-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Hyb4gnRDnpJqNAFV2lNgRKyRrygfluuuYpIrcUu6dwOO+WJvL6Ez/K7sPlBJTW+l Xm3qJ9eanaHvELoVEOhL9w== 0001341004-06-000549.txt : 20060227 0001341004-06-000549.hdr.sgml : 20060227 20060227135705 ACCESSION NUMBER: 0001341004-06-000549 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20060227 DATE AS OF CHANGE: 20060227 GROUP MEMBERS: TINICUM CAPITAL PARTNERS II PARALLEL FUND, L.P. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: TRANSTECHNOLOGY CORP CENTRAL INDEX KEY: 0000099359 STANDARD INDUSTRIAL CLASSIFICATION: AIRCRAFT PART & AUXILIARY EQUIPMENT, NEC [3728] IRS NUMBER: 954062211 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-38259 FILM NUMBER: 06645893 BUSINESS ADDRESS: STREET 1: 700 LIBERTY AVENUE CITY: UNION STATE: NJ ZIP: 07083 BUSINESS PHONE: 908-688-2440 MAIL ADDRESS: STREET 1: 700 LIBERTY AVENUE CITY: UNION STATE: NJ ZIP: 07083 FORMER COMPANY: FORMER CONFORMED NAME: SPACE ORDNANCE SYSTEMS INC DATE OF NAME CHANGE: 19740717 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: TINICUM CAPITAL PARTNERS II LP CENTRAL INDEX KEY: 0001285997 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: SC 13D MAIL ADDRESS: STREET 1: 800 THIRD AVENUE STREET 2: 40TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D 1 nyc590104.txt SCHEDULE 13D UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D (Rule 13d-101) Under the Securities Exchange Act of 1934 (Amendment No. ___) TRANSTECHNOLOGY CORPORATION ------------------------------------------------------------------------------ (Name of Issuer) Common Stock, par value $0.01 per share ------------------------------------------------------------------------------ (Title of Class of Securities) 893889105 ------------------------------------------------------------------------------ (CUSIP Number) Eric M. Ruttenberg Tinicum Capital Partners II, L.P. Tinicum Capital Partners II Parallel Fund, L.P. c/o Tinicum Lantern II L.L.C. 800 Third Avenue 40th Floor New York, NY 10022 212-446-9300 (phone) -------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) February 17, 2006 --------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of ss.240.13d-1(e), ss.240.13d-1(f) or ss.240.13d-1(g), check the following box. Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See ss.240.13d-7 for other parties to whom copies are to be sent. * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). SCHEDULE 13D CUSIP No. 893889105 - -------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Tinicum Capital Partners II, L.P. - -------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) (b) [X] - -------------------------------------------------------------------------------- 3. SEC Use Only - -------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) WC (see Item 3) - -------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7. Sole Voting Power Shares 0 Number of Shares Beneficially Owned ---------------------------------------------------------- by Each Reporting Persons With 8. Shared Voting Power 1,720,919 (see Item 5)* ---------------------------------------------------------- 9. Sole Dispositive Power 0 ---------------------------------------------------------- 10. Shared Dispositive Power 1,720,919 (see Item 5)* - -------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 1,720,919 (See Item 5)* - -------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) - -------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 18.7% (see Item 5) - -------------------------------------------------------------------------------- 14. Type of Reporting Person. PN - -------------------------------------------------------------------------------- * Pursuant to Rule 13d-4 of the Securities Exchange Act of 1934 (the "Act"), the Reporting Person disclaims beneficial ownership of such Shares, and this Statement on Schedule 13D (this "Statement") shall not be construed as an admission that the Reporting Person is the beneficial owner of any securities covered by this Statement. CUSIP No. 893889105 - -------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Tinicum Capital Partners II Parallel Fund, L.P. - -------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) (b) [X] - -------------------------------------------------------------------------------- 3. SEC Use Only - -------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) WC (see Item 3) - -------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- 7. Sole Voting Power Shares 0 Number of Shares Beneficially Owned ---------------------------------------------------------- by Each Reporting Persons With 8. Shared Voting Power 9,048 (see Item 5)* ---------------------------------------------------------- 9. Sole Dispositive Power 0 ---------------------------------------------------------- 10. Shared Dispositive Power 9,048 (see Item 5)* - -------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 9,048 (See Item 5)* - -------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) - -------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) Less than 1.0% (see Item 5) - -------------------------------------------------------------------------------- 14. Type of Reporting Person. PN - -------------------------------------------------------------------------------- * Pursuant to Rule 13d-4 of the Securities Exchange Act of 1934 (the "Act"), the Reporting Person disclaims beneficial ownership of such Shares, and this Statement on Schedule 13D (this "Statement") shall not be construed as an admission that the Reporting Person is the beneficial owner of any securities covered by this Statement. SCHEDULE 13D Item 1. Security and Issuer This Statement on Schedule 13D (this "Statement") relates to the Common Stock, par value $0.01 per share (the "Common Stock") of TransTechnology Corporation, a Delaware corporation (the "Company"). The address of the principal executive offices of the Company is 700 Liberty Avenue, Union, New Jersey, 07083. Item 2. Identity and Background (a)-(c); (f).This Statement is being jointly filed by Tinicum Capital Partners II, L.P., a Delaware limited partnership ("TCP"), and Tinicum Capital Partners II Parallel Fund, L.P., a Delaware limited partnership ("TCPP" and together with TCP the "Reporting Persons"). TCP is a private investment partnership with its principal business address and principal office at c/o Tinicum Lantern II, L.L.C., 800 Third Avenue, 40th Floor, New York, New York 10022. TCPP is a private investment partnership with its principal business address and principal office at c/o Tinicum Lantern II, L.L.C., 800 Third Avenue, 40th Floor, New York, New York 10022. For information required by General Instruction C to Schedule 13D, reference is made to Exhibit A attached hereto which is incorporated herein by reference to this Item 2. (d)-(e). Neither of the Reporting Persons, nor, to the knowledge of the Reporting Persons, any person listed on Exhibit A hereto, has during the last five years (i) been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) been a party to any civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which such person was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Item 3. Source and Amount of Funds or Other Contribution Pursuant to a Stock Purchase Agreement (the "SPA," a copy of which is attached hereto as Exhibit B and incorporated herein by reference), dated as of February 15, 2006, by and among TCP, TCPP and the Company, the Reporting Persons agreed to purchase, from the Company through a privately negotiated transaction (the "Transaction"), an aggregate of 1,666,667 newly issued shares of Common Stock for a purchase price of $7.50 in cash per share. The Transaction closed on February 17, 2006, at which time TCP purchased 1,658,044 shares of Common Stock for an aggregate purchase price of $12,435,330, and TCPP purchased 8,623 shares of Common Stock for an aggregate purchase price of $64,672.50. Prior to the closing of the Transaction, TCP held 62,875 shares of Common Stock and TCPP held 425 shares of Common Stock. The Reporting Persons, together with the Other Investors (as defined below) entered into a Registration Rights Agreement, dated as of February 17, 2006, with the Company (the "RRA," a copy of which is attached hereto as Exhibit C and incorporated herein by reference), which provides for certain registration rights regarding the Common Stock purchased in the Transaction. For a description of the SPA, RRA and the Transaction, see Item 6 below, which descriptions are incorporated herein by reference. TCP and TCPP purchased the Common Stock with cash funded by a capital call to the limited partners of TCP and TCPP, respectively. This Item 3 is not applicable to the persons listed on Exhibit A hereto. Item 4. Purpose of Transaction The Reporting Persons acquired the shares of Common Stock for investment purposes. However, consistent with the Reporting Persons' interest in protecting their investment in the Company, the Reporting Persons intend to closely monitor the business and financial performance of the Company and their investment in the Company on a continuing basis. In addition, depending on various factors, including, without limitation, the Company's financial position and business strategy, the conduct of management and the Board of Directors of the Company (the "Board of Directors"), the amount of Common Stock held by other 5% shareholders and related risk of a Section 382 Limitation (as defined in the Internal Revenue Code) being applied to the Company's net operating loss carry forwards ("NOLs"), conditions in the securities market and general economic and industry conditions and alternative business and investment opportunities available to the Reporting Persons, the Reporting Persons may, from time to time in the open market or through private transactions, purchase additional shares of Common Stock. The Reporting Persons have the right, as described in Item 6 hereof, to nominate one director to the Board of Directors (such nominee the "Board Nominee"). The Reporting Persons have selected William Shockley to be the initial Board Nominee. Mr. Shockley is currently the President and Chief Executive Officer of Penn Engineering & Manufacturing Corporation, a company which is controlled by affiliates of the Reporting Persons. The Company and the Reporting Persons have agreed, as described in Item 6 hereof, to continue to explore and implement options to prevent the NOLs of the Company from becoming subject to a Section 382 Limitation, including, without limitation, the possible adoption at the Company's next annual meeting of shareholders of a charter amendment to impose restrictions upon the transfer of Common Stock in order to preserve the NOLs. The Reporting Persons have agreed, as described in Item 6 hereof, to vote all of their shares, until February 17, 2008, at their election either (a) pursuant to the recommendation of the Board of Directors or (b) proportionately with the vote of all other shareholders, provided, however, that notwithstanding the foregoing, the Reporting Persons may vote all of their shares in favor of the Board Nominee. The Reporting Persons have also agreed to certain "standstill" restrictions, which are described in Item 6 hereof, until the earlier of September 21, 2007 or such time as the Reporting Persons own less than 50% of the shares of Common Stock purchased pursuant to the SPA. The descriptions of the foregoing subparagraphs of Item 4 are qualified in their entirety by reference to Item 6 hereof, which, together with copies of the SPA and RRA attached as Exhibits B and C hereto, respectively, are incorporated by reference herein. The Reporting Person and, to the knowledge of the Reporting Persons, each person listed on Exhibit A hereto, has no present plan or proposal that relate to or that would result in any of the actions specified in subparagraphs (a) through (j) of Item 4 of Schedule 13D except as set forth herein. Item 5. Interest in Securities of the Issuer TCP has direct beneficial ownership of 1,702,919 shares of Common Stock, which represents approximately 18.7% of the outstanding shares of Common Stock, based upon the representations of the Company and the shares issued under the Stock Purchase Agreements (as defined in Item 6). TCPP has direct beneficial ownership of 9,048 shares of Common Stock, which represents less than 1% of the outstanding shares of Common Stock, based upon the representations of the Company and the shares issued under the Stock Purchase Agreements. Because the Reporting Persons may be deemed to be under common control, each such Reporting Person may be deemed to beneficially own shares of Common Stock beneficially owned by the other, although each such Reporting Person disclaims such beneficial ownership. If the Reporting Persons are deemed to beneficially own shares of Common Stock beneficially owned by the other, the Reporting Persons' aggregate beneficial ownership of Common Stock would be 1,729,967 shares of Common Stock, which represents approximately 18.8% of the outstanding shares of Common Stock based upon the representations of the Company and the shares issued under the Stock Purchase Agreements. Other than as provided in this Item 5, neither of the Reporting Persons, nor, to the knowledge of the Reporting Persons, any person listed on Exhibit A hereto, owns or has any rights to acquire, directly or indirectly, any Common Stock. Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer. Contemporaneously with the entering into the SPA by the Reporting Persons, the Company entered into certain other Stock Purchase Agreements (collectively the "Stock Purchase Agreements") with certain other investors unaffiliated with the Reporting Persons (collectively the "Other Investors"). In addition to customary representations, warranties and covenants, the SPA contains certain specific covenants relating to the Company and the Reporting Persons. The SPA also contains indemnification provisions for the benefit of the Reporting Persons. The SPA provides that the Reporting Persons will be granted access to the Company and additional information regarding the Company for so long as the Reporting Persons own 50% of the shares of Common Stock purchased under the SPA, provided that any material non-public information received by the Reporting Persons by means of such access remains subject to the terms of a confidentiality agreement between the Company and the Reporting Persons. The Reporting Persons have the right, under the SPA, for so long as the Reporting Persons continue to own 50% of the shares of Common Stock purchased under the SPA, to nominate one director to the Board of Directors (such nominee the "Board Nominee"). The Reporting Persons have selected William Shockley to be the initial Board Nominee. The Company has agreed to fully support the Board Nominee, including having the Board of Directors recommend that the shareholders of the Company vote in favor of the Board Nominee, and the Board Nominee will be included in any slate of directors put forth for election at any meeting of stockholders at which directors are elected. Pursuant to the SPA, until February 17, 2008 or until the Board of Directors waives the restrictions in Section 6.3 of the SPA, the Reporting Persons have agreed not to acquire an aggregate amount of additional Common Stock of the Company (or securities convertible into Common Stock) that would cause the Reporting Persons' aggregate ownership to exceed 30% of the then-outstanding shares of Common Stock. The Reporting Persons are also prohibited, until the earlier of (i) September 21, 2007, (ii) such date as the Reporting Persons own less than 50% of the shares of Common Stock acquired pursuant to the SPA, or (iii) the Board of Directors waives such limitations, from (a) engaging in any "solicitation" of "proxies" (as such terms are used in the proxy rules of the Commission) or consents to vote any voting securities of the Company, (b) forming, joining or participating in a "group" (as such term is defined under the Act) with unaffiliated third parties with respect to the Company or otherwise act in concert with any third person in respect of any of the Company's securities, (c) assisting, facilitating or encouraging any other person to effect or seek, offer or propose to effect or participate in any tender exchange offer, merger, recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company or any of its subsidiaries or (d) entering into any discussions or arrangements with any third party (other than the Reporting Persons representatives and financing sources) with respect to any of the foregoing. Notwithstanding the prohibitions listed above, the Reporting Persons are not prohibited from requesting that the Board of Directors waive any of the foregoing restrictions. Additionally, in order to protect the Company's NOLs from becoming subject to a Section 382 Limitation, the SPA provides that, upon receipt of a notice from the Company informing the Reporting Persons that additional acquisitions of equity of the Company may subject the Company's NOLs to such Section 382 Limitation, the Reporting Persons shall refrain from acquiring additional Common Stock of the Company until the Reporting Persons receive approval to do so from the Company. The Company and the Reporting Persons have agreed, in the SPA, to continue to explore options to prevent the NOLs of the Company from becoming subject to a Section 382 Limitation. The Company has agreed to use good faith commercial efforts to implement such additional mechanisms as the Board of Directors deems in the best interest of the Company, including, without limitation, the possible adoption at the next annual meeting of shareholders of a charter amendment to impose restrictions upon the transfer of Common Stock in order to preserve the Company's NOLs. The RRA also requires the Company to prepare and file a registration statement on Form S-3 (the "Shelf Registration Statement") for the resale pursuant to Rule 415 of the Securities Act of 1933, as amended, of the shares of Common Stock sold pursuant to the Stock Purchase Agreements as soon as the Company becomes eligible to use Form S-3. The RRA further provides that any stockholder, or group of stockholders, holding 50% or more of the shares issued pursuant to the Stock Purchase Agreements, may at any time after September 30, 2006 and until (and so long as) the Company is eligible to file the Shelf Registration Statement, make two demands of the Company that the Company file a registration statement for the resale, pursuant to Rule 415 of the Securities Act, of shares of Common Stock sold pursuant to the Stock Purchase Agreements having a market value as of the date of such request of at least $6,250,000. The Company has agreed to use their reasonable best efforts to cause any such registration statement to be declared effective by the Commission and to keep such registration statement effective as set forth in the RRA. The RRA also contains customary "piggy-back" rights, indemnification provisions and procedures for selection of underwriters, marketing activities and filing of registration statements. The information set forth, or incorporated by reference, in Items 3, 4, and 5 is incorporated herein by reference to this Item 6. Copies of the SPA and RRA are attached hereto as Exhibits B and C respectively, and are incorporated herein by reference. Item 7. Material to Be Filed As Exhibits Exhibit A: General Partner and control persons of TCP and TCPP. Exhibit B: Stock Purchase Agreement, dated as of February 15, 2006, by and among TCP, TCPP and the Company. Exhibit C: Registration Rights Agreement, dated as of February 17, 2006, by and among TCP, TCPP, Wynnefield Partners Small Cap Value, L.P., Wynnefield Partners Small Cap Value, L.P. I, Wynnefield Small Cap Value Offshore Fund, Ltd., and Terrier Partners LP, and the Company. Exhibit D: Filing Agreement. Signature After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Date: February 27, 2006 TINICUM CAPITAL PARTNERS II, L.P. By: TINICUM LANTERN, L.L.C. Its: General Partner By: /s/ Eric Ruttenberg -------------------------------- Name: Eric Ruttenberg Title: Co-Managing Member TINICUM CAPITAL PARTNERS II PARALLEL FUND, L.P. By: TINICUM LANTERN, L.L.C. Its: General Partner By: /s/ Eric Ruttenberg -------------------------------- Name: Eric Ruttenberg Title: Co-Managing Member EX-99 2 transtechexh_a.txt EXHIBIT A - GEN PRTNR & CTRL PERS FOR TCP & TCPP EXHIBIT A General Partner and control persons for TCP and TCPP Tinicum Lantern II L.L.C. - ------------------------- Tinicum Lantern II L.L.C., a Delaware limited liability company ("Lantern"), is the general partner of TCP and TCPP. Lantern is a private investment corporation. The address of its principal business and principal office is 800 Third Avenue, 40th Floor, New York, NY 10022. The name, present principal occupation, business address and citizenship of the managing members of Lantern are set forth below. Eric M. Ruttenberg - Co-Managing Member Mr. Ruttenberg's principal occupation is Co-Managing Member of Lantern. His business address is 800 Third Avenue, New York, NY 10022. Mr. Ruttenberg is a United States citizen. Terence O'Toole - Co-Managing Member Mr. O'Toole's principal occupation is Co-Managing Member of Lantern. His business address is 800 Third Avenue, New York, NY 10022. Mr. O'Toole is a United States citizen. EX-99 3 transtechexh_b.txt EXHIBIT B - STOCK PURCHASE AGREEMENT EXHIBIT B STOCK PURCHASE AGREEMENT TransTechnology Corporation 700 Liberty Avenue Union, New Jersey 07083 Attn: Joseph F. Spanier, Vice President, Chief Financial Officer and Treasurer Ladies & Gentlemen: The undersigned, Tinicum Capital Partners II, L.P. and Tinicum Capital Partners II Parallel Fund, L.P. (collectively referred to herein as the "Investor" or "Tinicum"), hereby confirm their agreement with TransTechnology Corporation as follows: 1. This Stock Purchase Agreement (the "Stock Purchase Agreement") is made as of February 15, 2006 between TransTechnology Corporation, a Delaware corporation (the "Company"), and the Investor. 2. The Company has authorized the sale and issuance of up to 2,500,000 shares of common stock of the Company, $0.01 par value per share (the "Common Stock"), to certain investors in a private placement (the "Offering"). 3. The Company and the Investor agree that the Investor will purchase from the Company and the Company will issue and sell to the Investor 1,666,667 shares of Common Stock (the "Shares")(1) for a purchase price of $7.50 in cash per share (the "Purchase Price"), or an aggregate purchase price of $12,500,002.50 (the "Aggregate Purchase Price"), pursuant to the Terms and Conditions for Purchase of Shares attached hereto as Annex I and incorporated herein by reference as if fully set forth herein (the "Terms and Conditions"). This Stock Purchase Agreement, together with the Terms and Conditions which are incorporated herein by reference as if fully set forth herein, may hereinafter be referred to as the "Agreement." Unless otherwise requested by the Investor, certificates representing the Shares purchased by the Investor will be registered in the Investor's name and address as set forth below. 4. The Investor represents that, except as set forth below, (a) it has had no position, office or other material relationship within the past three years with the Company or persons known to it to be affiliates of the Company, (b) neither it, nor any group of which it is a member or to which it is related, beneficially owns (including the right to acquire or vote) any securities of the Company and (c) it has no direct or indirect affiliation or association with any NASD member as of the date hereof. Exceptions: Existing Share Ownership of Investor Tinicum Capital Partners II, L.P 62,875 Tinicum Capital Partners Parallel Fund II, L.P 425 [Signature Page Follows] - ---------- (1) Tinicum Capital Partners II, L,.P. to receive 1,658,044 shares for an aggregate price of $12,435,330 and Tinicum Capital Partners II Parallel Fund, L.P. to receive 8,623 shares for an aggregate price of $64,672.50. 1 Please confirm that the foregoing correctly sets forth the agreement between us by signing in the space provided below for that purpose. By executing this Agreement, the Investor acknowledges that the Company may use the information in paragraph 4 above and the name and address information below in preparation of the Registration Statement (as defined in Annex 1). This Agreement may be executed in separate counterparts, each of which shall be deemed to be an original and all of which taken together shall constitute one and the same instrument. AGREED AND ACCEPTED: TINICUM CAPITAL PARTNERS II, L.P. TRANSTECHNOLOGY CORPORATION By: TINICUM LANTERN II, LLC Its: General Partner By: /s/ Eric Ruttenberg ------------------------------------ /s/ Joseph F. Spanier - ------------------------------------ By: Joseph F. Spanier Name: Eric Ruttenberg Vice President, Chief Financial ---------------------------------- Officer and Treasurer Tax ID No.: (2) ------------------------ State of Formation: Delaware --------------------- Principal Place of Business:800 3rd Ave. NY, NY 10022 ------------ TINICUM CAPITAL PARTNERS PARALLEL FUND II, L.P. By: TINICUM LANTERN II, LLC Its: General Partner By: /s/ Eric Ruttenberg ------------------------------------ Name: Eric Ruttenberg ---------------------------------- Tax ID No.: (3) ------------------------- State of Formation: Delaware --------------------- Principal Place of Business:800 3rd Ave. NY, NY 10022 ------------ AND FOR PURPOSES OF SECTION 6.3 ONLY By: TINICUM, INC. By: /s/ Eric Ruttenberg ------------------------------------ Name: Eric Ruttenberg ---------------------------------- 2 TABLE OF CONTENTS 1. Authorization and Sale of the Shares.................................. 2 2. Agreement to Sell and Purchase the Shares; Subscription Date.......... 2 3. Delivery of the Shares at Closing..................................... 2 4. Representations and Warranties of the Company......................... 3 5. Representations, Warranties and Covenants of the Investor............. 11 6. Covenants............................................................. 12 7. Survival of Company Representations, Warranties; Indemnification...... 14 8. Registration of the Shares; Right of First Offer...................... 15 9. Notices............................................................... 16 10. Changes............................................................... 17 11. Headings.............................................................. 17 12. Severability.......................................................... 17 13. Governing Law......................................................... 17 14. Counterparts.......................................................... 17 15. Entire Agreement...................................................... 17 16. Confidential Information.............................................. 18 17. No Third-Party Beneficiaries.......................................... 18 18. Knowledge............................................................. 18 i ANNEX I TERMS AND CONDITIONS FOR PURCHASE OF SHARES 1. Authorization and Sale of the Shares. Subject to these Terms and Conditions, the Company has authorized the sale of up to 2,500,000 shares of Common Stock to the Investor and Other Investors. 2. Agreement to Sell and Purchase the Shares; Subscription Date. 2.1. At the Closing (as defined in Section 3), the Company will sell to the Investor, and the Investor will purchase from the Company, upon the terms and conditions hereinafter set forth, the number of Shares, each as set forth in Section 3 of the Stock Purchase Agreement to which these Terms and Conditions are attached at the Purchase Price set forth thereon. 2.2. The Company may enter into a substantially similar form of Stock Purchase Agreement, including these Terms and Conditions, with other investors (the "Other Investors") and expects to complete sales of shares of the Company's common stock to the Other Investors, provided, however, that the Company shall not grant the rights granted pursuant to Sections 6.1 through 6.3, Section 6.5 and Section 6.8 hereof to the Other Investors. The Company may accept executed subscription agreements from Other Investors for the purchase of Common Stock commencing upon the date hereof and ending on February 17, 2006.(4) 2.3. The obligations of the Other Investors under any similar subscription agreement are several and not joint with the obligations of any Other Investors and the Investor, and no Other Investor, including the Investor, shall be responsible in any way for the performance of the obligations of any Other Investors under any agreement. Nothing contained herein, and no action taken by the Investor, shall be deemed to constitute a partnership, an association, a joint venture or any other kind of entity between the Investor and the Other Investors, or create a presumption that the Other Investors and the Investor are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated hereby. The Investor shall be entitled to independently protect and enforce its rights, including without limitation the rights arising out of this Agreement (provided, that such rights may be modified, amended or waived in accordance with Section 9 below), and it shall not be necessary for any Other Investors to be joined as an additional party in any proceeding for such purpose. 3. Delivery of the Shares at Closing. 3.1. The completion of the purchase and sale of the Shares (the "Closing") shall occur on February 17, 2006 (the "Closing Date"), at the offices of Hahn Loeser & Parks LLP. At the Closing, upon receipt by the Company of the Aggregate Purchase Price, the transfer agent for the Company shall deliver to the Investor one or more stock certificates representing the number of Shares as set forth pursuant to Section 3 of the Stock Purchase Agreement, each such certificate to be registered in the name of the Investor or, if so indicated on the signature page of the Stock Purchase Agreement, in the name of a nominee designated by the Investor. 3.2. The Company's obligation to issue and deliver the Shares to the Investor shall be subject to the following conditions, any one or more of which may be waived by the Company: (a) receipt by the Company of a certified or official bank check or wire transfer of immediately available funds in the full amount of the Aggregate Purchase Price; (b) the accuracy of the representations and warranties made by the Investor herein and the fulfillment of the Investor's obligations hereunder prior to the Closing and (c) the absence of any order, court injunction, law, statue, or rule prohibiting the transactions contemplated hereby. 3.3. The Investor's obligation to purchase the Shares shall be subject to the following conditions, any one or more of which may be waived by the Investor: (a) Investor and the Company shall have executed this Agreement and the Registration Rights Agreement, (b) the representations and warranties of the Company set forth herein shall be true and correct as of the Closing Date in all material respects (except for representations and warranties that speak as of a specific date, which representations and warranties shall be true and correct as of such date), (c) the Company shall have complied in all material - ---------- (4) The Company shall provide to Investor a finalized list of Other Investors and the amounts to be purchased by such investors prior to the signing of this Agreement. The Company will have three business days from the date of this Agreement to enter into agreements with such Other Investors. 2 respects with all pre-Closing covenants of the Company hereunder and (d) the Investor shall have received such documents as the Investor shall reasonably have requested, including, an opinion of the Company's counsel, in substantially the form attached hereto as Exhibit 1.(5) 3.4. Legend; Restrictions on Transfer. The certificate or certificates for the Shares (and any securities issued in respect of or exchange for the Shares) shall be subject to a legend or legends restricting transfer under the Securities Act and referring to restrictions on transfer herein, such legend to be substantially as follows: THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COUNSEL, IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER OR HYPOTHECATION IS IN COMPLIANCE THEREWITH. The Company and the Investor acknowledge and agree that the Investor may, as permitted by law, from time to time pledge pursuant to a bona fide margin agreement or grant a security interest in some or all of the Shares and, if required under the terms of such arrangement, Investor may, as permitted by law, transfer pledged or secured Shares to the pledgees or secured parties. So long as Investor is not an affiliate of the Company, such a pledge or transfer would not be subject to approval or consent of the Company, provided that, upon the request of the Company, a legal opinion of legal counsel to the pledgee, secured party or pledgor shall be obtained. At the Investor's expense, so long as the Shares are subject to the legend required by this Section 3.4, the Company will use its best efforts to execute and deliver such reasonable documentation as a pledgee or secured party of Shares may reasonably request in connection with a pledge or transfer of the Shares. 4. Representations and Warranties of the Company. The Company hereby represents and warrants to the Investor, as follows: 4.1. Organization. The Company and each of its Subsidiaries (as defined in Rule 405 under the Securities Act) is duly organized and validly existing in good standing under the laws of the jurisdiction of its organization. Each of the Company and its Subsidiaries has full power and authority to own, lease, operate and occupy its properties and assets and to conduct its business as presently conducted and as described in the documents filed by the Company under the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the "Exchange Act"), including, without limitation, its most recent report on Form 10-K (the "Exchange Act Documents") and is registered or qualified to do business and in good standing in each jurisdiction in which the nature of the business conducted by it or the location of the properties owned or leased by it requires such qualification and where the failure to be so qualified would have a material adverse effect upon the condition (financial or otherwise), earnings, cash flow, business or business prospects, properties, assets, liabilities or operations of the Company and its Subsidiaries, considered as one enterprise (a "Material Adverse Effect"), and no proceeding has been instituted in any such jurisdiction, revoking, limiting or curtailing, or seeking to revoke, limit or curtail, such power and authority or qualification. 4.2. Due Authorization and Valid Issuance. The Company has all requisite power and authority to execute, deliver and perform its obligations under this Agreement and the related Registration Rights Agreement attached as Exhibit 2 hereto (collectively the "Agreements"), and the Agreements have been duly authorized and validly executed and delivered by the Company and constitute legal, valid and binding agreements of the Company enforceable against the Company in accordance with their terms, except as rights to indemnity and contribution may be limited by state or federal securities laws or the public policy underlying such laws, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' and contracting parties' rights generally and except as enforceability may be subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). - ---------- (5) Among other things, opinion to address (i) due execution and delivery by the Company of the Registration Rights Agreement and Stock Purchase Agreement, (ii) that the execution and delivery of the Registration Rights, Stock Purchase Agreement and the consummation of the transactions contemplated thereby, including the issuance and sale of the Shares, will not constitute a violation of, breach or default under [any] material contract, violate any law or create any lien, encumbrance, etc., on any assets of the Company, (iii) no pending legal or governmental action, which would need to be disclosed under Regulation S-K, (iv) no persons with registration rights or similar rights, (v) exemption from registration requirements and compliance with all SEC requirements and (vi) valid existence and good standing under Delaware law of Company, and (vii) no stockholder vote is required for the issuance or entering into the Agreements. 3 4.3. Non-Contravention. The execution and delivery of the Agreements, the issuance and sale of the Shares under this Agreement, the fulfillment of the terms of the Agreements and the consummation of the transactions contemplated hereby and thereby will not (A) conflict with or constitute a violation of, or default (with the passage of time or otherwise) under, (i) any material bond, debenture, note or other evidence of indebtedness, lease, contract, indenture, mortgage, deed of trust, loan agreement, joint venture or other agreement or instrument to which the Company or any Subsidiary is a party or by which it or any of its Subsidiaries or their respective properties are bound, (ii) the charter, by-laws or other organizational documents of the Company or any Subsidiary, or (iii) any law, administrative regulation, ordinance or order of any court or governmental agency, arbitration panel or authority applicable to the Company or any Subsidiary or their respective assets or properties, except in the case of clauses (i) and (iii) for any such conflicts, violations or defaults which are not reasonably likely to have a Material Adverse Effect, or (B) result in the creation or imposition of any lien, encumbrance, claim, security interest or restriction whatsoever upon any of the material properties or assets of the Company or any Subsidiary or an acceleration of indebtedness pursuant to any obligation, agreement or condition contained in any bond, debenture, note or any other evidence of indebtedness or any indenture, mortgage, deed of trust or any other material agreement or instrument to which the Company or any Subsidiary is a party or by which any of them is bound or to which any of the material property or assets of the Company or any Subsidiary is subject. No consent, approval, authorization or other order of, or registration, qualification or filing with, any regulatory body, administrative agency, or other governmental body in the United States or any foreign jurisdiction or any other person is required for the execution and delivery of the Agreements and the valid issuance and sale of the Shares pursuant to the Agreements, other than such as have been made or obtained, and except for any post-closing securities filings or notifications required to be made under federal or state securities laws. 4.4. Capitalization. The equity capitalization of the Company as of February 15, 2006 is as set forth on Schedule 4.4 hereto. The Shares to be sold pursuant to this Agreement have been duly authorized, and when issued and paid for in accordance with the terms of this Agreement, will be duly and validly issued, fully paid and nonassessable and free of any preemptive rights for any other securityholder of the Company. The outstanding shares of capital stock of the Company have been duly and validly issued and are fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and were not issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. Except as set forth on Schedule 4.4 hereof, there are no outstanding rights (including, without limitation, preemptive rights), warrants or options to acquire, or instruments convertible into or exchangeable for, any shares of capital stock or other equity interest in the Company or any Subsidiary, or any contract, commitment, agreement, understanding or arrangement of any kind to which the Company is a party or of which the Company has knowledge and relating to the issuance or sale of any capital stock of the Company or any Subsidiary, any such convertible or exchangeable securities or any such rights, warrants or options. Without limiting the foregoing, no preemptive right, co-sale right, right of first refusal, registration right, or other similar right exists with respect to the Shares or the issuance and sale thereof. No further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Shares. The Company owns the entire equity interest in each of its Subsidiaries, free and clear of any pledge, lien, security interest, encumbrance, claim or equitable interest, other than as set forth on Schedule 4.4 hereof. There are no stockholders agreements, voting agreements or other similar agreements with respect to the Common Stock to which the Company is a party or, to the knowledge of the Company between or among any of the Company's stockholders. 4.5. Legal Proceedings. There is no material legal or governmental proceeding pending or, to the knowledge of the Company, threatened to which the Company or any Subsidiary or any of their officers or directors is or may be a party or of which the business, assets or property of the Company or any Subsidiary is subject other than as set forth on Schedule 4.5. There are no disagreements of any kind presently existing, or reasonably anticipated by the Company to arise, between the accountants and lawyers formerly or presently employed by the Company and the Company is current with respect to any fees owed to its accountants and lawyers. 4.6. No Violations. Neither the Company nor any Subsidiary is (i) in violation of its charter, bylaws, or other organizational document, or (ii) in violation of any law, administrative regulation, ordinance or order of any court or governmental agency, arbitration panel or authority applicable to the Company or any Subsidiary, except for such violations, individually or in the aggregate, which would not be material to the Company and its Subsidiaries or (iii) is in default (and there exists no condition which, with the passage of time or otherwise, would constitute a default) in any material respect in the performance of any bond, debenture, note or any other evidence of indebtedness in any indenture, mortgage, deed of trust or any other material agreement or instrument to which the Company or any Subsidiary is a party or by which the Company or any Subsidiary is bound, except for such default which would not be material to the Company and its Subsidiaries. 4 4.7. Governmental Permits, Etc. Each of the Company and its Subsidiaries has and is in material compliance with all necessary franchises, licenses, certificates, permits and other authorizations from any foreign, federal, state or local government or governmental agency, department, or body that are currently necessary for the operation of the business of the Company and its Subsidiaries as currently conducted and as described in the Exchange Act Documents except where the failure to currently possess such could not reasonably be expected to have a Material Adverse Effect. To the knowledge of the Company, all necessary franchises, licenses, certificates, permits and other authorizations are in full force and effect, and no suspension or cancellation of the same is threatened or reasonably likely. 4.8. Intellectual Property. Except as set forth on Schedule 4.8 hereof (i) each of the Company and its Subsidiaries owns, or has the valid right to use, without limitation, all United States and foreign patents, patent rights, patent applications, trademarks, trademark applications, service marks, copyrights, copyright registrations, licenses, inventions, software, trade secrets, trade names; know-how and other similar rights (collectively, "Intellectual Property") necessary for the conduct of its business as now conducted except where the failure to currently own or have the right to use would not be material to the Company and its Subsidiaries and (ii) to the knowledge of the Company, neither the Company nor any of its Subsidiaries is infringing, or has received any notice of, or has any knowledge of, any asserted infringement by the Company or any of its Subsidiaries of, any rights of a third party with respect to any Intellectual Property. 4.9. Financial Statements. (a) The financial statements of the Company and the related notes contained in the Exchange Act Documents present fairly, in accordance with generally accepted accounting principles, the financial position of the Company and its Subsidiaries as of the dates indicated, and the results of its operations and cash flows for the periods therein specified consistent with the books and records of the Company and its Subsidiaries except that the unaudited interim financial statements were or are subject to normal and recurring year-end adjustments which are not material in amount. Such financial statements (including the related notes) have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods therein specified, except as may be disclosed in the notes to such financial statements, or in the case of unaudited statements, as may be permitted by the Securities and Exchange Commission (the "SEC") on Form 10-Q under the Exchange Act and except as disclosed in the Exchange Act Documents and complied in all material respects with all applicable accounting requirements and with the published rules and regulations of the SEC with respect thereto. The other financial information contained in the Exchange Act Documents has been prepared on a basis consistent with the financial statements of the Company. (b) (i) The Company's assets do not constitute unreasonably small capital to carry on its business for the current fiscal year as now conducted taking into account the current and projected capital requirements of the business conducted by the Company and projected capital availability; and (ii) the current cash flow of the Company, together with the proceeds the Company would receive upon liquidation of its assets, after taking into account all anticipated uses of such amounts, would be sufficient to pay all such liabilities and obligations when such is required to be paid. The Company does not intend to incur liabilities and other obligations beyond its ability to pay such as they mature or are required to be paid. The Company has no knowledge of any facts or circumstances which lead it to believe that it will be required to file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction, and has no present intention to so file. (c) Except as set forth in any Exchange Act Documents, there are no obligations of the Company to officers, directors, stockholders or employees of the Company other than (i) for payment of salary for services rendered and for bonus payments; (ii) reimbursements for reasonable expenses incurred on behalf of the Company; (iii) for other standard employee benefits made generally available to all employees (including stock option agreements outstanding under any stock option plan approved by the Board of Directors); and (iv) obligations listed in the Company's financial statements. Except as described above or in any Exchange Act Documents, none of the officers, directors or, to the knowledge of the Company, key employees or stockholders of the Company or any members of their immediate families, are indebted to the Company, individually or in the aggregate, in excess of $60,000 or have any direct or indirect ownership interest in any firm or corporation with which the Company is affiliated or with which the Company has a business relationship, or any firm or corporation which competes with the Company, other than passive investments in publicly traded companies (representing less than one percent (1%) of such company) which may compete with the Company. Except as described above, no officer, director or stockholder, or any member of their immediate families, is, directly or indirectly, interested in any material contract with the Company and no agreements, understandings or transactions are contemplated between the Company and any such person. Except as set forth in any Exchange Act Documents, the Company is not a guarantor or indemnitor of any indebtedness of any other person, firm or corporation. 5 4.10. No Material Adverse Change. Except as disclosed in the Exchange Act Documents, since December 25, 2005, (A) there has not been (i) any Material Adverse Effect, (ii) any dividend or distribution of any kind declared, paid or made on the capital stock of the Company or any of its Subsidiaries, or (iii) any loss or damage (whether or not insured) to the physical property of the Company or any of its Subsidiaries which has been sustained which has a Material Adverse Effect, and (B) the Company and its Subsidiaries have operated the business in the ordinary course, consistent with past practice. 4.11. ERISA Except as disclosed in an Exchange Act Document, neither the Company, any of its Subsidiaries or any person required to be aggregated with the Company or any of its Subsidiaries maintains or contributes to, or is subject to liability for, any "defined benefit plan," as defined in Sections 3(35) of the Employee Retirement Income Security Act, as amended ("ERISA") (any such defined benefit plan, a "Plan"). No Plan is subject to Section 412 of the Internal Revenue Code of 1986, as amended (the "Code"), or Title IV of ERISA. Each employee benefit plan, within the meaning of Section 3(3) of ERISA, maintained by the Company and its Subsidiaries is in compliance in all material respects with the requirements of ERISA and the Code. The Company or its Subsidiaries may amend or terminate each Plan under the terms of such Plan without incurring any liability thereunder. 4.12. Product Liability. There is no material legal or governmental proceeding pending or, to the knowledge of the Company, threatened to which the Company or any Subsidiary or any of their officers or directors is or may be a party based on any legal or equitable theory of recovery whatsoever, relating to any alleged defect in design, manufacture, materials or workmanship, including any failure to warn or alleged breach of express or implied warranty, representation, or condition, relating to any product designed, manufactured or sold by or on behalf of the Company or any of its Subsidiaries within the last three years. There have not been, within the last three years, any product recalls or post-sale warnings by the Company or any of its Subsidiaries relating to a product designed, manufactured or sold by or on behalf of the Company or any of its Subsidiaries, and no circumstances exist affecting the safety of the products of the Company or any of its Subsidiaries. All products designed or manufactured by the Company or any of its Subsidiaries, and any services rendered in the conduct of the business of the Company or any of its Subsidiaries, within the last three years, have been in material conformity with all applicable standards, contractual commitments and all express or implied warranties. 4.13. No Undisclosed Liabilities. Except as set forth on Schedule 4.13 hereof or disclosed in an Exchange Act Document, neither the Company nor any of its Subsidiaries has, since December 25, 2005, incurred any debts, liabilities, claims, demands, expenses, commitments and obligations (whether accrued, absolute, contingent, known, disclosed or undisclosed, asserted or unasserted, liquidated or unliquidated) ("Liabilities"), which individually or in the aggregate are material to the Company or its Subsidiaries, except such Liabilities as were incurred in the ordinary course of business consistent with past practice and are of a nature, type and magnitude consistent with the Liabilities reflected in the Company's Exchange Act Documents. 4.14. Assets. The assets, rights and properties of the Company and its Subsidiaries constitute all of the assets, rights and properties which are necessary for the conduct of the business of the Company and its Subsidiaries as presently conducted and are sufficient to provide the Company with the means and capability to conduct the business of the Company and its Subsidiaries as presently being conducted. The Company and its Subsidiaries have good and marketable title to all personal property owned by them, in each case free and clear of all liens, encumbrances and defects, except such as are described in Schedule 4.14 or in the Exchange Act Documents or such as do not materially affect the value of such property and do not interfere with the use made of such property by the Company and its Subsidiaries. The Company and its Subsidiaries have good and marketable title in fee simple, free of any material liens or encumbrances, to all real property owned by them, except such as are described in Schedule 4.14. Any real property and buildings held under lease by the Company and its Subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the use made of such property and buildings by the Company and its Subsidiaries. 4.15. Insurance. The Company maintains insurance of the types and in the amounts and covering such risks as is prudent and adequate for its business as currently conducted, including, without limitation, property and casualty insurance, including physical damage, general liability, workers compensation, product liability and all other risks customarily insured against (any such insurance or similar agreements collectively the "Policies"). To the knowledge of the Company (X) the Policies are valid, outstanding, and enforceable, and have been issued to the Company or any of its Subsidiaries or are held by the Company or any of its affiliates for the benefit of the Company or its Subsidiaries, (Y) are in full force and effect, and to the knowledge of the Company have been issued by licensed insurers, and (Z) all premiums with respect to the Policies covering all periods up to and 6 including the Closing Date have been paid, and, except as set forth on Schedule 4.15 hereof, no written notice of cancellation or termination has been received with respect to any Policies. 4.16. Labor Relations. Except as described in Schedule 4.16, no labor dispute with employees of the Company or any of its Subsidiaries exists or, to the knowledge of the Company is threatened or imminent, that could have or be reasonably expected to have a Material Adverse Effect. To the knowledge of the Company, no employee of the Company or its Subsidiaries is or will be in violation of any judgment, decree, or order or any term of any employment contract, patent disclosure agreement, or other contract or agreement relating to the relationship of any such employee with the Company of any of its Subsidiaries, or any other party because of the nature of the business presently conducted by the Company and its Subsidiaries. 4.17. Environmental. Except as disclosed in any Exchange Act Document, neither the Company nor its Subsidiaries are in violation in any material respect of applicable federal, state, local and foreign laws and regulations, all common law and all other provisions having the force or effect of law relating to pollution or protection of the environment ("Environmental Laws"). To the knowledge of the Company, except as described in Schedule 4.17 hereto, there are no material pending or threatened claims, actions, causes of action, investigations or notices by any person alleging a potential liability arising out of, based on or resulting from the presence or release of, or threat of release of, or exposure to, any hazardous materials, noise or odor or any violation or alleged violation of any Environmental Laws ("Environmental Claims"), against the Company or any of its Subsidiaries or against any person whose liability for any Environmental Claims the Company or any of its Subsidiaries has or may have retained or assumed, either contractually or by operation of law. 4.18. Disclosure. The representations and warranties of the Company contained in this Section 4 as of the date hereof and as of the Closing Date and all material information provided to the Investor by or on behalf of the Company including the schedules, taken as a whole, do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Notwithstanding anything to the contrary contained in this Agreement or in any of the Schedules, any information disclosed in one Schedule shall, should the existence of the fact or item or its contents be readily apparent to be relevant to any other Schedules, be deemed to be disclosed in respect to such other Schedules. 4.19. Reporting Status. (a) Except as noted on Schedule 4.19 attached hereto, the Company has filed in a timely manner all documents that the Company was required to file under the Exchange Act or the Securities Act during the two (2) years preceding the date of this Agreement, including all such documents filed after the date hereof and prior to the Closing. None of the Company's Subsidiaries is required to file any form, report, schedule, statement or other document with the SEC. The Company is not currently eligible to use Form S-3 under the Securities Act to register the Shares to be offered for the account of the Investor, but is eligible to effectuate such registration on Form S-1 under the Securities Act. The following documents complied in all material respects with the SEC's requirements as of their respective filing dates, and the information contained therein as of the date thereof did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein in light of the circumstances under which they were made not misleading: (i) Annual Report on Form 10-K for the year ended March 31, 2005, Quarterly Reports on Form 10-Q for the quarters ended December 26, 2004; June 26, 2005; September 25, 2005 and December 25, 2005; Current Reports on Form 8-K filed on January 14, 2005; January 18, 2005; January 28, 2005; February 15, 2005; March 15, 2005; June 9, 2005; June 27, 2005; July 19, 2005; August 19, 2005; September 12, 2005; October 20, 2005; December 23, 2005; and December 28, 2005; and the Definitive Proxy Statement filed September 14, 2005 with respect to the 2005 annual meeting of the Company's stockholders; and (ii) all other documents, if any, filed by the Company with the SEC during the two (2) year period preceding the date of this Agreement pursuant to the reporting requirements of the Exchange Act. 4.20. Exchange Act Reporting; Compliance. The Company's Common Stock is registered pursuant to Section 12(g) of the Exchange Act, and the Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act, nor has the Company received any notification that the SEC or the National Association of Securities Dealers, Inc. ("NASD") is contemplating terminating such registration. The Company shall comply with all requirements of the NASD and the SEC with respect to the issuance of the Shares. 7 4.21. No Manipulation of Stock. The Company has not taken and will not take any action designed to or that might reasonably be expected to cause or result in stabilization or manipulation of the price of the Common Stock. 4.22. Company not an "Investment Company." The Company has been advised of the rules and requirements under the Investment Company Act of 1940, as amended (the "Investment Company Act"). The Company is not, and immediately after receipt of payment for the Shares will not be, an "investment company" or an entity "controlled" by an "investment company" within the meaning of the Investment Company Act and shall conduct its business in a manner so that it will not become subject to the Investment Company Act. 4.23. Foreign Corrupt Practices. Neither the Company, nor to the best knowledge of the Company, any agent or other person acting on behalf of the Company, has (i) directly or indirectly, used any corrupt funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company (or made by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended. 4.24. Accountants. To the knowledge of the Company, Deloitte & Touche LLP, who the Company expects will consent to the incorporation by reference of its report dated August 12, 2005 with respect to the consolidated financial statements of the Company included in the Company's Annual Report on Form 10-K for the year ended March 31, 2005 into any Registration Statement (as defined in the Registration Rights Agreement) and the prospectus which forms a part thereof contemplated by the Registration Rights Agreement, are and, during the periods covered by their report, were independent accountants as required by the Securities Act and the rules and regulations promulgated thereunder. 4.25. Contracts. The contracts described in the Exchange Act Documents that are material to the Company are in full force and effect on the date hereof, and neither the Company nor, to the knowledge of the Company, any other party to such contracts is in breach of or default under any of such contracts which would have a Material Adverse Effect. The Company has filed with the SEC all contracts and agreements required to be filed by the Exchange Act and Securities Act. 4.26. Taxes. (a) Each of the Company and its subsidiaries has (i) duly and timely filed (or there has been duly and timely filed on its behalf) with the appropriate governmental authorities all returns, reports, declarations, estimates, information returns and other documents (including any related or supporting information) with respect to Taxes (including any attachments thereto and amendments thereof), and including, where permitted or required, combined, consolidated or unitary returns for any group of entities that includes the Company and any of its subsidiaries (the "Tax Returns") required to be filed by them (giving effect to all valid extensions and such Tax Returns are true, correct and complete in all material respects; (ii) timely paid in full (or there has been timely paid on its behalf) all Taxes required to be paid by it, except for (A) those Taxes for which the failure to have paid would not, individually or in the aggregate, reasonably be expected to materially affect the Company and its Subsidiaries and (B) those Taxes which are being contested in good faith and adequately disclosed and provided for in the financial statements of the Company and for which the Company has provided adequate reserves in accordance with generally accepted accounting principles ("GAAP"); and (iii) made adequate provision in accordance with GAAP (or provision has been made on its behalf) for all accrued Taxes not yet due and payable. Since the date of the Company's most recent Financial Statements, neither the Company nor any of its Subsidiaries have incurred any liability for Taxes other than in the ordinary course of business consistent with past practice. (b) Except as set forth in Schedule 4.26 hereto, there are no liens for Taxes upon any property or assets of the Company or any Subsidiary, except for liens which arise by operation of law with respect to current Taxes not yet due and payable, or for Taxes which are being contested in good faith and for which the Company has provided adequate reserves in accordance with GAAP. (c) Each of the Company and its subsidiaries has complied in all material respects with all applicable laws relating to the payment and withholding of Taxes and has, within the time and manner prescribed by law, withheld and paid over to the proper governmental authorities all amounts required to be so withheld and paid over. 8 (d) Except as noted in Schedule 4.26 hereto, no federal, state, local or foreign audits, actions, suits, proceedings, investigations, claims or other administrative proceedings ("Tax Claims") have commenced or are pending with regard to any Taxes of the Company or any of its subsidiaries, and no notification has been received that an audit, investigation, claim or other administrative proceeding is pending or threatened with respect to any Taxes due from or with respect to the Company or any of its subsidiaries. No deficiency for any Tax has been proposed, asserted or assessed with respect to the Company or any of its subsidiaries which has not been finally resolved and paid in full. (e) Except as noted in Schedule 4.26 hereto, none of the Company or any of its subsidiaries is a party to, bound by, or has any obligation under, any Tax sharing agreement, Tax indemnification agreement or similar contract or arrangement, whether written or unwritten, or has any potential liability or obligation to any person as a result of, or pursuant to, any such agreement, contract or arrangement. (f) None of the Company or any of its subsidiaries (i) has been included in any "consolidated," "unitary," "combined" or similar Tax Return provided for under the laws of the United States, any foreign jurisdiction or any state or locality with respect to Taxes other than a group of which the Company is the common parent or (ii) has any liability for Taxes as a result of transferee, successor or similar liability. (g) The Company has not given or been requested to give waivers or extensions of any statute of limitations relating to the payment of Taxes of the Company or any of its Subsidiaries. (h) The Company and its subsidiaries have made available to the Investor complete copies of (i) all federal, state, local and foreign income, franchise and other material Tax Returns of the Company and/or any of its subsidiaries relating to taxable periods ended since 2000, and (ii) any audit report issued within the last three years relating to any income, franchise or other material Taxes due from or with respect to the Company and/or any of its subsidiaries. (i) No closing agreements, private letter rulings, technical advance memoranda or similar agreement or ruling have been entered into or issued by any taxing authority with respect to the Company or any of its subsidiaries within three years of the date this Agreement, and no such agreement or ruling has been applied for and is currently pending. (j) Neither the Company nor any of its subsidiaries has agreed or is required to make any adjustments under Section 481(a) of the Code (or any similar provision of state, local, foreign or other Law) by reason of a change in accounting method or otherwise for any Tax period for the which the applicable statutes of limitations has not yet expired. (k) Neither the Company nor any of its subsidiaries has been a "distributing corporation" or a "controlled corporation" in a distribution intended to qualify under Section 355(a) of the Code. (l) Neither the Company nor any of its subsidiaries has engaged in any transaction that, for federal income tax reporting purposes, gives rise to a disclosure obligation as a "reportable transaction" under Section 6011 of the Code and the Treasury Regulations thereunder. (m) Neither the Company nor any of its subsidiaries will be required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any intercompany transaction or excess loss account described in Treasury Regulations under Section 1502 of the Code (or any corresponding or similar provision of state, local or foreign Tax law). (n) Except as disclosed on Schedule 4.26 hereto, none of the Company or any of its subsidiaries has engaged in a trade or business, had a permanent establishment (within the meaning of an applicable tax treaty or local law), or has otherwise become subject to Tax in a jurisdiction other than the country of its formation or has a foreign branch or division. (o) None of the Company or any of its subsidiaries is or has been a "United States real property holding corporation" within the meaning of Section 897 of the Code or the Treasury Regulations thereunder. "Taxes" means all federal, state, local or foreign taxes, charges, fees, imposts, levies or other assessments, including, without limitation, all net income, gross receipts, capital, sales, use, ad valorem, value added, transfer, franchise, profits, inventory, capital stock, license, withholding, payroll, employment, social security, unemployment, excise, severance, stamp, occupation, property 9 and estimated taxes, customs duties, fees, assessments and charges of any kind whatsoever, and all interest, penalties, fines, additions to tax or additional amounts imposed by any taxing authority in connection with any item described above. 4.27. Transfer Taxes. On the Closing Date, all stock transfer or other taxes (other than income taxes) which are required to be paid in connection with the sale and transfer of the Shares to be sold to the Investor hereunder will be, or will have been, fully paid or provided for by the Company and all laws imposing such taxes will be or will have been fully complied with. 4.28. Private Offering. Assuming the correctness of the representations and warranties of the Investor set forth in Section 5 hereof, the offer and sale of Shares are exempt from registration under the Securities Act. The Company has not distributed and will not distribute prior to the Closing Date any offering material in connection with this Offering and sale of the Shares other than the documents of which this Agreement is a part or the Exchange Act Documents. The Company has not in the past nor will it hereafter take any action independent of the placement agent to sell, offer for sale or solicit offers to buy any securities of the Company which would bring the offer, issuance or sale of the Shares within the provisions of Section 5 of the Securities Act, unless such offer, issuance or sale was or shall be within the exemptions of Section 4 of the Securities Act. Neither the Company nor any person acting on behalf of the Company has offered or sold any of the Shares by any form of general solicitation or general advertising. The Company has offered the Shares for sale only to the Investor and certain other "accredited investors" within the meaning of Rule 501 under the Securities Act. 4.29. Inventory. All of the Company's inventory consists of a quality and quantity useable and saleable in the ordinary and usual course of business, except for items of excess and obsolete materials, all of which items have been written off or written down on the applicable balance sheet to fair market value or for which adequate reserves have been provided therein. All inventories not written off have been priced at the lower of cost or market. The quantities of each type of inventory (whether raw materials, work-in-progress, or finished goods) are in quantities sufficient for the ordinary and usual course of the Company's business. The valuation of all of the inventory of the Company and its Subsidiaries have been determined consistent with GAAP, consistently applied throughout the periods covered by the Exchange Act Documents filed by the Company within the last three fiscal years. 4.30. Accounts Receivable. All notes and accounts receivable of the Company and its Subsidiaries on the books and records of the Company and its Subsidiaries, reflect valid receivables resulting from bona fide transactions with third parties in the ordinary course of business, subject to no setoffs or counterclaims except those that are customarily required by government authorities under government contracts governed by the Federal Acquisition Regulations, and that are reasonably anticipated to be paid in accordance with their terms at their recorded amounts, subject to the reserve for bad debts set forth on the balance sheets of the Company Company's financial statements or Exchange Act Documents. The valuation of all notes and accounts receivable of the Company and its Subsidiaries have been determined consistent with GAAP, consistently applied throughout the periods covered by the Exchange Act Documents filed by the Company within the last three fiscal years. 4.31. Controls and Procedures. The Company is in material compliance with all provisions of the Sarbanes-Oxley Act of 2002 which are applicable to it as of the Closing Date. The Company has established and maintains an effective system of internal control over financial reporting (as such term is defined in the Exchange Act ) regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with GAAP and includes policies and procedures that (i) pertain to maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company's assets that could have a material impact on the financial statements. The Company has established and maintains disclosure controls and procedures (as defined in Exchange Act) that are effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms, including, without limitation, controls and procedures designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. The Company's certifying officers have evaluated the effectiveness of the Company's disclosure controls and procedures and presented in the applicable Exchange Act Documents their conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the periods covered by such Exchange Act Documents based on such evaluation. Since the last such evaluation date, there has been no change in the 10 Company's internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting, and no significant deficiencies or material weaknesses in internal controls over financial reporting, or other factors that could significantly affect the Company's internal control over financial reporting, have been identified. 4.32. Section 203 Exemption. The Board of Directors has adopted this Agreement and the Registration Rights Agreement and the transactions contemplated hereby and thereby in such manner as is sufficient to render the restrictions of Section 203 of the Delaware General Corporations Law inapplicable to the Agreements and all transactions contemplated hereby and thereby. 4.33. No Registration Rights. No person has the right to require the Company or any Subsidiary to register any securities for sale under the Securities Act by reason of the filing of the Registration Statement with the SEC for the issuance and sale of the Shares. 5. Representations, Warranties and Covenants of the Investor. 5.1. The Investor represents and warrants to, and covenants with, the Company that: (i) the Investor is an "accredited investor" as defined in Regulation D under the Securities Act and the Investor is also knowledgeable, sophisticated and experienced in making, and is qualified to make decisions with respect to investments in shares presenting an investment decision like that involved in the purchase of the Shares, including investments in securities issued by the Company and investments in comparable companies, and has requested, received, reviewed and considered all information it deemed relevant in making an informed decision to purchase the Shares; (ii) the Investor is acquiring the number of Shares, each as set forth in Section 3 of the Stock Purchase Agreement in the ordinary course of its business and for its own account for investment only and with no present intention of distributing any of such Shares, or any arrangement or understanding with any other persons regarding the distribution of such Shares; (iii) the Investor will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy,) any of the Shares except in compliance with the Securities Act, applicable state securities laws and the respective rules and regulations promulgated thereunder; and (iv) the Investor has, in connection with its decision to purchase the number of Shares as set forth in Section 3 of the Stock Purchase Agreement, relied upon the Exchange Act Documents and the representations and warranties of the Company contained herein. The Investor understands that its acquisition of the Shares has not been registered under the Securities Act or registered or qualified under any state securities law in reliance on specific exemptions therefrom, which exemptions may depend upon, among other things, the bona fide nature of the Investor's investment intent as expressed herein. Subject to compliance with the Securities Act, applicable securities laws and the respective rules and regulations promulgated thereunder, nothing contained herein shall be deemed a representation or warranty by such Investor to hold the Shares for any period of time. 5.2. The Investor acknowledges, represents and agrees that no action has been or will be taken in any jurisdiction outside the United States by the Company that would permit an offering of the Shares, or possession or distribution of offering materials in connection with the issue of the Shares, in any jurisdiction outside the United States where legal action by the Company for that purpose is required. Each Investor outside the United States will comply with all applicable laws and regulations in each foreign jurisdiction in which it purchases, offers, sells or delivers Shares or has in its possession or distributes any offering material, in all cases at its own expense. 5.3. The Investor hereby covenants with the Company not to make any sale of the Shares without complying with the provisions of this Agreement and the Registration Rights Agreement and without complying with any prospectus delivery requirement then applicable to it, and the Investor acknowledges that the certificates evidencing the Shares will be imprinted with a legend that prohibits their transfer except in accordance therewith. 5.4. The Investor further represents and warrants to, and covenants with, the Company that (i) the Investor has full right, power, authority and capacity to enter into this Agreement and to consummate the transactions contemplated hereby and has taken all necessary action to authorize the execution, delivery and performance of this Agreement, and (ii) this Agreement constitutes a valid and binding obligation of the Investor enforceable against the Investor in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' and contracting parties' rights generally and except as enforceability may be subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and except as the indemnification agreements of the Investor herein may be legally unenforceable. 11 5.5. Neither the Investor nor any person acting on its behalf or at its direction has engaged in any purchase or sale of Common Stock (including without limitation any short sale), pledge, transfer, establishment of an open "put equivalent position" within the meaning of Rule 16a-1(h) under the Exchange Act) during the thirty (30) trading days immediately preceding the date of this Agreement or otherwise has engaged or will engage, directly or indirectly, in any action designed to, or which might be reasonably expected to, cause or result in any manipulation of the price of the Common Stock. The Investor will not use any of the restricted Shares acquired pursuant to this Agreement to cover any short position in the Common Stock of the Company if doing so would be in violation of applicable securities laws and otherwise will comply with federal securities laws in the holding and sale of the Shares. 5.6. The Investor has consulted such legal, tax and investment advisors as it, in its sole discretion, has deemed necessary or appropriate in connection with its purchase of Shares. 5.7. The Company acknowledges and agrees that Investor does not make or has not made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Sections 5, 6 and 16(a) of this Agreement, or in the Confidentiality Agreement (as defined below). 6. Covenants. 6.1. Investor Board Nominee. So long as the Investor shall continue to own 50% of the Shares purchased pursuant to this Agreement, the Investor shall have the right to nominate one director to the Board of Directors (the "Investor Board Nominee"), who shall initially be William Shockley. If the Investor Board Nominee is any person other than Mr. Shockley, such person shall be reasonably acceptable to the Company. The Company agrees to fully support and include the Investor Board Nominee in any slate of directors put forth for election at any meeting of stockholders at which directors are elected, and that the Board of Directors shall recommend that stockholders vote in favor of the Investor Board Nominee. The Investor shall provide to the Company all information necessary for the inclusion of the Investor Board Nominee in any filings with the SEC.(6) 6.2. Voting of Investor Shares. For the two (2) year period commencing at the Closing, at any meeting of the stockholders of the Company the Investor agrees to, in its sole discretion, vote all of its shares of Common Stock either (a) pursuant to the recommendation of the board of directors of the Company (the "Board of Directors") or (b) proportionately with the vote of all other shareholders at any such meeting, provided that in any vote to elect members of the Board of Directors, the Investor shall be free to vote all of its Shares for the Investor Board Nominee; however, any shares not voted by the Investor in favor of the Investor Board Nominee shall be voted in accordance with this Section 6.2. 6.3. Maximum Ownership. The Investor agrees that, for a period of two (2) years commencing at the Closing, the Investor and its affiliates will not Acquire (as defined below) any additional Common Stock, or securities convertible into Common Stock, which would cause the Investor's aggregate ownership (which shall include ownership by its affiliates) to exceed 30% of the then outstanding shares of Common Stock (the "Maximum Ownership Provision"). The Board of Directors may at any time, in its sole discretion, waive the Maximum Ownership Provision. The Company and the Investor further agree that the provisions of this Section 6.3 with respect to the permitted acquisition of additional Common Stock shall supersede and replace the provisions with respect to acquisition of Common Stock set forth in Section 7 of the Confidentiality Agreement, dated as of September 21, 2005 by and among Tinicum, Inc. and the Company (the "Confidentiality Agreement"). Promptly following the Closing, the Company, the Investor and Tinicum, Inc. shall formally amend the Confidentiality Agreement to (x) modify the term set forth in Section 21 thereof, which shall not be applicable to Section 7 thereof, until the later of (i) September 21, 2007 or (ii) such date when the Investor owns less than 50% of the Shares purchased pursuant to this Agreement, (y) add Investor as a party to the Confidentiality Agreement jointly and severally with Tinicum, Inc, and (z) amend Section 7 thereof to read in its entirety as set forth on Exhibit 4 hereto. Tinicum, Inc. has acknowledged its obligation set forth in the preceding sentence by its signature to this Agreement. For purposes of this Section 6.3, the term "Acquire" shall mean purchase, offer to purchase, contract to purchase, hold pursuant to an assignment, transfer, pledge, swap or hedge or otherwise acquire (or enter into any transaction which is designed to, or might reasonably be expected to, result in the acquisition (whether by actual acquisition or effective economic acquisition due to a cash settlement or otherwise) by the Investor or any of its affiliates or any person in privity with the Investor or any of its affiliates), directly or indirectly, or establish or increase a call equivalent position or decrease a put equivalent position with respect to any shares of the capital stock of the Company, any securities convertible into or exercisable or exchangeable for such capital stock, or which the undersigned has beneficial ownership within the rules and regulations of the SEC. - ---------- (6) Parties to discuss committee assignments for Investor Board Nominee. 12 6.4. Preservation of NOLs. The Company and the Investor have discussed, and the Investor is aware, of, the importance to the Company of preserving the benefits of its substantial net operating loss carry forwards ("NOLs") under the requirements of the Code and Treasury Regulations. In furtherance of this objective, and notwithstanding anything in this Agreement to the contrary, The Company will notify Investor and the Other Investors in writing when, in consultation its independent auditors, it has determined that additional acquisitions of its equity securities by any of the Investor or Other Investors may subject the utilization of its NOLs to the Section 382 Limitation (as defined under the Code). Investor covenants, upon receipt of such notice and delivery of similar notices to the Other Investors, that neither it nor its affiliates will acquire any additional Common Stock of the Company until such time as Investor requests and receives written approval from the Company, which approval shall not be unreasonably withheld and shall be provided solely on the basis of whether the Company and its independent auditors have determined that such proposed acquisition by Investor, upon consideration of the relevant facts and circumstances known to the Company, would more likely than not subject the Company to the Section 382 Limitation with respect to the utilization of its NOLs. The Company and the Investor hereby further agree, following the Closing, to continue to explore the feasibility of, and to use good faith commercial efforts to implement, if determined by the Board of Directors to be in the best interest of the Company, additional mechanisms to ensure protection of the Company's NOLs in order to avoid the imposition of the Section 382 Limitation on the Company, including without limitation the possible adoption at the next annual meeting of shareholders of a charter amendment to impose restrictions upon the transfer of the Common Stock of the Company. The Company agrees that the Stock Purchase Agreements entered into with Other Investors will contain provisions no less restrictive than the restrictions imposed upon the Investor under this Section 6.4. Notwithstanding any other provision of this Section 6.4, nothing in this Agreement shall (X) prohibit the Investor from making any proposal, as permitted by Section 7 of the Confidentiality Agreement, or, upon approval of the Board of Directors, effecting any transaction which would have the effect of subjecting the utilization of the Company's NOLs to the Section 382 Limitation, or (Y) extend the term of the covenants contained in Section 6.3 of this Agreement. 6.5. Access to Information. So long as the Investor shall continue to own 50% of the Shares purchased pursuant to this Agreement, the Company and its Subsidiaries shall afford the Investor or any authorized representative or agent thereof who is not a competitor the opportunity to visit and inspect the properties of the Company and its Subsidiaries and to discuss the business and finances of the Company and its Subsidiaries with the officers of the Company and the Subsidiaries , during normal business hours following reasonable notice as often as may be reasonably requested; provided however, that notwithstanding the foregoing, the Company shall have no obligation to provide the Investor with (a) any trade secrets of the Company or (b) any information that, in the opinion of counsel, may constitute or result in a waiver of the attorney-client privilege of the Company. In exercising its rights hereunder, the Investor shall (and shall cause each of its representatives and agents to) conduct themselves so as not to interfere in any material respect in the conduct of the business of the Company. The Investor acknowledges and agrees that, prior to the Closing, any contact by such the Investor and its representatives and agents with officers, employees, customers or agents of the Company and its subsidiaries hereunder shall be arranged and supervised by representatives of the Company, unless the Company otherwise expressly consents with respect to any specific contact. Any access or confidential non-public information obtained in connection with the Investor's exercise of its rights pursuant to this Section 6.4 shall be deemed "Evaluation Material" subject to the confidentiality, but not use, terms of the Confidentiality Agreement. 6.6. Conduct of Business. During the period from the date of this Agreement to the Closing, the Company will continue to operate its business in the ordinary course. 6.7. Use of Proceeds. The Aggregate Purchase Price, together with all other funds received pursuant to the Offering, net of reasonable and customary offering fees and expenses, will be used to pay down existing indebtedness, in the order and amounts set forth on Schedule 6.6 hereof.(7) 6.8. Investor Expenses. The Company agrees to reimburse the Investor all reasonable, documented legal and out-of-pocket expenses incurred in the entering into of the Agreements, up to a maximum of $50,000. 6.9. Transferability; Termination of Covenants. The Investor may not transfer or assign any of its rights or obligations pursuant to this Section 6, whether in connection with a sale of Shares or otherwise. The covenants of the Company set forth in this Section 6 shall terminate upon a merger or consolidation of the Company into another entity, the sale of all or substantially all the assets of the Company or a transaction or series of related transactions in which a person or persons acquire - ---------- (7) Schedule to indicate that Term Loan C, in an amount of $9.2 million, will be repaid first as permitted by the Company's existing credit agreement, and itemize all other projected repayment of debt. 13 from stockholders of the Company shares representing more than fifty percent (50%) of the outstanding voting power of the Company, provided that, the covenants will not terminate upon any such transaction if the stockholders of the Company prior to the transaction continue to own fifty percent (50%) or more of the outstanding voting power of any surviving entity after giving effect to such transaction. 7. Survival of Company Representations, Warranties; Indemnification. 7.1. Survival of Representations and Warranties. Notwithstanding any investigation made by any party to this Agreement, all representations and warranties made by the Company shall survive for two (2) years following the execution of this Agreement. 7.2. Indemnification. (a) The Company agrees to indemnify and hold harmless the Investor and each of its partners, officers, managers, employees and representatives (each an "Investor Indemnitee") from and against (x) any losses, claims, demands, penalties, fines, actions, damages, costs, expenses (including, without limitation, reasonable legal fees and expenses incurred by the Investor Indemnitee in investigating or defending any such proceeding) or liabilities (all of the foregoing, including associated costs and expenses, a "Loss") insofar as such Loss arises out of, or is based upon any breach of the representations or warranties of the Company contained herein or failure to comply with the covenants and agreements of the Company contained herein, and (y) any finally judicially determined material diminution in value of the Investor's Shares as measured against the Purchase Price (a "Diminution") insofar as such Diminution arises out of, or is based upon any breach of the representations or warranties of the Company contained herein, provided, however, that the Company shall not be liable in any such case to the extent that such Diminution or Loss arises out of, or is based upon, the bad faith, gross negligence or willful misconduct of the Investor in connection therewith, provided, further, that the Company shall not have any obligation to indemnify the Investor from and against any Loss or Diminution until the Investor has suffered, individually or in the aggregate, any Loss or Diminution in excess of $750,000 (such amount, the "Indemnification Threshold") and then only to the extent the amount of all Loss or Diminution exceeds the Indemnification Threshold. Notwithstanding anything to the contrary herein, and except in the case of fraud or intentional misrepresentation, in no event shall the Company be obligated to indemnify the Investor Indemnitees pursuant to this Section 7.2(a) for an aggregate amount in excess of the Aggregate Purchase Price. The Company shall reimburse each Investor Indemnitee for the indemnifiable amounts provided for herein on demand as such expenses are incurred provided that, to the extent that it is finally judicially determined that an Investor Indemnitee was not entitled to any such reimbursement or any part of such reimbursement made by the Company, such Investor Indemnitee shall promptly pay such amount to the Company, together with interest thereon, at the prime rate announced by the Wall Street Journal, from time to time. (b) Promptly after receipt by the Investor Indemnitee of a notice of a claim or the beginning of any action in respect of which indemnity is to be sought against the Company pursuant to this Section 7.2, such Investor Indemnitee shall notify the Company in writing of such claim or of the commencement of such action, but the omission to so notify the Company will not relieve it from any liability which it may have to the Investor Indemnitee under this Section 7.2 (except to the extent that such omission materially and adversely affects the Company's ability to defend such action) or from any liability otherwise than under this Section 7.2. Subject to the provisions hereinafter stated, in case any such action shall be brought against an Investor Indemnitee, the Company shall be entitled to participate therein, and, to the extent that it shall elect by written notice delivered to the Investor Indemnitee promptly after receiving the aforesaid notice from such Investor Indemnitee, shall be entitled to assume the defense thereof, with counsel reasonably satisfactory to such Investor Indemnitee. After notice from the Company to such Investor Indemnitee of its election to assume the defense thereof, the Company shall not be liable to such Investor Indemnitee for any legal expenses subsequently incurred by such Investor Indemnitee in connection with the defense thereof, provided, however, that if there exists or shall exist a conflict of interest that would make it inappropriate, in the opinion of counsel to the Investor Indemnitee, for the same counsel to represent both the Investor Indemnitee and the Company or any affiliate or associate thereof, the Investor Indemnitee shall be entitled to retain its own counsel at the expense of the Company; provided, however, that the Company shall not be responsible for the fees and expenses of more than one separate counsel (together with appropriate local counsel) for all indemnified parties. In no event shall the Company be liable in respect of any amounts paid in settlement of any action unless the Company shall have approved the terms of such settlement; provided that such consent shall not be unreasonably withheld, conditioned or delayed. The Company shall not, without the prior written consent of the Investor Indemnitee, effect any settlement of any pending or threatened proceeding in respect of which the Investor Indemnitee is or could have been a party and indemnification could have been sought hereunder by such Investor Indemnitee, unless such settlement includes an unconditional release of such Investor Indemnitee from all liability on claims that are the subject matter of such proceeding. 14 (c) For avoidance of confusion, no control person, director, or officer of the Company is an indemnifying person for purposes of subsection (a) hereof. 7.3. Except for any claim for fraud or intentional misrepresentation, the indemnification provisions provided pursuant to this Section 7 shall be the sole remedy of the Investor, provided that, nothing in this Agreement shall prevent the Investor from seeking to enforce any agreements or covenants set forth herein (including this indemnification) in any court of law. 8. Registration of the Shares; Right of First Offer. 8.1. Registration Rights Agreement. The Company and the Investor shall, at the Closing, enter into a Registration Rights Agreement (the "Registration Rights Agreement"), in the form attached hereto as Exhibit 2, governing certain rights and obligations relating to the Shares. 8.2. Right of First Offer. (a) Right of First Offer. In the event that the Company shall issue, sell or exchange, agree or obligate itself to issue, sell or exchange, or reserve or set aside for issuance, sale or exchange, in a private sale transaction not involving a public offering, any (i) shares of Common Stock, (ii) any other equity security of the Company, including without limitation, preferred shares, (iii) any debt security of the Company which by its terms is convertible into or exchangeable for any equity security of the Company, (iv) any security of the Company that is a combination of debt and equity, or (v) any option, warrant or other right to subscribe for, purchase or otherwise acquire any such equity security or any such debt security of the Company, in each such case the Company shall first offer to sell such securities (the "Offered Securities") to the Investor as follows: The Investor shall have the right to purchase that portion of the Offered Securities determined as follows: the amount of the Offered Securities shall be multiplied by a fraction, (i) the numerator of which is the number of shares of Common Stock acquired hereunder and then held by the Investor and (ii) the denominator of which is the total number of shares of issued and outstanding Common Stock on a fully diluted basis, of the Company (the "Investor's Pro Rata Portion"), at a price and on such other terms as shall have been specified by the Company in writing with respect to such private sale and delivered to the Investor (the "Offer"), which Offer by its terms shall remain open and irrevocable for a period of seven (7) days from receipt of the Offer (the "Offer Acceptance Period"). (b) Notice of Acceptance. Notice of the Investor's intention to accept, in whole or in part, any Offer made shall be evidenced by a writing signed by the Investor and delivered to the Company prior to the end of the 7-day period of such Offer, setting forth such of the Investor's Pro Rata Portion as the Investor elects to purchase (the "Notice of Acceptance"). (c) Conditions to Acceptances and Purchase. (i) Permitted Sales of Refused Securities. The Company shall have one hundred eighty (180) days from the expiration of the Offer Acceptance Period to close the sale of all or any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Investor (the "Refused Securities"), upon terms and conditions, including, without limitation, unit price and interest rates, which are no more favorable, in the aggregate, to such other person or persons to whom the Offered Securities are proposed to be sold or no less favorable to the Company than those set forth in the Offer. (ii) Reduction in Amount of Offered Securities. In the event the Company shall propose to sell an amount of the Offered Securities which is less than the aggregate amount of all of the Investor's Pro Rata Portions with respect to the Investor who has timely submitted Notices of Acceptance (any such sale to be in the manner and on the terms specified above), then the number of the Offered Securities specified in the Investor's Notice of Acceptance shall be reduced to an amount which shall be not less than the amount of the Offered Securities which the Investor elected to purchase pursuant to (b) above multiplied by a fraction, (i) the numerator of which shall be the amount of Offered Securities which the Company actually proposes to sell, and (ii) the denominator of which shall be the amount of all Offered Securities the Company proposed to sell in its writing delivered pursuant to Section 8.2(a) above. In the event that the number or amount of Offered Securities specified in the Investor's Notice of Acceptance, is so reduced, the Company may not sell or otherwise dispose of more than the reduced amount of the Offered Securities until such securities have again been offered to the Investor in accordance with (a) above. (iii) Closing. At the closing of the sale of the Offered Securities, which shall include full payment to the Company of the sale to such other person or persons of all or less than all the Offered Securities, the Investor shall 15 purchase from the Company, and the Company shall sell to the Investor, the number of Offered Securities specified in the Notice of Acceptance, as reduced pursuant to Section 8.2(b) above upon the terms and conditions specified in the Offer. The purchase by the Investor of any Offered Securities is subject in all cases to the timely preparation, execution and delivery by the Company and the Investor of a form of purchase agreement, which shall be the same for each Investor, relating to such Offered Securities reasonably satisfactory in form and substance to the Company and the Investor and their respective counsel reflecting the terms and conditions specified in the Offer. In connection therewith, the Investor undertakes to use commercially reasonable efforts to execute and deliver such agreement with respect to the shares to be purchased by the Investor such that the sale of the Offered Securities by the Company may take place with such other person or persons in a timely manner as required by any agreements between or among the Company and such other person or persons. (d) Further Sale. In each case, any Offered Securities not purchased by the Investor or other person or persons in accordance with Section 8.2(c)(iii) above may not be sold or otherwise disposed of until they are again offered to the Investor under the procedures specified in Section 8.2(c)(i)-(iii) above. (e) Exceptions. The rights of the Investor under this Section 8.2 shall not apply to: (i) Common Stock issued as a stock dividend to holders of Common Stock or upon any subdivision or combination of shares of Common Stock; (ii) any capital stock or derivative thereof granted to an employee, director or consultant under a Company stock or stock option plan or as compensation for services; (iii) any securities issued as consideration for the acquisition of another entity by the Company by merger or share exchange (whereby the Company owns no less than 51% of the voting power of the surviving entity) or purchase of substantially all of such entity's stock or assets; (iv) any securities issued in connection with a license, strategic partnership, joint venture or other similar agreement, provided that the purpose of such arrangement is not primarily the raising of capital; (v) securities issued in an underwritten public offering, or (viii) securities of the Company proposed to be sold by a person, persons or entity other than the Company. (f) Termination of Right. The Right of First Offer set forth in this Section 8.2 shall be available so long as the Investor shall continue to own 50% of the Shares purchased pursuant to this Agreement and shall in any event terminate two (2) years following the Closing Date. 9. Notices. All notices, requests, consents and other communications hereunder shall be in writing, shall be mailed (A) if within the United States by first-class registered or certified airmail, or nationally recognized overnight express courier, postage prepaid, or by facsimile or electronic mail or other electronic means providing for verifiable proof of receipt by the addressee thereof (including transmittal in PDF format), or (B) if delivered from outside the United States, by International Federal Express (or other recognized international express courier), e-mail or facsimile, and shall be deemed given (i) if delivered by first-class registered or certified mail, three business days after so mailed, (ii) if delivered by nationally recognized overnight carrier, one business day after so mailed, (iii) if delivered by International Federal Express (or other recognized international express courier), two business days after so mailed, (iv) if delivered by facsimile, upon electronic confirmation of receipt and (v) if delivered by electronic mail or other electronic means providing for verifiable proof of receipt by the address thereof, when transmitted, and shall be delivered as addressed as follows: (a) if to the Company, to: TransTechnology Corporation 700 Liberty Avenue Union, New Jersey 07038 Attn: Joseph F. Spanier, Vice President, Chief Financial Officer and Treasurer Fax: (908) 686-6921 E-mail: jspanier@ttccorp.com with a copy to: Hahn Loeser & Parks LLP 3300 BP Tower 200 Public Square Cleveland, Ohio 44114-2301 Attn: F. Ronald O'Keefe, Esq. 16 Fax: (216) 241-2824 E-mail: frokeefe@hahnlaw.com (b) if to the Investor Tinicum Capital Partners II, L.P. & Tinicum Capital Partners Parallel Fund II, L.P. c/o Tinicum Incorporated Attention: Eric Ruttenberg 800 Third Avenue New York, NY 10022 Fax: (212) 750-9264 Email: eruttenberg@tinicum.com With a copy to: Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036-6522 Attention: Richard J. Grossman, Esq. Fax: (917) 777-2116 Email: rgrossma@skadden.com or at such other address as such party each may specify by written notice to the others. 10. Changes. This Agreement may be modified, amended or waived pursuant to a written instrument signed by the Company and the Investor. Any agreements with Other Investors may be modified, amended or waived only pursuant to a written instrument signed by the Company and Investor holding a majority of the Shares issued and sold in the Offering, provided that such modification, amendment or waiver is made with respect to all Agreements and does not adversely affect the Investor without adversely affecting all Investors in a similar manner. 11. Headings. The headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be part of this Agreement. 12. Severability. In case any provision contained in this Agreement should be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby. 13. Governing Law. This Agreement shall be governed by, and construed in accordance with, the internal laws of the State of Delaware, without giving effect to the principles of conflicts of law. 14. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall constitute an original, but all of which, when taken together, shall constitute but one instrument, and shall become effective when one or more counterparts have been signed by each party hereto and delivered to the other parties. Any signatures delivered by a party by facsimile transmission or by other electronic means providing for verifiable proof of receipt by the addressee thereof (including via e-mail transmission and PDF format) shall be deemed an original signature hereto. 15. Entire Agreement. This Agreement and the Schedules annexed hereto, together with the Confidentiality Agreement, the Registration Rights Agreement and Opinion attached hereto as exhibits, constitute the entire agreement between the parties hereto and supersedes any prior understandings or agreements concerning the purchase and sale of the Shares and the resale registration of the Shares. 17 16. Confidential Information. (a) The Investor represents to the Company that, at all times during the Company's offering of the Shares, the Investor has maintained in confidence all non-public information regarding the Company received by the Investor from the Company or its agents, and covenants that it will continue to maintain in confidence such information until such information (a) becomes generally publicly available other than through a violation of this provision or the provisions of the Confidentiality Agreement by the Investor or its agents or (b) is required to be disclosed in legal proceedings (such as by deposition, interrogatory, request for documents, subpoena, civil investigation demand, filing with any governmental authority or similar process), provided, however, that before making any use or disclosure in reliance on this subparagraph (b) the Investor shall, to the extent not prohibited by applicable law, rule or regulation, promptly notify the Company of the circumstances giving rise thereto and will furnish only that portion of the non-public information which is legally required and will exercise its best efforts to obtain reliable assurance that confidential treatment will be accorded any non-public information so furnished. (b) The Company shall promptly after the execution of this Agreement issue a press release substantially in the form attached hereto as Exhibit 3, and within one business day following the Closing Date, file with the SEC a Form 8-K (which shall include as exhibits the Agreement), in each case, disclosing the material terms of the transactions contemplated hereby (including at least the number of Shares sold and proceeds therefrom). The Company shall not publicly disclose the name of Investor or any beneficial owner of Shares held by the Investor, or include the name of Investor or such beneficial owner in any filing with the SEC or any state and federal regulatory agency (other than the filing of the Agreements with the SEC pursuant to the Exchange Act), without the prior written consent of Investor, except to the extent such disclosure is required by law or regulation. 17. No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person except as provided in Section 12 of the Registration Rights Agreement. 18. Knowledge. The term "knowledge" in this Agreement shall mean the knowledge of the executive officers of the Company after making reasonable inquiry under the circumstances. 18 INDEX OF DEFINED TERMS Acquire................................................................... 12 Aggregate Purchase Price.................................................. 1 Agreements................................................................ 3 Board of Directors........................................................ 12 Closing................................................................... 2 Closing Date.............................................................. 2 Common Stock.............................................................. 1 Company................................................................... 1 Confidentiality Agreement................................................. 12 Diminution................................................................ 13 Environmental Claims...................................................... 6 Environmental Laws........................................................ 6 Exchange Act.............................................................. 3 Exchange Act Documents.................................................... 3 GAAP...................................................................... 8 Indemnification Threshold................................................. 13 Intellectual Property..................................................... 4 Investment Company Act.................................................... 7 Investor.................................................................. 1 Investor Board Nominee.................................................... 11 Investor Indemnitee....................................................... 13 Investor's Pro Rata Portion............................................... 14 Knowledge................................................................. 17 Liabilities............................................................... 6 Loss...................................................................... 13 Material Adverse Effect................................................... 3 Maximum Ownership Provision............................................... 12 NASD...................................................................... 7 Notice of Acceptance...................................................... 14 Offer..................................................................... 14 Offer Acceptance Period................................................... 14 Offered Securities........................................................ 14 Offering.................................................................. 1 Other Investors........................................................... 2 Plan...................................................................... 5 Policies.................................................................. 6 Purchase Price............................................................ 1 Refused Securities........................................................ 15 Registration Rights Agreement............................................. 14 Sale Transaction.......................................................... 22 SEC....................................................................... 5 Shares.................................................................... 1 SPA....................................................................... 22 Stock Purchase Agreement.................................................. 1 Tax Claims................................................................ 8 Tax Returns............................................................... 8 Terms and Conditions...................................................... 1 Tinicum................................................................... 1 19 EXHIBIT 4 7. Standstill. You agree that, for a period until the earlier of (i) a public announcement of any tender or exchange offer, merger or other business combination involving the Company, any of the subsidiaries or assets of the Company or the subsidiaries constituting a significant portion of the consolidated assets of the Company and its subsidiaries (a "Sale Transaction"), (ii) September 21, 2007, (iii) such date as the Investor (as such term is defined in the SPA) or its affiliates do not own 50% of the shares purchased in the Stock Purchase Agreement, dated February 15, 2006, by and among the Company, Tinicum Capital Partners, L.P., Tinicum Capital Partners Parallel Fund II, L.P. and Tinicum Inc. (the "SPA"), or (iv) the Board of Directors waives the restrictions in this paragraph 7, unless specifically invited in writing by the Company, neither you nor any of your affiliates or Representatives will in any manner, directly or indirectly: (a) assist, facilitate or encourage any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect or participate in (x) any Sale Transaction or (y) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company or any of its subsidiaries, it being understood that the foregoing shall not prohibit you or your affiliates from effecting or participating in such transaction, (b) engage in any "solicitation" of "proxies" (as such terms are used in the proxy rules of the Securities and Exchange Commission) or consents to vote any voting securities of the Company; (c) form, join or in any way participate in a "group" (as defined under the 1934 Act) with unaffiliated third parties with respect to the Company or otherwise act in concert with any person in respect of any such securities; (d) other than by requesting to the Board of Directors of the Company to waive any of the provisions of this Section, take any action which would or would reasonably be expected to force the Company to make a public announcement regarding any of the types of matters set forth in (a) above; or (e) enter into any discussions or arrangements with any third party (other than your representatives and any financing sources) with respect to any of the foregoing. The Company agrees that during such period you may request that the Company or any of its Representatives, directly or indirectly, amend or waive any provisions of this paragraph. Nothing in this paragraph 7 shall prohibit or be construed to prohibit the Investor from making any filings with the Securities and Exchange Commission which the Investor reasonably determines it is required to make. 20 EX-99 4 transtechexh_c.txt EXHIBIT C - REGISTRATION RIGHTS AGREEMENT Exhibit C =============================================================================== REGISTRATION RIGHTS AGREEMENT by and between TransTechnology Corporation and The Stockholders listed on Schedule A hereto ------------------ Dated as of February 17, 2006 =============================================================================== Table of Contents 1. Certain Definitions........................................................1 2. Demand Registrations.......................................................3 3. Shelf Registration.........................................................6 4. Piggyback Registrations....................................................8 5. Other Registrations........................................................9 6. Selection of Underwriters..................................................9 7. Holdback Agreements........................................................9 8. Procedures................................................................10 9. Registration Expenses.....................................................14 10. Indemnification...........................................................15 11. Rule 144..................................................................17 12. Transfer of Registration Rights...........................................17 13. Miscellaneous.............................................................18 Index of Defined Terms Affiliate......................................................................1 Agreement......................................................................1 Business Day...................................................................1 Closing Date...................................................................1 Common Stock...................................................................1 Company........................................................................1 Delay Period...................................................................1 Demand Registration............................................................1 Demand Registration Statement..................................................1 Exchange Act...................................................................2 Full Cooperation...............................................................2 Fully Marketed Underwritten Offering...........................................2 Governmental Entity............................................................2 Nasdaq.........................................................................2 NYSE...........................................................................2 Person.........................................................................2 Piggyback Registration.........................................................2 Piggyback Registration Statement...............................................2 Prospectus.....................................................................2 Registrable Common Stock.......................................................2 Registration Expenses..........................................................3 Registration Statement.........................................................3 Rule 144.......................................................................3 Rule 415.......................................................................3 SEC............................................................................3 Securities Act.................................................................3 Shelf Registration.............................................................3 Shelf Registration Statement...................................................3 Stock Purchase Agreement.......................................................3 Stockholder....................................................................3 underwritten registration or underwritten offering.............................3 REGISTRATION RIGHTS AGREEMENT dated as of February 17, 2006, by and between TransTechnology Corporation, a Delaware corporation (the "Company"), and the stockholders of the Company listed in Exhibit A hereto (together, the "Stockholders"). In consideration of the mutual covenants and agreements herein contained, and the entering into of the Stock Purchase Agreements, and other good and valid consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows: 1. Certain Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms shall have the following meanings: "Affiliate" of any Person means any other Person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person. The term "control" (including the terms "controlling," "controlled by" and "under common control with") as used with respect to any Person means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. "Agreement" means this Registration Rights Agreement, including all amendments, modifications and supplements and any exhibits or schedules to any of the foregoing, and shall refer to this Registration Rights Agreement as the same may be in effect at the time such reference becomes operative. "Business Day" means any day, except a Saturday, Sunday or legal holiday on which banking institutions in The City of New York are authorized or obligated by law or executive order to close. "Closing Date" has the meaning set forth in the Stock Purchase Agreements. "Common Stock" means common stock, par value $.01 per share, of the Company. "Company" has the meaning set forth in the introductory paragraph and includes any other person referred to in the second sentence of Section 14(c) hereof. "Delay Period" has the meaning set forth in Section 2(f) hereof. "Demand Registration" has the meaning set forth in Section 2(a) hereof. "Demand Registration Statement" has the meaning set forth in Section 2(b) hereof. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Full Cooperation" means, in connection with any underwritten offering, where, in addition to the cooperation otherwise required by this Agreement, (a) members of senior management of the Company (including the chief executive officer and chief financial officer) fully cooperate with the underwriter(s) in connection therewith and make themselves available to participate in "road-shows" and other customary marketing activities in such locations (domestic and foreign) as reasonably recommended by the underwriter(s) (including one-on-one meetings with prospective purchasers of the Registrable Common Stock) and (b) the Company prepares preliminary and final prospectuses (preliminary and final prospectus supplements in the case of an offering pursuant to the Shelf Registration Statement) for use in connection therewith containing such additional information as reasonably requested by the underwriter(s) (in addition to the minimum amount of information required by law, rule or regulation). "Fully Marketed Underwritten Offering" means an underwritten offering in which there is Full Cooperation. "Governmental Entity" means any national, federal, state, municipal, local, territorial, foreign or other government or any department, commission, board, bureau, agency, regulatory authority or instrumentality thereof, or any court, judicial, administrative or arbitral body or public or private tribunal. "Nasdaq" means the Nasdaq quotation system, or any successor reporting system. "NYSE" means the New York Stock Exchange, Inc. "Person" means any individual, sole proprietorship, partnership, limited liability company, joint venture, trust, unincorporated organization, association, corporation, institution, public benefit corporation, Governmental Entity or any other entity. "Piggyback Registrations" has the meaning set forth in Section 4(a) hereof. "Piggyback Registration Statement" has the meaning set forth in Section 4(a) hereof. "Prospectus" means the prospectus or prospectuses included in any Registration Statement, as amended or supplemented by any prospectus supplement with respect to the terms of the offering of any portion of the Registrable Common Stock covered by such Registration Statement and by all other amendments and supplements to the prospectus, including post-effective amendments and all material incorporated by reference in such prospectus or prospectuses. "Registrable Common Stock" means (i) any shares of Common Stock issued pursuant to the Stock Purchase Agreements, and (ii) any other securities into or for which the Common Stock referred to in clause (i) has been converted, substituted or exchanged, and any securities issued or issuable with respect thereto upon any stock dividend or stock split or in connection with a combination of shares, reclassification, recapitalization, merger, consolidation or other reorganization or otherwise. "Registration Expenses" has the meaning set forth in Section 9(a) hereof. "Registration Statement" means any registration statement of the Company that covers any of the Registrable Common Stock pursuant to the provisions of this Agreement, including the Prospectus, amendments and supplements to such Registration Statement, including post-effective amendments, all exhibits and all materials incorporated by reference in such Registration Statement. "Rule 144" means Rule 144 promulgated by the SEC pursuant to the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC as a replacement thereto having substantially the same effect as such rule. "Rule 415" means Rule 415 promulgated by the SEC pursuant to the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC as a replacement thereto having substantially the same effect as such rule. "SEC" means the Securities and Exchange Commission. "Securities Act" means the Securities Act of 1933, as amended. "Shelf Registration" has the meaning set forth in Section 3(a) hereof. "Shelf Registration Statement" has the meaning set forth in Section 3(a) hereof. "Stockholders" has the meaning set forth in the introductory paragraph. "Stock Purchase Agreements" shall mean those Stock Purchase Agreements, dated as of February 15, 2006, by and among the Company and the Stockholders. "underwritten registration or underwritten offering" means an offering in which securities of the Company are sold to one or more underwriter (as defined in Section 2(a)(11) of the Securities Act) for resale to the public. 2. Demand Registrations. (a) Demand Registration on Form S-1. At any time after September 30, 2006, a Stockholder or Stockholders holding in the aggregate at least a majority of the Registrable Common Stock then outstanding may request, in writing, that the Company effect the registration on Form S-1 (or any successor form) providing for the resale pursuant to Rule 415 from time to time by the Stockholders of Registrable Common Stock owned by such Stockholder or Stockholders having an aggregate value of at least $6,250,000 (based on the market price on the date of such request) (a "Demand Registration"), in accordance with the methods of distribution set forth in such Demand Registration Statement (as defined below) (which plan of distribution is attached hereto as Exhibit A, modified to be consistent with then current market practice and in accordance with then applicable securities laws, rules and regulations); provided, however, that if the Stockholders requesting a Demand Registration pursuant to this Section 2(a) intend to distribute the Registrable Common Stock by means of an underwriting, the Demand Registration shall not provide for resale pursuant to Rule 415 and the plan of distribution shall be that plan of distribution provided by the lead underwriter for the underwritten offering. As promptly as practicable after such request, but in any event within 60 days of such request by the Stockholder, the Company shall file a registration statement on Form S-1 or such other form under the Securities Act then available to the Company. The Company shall use its best efforts to cause a Demand Registration Statement to be declared effective by the SEC as promptly as practicable following such filing. In connection with each such Demand Registration, the Company shall cause there to occur Full Cooperation. Notwithstanding anything to the contrary herein, the right to request a Demand Registration pursuant to this Section 2(a) shall be suspended upon the Company becoming eligible to file a Registration Statement on Form S-3 (or any successor form), provided that the Company has filed a Shelf Registration Statement (as defined below) and such Shelf Registration Statement has been declared effective by the SEC. The foregoing notwithstanding, the Stockholders shall be entitled to exercise their Demand Registration rights during the term of this Agreement in the event (i) the Company is no longer eligible to use Form S-3, (ii) the Shelf Registration is withdrawn prior to the time period specified in the third sentence of Section 3(b) or (iii) sales under the Shelf Registration Statement are suspended for periods in excess of those set forth in the last sentence of Section 3(b). (b) Notice of Demand Registration on Form S-1. Upon receipt of any request for a Demand Registration, the Company shall promptly give written notice of such proposed registration to all other Stockholders. Such Stockholders shall have the right, by giving written notice to the Company within fifteen (15) days after the Company provides its notice, to elect to have included in such registration such of their Registrable Common Stock as such Stockholders may request in such notice of election, subject in the case of an underwritten offering to the terms of Section 2(d). Thereupon, the Company shall, as expeditiously as possible, use its best efforts to effect the registration of all Registrable Common Stock which the Company has been requested to so register (the "Demand Registration Statement"). (c) Number of Demand Registrations. The Stockholders shall be entitled to request two (2) Demand Registrations pursuant to Section 2(a). For purposes of this Section 2(c), a Demand Registration pursuant to Section 2(a) shall not be counted (i) until such time as the Demand Registration Statement has been declared effective by the SEC (provided that the requesting Stockholders may withdraw their request for such registration and such request shall not count as a Demand Registration if (X) such withdrawal is as a result of information concerning the business or financial condition of the Company which is made known to the Stockholders after the date on which such registration was requested or (Y) the Stockholders making such demand agree to pay the Registration Expenses therefor pursuant to Section 9; or (ii) if, as a result of an exercise of the underwriter's cut-back provisions, less than 50% of the total amount of Registrable Common Stock that Stockholders have requested to be included in such Demand Registration Statement are sold. (d) Number of Fully Marketed Underwritten Offerings. The Stockholders shall be entitled to request no more than three (3) underwritten offerings pursuant to all of the Demand Registration Statements and Shelf Registration Statements and no more than one (1) underwritten offering pursuant to all of the Demand Registration Statements and Shelf Registration Statements in any 12 month period that requires involvement by management of the Company in road-show or similar marketing activities (a "Fully Marketed Underwritten Offering). If the Stockholders requesting a Demand Registration pursuant to Section 2(a) intend to distribute the Registrable Common Stock covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to Section 2(a) and the Company shall include such information in its written notice referred to in Section 2(b). In such event, (i) the right of any other Stockholders to include their Registrable Common Stock in such registration pursuant to Section 2(a) shall be conditioned upon such other Stockholder's participation in such underwriting on the terms set forth herein, and (ii) all Stockholders including Registrable Common Stock in such registration shall enter into an underwriting agreement upon customary terms with the underwriter or underwriters managing the offering; provided that such underwriting agreement shall not provide for indemnification or contribution obligations on the part of the Stockholders greater than the obligations of the Stockholders pursuant to Section 9. If the Stockholders request a Fully Marketed Underwritten Offering, the Company shall cause there to occur Full Cooperation in connection therewith. An underwritten offering shall not count as one of the permitted Fully Marketed Underwritten Offerings if there is not Full Cooperation in connection therewith. (e) Priority on Demand Registrations. If, in connection with a Demand Registration pursuant to Section 2(a), the managing underwriter shall advise the Company that in its opinion the number of securities requested to be included in such registration exceeds the number that can be sold in such offering without having an adverse effect on such offering, including the price at which such securities can be sold, then the Company shall include in such registration the maximum number of shares that such underwriter advises can be so sold without having such effect, allocated (i) first, to Registrable Common Stock requested by the Stockholder or Stockholders to be included in such registration, (ii) second, to the shares of Common Stock to be sold for the account of Company, and (iii) third, among all shares of Common Stock requested to be included in such registration by any other Persons allocated among such Persons in such manner as they may agree. (f) Restrictions on Demand Registrations. If at the time of any request to register Registrable Common Stock by a Stockholder or Stockholders pursuant to Section 2(a), the Company is engaged or has plans to engage in a registered public offering or is engaged in any other activity which, in the good faith determination of the Company's Board of Directors by a majority of its Board of Directors, would be adversely affected by the requested registration, then the Company may at its option direct that such request be delayed for a period not in excess of 90 days from the date of such request, such right to delay a request to be exercised by the Company not more than twice in any 12-month period but in no event may such two 90-day periods be consecutive or so close in proximity as to cause a delay with respect to the filing of a Demand Registration Statement to be longer than 120 days. The period during which any filing is so delayed hereunder is referred to as a "Delay Period". In the event that, in the judgment of the Company, it is advisable to suspend use of a Prospectus included in a Demand Registration Statement due to pending material developments or other events that have not yet been publicly disclosed and as to which the Company believes public disclosure would be detrimental to the Company, the Company shall notify all Stockholders to such effect, and, upon receipt of such notice, each of the Stockholders shall immediately discontinue any sales of Registrable Common Stock pursuant to such Demand Registration Statement until each of the Stockholders has received copies of a supplemented or amended Prospectus or until each of the Stockholders is advised in writing by the Company that the then current Prospectus may be used and has received copies of any additional or supplemental filings that are incorporated or deemed incorporated by reference in such Prospectus. Notwithstanding anything to the contrary herein, the Company shall not exercise its rights under the preceding sentence to suspend sales of Registrable Common Stock for a period in excess of 60 days consecutively or 90 days in any 365-day period. (g) Effective Period of Demand Registrations. Subject to Sections 8(a)(ii), after any Demand Registration filed pursuant to this Agreement has become effective, the Company shall use its best efforts to keep such Demand Registration Statement effective for a period of at least one (1) year from the date on which the SEC declares such Demand Registration Statement effective plus the duration of any Delay Period and any period during which the use of a Prospectus is suspended pursuant to Section 2(f), or such shorter period that shall terminate on the earliest of (x) when all of the Registrable Common Stock covered by such Demand Registration Statement has been sold pursuant to such Demand Registration Statement in accordance with the plan of distribution set forth therein, and (y) when, in the opinion of counsel to the Stockholders, all outstanding Registrable Common Stock may be resold without registration under the Securities Act pursuant to Rule 144(k) under the Securities Act or any successor provision thereto. 3. Shelf Registrations. (a) Shelf Registration on Form S-3. As soon as the Company becomes eligible to file a Registration Statement on Form S-3 (or any successor form relating to secondary offerings), the Company shall prepare and file or cause to be prepared and filed with the SEC, as soon as practicable, a Registration Statement on Form S-3 (or any successor thereto) relating to the offering on a continuous or delayed basis pursuant to Rule 415 from time to time by the Stockholders of all then outstanding Registrable Common Stock (a "Shelf Registration" and any such Registration Statement filed on Form S-3 (or any successor thereto) a "Shelf Registration Statement"), in each case, in accordance with the methods of distribution set forth in such Shelf Registration Statement (which plan of distribution is attached as hereto as Exhibit A modified to be consistent with then current market practice and in accordance with then applicable securities laws, rules and regulations) and, thereafter, shall use its commercially reasonable efforts to cause such Shelf Registration Statement to be declared effective under the Securities Act as promptly as practicable thereafter. Notwithstanding the foregoing, the Company may be able combine a Shelf Registration Statement from primary and/or secondary offerings. Furthermore, the Company shall not be required to prepare and file a Shelf Registration Statement if all Registrable Common Stock shall have been sold or when, in the opinion of counsel to the Stockholders, all outstanding Registrable Common Stock may be resold without registration under the Securities Act pursuant to Rule 144(k) under the Securities Act or any successor provision thereto. (b) Limitations on Takedowns. There shall be no limit on the aggregate number of takedowns, off such Shelf Registration Statement; provided, however, that the Company shall not be obligated to effect (i) more than three (3) Fully Marketed Underwritten Offerings off such Shelf Registration Statements, (ii) one Fully Marketed Underwritten Offering off such Shelf Registration Statement in any 12-month period, or (iii) a takedown within ninety (90) days after the pricing date of a Fully Marketed Underwritten Offering off any Shelf Registration. The Company shall use its commercially reasonable efforts to keep the Shelf Registration Statement pursuant to this Section 3(b) continuously effective (including by filing supplements and amendments) in order to permit the Prospectus forming part thereof to be usable by the Stockholders for such period that will terminate upon the earliest to occur of the following: (X) when all Registrable Common Stock have been sold pursuant to such Shelf Registration Statement, (Y) when, in the opinion of counsel to the Stockholders, all outstanding Registrable Common Stock may be resold without registration under the Securities Act pursuant to Rule 144(k) under the Securities Act or any successor provision thereto and (Z) three (3) years from the effective date of such Shelf Registration Statement. In the event that, in the judgment of the Company, it is advisable to suspend use of a Prospectus included in a Shelf Registration Statement due to pending material developments or other events that have not yet been publicly disclosed and as to which the Company believes public disclosure would be detrimental to the Company, the Company shall notify all Stockholders to such effect, and, upon receipt of such notice, each of the Stockholders shall immediately discontinue any sales of Registrable Common Stock pursuant to such Shelf Registration Statement until each of the Stockholders has received copies of a supplemented or amended Prospectus or until Stockholders are advised in writing by the Company that the then current Prospectus may be used and has received copies of any additional or supplemental filings that are incorporated or deemed incorporated by reference in such Prospectus. Notwithstanding anything to the contrary herein, the Company shall not exercise its rights under the preceding sentence to suspend sales of Registrable Common Stock for a period in excess of 60 days consecutively or 90 days in any 365-day period. (c) Priority on Shelf Registrations. If, in connection with a Shelf Registration pursuant to this Section 3, the managing underwriter shall advise the Company that in its opinion the number of securities requested to be included in such registration exceeds the number that can be sold in such offering without having an adverse effect on such offering, including the price at which such securities can be sold, then the Company shall include in such registration the maximum number of shares that such underwriter advises can be so sold without having such effect, allocated (i) first, to the securities to be sold for the account of the Company, (ii) second, to Registrable Common Stock requested by the Stockholders to be included in such registration and (iii) third, among all shares of Common Stock requested to be included in such registration by any other Persons allocated among such Persons in such manner as they may agree. 4. Piggyback Registrations. (a) Right to Piggyback. Whenever the Company proposes to publicly sell or register for sale any of its common equity securities pursuant to a registration statement (a "Piggyback Registration Statement") under the Securities Act (other than a registration statement on Form S-8 or on Form S-4 or any similar successor forms thereto), whether for its own account or for the account of one or more securityholders of the Company (a "Piggyback Registration"), the Company shall give prompt written notice to the Stockholders of its intention to effect such sale or registration and, subject to Sections 4(b) and 4(c), shall include in such transaction all Registrable Common Stock with respect to which the Company has received a written request from the Stockholders for inclusion therein within 15 days after the receipt of the Company's notice. The Company may postpone or withdraw the filing or the effectiveness of a Piggyback Registration at any time in its sole discretion, without prejudice to the Stockholder's right to immediately request a Demand Registration hereunder. A Piggyback Registration shall not be considered a Demand Registration for purposes of Section 2 of this Agreement. (b) Priority on Primary Registrations. If a Piggyback Registration is initiated as an underwritten primary registration on behalf of the Company, and the managing underwriter advises the Company in writing that in its opinion the number of securities requested to be included in such registration exceeds the number that can be sold in such offering without having an adverse effect on such offering, including the price at which such securities can be sold, then the Company shall include in such registration the maximum number of shares that such underwriter advises can be so sold without having such effect, allocated (i) first, to the securities the Company proposes to sell, (ii) second, to the Registrable Common Stock requested to be included therein by the Stockholders, and (iii) third, among other securities requested to be included in such registration by other security holders of the Company on such basis as such holders may agree among themselves and the Company. (c) Priority on Secondary Registrations. If a Piggyback Registration is initiated as an underwritten registration on behalf of a holder of the Company's securities other than Registrable Common Stock or on behalf of the Company, and the managing underwriter advises the Company in writing that in its opinion the number of securities requested to be included in such registration exceeds the number that can be sold in such offering without having an adverse effect on such offering, including the price at which such securities can be sold, then the Company shall include in such registration the maximum number of shares that such underwriter advises can be so sold without having such effect, allocated (i) first, to other securities requested to be included in such registration by other security holders and the Company, pro rata among such holder(s) and the Company on the basis of the number of shares requested to be registered by them, and (ii) second, to Registrable Common Stock requested to be included therein by the Stockholders. 5. Other Registrations. The Company shall not grant to any Person the right, other than as set forth herein and except to employees of the Company with respect to registrations on Form S-8 and with respect to registrations on Form S-4 (or any successor forms thereto), to request the Company to register any securities of the Company except such rights as are (a) not more favorable than or inconsistent with the rights granted to the Stockholders, and (b) that do not adversely affect the priorities set forth herein of the Stockholders. 6. Selection of Underwriters. If any of the Registrable Common Stock covered by a Demand Registration Statement or a Shelf Registration Statement is to be sold in an underwritten offering, the Stockholders shall have the right to select the managing underwriter(s) to administer the offering subject to the prior approval of the Company, which approval shall not be unreasonably withheld. 7. Holdback Agreements. Each of the Stockholders (regardless of whether or not such Stockholder is a selling Stockholder in any underwritten Demand Registration, Piggyback Registration or Shelf Registration, and, in each case, with respect to the Shares not included in such underwritten offering) and the Company agrees not to, and the Company shall exercise its best efforts to obtain from its directors and executive officers, and commercially reasonable efforts to obtain from its beneficial owners of 5% or more of the Company's outstanding voting stock, agreements (in the underwriters' customary form) not to, directly or indirectly offer, sell, pledge, contract to sell, (including any short sale), grant any option to purchase or otherwise dispose of any equity securities of the Company or enter into any hedging transaction relating to any equity securities of the Company during the 90 days beginning on the effective date of any underwritten Demand Registration Statement or any underwritten Piggyback Registration Statement or the pricing date of any underwritten offering pursuant to a Shelf Registration Statement (except as part of such underwritten registration or pursuant to registrations on Form S-8 or S-4 or any successor forms thereto) unless the underwriter managing the offering otherwise agrees to a shorter period, provided, however, that if (i) the Company issues an earnings release or material news, or a material event relating to the Company occurs, during the last 17 days of the lock-up period, or (ii) prior to the expiration of the holdback period, the Company announces that it will release earnings results during the 16-day period beginning on the last day of the holdback period, the restrictions imposed by this Section 7 shall continue to apply until the expiration of the 18-day period beginning on the issuance of the earnings release or the occurrence of the material news or material event; provided, however, that this sentence shall not apply if any research published or distributed by any underwriter on the Company would be compliant under Rule 139 of the Securities Act and the Company's securities are actively traded as defined in Rule 101(c)(1) of Regulation M of the Exchange Act. The Company may impose stop-transfer instructions with respect to the Registrable Common Stock or other securities subject to the foregoing restriction until the end of the applicable "holdback" period. In addition, to the extent that the terms of the holdback agreements of any of the Stockholders provide for more favorable terms than those of the Company, its executive officers or directors, then the terms of the holdback agreements of the Company, its executive officers and directors shall be amended to be consistent with those of the Stockholders. 8. Procedures. (a) Whenever the Stockholders request that any Registrable Common Stock be registered or sold pursuant to this Agreement, the Company shall use its best efforts to effect the registration and the sale of such Registrable Common Stock in accordance with the intended methods of disposition thereof, and pursuant thereto the Company shall as expeditiously as possible: (i) prepare and file with the SEC a Registration Statement with respect to such Registrable Common Stock and use its best efforts to cause such Registration Statement to become effective as soon as practicable thereafter; and at least five (5) Business Days before filing a Registration Statement or Prospectus or any amendments or supplements thereto (including any prospectus supplement for a shelf takedown), furnish to the Stockholders and the underwriter or underwriters, if any, copies of all such documents proposed to be filed, including documents incorporated by reference in the Prospectus and, if requested by the Stockholders, the exhibits incorporated by reference, and the Stockholders (and the underwriter(s), if any) shall have the opportunity to review and comment thereon, and the Company will make such changes and additions thereto as reasonably requested by the Stockholders (and the underwriter(s), if any) prior to filing any Registration Statement or amendment thereto or any Prospectus or any supplement thereto; (ii) prepare and file with the SEC such amendments and supplements to such Registration Statement and the Prospectus used in connection therewith as may be necessary to keep such Registration Statement effective as set forth in Section 2 hereof, or such shorter period as is necessary to complete the distribution of the securities covered by such Registration Statement and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such Registration Statement during such period in accordance with the intended methods of disposition by the Stockholders thereof set forth in such Registration Statement and, in the case of the Shelf Registration Statement, prepare such prospectus supplements containing such disclosures as may be reasonably requested by the Stockholders or any underwriter(s) in connection with each shelf takedown; (iii) furnish to the Stockholders such number of copies of such Registration Statement, each amendment and supplement thereto, the Prospectus included in such Registration Statement (including each preliminary Prospectus) and such other documents as the Stockholders and any underwriter(s) may reasonably request in order to facilitate the disposition of the Registrable Common Stock, provided, however, that the Company shall have no such obligation to furnish copies of a final prospectus if the conditions of Rule 172(c) under the Securities Act are satisfied by the Company; (iv) use its best efforts to register or qualify such Registrable Common Stock under such other securities or blue sky laws of such jurisdictions (domestic or foreign) as any underwriter(s) reasonably requests (in light of the Company's status as OTC-Other) to enable the Stockholder and any underwriter(s) to consummate the disposition in such jurisdictions of the Registrable Common Stock (provided, that the Company will not be required to (1) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph (iv), (2) subject itself to taxation in any such jurisdiction or (3) consent to general service of process in any such jurisdiction); (v) promptly notify the Stockholders and any underwriter(s), at any time when a Prospectus relating thereto is required to be delivered under the Securities Act, of the occurrence of any event as a result of which the Prospectus included in such Registration Statement contains an untrue statement of a material fact or omits any material fact necessary to make the statements therein not misleading, and, at the request of the Stockholders or any underwriter(s), the Company shall prepare a supplement or amendment to such Prospectus so that, as thereafter delivered to the purchasers of such Registrable Common Stock, such Prospectus shall not contain an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading; (vi) in the case of an underwritten offering, (i) enter into such agreements (including underwriting agreements in customary form), (ii) take all such other actions as the Stockholders or the underwriter(s) reasonably request in order to expedite or facilitate the disposition of such Registrable Common Stock (including, without limitation, causing senior management and other Company personnel to cooperate with the Stockholders and the underwriter(s) in connection with performing due diligence) and (iii) cause its counsel to issue opinions of counsel in form, substance and scope as are customary in primary underwritten offerings, addressed and delivered to the underwriter(s) and the Stockholders; (vii) in connection with any Demand Registration pursuant to Section 2 and each Fully Marketed Underwritten Offering requested by the Stockholders under Section 2 or 3, cause there to occur Full Cooperation and, in all other cases, cause members of senior management of the Company to be available to participate in, and to cooperate with the underwriter(s) in connection with customary marketing activities (including select conference calls and one-on-one meetings with prospective purchasers); (viii) make available for inspection by the Stockholders, any underwriter participating in any disposition pursuant to such Registration Statement, and any attorney, accountant or other agent retained by the Stockholders or underwriter, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company's officers, directors, employees and independent accountants to supply all information reasonably requested by the Stockholders, underwriter, attorney, accountant or agent in connection with such Registration Statement; (ix) use its best efforts to cause all such Registrable Common Stock to be listed or qualified on each securities exchange on which securities of the same class issued by the Company are then listed or traded or, if no such similar securities are then listed or traded, on Nasdaq or a national securities exchange on which the Registrable Common Stock may be listed and traded; (x) provide a transfer agent and registrar for all such Registrable Common Stock not later than the effective date of such Registration Statement; (xi) if requested, cause to be delivered, immediately prior to the pricing of any underwritten offering, immediately prior to effectiveness of each Registration Statement (and, in the case of an underwritten offering, at the time of closing of the sale of Registrable Common Stock pursuant thereto), letters from the Company's independent registered public accountants addressed to the Stockholders and each underwriter, if any, stating that such accountants are independent public accountants within the meaning of the Securities Act and the applicable rules and regulations adopted by the SEC thereunder, and otherwise in customary form and covering such financial and accounting matters as are customarily covered by letters of the independent registered public accountants delivered in connection with primary underwritten public offerings; and (xii) promptly notify the Stockholders and the underwriter or underwriters, if any: (1) when the Registration Statement, any pre- effective amendment, the Prospectus or any Prospectus supplement or post-effective amendment to the Registration Statement has been filed and, with respect to the Registration Statement or any post-effective amendment, when the same has become effective; (2) of any written request by the SEC for amendments or supplements to the Registration Statement or Prospectus; (3) of the notification to the Company by the SEC of its initiation of any proceeding with respect to the issuance by the SEC of any stop order suspending the effectiveness of the Registration Statement; and (4) of the receipt by the Company of any notification with respect to the suspension of the qualification of any Registrable Common Stock for sale under the applicable securities or blue sky laws of any jurisdiction. (b) The Company represents and warrants that no Registration Statement (including any amendments or supplements thereto and Prospectuses contained therein) shall contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein not misleading (except that the Company makes no representation or warranty with respect to information relating to the Stockholders furnished to the Company by or on behalf of the Stockholders specifically for use therein). (c) The Company shall make available to the Stockholders (i) promptly after the same is prepared and publicly distributed, filed with the SEC, or received by the Company, one copy of each Registration Statement and any amendment thereto, each preliminary Prospectus and Prospectus and each amendment or supplement thereto, each letter written by or on behalf of the Company to the SEC or the staff of the SEC (or other governmental agency or self-regulatory body or other body having jurisdiction, including any domestic or foreign securities exchange), and each item of correspondence from the SEC or the staff of the SEC (or other governmental agency or self-regulatory body or other body having jurisdiction, including any domestic or foreign securities exchange), in each case relating to such Registration Statement, and (ii) such number of copies of a Prospectus, including a preliminary Prospectus, and all amendments and supplements thereto and such other documents as the Stockholders or any underwriter may reasonably request in order to facilitate the disposition of the Registrable Common Stock. The Company will promptly notify the Stockholders of the effectiveness of each Registration Statement or any post-effective amendment. The Company will promptly respond to any and all comments received from the SEC, with a view towards causing each Registration Statement or any amendment thereto to be declared effective by the SEC as soon as practicable and shall file an acceleration request as soon as practicable following the resolution or clearance of all SEC comments or, if applicable, following notification by the SEC that any such Registration Statement or any amendment thereto will not be subject to review. (d) The Company may require the Stockholders to furnish to the Company any other information regarding the Stockholders and the distribution of such securities as the Company reasonably determines, based on the advice of counsel, is required to be included in any Registration Statement. (e) The Company shall not permit any officer, director, underwriter, broker or any other person acting on behalf of the Company to use any free writing prospectus (as defined in Rule 405 under the Securities Act) in connection with any registration statement covering Registrable Common Stock, without the prior written consent of the Stockholder and any underwriter which consent shall not be unreasonably withheld or delayed. Any consent to the use of a free writing prospectus included in an underwriting agreement to which the Stockholders are parties shall be deemed to satisfy the requirement for such consent. 9. Registration Expenses. (a) All expenses incident to the Company's performance of or compliance with this Agreement, including, without limitation, all registration and filing fees (including SEC registration fees and NASD filing fees), fees and expenses of compliance with securities or blue sky laws, listing application fees, printing expenses, transfer agent's and registrar's fees, cost of printing and distributing Prospectuses in preliminary and final form as well as any supplements thereto, and fees and disbursements of counsel for the Company and all accountants and other Persons retained by the Company (all such expenses being herein called "Registration Expenses") (but not including any underwriting discounts or commissions or transfer taxes, if any, attributable to the sale of Registrable Common Stock, shall be borne by the Company. In addition, the Company shall pay its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expense of any annual audit or quarterly review, the expense of any liability insurance and the expenses and fees for listing the securities to be registered on each securities exchange on which they are to be listed. Notwithstanding the foregoing, the Stockholders will use commercially reasonable efforts to negotiate with the underwriter(s) to any offerings for the payment by the underwriter(s) of 50% of any expenses incurred in any road-shows. If any Stockholders attend any road-show, whether in domestic or foreign locations, the Stockholders shall be reimbursed only for their reasonable expenses in connection therewith (e.g. use of private planes will not be reimbursed). (b) In connection with each registration initiated hereunder (whether a Demand Registration, Shelf Registration, Piggyback Registration or any Fully Marketed Underwritten Offering under each of the foregoing), the Company shall pay, or shall reimburse the Stockholders for, the reasonable fees and disbursements of one law firm chosen by the Stockholders as their counsel. (c) The obligation of the Company to bear the expenses described in Section 9(a) and to pay or reimburse the Stockholders for the expenses described in Section 9(b) shall apply irrespective of whether a registration, once properly demanded, if applicable, becomes effective, is withdrawn or suspended, is converted to another form of registration and irrespective of when any of the foregoing shall occur. 10. Indemnification. (a) The Company shall indemnify, to the fullest extent permitted by law, the Stockholders and their respective officers, directors, employees and Affiliates and each Person who controls the Stockholders (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and expenses arising out of or based upon any untrue or alleged untrue statement of material fact contained in any Registration Statement, Prospectus or preliminary Prospectus or any "issuer free writing prospectus" (as defined in Securities Act Rule 433) or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading or any violation or alleged violation by the Company of the Securities Act, the Exchange Act or applicable "blue sky" laws, except insofar as the same are made in reliance and in conformity with information relating to the Stockholders furnished in writing to the Company by the Stockholders expressly for use therein. In connection with an underwritten offering, the Company shall indemnify such underwriter(s), their officers, employees and directors and each Person who controls such underwriter(s) (within the meaning of the Securities Act) to the same extent as provided above with respect to the indemnification of the Stockholders. (b) In connection with any Registration Statement in which the Stockholders are participating, the Stockholders shall furnish to the Company, in writing, such information as the Company reasonably determines, based on the advice of counsel, is required to be included in any such Registration Statement or Prospectus and shall indemnify, to the fullest extent permitted by law, the Company, its officers, employees, directors, Affiliates, and each Person who controls the Company (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and expenses arising out of or based upon any untrue or alleged untrue statement of material fact contained in the Registration Statement, Prospectus or preliminary Prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that the same are made in reliance and in conformity with information relating to the Stockholders furnished in writing to the Company by the Stockholders expressly for use therein. (c) Any Person entitled to indemnification hereunder shall (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) unless in such indemnified party's reasonable judgment a conflict of interest between such indemnified and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. If such defense is assumed, the indemnifying party shall not be subject to any liability for any settlement made by the indemnified party without its consent (but such consent will not be unreasonably withheld). An indemnifying party who is not entitled to, or elects not to, assume the defense of a claim shall not be obligated to pay the fees and expenses of more than one counsel (in addition to any local counsel) for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment of any indemnified party there may be one or more legal or equitable defenses available to such indemnified party that are in addition to or may conflict with those available to another indemnified party with respect to such claim. Failure to give prompt written notice shall not release the indemnifying party from its obligations hereunder. (d) The indemnification provided for under this Agreement shall remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director or controlling Person of such indemnified party and shall survive the transfer of securities. (e) If the indemnification provided for in or pursuant to this Section 10 is due in accordance with the terms hereof, but is held by a court to be unavailable or unenforceable in respect of any losses, claims, damages, liabilities or expenses referred to herein, then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified Person as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other in connection with the statements or omissions that result in such losses, claims, damages, liabilities or expenses as well as any other relevant equitable considerations. The relative fault of the indemnifying party on the one hand and of the indemnified Person on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party, and by such party's relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. In no event shall the liability of the Stockholders be greater in amount than the amount of net proceeds received by the Stockholders upon such sale. 11. Rule 144. The Company covenants that it will file the reports required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder, and it will take such further action as the Stockholders may reasonably request to make available adequate current public information with respect to the Company meeting the current public information requirements of Rule 144(c) under the Securities Act, to the extent required to enable the Stockholders to sell Registrable Common Stock without registration under the Securities Act within the limitation of the exemptions provided by (i) Rule 144 under the Securities Act, as such Rule may be amended from time to time, or (ii) any similar rule or regulation hereafter adopted by the SEC. Upon the request of the Stockholders, the Company will deliver to the Stockholders a written statement as to whether it has complied with such information and requirements. 12. Transfer of Registration Rights. (a) The Stockholders may transfer all or any portion of their then-remaining rights under Sections 2, 3, 4, 6, 7, 8, 9, 10, 11, and 13 of this Agreement to any transferee who acquires at least 1,000,000 shares of the Registrable Common Stock initially received by the Stockholders pursuant to the Stock Purchase Agreement (each, a "transferee"). Any transfer of registration rights pursuant to this Section 12 shall be effective upon receipt by the Company of (x) written notice from the Stockholders stating the name and address of any transferee and identifying the amount of Registrable Common Stock with respect to which the rights under this Agreement are being transferred and the nature of the rights so transferred and (y) a written agreement from the transferee to be bound by all of the terms of this Agreement. In connection with any such transfer, the term "Stockholders" as used in this Agreement shall, where appropriate to assign such rights to such transferees, be deemed to refer to the transferee holders of such Registrable Common Stock. The Stockholders and such transferees may exercise the registration rights hereunder in such proportion (not to exceed the then-remaining rights hereunder) as they shall agree among themselves. (b) After such transfer, the Stockholders shall retain their rights under this Agreement with respect to all other Registrable Common Stock owned by the Stockholders. Upon the request of the Stockholders, the Company shall execute a Registration Rights Agreement with such transferee or a proposed transferee substantially similar to the applicable sections of this Agreement. 13. Termination. This Agreement shall terminate upon the later to occur of (i) five (5) years from the date hereof, and (ii) when, in the opinion of counsel to the Stockholders, all outstanding Registrable Common Stock may be resold without registration under the Securities Act pursuant to Rule 144(k) under the Securities Act or any successor provision thereto. 14. Miscellaneous. (a) Notices. All notices, requests, consents and other communications required or permitted hereunder shall be in writing and shall be hand delivered or mailed postage prepaid by registered or certified mail or by facsimile transmission (with immediate telephone confirmation thereafter) and, in the case of the Stockholders, shall also be sent via e-mail, If to the Company: TransTechnology Corporation 700 Liberty Avenue Union, NJ 07083 Attention: Joseph F. Spanier Facsimile No.: (908) 686-6921 Email: jspanier@ttccorp.com with a copy to (which shall not constitute notice): Wells Fargo Securities, LLC 123 N. Wacker Drive, Suite 1150 Chicago, IL 60606 Attention: Stephen T. Moss Facsimile No.: (312) 762-9059 Email: steve.moss@wellsfargo.com And Hahn Loeser & Parks, LLP 3300 BP Tower, 200 Public Square Cleveland, Ohio 44114-2301 Attention: F. Ronald O'Keefe, Esq. Facsimile No.: (216) 241-2824 Email: frokeefe@hahnlaw.com If to the Stockholders to the address set forth in Schedule A and if to any transferee Stockholders, to the address of such transferee Stockholders set forth in the transfer documentation provided to the Company, in each case with copies to (which shall not constitute notice) their respective counsel at the address set forth in Schedule A, or at such other address as such party each may specify by written notice to the others, and each such notice, request, consent and other communication shall for all purposes of the Agreement be treated as being effective or having been given when delivered personally, upon one Business Day after being deposited with a courier if delivered by courier, upon receipt of facsimile confirmation if transmitted by facsimile, or, if sent by mail, at the earlier of its receipt or 72 hours after the same has been deposited in a regularly maintained receptacle for the deposit of United States mail, addressed and postage prepaid as aforesaid. (b) No Waivers. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. (c) Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. If the outstanding Common Stock is converted into or exchanged or substituted for other securities issued by any other Person, as a condition to the effectiveness of the merger, consolidation, reclassification, share exchange or other transaction pursuant to which such conversion, exchange, substitution or other transaction takes place, such other Person shall automatically become bound hereby with respect to such other securities constituting Registrable Common Stock and, if requested by the Stockholders or a permitted transferee, shall further evidence such obligation by executing and delivering to the Stockholders and such transferee a written agreement to such effect in form and substance satisfactory to the Stockholders. (d) Governing Law. The internal laws of Delaware shall govern the enforceability and validity of this Agreement, the construction of its terms and the interpretation of the rights and duties of the parties, without regard to its principles of conflicts of laws that would implicate the substantive or procedural laws of any other jurisdiction. (e) Jurisdiction. Any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby may be brought in any federal or state court located in the County and State of New York, and each of the parties hereby consents to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding which is brought in any such court has been brought in an inconvenient forum. Process in any such suit, action or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service of process on such party as provided in Section 14(a) shall be deemed effective service of process on such party. (f) Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. (g) Counterparts; Effectiveness. This Agreement may be executed in any number of counterparts (including by facsimile) and by different parties hereto in separate counterparts, with the same effect as if all parties had signed the same document. All such counterparts shall be deemed an original, shall be construed together and shall constitute one and the same instrument. This Agreement shall become effective when each party hereto shall have received counterparts hereof signed by all of the other parties hereto. (h) Entire Agreement. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes and replaces all other prior agreements, written or oral, among the parties hereto with respect to the subject matter hereof. (i) Captions. The headings and other captions in this Agreement are for convenience and reference only and shall not be used in interpreting, construing or enforcing any provision of this Agreement. (j) Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such a determination, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible. (k) Amendments. The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to or departures from the provisions hereof may not be given, without the written consent of the Company and the Stockholders. (l) Aggregation of Stock. All Registrable Common Stock held by or acquired by any Person who is an Affiliate of any of the Stockholders will be aggregated together for the purpose of determining the availability of any rights under this Agreement. (m) Equitable Relief. The parties hereto agree that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement. [Execution Page Follows] IN WITNESS WHEREOF, this Registration Rights Agreement has been duly executed by each of the parties hereto as of the date first written above. TRANSTECHNOLOGY CORPORATION By: /s/ Robert L.G. White -------------------------------- Name: Robert L.G. White Title: President & CEO TINICUM CAPITAL PARTNERS II, L.P. By: TINICUM LANTERN II, L.L.C. Its General Partner By: /s/ Eric Ruttenberg -------------------------------- Name: Eric Ruttenberg Title: Co-Managing Member TINICUM CAPITAL PARTNERS PARALLEL FUND II, L.P. By: TINICUM LANTERN II, L.L.C. Its General Partner By: /s/ Eric Ruttenberg --------------------------------- Name: Eric Ruttenberg Title: Co-Managing Member TERRIER PARTNERS LP By: B DOGGY LLC, its General Partner By: Bobby Melnick, its Managing Member By: /s/ Bobby Melnick --------------------------------- WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P. By: Wynnefield Capital Management, LLC, its General Partner By: /s/ Joshua H. Landes ------------------------------------- Joshua H. Landes, Co-Managing Member WYNNEFIELD PARTNERS SMALL CAP VALUE, L.P. I By: Wynnefield Capital Management, LLC, its General Partner By: /s/ Joshua H. Landes ------------------------------------ Joshua H. Landes, Co-Managing Member WYNNEFIELD SMALL CAP VALUE OFFSHORE FUND, LTD. By: Wynnefield Capital, Inc., its Investment Manager By: /s/ Joshua H. Landes ------------------------------------ Joshua H. Landes EXHIBIT A PLAN OF DISTRIBUTION TransTechnology Corporation [or such defined term] is registering the shares of common stock covered by this prospectus for the selling stockholders. As used in this prospectus, "selling stockholders" includes the donees, transferees, pledgees or others who may later hold the selling stockholders' interests. Pursuant to a registration rights agreement, dated as of February 17, 2006, TransTechnology Corporation agreed to register the common stock owned by the selling stockholders and to indemnify the selling stockholders against certain liabilities related to the selling of the common stock, including liabilities arising under the Securities Act. Under the registration rights agreement, TransTechnology Corporation also agreed to pay the costs and fees of registering the shares of common stock; however, the selling stockholders will pay any brokerage commissions or underwriting discounts relating to the sale of the shares of common stock. The selling stockholders may sell the common stock being offered hereby in one or more of the following ways at various times: o to underwriters for resale to the public or to institutional investors; o directly to institutional investors; or o through agents to the public or to institutional investors. The selling stockholder may offer its shares of common stock in one or more offerings pursuant to one or more prospectus supplements, if required by applicable law, and any such prospectus supplement will set forth the terms of the relevant offering to the extent required. To the extent the shares of common stock offered pursuant to a prospectus supplement remain unsold, the selling stockholders may offer those shares of common stock on different terms pursuant to another prospectus supplement. The selling stockholders will act independently of TransTechnology Corporation in making decisions with respect to the timing, manner and size of each sale. The selling stockholders may sell the common stock on any national securities exchange on which the common stock may be listed and traded or otherwise, at market prices prevailing at the time of sale, at prices related to the prevailing market prices, or at negotiated prices. If underwriters are used in the sale, the common stock will be acquired by the underwriters for their own account and may be resold at various times in one or more transactions, including negotiated transactions, at a fixed public offering price or prices, which may be changed, at market prices prevailing at the time of sale, at prices related to such prevailing market prices, or at negotiated prices. A distribution of the common stock by the selling stockholders may also be effected through the issuance by the selling stockholders or others of derivative securities, including without limitation, warrants, exchangeable securities, forward delivery contracts and the writing of options. In addition, the selling stockholders may sell some or all of the shares of common stock covered by this prospectus through: o a block trade in which a broker-dealer will attempt to sell as agent, but may position or resell a portion of the block, as principal, in order to facilitate the transaction; o purchases by a broker-dealer, as principal, and resale by the broker-dealer for its account; o ordinary brokerage transactions and transactions in which a broker solicits purchasers; or o privately negotiated transactions. The selling stockholders may also enter into hedging transactions. For example, the selling stockholders may: o enter into transactions with a broker-dealer or affiliate thereof in connection with which such broker-dealer or affiliate will engage in short sales of the common stock pursuant to this prospectus, in which case such broker-dealer or affiliate may use shares of common stock received from the selling stockholders to close out its short positions; o sell common stock short itself and redeliver such shares to close out its short positions; o enter into option or other types of transactions that require the selling stockholders to deliver common stock to a broker-dealer or an affiliate thereof, who will then resell or transfer the common stock under this prospectus; or o loan or pledge the common stock to a broker-dealer or an affiliate thereof, who may sell the loaned shares or, in an event of default in the case of a pledge, sell the pledged shares pursuant to this prospectus. In addition, _____________ may enter into derivative or hedging transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. In connection with such a transaction, the third parties may sell securities covered by and pursuant to this prospectus and an applicable prospectus supplement. If so, the third party may use securities borrowed from _____________ or others to settle such sales and may use securities received from _____________ to close out any related short positions. _____________ may also loan or pledge securities covered by this prospectus and an applicable prospectus supplement to third parties, who may sell the loaned securities or, in an event of default in the case of a pledge, sell the pledged securities pursuant to this prospectus and the applicable prospectus supplement. The applicable prospectus supplement will set forth the terms of the offering of the common stock covered by this prospectus, including: o the name or names of any underwriters, dealers or agents and the amounts of securities underwritten or purchased by each of them, if any; and o the public offering price of the common stock and the proceeds to the selling stockholders and any discounts, commissions or concessions or other items constituting compensation allowed, reallowed or paid to underwriters, dealers or agents, if any. Any public offering price and any discounts, commissions, concessions or other items constituting compensation allowed or rea5llowed or paid to underwriters, dealers or agents may be changed from time to time. The selling stockholders may negotiate and pay broker-dealers' commissions, discounts or concessions for their services. Broker-dealers engaged by the selling stockholders may allow other broker-dealers to participate in resales. The selling stockholders and any broker-dealers involved in the sale or resale of the common stock may qualify as "underwriters" within the meaning of Section 2(a)(11) of the Securities Act. In addition, the broker-dealers' commissions, discounts or concessions may qualify as underwriters' compensation under the Securities Act. If any the selling stockholders qualifies as an "underwriter," it will be subject to the prospectus delivery requirements of Section 5(b)(2) of the Securities Act. In addition to selling its common stock under this prospectus, the selling stockholders may: o agree to indemnify any broker-dealer or agent against certain liabilities related to the selling of the common stock, including liabilities arising under the Securities Act; o transfer its common stock in other ways not involving market makers or established trading markets, including directly by gift, distribution, or other transfer; o sell its common stock under Rule 144 of the Securities Act rather than under this prospectus, if the transaction meets the requirements of Rule 144; or o sell its common stock by any other legally available means. SCHEDULE A Tinicum Capital Partners II, L.P. and Tinicum Capital Partners II Parallel Fund, L.P. c.o. Tinicum Incorporated Attention: Eric Ruttenberg 800 Third Avenue New York, NY 10022 Facsimile No.: (212) 446-9333 Email: eruttenberg@tinicum.com with copies to Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036-6522 Attention: Richard J. Grossman, Esq. Facsimile No.: (212) 735-2000 Email: rgrossma@sckadden.com Terrier Partners LP Attention: Bobby Melnick 145 E. 57th Street, 10th Floor New York, NY 10022 Email: bdoggy@banet.net Wynnefield Partners Small Cap Value, L.P., Wynnefield Partners Small Cap Value, L.P. I and Wynnefield Small Cap Value Offshore Fund, Ltd. c.o. Wynnefield Capital, Inc. Attention: Nelson Obus 450 Seventh Avenue, Suite 509 New York, NY 10123 Facsimile: (212) 760-0824 Email: nobus@wynnefieldcapital.com EX-99 5 transtechexh_d.txt EXHIBIT D - FILING AGREEMENT EXHIBIT D FILING AGREEMENT ---------------- The undersigned, the Reporting Persons named in this Schedule 13D, hereby agree that this Schedule 13D is filed on a combined basis on behalf of each of them and that each Reporting Person is individually responsible for the timely filing of any amendments to this Schedule 13D. Each Reporting Person further agrees that it is responsible for the completeness and accuracy of the information concerning such Reporting Persons, respectively, contained in this Schedule 13D and that it is not responsible for the completeness or accuracy of the information concerning the other Reporting Persons. IN WITNESS WHEREOF, the undersigned have executed this Joint Filing Agreement as of the 27th day of February, 2006. TINICUM CAPITAL PARTNERS II, L.P. By: TINICUM LANTERN, L.L.C. Its: General Partner By: /s/ Eric Ruttenberg -------------------------------- Name: Eric Ruttenberg Title: Co-Managing Member TINICUM CAPITAL PARTNERS II PARALLEL FUND, L.P. By: TINICUM LANTERN, L.L.C. Its: General Partner By: /s/ Eric Ruttenberg -------------------------------- Name: Eric Ruttenberg Title: Co-Managing Member -----END PRIVACY-ENHANCED MESSAGE-----