for premises located at 435-445 El Camino Real, Santa Clara, California,
by and between Zycon Corporation and University Research Center and addenda
thereto dated March 1, 1988; July 8, 1988; February 27, 1989; August 30, 1989;
May 19, 1993; and August 9, 1993.
10.2+ Provisional Lease dated November 14, 1995 for the premises located at the Muara
Tebas Land of Kuching East Malaysia by and between Sudarsono Osman and Zycon
Corporation Sendirian Berhad.
10.3+ Construction Agreement dated August 3, 1995 by and between Zycon Corporation
and Hiti Engineering Sdn.Bhd.
10.4+ Facilities Agreement dated February 9, 1996 by and among the Zycon Corporation
Sdn.Bhd., Bank Bumiputra Malaysia Berhad and BBMB Kewangan Berhad.
10.5+ Corporate Guarantee dated February 9, 1996 issued by Zycon Corporation in favor
of Bank Bumiputra Malaysia Berhad and BBMB Kewangan Berhad.
10.6+ Lease for the three acre premises located in Santa Clara, California by and
between Zycon Corporation and Sobrato Interests III, dated January 4, 1996.
10.7+ Profit Sharing Plan and Trust of Registrant, as amended and restated effective
January 1, 1988 and as amended June 20, 1990.
10.8+ First Amendment and Modification Agreement by and among Registrant and The
First National Bank of Boston (the "Bank of Boston") dated as of February 27,
1997 amending the Revolving Credit Agreement dated January 8, 1997 among
Registrant and the Bank of Boston (the "Revolving Credit Agreement").
10.9+ Form of Assignment and Acceptance to Revolving Credit Agreement.
11 Statement re: Computation of Earnings per Share.
23.1 Consent of Testa, Hurwitz & Thibeault, LLP (included as part of Exhibit 5).
23.2 Consent of Arthur Andersen LLP, Boston.
23.3 Consent of KPMG Peat Marwick LLP.
23.4 Consent of Arthur Andersen LLP, San Jose.
24+ Power of Attorney (included on signature page).
27+ Financial Data Schedule.
</TABLE>

- ---------------

+ Filed previously.

FINANCIAL STATEMENT SCHEDULES:

Report of Independent Public Accountants on Schedule

Schedule II -- Valuation and Qualifying Accounts

II-3
<PAGE> 97

ITEM 17. UNDERTAKINGS.

The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

The undersigned Registrant hereby undertakes as follows:

(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

II-4
<PAGE> 98

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment No. 4 to
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the Town of Salem, State of New Hampshire, on May 13, 1997.

HADCO CORPORATION

By /s/ TIMOTHY P. LOSIK

----------------------------------

TIMOTHY P. LOSIK

Vice President, Chief Financial

Officer and Treasurer

Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 4 to Registration Statement has been signed below by the following persons
in the capacities and on the date indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------- -------------------------------------------- -------------
<C> <S> <C>

* Chairman of the Board and Director May 13, 1997
- ---------------------------------
(HORACE H. IRVINE)

* President, Chief Executive Officer and May 13, 1997
- --------------------------------- Director (Principal Executive Officer)
(ANDREW E. LIETZ)

/s/ TIMOTHY P. LOSIK Vice President, Chief Financial Officer May 13, 1997
- --------------------------------- and Treasurer (Principal Financial Officer
(TIMOTHY P. LOSIK) and Principal Accounting Officer)
* Director May 13, 1997
- ---------------------------------
(LAWRENCE COOLIDGE)

* Director May 13, 1997
- ---------------------------------
(J. STANLEY HILL)

* Director May 13, 1997
- ---------------------------------
(JOHN F. SMITH)

* Director May 13, 1997
- ---------------------------------
(OLIVER O. WARD)

* Director May 13, 1997
- ---------------------------------
(PATRICK SWEENEY)

* Director May 13, 1997
- ---------------------------------
(JOHN E. POMEROY)

* Director May 13, 1997
- ---------------------------------
(JAMES C. TAYLOR)
</TABLE>

By: /s/ TIMOTHY P. LOSIK

-------------------------

(TIMOTHY P. LOSIK)

ATTORNEY-IN-FACT

II-5
<PAGE> 99

REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULE

To Hadco Corporation:

We have audited, in accordance with generally accepted auditing standards,
the consolidated financial statements of Hadco Corporation included in this
registration statement and have issued our report thereon dated November 15,
1996 (except with respect to the matter discussed in Note 2, as to which the
date is January 10, 1997). Our audit was made for the purpose of forming an
opinion on the basic financial statements taken as a whole. The schedule listed
in Item 16(b) is the responsibility of the Company's management and is presented
for purposes of complying with the Securities and Exchange Commission's rules
and is not part of the basic financial statements. This schedule has been
subjected to the auditing procedures applied in the audit of the basic financial
statements and, in our opinion, fairly states, in all material respects, the
financial data required to be set forth therein, in relation to the basic
financial statements taken as a whole.

ARTHUR ANDERSEN LLP

Boston, Massachusetts
November 15, 1996

S-1
<PAGE> 100

SCHEDULE II

HADCO CORPORATION

VALUATION AND QUALIFYING ACCOUNTS
(IN THOUSANDS)

<TABLE>
<CAPTION>
ADDITIONS
BALANCE AT CHARGED TO DEDUCTIONS BALANCE AT
BEGINNING COSTS AND FROM END OF
OF PERIOD EXPENSES RESERVES(1) PERIOD
---------- ---------- ------------ ----------
<S> <C> <C> <C> <C>
Allowance for Doubtful Accounts
October 29, 1994........................... $600 234 (109) $ 725
October 28, 1995........................... $725 277 (152) $ 850
October 26, 1996........................... $850 329 (79) $1,100
</TABLE>

- ---------------
(1) Amounts deemed uncollectible.

S-2
<PAGE> 101

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION PAGE NO.
- ----------- ----------------------------------------------------------------------- --------
<C> <S> <C>
1.1+ Form of Underwriting Agreement by and among Registrant, certain
stockholders of the Company and Robertson, Stephens & Company LLC,
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Adams, Harkness
& Hill, Inc., as representatives of the several Underwriters...........
3.1+ Restated Articles of Organization of Registrant. ......................
3.2+ By-laws, as amended, of Registrant.....................................
5 Opinion of Testa, Hurwitz & Thibeault, LLP as to the legality of the
Common Stock to be offered.............................................
10.1+ Leases for premises located at 435-445 El Camino Real, Santa Clara,
California, by and between Zycon Corporation and University Research
Center and addenda thereto dated March 1, 1988; July 8, 1988; February
27, 1989; August 30, 1989; May 19, 1993; and August 9, 1993............
10.2+ Provisional Lease dated November 14, 1995 for the premises located at
the Muara Tebas Land of Kuching East Malaysia by and between Sudarsono
Osman and Zycon Corporation Sendirian Berhad. .........................
10.3+ Construction Agreement dated August 3, 1995 by and between Zycon
Corporation and Hiti Engineering Sdn.Bhd...............................
10.4+ Facilities Agreement dated February 9, 1996 by and among the Zycon
Corporation Sdn.Bhd., Bank Bumiputra Malaysia Berhad and BBMB Kewangan
Berhad.................................................................
10.5+ Corporate Guarantee dated February 9, 1996 issued by Zycon Corporation
in favor of Bank Bumiputra Malaysia Berhad and BBMB Kewangan
Berhad. ...............................................................
10.6+ Lease for the three acre premises located in Santa Clara, California by
and between Zycon Corporation and Sobrato Interests III, dated January
4, 1996. ..............................................................
10.7+ Profit Sharing Plan and Trust of Registrant, as amended and restated
effective January 1, 1988 and as amended June 20, 1990.................
10.8+ First Amendment and Modification Agreement by and among Registrant and
The First National Bank of Boston (the "Bank of Boston") dated as of
February 27, 1997 amending the Revolving Credit Agreement dated January
8, 1997 among Registrant and the Bank of Boston (the "Revolving Credit
Agreement")............................................................
10.9+ Form of Assignment and Acceptance to Revolving Credit Agreement........
11 Statement re: Computation of Earnings per Share........................
23.1 Consent of Testa, Hurwitz & Thibeault, LLP (included as part of Exhibit
5).....................................................................
23.2 Consent of Arthur Andersen LLP, Boston.................................
23.3 Consent of KPMG Peat Marwick LLP.......................................
23.4 Consent of Arthur Andersen LLP, San Jose...............................
24+ Power of Attorney (included on signature page).........................
27+ Financial Data Schedule................................................
</TABLE>

- ---------------

+ Filed previously.

<PAGE> 1

May 12, 1997

Hadco Corporation

12A Manor Parkway

Salem, NH 03079

Re: Registration Statement on Form S-3

Registration No. 333-21977

Ladies and Gentlemen:

We are counsel to Hadco Corporation, a Massachusetts corporation (the
"Company"), and have represented the Company in connection with the preparation
and filing of the Company's Registration Statement on Form S-3, Registration No.
333-21977, as amended (the "Registration Statement"), relating to the public
offering of up to an aggregate of 2,000,000 shares of the Company's common
stock, $.05 par value per share (the "Common Stock"), all of which will be
issued and sold to the underwriters by the Company, and up to 300,000 shares of
Common Stock which may be purchased by the underwriters from the Company and
certain other stockholders of the Company (the "Selling Stockholders") to cover
over-allotments, if any (collectively, the "Shares"). The Shares are to be sold
by the Company and the Selling Stockholders to certain underwriters (the
"Underwriters") represented by Robertson, Stephens & Company LLC, Merrill Lynch
& Co., and Adams, Harkness & Hill, Inc., pursuant to an underwriting agreement
(the "Underwriting Agreement") filed as Exhibit 1.1 to the Registration
Statement.

We have reviewed the corporate proceedings taken by the Board of Directors
of the Company with respect to the authorization and issuance of the Shares. We
have also examined and relied upon originals or copies, certified or otherwise
authenticated to our satisfaction, of all corporate records, documents,
agreements or other instruments of the Company and have made all investigations
of law and have discussed with the Company's officers all questions of fact that
we have deemed necessary or appropriate.

Based upon and subject to the foregoing, we are of the opinion that (i) the
Shares to be issued and sold by the Company have been duly and validly
authorized and, when sold in the manner contemplated by the Underwriting
Agreement (and upon receipt by the Company of payment therefor as provided in
the Underwriting Agreement) will be validly issued, fully paid and non-
assessable; and (ii) the Shares to be sold by the Selling Stockholders are duly
and validly authorized, validly issued, fully paid and non-assessable.

We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement and to the reference to our firm in the Prospectus
contained in the Registration Statement under the caption "Legal Matters."

Very truly yours,

TESTA, HURWITZ & THIBEAULT, LLP

<PAGE> 1

FORM S-3

EXHIBIT 11

HADCO CORPORATION

STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
SIX MONTHS
FOR THE YEARS ENDED OCTOBER, ENDED APRIL
------------------------------- --------------------
1994 1995 1996 1996 1997
------- ------- ------- ------- --------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
Primary:
Net Income (Loss)..................... $ 9,943 $21,374 $32,014 $15,085 $(59,212)
======= ======= ======= ======= =======
Average shares outstanding............ 9,861 9,805 10,245 10,138 10,435
Add: Average common stock equivalents
outstanding........................ 1,536 1,553 1,140 1,251 --
Less: Shares assumed repurchased under
the treasury stock method.......... (677) (552) (301) (264) --
------- ------- ------- ------- -------
Total......................... 10,720 10,806 11,084 11,125 10,435
------- ------- ------- ------- -------
Per share amount...................... $ .93 $ 1.98 $ 2.89 $ 1.36 $ (5.67)
======= ======= ======= ======= =======
</TABLE>

<PAGE> 1

EXHIBIT 23.2

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) included in or made a part of this
registration statement.

ARTHUR ANDERSEN LLP

Boston, Massachusetts

May 13, 1997

<PAGE> 1

EXHIBIT 23.3

The Board of Directors
Hadco Corporation

We consent to the use of our report included herein and to the reference to our
firm under the heading "Experts" in the prospectus.

KPMG Peat Marwick LLP

San Jose, California

May 12, 1997

<PAGE> 1

EXHIBIT 23.4

CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS

As independent public accountants, we hereby consent to the use of our
reports (and to all references to our Firm) included in or made a part of this
registration statement.

ARTHUR ANDERSEN LLP

San Jose, California

May 13, 1997