S-2/A

    As filed with the Securities and Exchange Commission on October 12, 2005
                                                     Registration No. 333-126335
================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                           --------------------------
                               AMENDMENT NO. 4 TO
                                    FORM S-2

                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                           --------------------------

                                LYNCH CORPORATION
             (Exact Name of Registrant as Specified in Its Charter)

            INDIANA                                   38-1799862
(State or Other Jurisdiction of          (I.R.S. Employer Identification Number)
Incorporation or Organization)

                         140 GREENWICH AVENUE, 4TH FLOOR
                          GREENWICH, CONNECTICUT 06830
                                 (203) 622-1150
               (Address, Including Zip Code, and Telephone Number,
       Including Area Code, of Registrant's Principal Executive Offices)

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

                                 JOHN C. FERRARA
                      PRESIDENT AND CHIEF EXECUTIVE OFFICER
                                LYNCH CORPORATION
                         140 GREENWICH AVENUE, 4TH FLOOR
                          GREENWICH, CONNECTICUT 06830
                                 (203) 622-1150
            (Name, Address, Including Zip Code, and Telephone Number,
                   Including Area Code, of Agent For Service)

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

                                    Copy to:
                              DAVID J. ADLER, ESQ.
                 OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP
                                PARK AVENUE TOWER
                               65 EAST 55TH STREET
                            NEW YORK, NEW YORK 10022
                                 (212) 451-2300

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

            Approximate  date of  commencement  of proposed  sale to the public:
From time to time after this Registration Statement becomes effective.
            If any of the  securities  being  registered  on this Form are to be
offered  on a  delayed  or  continuous  basis  pursuant  to Rule 415  under  the
Securities Act of 1933, please check the following box. /X/
            If the  registrant  elects to deliver  its latest  annual  report to
security holders, or a complete and legible facsimile thereof,  pursuant to Item
11(a)(1) of this Form, check the following box. /X/
            If this  Form is  filed to  register  additional  securities  for an
offering  pursuant to Rule 462(b) under the Securities  Act, check the following
box and list the Securities  Act  registration  statement  number of the earlier
effective registration statement for the same offering. /_/ ___________
            If this Form is a  post-effective  amendment  filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act  registration   statement  number  of  the  earlier  effective  registration
statement for the same offering. /_/ ___________
            If this Form is a  post-effective  amendment  filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act  registration   statement  number  of  the  earlier  effective  registration
statement for the same offering. /_/ ___________
            If delivery  of the  prospectus  is expected to be made  pursuant to
Rule 434, please check the following box.  /_/






                         CALCULATION OF REGISTRATION FEE

TITLE OF EACH CLASS OF                                   PROPOSED MAXIMUM       PROPOSED MAXIMUM
   SECURITIES TO BE                     AMOUNT TO BE    OFFERING PRICE PER     AGGREGATE OFFERING          AMOUNT OF
      REGISTERED                        REGISTERED(1)        SHARE(2)                PRICE              REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------
Common Shares,
$0.01 par value per                        538,676            $8.12               $4,465,534.40(3)         $525.60(3)
share                                   common shares
- ------------------------------------------------------------------------------------------------------------------------

Subscription Rights to
purchase  Common                           1,616,026            -                       -                       -
Shares(4)                             subscription rights
- ------------------------------------------------------------------------------------------------------------------------

(1)   In the event of a share  split,  share  dividend  or  similar  transaction
      involving  the common  shares,  the common shares  registered  hereby will
      automatically  be increased  pursuant to Rule 416 of the Securities Act of
      1933,  as  amended,  to cover the  additional  common  shares  required to
      prevent dilution.
(2)   Estimated  solely for the  purpose of  calculating  the  registration  fee
      pursuant to Rule 457(c) under the Securities Act of 1933, as amended,  and
      based  upon the  average  of the high and low  prices of the  Registrant's
      common shares on the American Stock Exchange on June 30, 2005.
(3)   The  registration fee was previously paid with the filing on July 1, 2005.
      At the time of such filing,  there were  1,649,834  shares  issued,  which
      could have resulted in the issuance of 549,945 additional shares, assuming
      exercise of all of the rights that would have been issued.
(4)   Under Rule 457(g) of the Securities  Act of 1933, as amended,  no separate
      registration  fee is required for the rights as they are being  registered
      in the same  registration  statement as the common shares  underlying such
      rights.

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


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

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




The  information in this  prospectus is not complete and may be changed.  We may
not sell  these  securities  until the  registration  statement  filed  with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to  sell  these  securities  and it is not  soliciting  an  offer  to buy  these
securities in any state where the offer or sale is not permitted.


                  Subject to Completion, dated October 12, 2005

            PROSPECTUS

                                LYNCH CORPORATION

                              538,676 COMMON SHARES
                          1,616,026 SUBSCRIPTION RIGHTS

            We are offering at no cost to you, as a holder of our common shares,
transferable  rights to purchase our common shares.  If you own common shares on
________,  2005,  the record date, you will be entitled to receive one right per
share.  Every  three such rights will  entitle you to  subscribe  for one common
share. The subscription price will be $_______ per whole share.  Shareholders on
the record date who fully  exercise  the rights  distributed  to them by us will
also be entitled to subscribe for and purchase additional common shares that are
not  purchased  by  other  rights  holders  through  their  basic   subscription
privileges.  The rights will be evidenced by Subscription  Certificates and will
expire at _______ p.m. New York City time on _________,  2005,  unless  extended
for up to 15 days.

            We have applied to list the rights and expect to be  authorized  for
trading of the rights on the American Stock Exchange under the symbol  "LGL.RT."
Our common  shares are traded on the American  Stock  Exchange  under the symbol
"LGL."

            Our principal executive offices are located at 140 Greenwich Avenue,
4th Floor, Greenwich, Connecticut 06830. Our telephone number is (203) 622-1150.

            AN INVESTMENT  IN OUR COMMON SHARES  INVOLVES A HIGH DEGREE OF RISK.
CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE 5 OF THIS PROSPECTUS.

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

- --------------------------------------------------------------------------------
                                                            PROCEEDS TO LYNCH
                               PRICE PER SHARE                 CORPORATION
- --------------------------------------------------------------------------------
Offering Price to
Shareholders                   $_____________               $_____________ (1)
- --------------------------------------------------------------------------------
(1)  Before deduction of estimated expenses of $__________,  including legal and
     accounting  fees,  printing  expenses  and  other  miscellaneous  fees  and
     expenses.

     NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
    COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON
     THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
                         CONTRARY IS A CRIMINAL OFFENSE.

                 The date of this prospectus is _________, 2005.






                                TABLE OF CONTENTS

Prospectus Summary.............................................................1

Risk Factors...................................................................5

Special Note Regarding Forward-Looking Statements.............................16

Description of Securities to Be Registered....................................17

Use of Proceeds...............................................................18

The Rights Offering...........................................................18

Material United States Federal Income Tax Consequences........................28

Plan of Distribution..........................................................30

Legal Matters.................................................................31

Experts.......................................................................32

Information with Respect to the Registrant....................................32

Where You Can Find More Information...........................................32

Incorporation by Reference....................................................32








                               PROSPECTUS SUMMARY

            This summary highlights  important features of this offering and the
information  included or  incorporated  by  reference in this  prospectus.  This
summary does not contain all of the information  that you should consider before
investing in our common shares. You should read the entire prospectus carefully,
especially  the risks of investing in our common  shares  discussed  under "Risk
Factors."

            Unless the context  otherwise  requires,  all references to "Lynch,"
"we," "us," or "our" in this prospectus refer collectively to Lynch Corporation,
an Indiana corporation, and its subsidiaries.

                                   THE COMPANY

            We are a diversified  holding company with  subsidiaries  engaged in
manufacturing.  Our  business  development  strategy  is to expand our  existing
operations  through internal growth and acquisitions.  We may also, from time to
time,  consider  the  acquisition  of other  assets or  businesses  that are not
related to our  present  businesses  and the  strategic  disposition  of certain
assets.

M-TRON INDUSTRIES, INC./PIEZO TECHNOLOGY, INC.

            Mtron designs,  manufactures and markets custom designed  electronic
components  used  primarily  to control the  frequency  or timing of  electronic
signals in  communications  equipment.  Its devices,  which are commonly  called
frequency  control  devices,  crystals or oscillators,  support fixed and mobile
wireless,  copper wire,  coaxial cable, wide area networks,  local area networks
and  fiber  optic  systems.   It  sells  its  products  to  original   equipment
manufacturers, contract manufacturers and to distributors.

            On October 15, 2004,  Mtron  completed  its  acquisition  of all the
issued  and  outstanding  common  shares  of  Piezo.  Piezo  is  a  wholly-owned
subsidiary of Mtron that designs,  manufactures  and markets  frequency  control
devices,  crystal  resonators,  crystal  oscillators,  timing devices,  filters,
crystal filters,  liquid crystal filters and related products and  technologies.
The combined operations of Mtron and PTI are referred to herein as "MtronPTI."

LYNCH SYSTEMS, INC.

            Lynch Systems  designs,  develops,  manufactures and markets a broad
range of manufacturing  equipment for the electronic  display and consumer glass
industries.  Lynch Systems also produces  replacement parts for various types of
packaging  and glass  container-making  machines,  which Lynch  Systems does not
manufacture.







                               THE RIGHTS OFFERING

Basic Subscription
  Privilege........................We will  distribute  to the holders of record
                                   of our common shares at the close of business
                                   on  ___________,  2005,  at  no  charge,  one
                                   transferable   subscription  right  for  each
                                   common share  owned.  Every three such rights
                                   will entitle the holder to subscribe  for one
                                   common share.

Oversubscription Privilege.........Shareholders  on the  record  date  who.fully
                                   exercise the rights distributed to them by us
                                   will also be  entitled to  subscribe  for and
                                   purchase  additional  common  shares that are
                                   not purchased by other rights holders through
                                   their  basic  subscription  privileges.   The
                                   maximum   number  of  shares   that  you  may
                                   purchase under the oversubscription privilege
                                   is  equal  to  the   number  of  shares   you
                                   purchased   under  the   basic   subscription
                                   privilege.

                                   You  will  be  entitled   to  exercise   your
                                   oversubscription  privilege only if you are a
                                   shareholder  on the record date and  exercise
                                   your basic subscription privilege in full. If
                                   the number of common shares  remaining  after
                                   the   exercise  of  all  basic   subscription
                                   privileges  is not  sufficient to satisfy all
                                   requests  for  common   shares   pursuant  to
                                   oversubscription   privileges,  you  will  be
                                   allocated  additional common shares pro rata,
                                   based on the  number  of  common  shares  you
                                   purchased  through  the  basic   subscription
                                   privilege in  proportion  to the total number
                                   of   common   shares   that  you  and   other
                                   oversubscribing     shareholders    purchased
                                   through the basic subscription privilege.

Subscription Price.................$______ in cash per share.

Common Shares
  Outstanding after Rights
  Offering.........................Assuming  that  all  rights  are   exercised,
                                   including  those that may be  exercised  as a
                                   result of the oversubscription  privilege, an
                                   aggregate  of  approximately  538,676  common
                                   shares will be sold.

Transferability of Rights..........The   rights  are   transferable,   excluding
                                   oversubscription    privileges,   until   the
                                   opening of trading on the expiration date and
                                   are expected to be authorized  for trading on
                                   the American Stock  Exchange.  Trading of the
                                   rights  will be  conducted  on a  regular-way
                                   basis from ________, 2005 through the opening
                                   of  trading  on  the  expiration   date.  Any
                                   commissions  in  connection  with the sale of
                                   rights  will be paid  by the  selling  rights
                                   holder.  We cannot  assure  you that a market
                                   for the rights will develop, or of the prices
                                   at which  rights may be sold if a market does
                                   develop.

                                       2





Record Date......................  ______________, 2005.

Expiration Time..................  _________,   2005,  at  5:00.p.m.,   New York
                                   City time, unless extended for up to 15 days.

Procedure for Exercising
  Rights.........................  If you  want  to  exercise  rights  you  must
                                   properly  complete and sign the  Subscription
                                   Certificate evidencing the rights and forward
                                   the  Subscription   Certificate,   with  full
                                   payment,  to  the  subscription  agent  at or
                                   prior to the expiration time.

                                   YOU MAY NOT  REVOKE  AN  EXERCISE  OF  RIGHTS
                                   UNLESS WE MAKE A SIGNIFICANT AMENDMENT TO THE
                                   TERMS  OF  THE   OFFERING   AFTER   YOU  HAVE
                                   EXERCISED.

Issuance of Common
   Shares........................  We   will   deliver   to   you   certificates
                                   representing  common  shares  purchased  upon
                                   exercise  of  the  basic   subscription   and
                                   oversubscription   privileges   as   soon  as
                                   practicable   after  the   expiration   date,
                                   anticipated to be  approximately  seven to 10
                                   business days after the expiration date.

Use of Proceeds..................  The net  cash  proceeds  from the sale of the
                                   common shares offered  hereby,  after payment
                                   of fees and expenses,  is  anticipated  to be
                                   approximately  $__________.  We  expect  that
                                   such net  proceeds  will be used for  general
                                   corporate  purposes,  working  capital and to
                                   make  acquisitions,  although the Company has
                                   not identified any specific  acquisitions  at
                                   this time.

Risk Factors.....................  There  are  substantial  risks in  connection
                                   with this  offering that should be considered
                                   by you. See "Risk Factors."

Amendment, Extension or
   Termination Rights
   Offering......................  We reserve the right, in our sole discretion,
                                   to:  (a)  amend or  modify  the terms of this
                                   rights  offering;  (b) extend the  expiration
                                   time to a later  date,  but in no  event  for
                                   more  than  15  additional   days;   and  (c)
                                   terminate the rights offering at any time for
                                   any reason.

                                       3





Intentions of the
    Company's Directors..........  At  a  meeting  of  our  Board  of  Directors
                                   convened  to  determine   the  terms  of  the
                                   proposed offering,  our directors advised the
                                   Company that, as to the shares owned directly
                                   or  indirectly   by  them,   they  intend  to
                                   exercise  the  basic  subscription  privilege
                                   under  rights  received  and  might  exercise
                                   their oversubscription privilege with respect
                                   to   additional   shares  that  might  become
                                   available   for   purchase.   The   expressed
                                   intention   of   the   directors   does   not
                                   constitute  a  binding  obligation  on  their
                                   part.

                                       4





                                  RISK FACTORS

AN INVESTMENT IN OUR COMMON SHARES INVOLVES A HIGH DEGREE OF RISK. THE FOLLOWING
RISK FACTORS SHOULD BE CONSIDERED CAREFULLY IN ADDITION TO THE OTHER INFORMATION
IN THIS  PROSPECTUS,  INCLUDING THE  INFORMATION  UNDER  "SPECIAL NOTE REGARDING
FORWARD-LOOKING STATEMENTS," BEFORE MAKING AN INVESTMENT IN OUR COMMON SHARES.

RISKS RELATING TO THIS OFFERING

THE  SUBSCRIPTION  PRICE IS NOT AN  INDICATION OF THE VALUE OF OUR COMMON SHARES
AND YOU MAY NOT BE ABLE TO SELL COMMON  SHARES  PURCHASED  UPON THE  EXERCISE OF
YOUR  SUBSCRIPTION  RIGHTS AT A PRICE EQUAL TO OR GREATER THAN THE  SUBSCRIPTION
PRICE.

            The  subscription  price per common share does not necessarily  bear
any  relationship  to the book value per share of our assets,  operations,  cash
flows,  earnings,  financial  condition  or any other  established  criteria for
value.  As a result,  you  should  not  consider  the  subscription  price as an
indication of the current value of our common shares.  We cannot assure you that
you will be able to sell common  shares  purchased  in this  offering at a price
equal to or greater than the subscription price.

THIS OFFERING MAY CAUSE THE PRICE OF OUR COMMON SHARES TO DECREASE  IMMEDIATELY,
AND THIS DECREASE MAY CONTINUE.

            The subscription price per share represents a discount of ____% from
[the closing sale price of our common  shares on _____ __, 2005] [the average of
the closing  sales prices of our common shares over the  ___-trading  day period
ending ______ __, 2005].  This discount,  along with the number of common shares
we propose to issue and ultimately will issue if this offering is completed, may
result in an immediate  decrease in the market value of our common shares.  This
decrease may continue after the completion of this offering.

YOU MAY SUFFER DILUTION OF YOUR PERCENTAGE OWNERSHIP OF OUR COMMON SHARES.

            If you do not exercise  your  subscription  rights and common shares
are purchased by other shareholders in this offering,  your proportionate voting
and  ownership  interest will be reduced and the  percentage  that your original
common  shares   represents  of  our  expanded  equity  after  exercise  of  the
subscription rights will be diluted. For example, if you own 5,000 common shares
before this offering,  or approximately  0.3% of our outstanding  common shares,
and you exercise none of your subscription  rights while all other  subscription
rights are exercised by other shareholders, then your percentage ownership would
be reduced  to  approximately  0.2%.  The  magnitude  of the  reduction  of your
percentage  ownership  will depend upon the number of common shares you hold and
the extent to which you exercise your subscription rights.

ONCE YOU EXERCISE  YOUR  SUBSCRIPTION  RIGHTS,  YOU MAY NOT REVOKE SUCH EXERCISE
EVEN IF THERE IS A DECLINE IN THE PRICE OF OUR COMMON  SHARES OR IF WE DECIDE TO
EXTEND THE EXPIRATION DATE OF THE SUBSCRIPTION PERIOD.

            The public  trading  market  price of our common  shares may decline
after you elect to exercise your subscription  rights. If that occurs,  you will
have committed to buy our common shares at a price above the  prevailing  market

                                       5





price and you will have an immediate  unrealized  loss. We may also, in our sole
discretion,  extend the expiration date of the  subscription  period,  but in no
event beyond an additional 15 days. During any potential  extension of time, the
value of our common shares may decline below the  subscription  price and result
in a loss on your  investment  upon the exercise of rights to acquire our common
shares.  If the expiration date is extended after you send in your  subscription
forms and payment,  you still may not revoke or change your  exercise of rights.
Moreover,  we cannot  assure you that  following  the  exercise of  subscription
rights  you  will be able to sell  your  common  shares  at a price  equal to or
greater than the subscription price.

YOU WILL NOT RECEIVE INTEREST ON SUBSCRIPTION FUNDS RETURNED TO YOU.

            If we cancel  this  offering  or if we are not able to fulfill  your
full  oversubscription,  we will not have any  obligation  with  respect  to the
subscription rights except to return to you, without interest,  any subscription
payments  and/or  oversubscription  payments  you  made  that  were  not used to
purchase common shares.

YOU NEED TO ACT PROMPTLY AND FOLLOW  SUBSCRIPTION  INSTRUCTIONS,  OTHERWISE YOUR
SUBSCRIPTION MAY BE REJECTED.

            Shareholders  who desire to purchase  common shares in this offering
must act  promptly to ensure that all  required  forms and payments are actually
received by the  subscription  agent prior to 5:00 p.m.,  New York City time, on
the expiration date. If you fail to complete and sign the required  subscription
forms,  send an  incorrect  payment  amount,  or  otherwise  fail to follow  the
subscription procedures that apply to your desired transaction, the subscription
agent may, depending on the circumstances, reject your subscription or accept it
to the extent of the payment  received.  Neither we nor our  subscription  agent
undertakes to contact you  concerning,  or attempt to correct,  an incomplete or
incorrect subscription form or payment. We have the sole discretion to determine
whether a subscription exercise properly follows the subscription procedures.

YOU MAY NOT RECEIVE ALL OF THE COMMON SHARES FOR WHICH YOU OVERSUBSCRIBE.

            If an  insufficient  number of common  shares is  available to fully
satisfy all  oversubscription  privilege  requests,  the available common shares
will be  distributed  proportionately  among the  eligible  rights  holders  who
exercised their oversubscription  privilege based on the number of common shares
each such rights holder subscribed for under the basic subscription privilege.

YOU MAY NOT WANT TO EXERCISE YOUR RIGHTS AS THE PROCEEDS OF THIS OFFERING MAY BE
USED TO MAKE ACQUISITIONS THAT YOU MAY NOT HAVE THE OPPORTUNITY TO APPROVE.

            We expect that the net cash proceeds from this offering will be used
for  general  corporate  purposes,  working  capital  and to make  acquisitions,
although we have not identified any specific  acquisitions  at this time. If you
exercise your rights,  you may not have an  opportunity to evaluate the specific
merits or risks of any potential future  acquisitions.  As a result,  you may be
entirely  dependent on the broad  discretion  and judgment of  management in the
selection of potential future acquisitions.

                                       6





NEITHER WE, NOR THE SUBSCRIPTION  AGENT, WILL HAVE ANY OBLIGATION TO YOU IF THIS
OFFERING IS CANCELED, OTHER THAN TO REFUND YOUR SUBSCRIPTION PAYMENTS.

            Neither we, nor the subscription  agent, will have any obligation to
you if this  offering  is  canceled,  other  than to  refund  your  subscription
payments, without interest.

IF YOU SELL YOUR SUBSCRIPTION RIGHTS, YOU MAY NOT BE ABLE TO CALCULATE YOUR GAIN
FOR TAX PURPOSES AT THE TIME OF YOUR SALE.

            A holder that sells subscription  rights will recognize capital gain
or loss,  depending on the amount  realized,  upon the sale and the holder's tax
basis (if any) in the subscription  rights.  If either (i) the fair market value
of the subscription  rights on the date such subscription rights are distributed
is equal to at least 15% of the fair  market  value on such  date of the  common
shares with respect to which the subscription  rights are received,  or (ii) the
holder  irrevocably  elects to  allocate  part of the tax  basis of such  common
shares to the  subscription  rights,  then, the holder's tax basis in the common
shares will be allocated  between the common shares and the subscription  rights
in  proportion  to  their   respective  fair  market  values  on  the  date  the
subscription rights are distributed. We intend to notify the holders whether the
fair  market  value of the  subscription  rights will equal or exceed 15% of the
fair market value of the common shares to which the  subscription  rights relate
and  the  fair  market  value  of  those  subscription  rights.   However,  such
notification  will be made by written  communication  that will be included with
the share  certificates  that are mailed to those  holders  who  exercise  their
subscription rights, and therefore will not be available at the time of the sale
of a holder's  subscription  rights.  A selling  holder's  holding period in the
subscription  rights will  include the  holding  period of the common  shares in
respect of which the  rights  were  received,  and will not be  affected  by the
allocation of tax basis described above.

RISKS RELATING TO OUR BUSINESS

WE HAVE INCURRED  OPERATING LOSSES FOR THE PAST THREE YEARS AND FACE UNCERTAINTY
IN OUR ABILITY TO ACHIEVE OPERATING PROFITS IN THE FUTURE.

            We have  incurred  substantial  operating  losses for the past three
years.  Without giving effect to gains realized from the deconsolidation in 2002
of one of our holdings,  we suffered operating losses of $2.9 million,  $832,000
and $3.3 million in 2004, 2003 and 2002, respectively.  We are uncertain whether
we will be able to achieve or sustain operating profits in the future.

IF WE ARE UNABLE TO SECURE NECESSARY  FINANCING,  WE MAY NOT BE ABLE TO FUND OUR
OPERATIONS OR STRATEGIC GROWTH.

            In order to achieve our strategic  business  objectives,  we will be
required to seek additional financing.  Effective October 6, 2005, Lynch Systems
entered into a one-year loan  agreement  with Branch  Banking and Trust Company,
the  proceeds  of which  were used to pay off  Lynch  Systems'  working  capital
revolving loan from SunTrust Bank. Lynch Systems' remaining credit facility with
SunTrust  Bank,  which was to have  expired  on  September  30,  2005,  has been
extended to December 31, 2005.  Lynch Systems intends to refinance this facility
with another lender, however, there can be no assurance that such financing will
be available.  On September  30, 2005,  MtronPTI  entered into a five-year  loan

                                       7





agreement  with RBC  Centura  Bank,  the  proceeds of which were used to pay off
MtronPTI's bridge loan from First National Bank of Omaha.  MtronPTI's  revolving
credit  facility from First National Bank of Omaha is scheduled to mature on May
31, 2006.  Venator Merchant Fund,  L.P.'s loan to the Company is due on November
10, 2005 (or within seven days after demand).

            Under certain of our existing credit facilities,  we are required to
obtain the lenders'  consent for most  additional  debt  financing and to comply
with other covenants,  including specific financial ratios. For example,  we may
require further capital to continue to develop our technology and infrastructure
and for working capital purposes. In addition,  future acquisitions would likely
require  additional  equity  and/or  debt  financing.   Our  failure  to  secure
additional  financing  could have a  material  adverse  effect on our  continued
development or growth.

AS A HOLDING  COMPANY,  WE DEPEND ON THE OPERATIONS OF OUR  SUBSIDIARIES TO MEET
OUR OBLIGATIONS.

            We are a holding company that transacts all of our business  through
operating  subsidiaries.  Our  primary  assets  are  the  common  shares  of our
operating  subsidiaries.  Our ability to meet our operating  requirements and to
make other payments  depends on the surplus and earnings of our subsidiaries and
their  ability  to pay  dividends  or to  advance or repay  funds.  Payments  of
dividends and advances and repayments of inter-company  debt by our subsidiaries
are restricted by our credit agreements.

WE MAY MAKE ACQUISITIONS  THAT ARE NOT SUCCESSFUL OR FAIL TO PROPERLY  INTEGRATE
ACQUIRED BUSINESSES INTO OUR OPERATIONS.

            We intend  to  explore  opportunities  to buy  other  businesses  or
technologies  that could  complement,  enhance or expand our current business or
product lines or that might otherwise offer us growth opportunities. We may have
difficulty finding such opportunities or, if we do identify such  opportunities,
we may not be able to complete such transactions for reasons including a failure
to secure necessary financing.

            Any  transactions  that we are able to  identify  and  complete  may
involve a number of risks, including:

     o      the  diversion  of our  management's  attention  from  our  existing
            business to integrate the  operations  and personnel of the acquired
            or combined business or joint venture;
     o      possible  adverse  effects  on  our  operating  results  during  the
            integration process;
     o      substantial acquisition related expenses, which would reduce our net
            income in future years;
     o      the loss of key  employees  and  customers as a result of changes in
            management; and
     o      our possible  inability to achieve the  intended  objectives  of the
            transaction.

            In  addition,  we may  not be  able to  successfully  or  profitably
integrate,  operate,  maintain  and  manage  our newly  acquired  operations  or
employees.  We  may  not  be  able  to  maintain  uniform  standards,  controls,
procedures and policies, and this may lead to operational inefficiencies.

                                       8



PROVISIONS IN OUR CHARTER DOCUMENTS AND UNDER INDIANA LAW MAY PREVENT OR DELAY A
CHANGE OF CONTROL  OF US AND COULD  ALSO  LIMIT THE  MARKET  PRICE OF OUR COMMON
SHARES.

            Provisions of our certificate of incorporation  and bylaws,  as well
as  provisions  of Indiana  corporate  law, may  discourage,  delay or prevent a
merger,  acquisition  or other change in control of our company,  even if such a
change in control would be beneficial to our shareholders.  These provisions may
also prevent or frustrate  attempts by our shareholders to replace or remove our
management. These provisions include those:

      o     prohibiting  our   shareholders   from  fixing  the  number  of  our
            directors;
      o     requiring advance notice for shareholder  proposals and nominations;
            and
      o     prohibiting  shareholders  from  acting by written  consent,  unless
            unanimous.

            We  are  subject  to  certain  provisions  of the  Indiana  Business
Corporation Law, or IBCL, that limit business combination  transactions with 10%
shareholders during the first five years of their ownership,  absent approval of
our  board of  directors.  The IBCL  also  contains  control  share  acquisition
provisions  that limit the ability of certain  shareholders to vote their common
shares  unless  their  control  share  acquisition  was  approved  in advance by
shareholders.  These  provisions  and  other  similar  provisions  make  it more
difficult  for  shareholders  or  potential  acquirers  to  acquire  us  without
negotiation  and could limit the price that  investors are willing to pay in the
future for our common shares.

COMPLIANCE  WITH  CHANGING   REGULATION  OF  CORPORATE   GOVERNANCE  AND  PUBLIC
DISCLOSURE WILL REQUIRE US EITHER TO INCUR ADDITIONAL  EXPENSES OR CEASE TO BE A
REPORTING COMPANY.

            Keeping  abreast  of,  and  in  compliance   with,   changing  laws,
regulations   and  standards   relating  to  corporate   governance  and  public
disclosure,  including the  Sarbanes-Oxley  Act of 2002, new SEC regulations and
American Stock Exchange  rules,  will require an increased  amount of management
attention  and  external  resources.  We would be required to invest  additional
resources  to comply with  evolving  standards,  which would result in increased
general and  administrative  expenses  and a diversion  of  management  time and
attention from revenue-generating activities to compliance activities.

            Our  Board  of  Directors  may  determine  that  it is in  the  best
interests of shareholders to eliminate or reduce such expense by ceasing to be a
reporting  company  for  purposes of the  Securities  Exchange  Act of 1934,  as
amended. One commonly used method, subject to shareholder approval, is to effect
a reverse  share split to reduce the number of  shareholders  to fewer than 300,
permitting termination of registration.  Under this method, shareholders who own
less than one whole common share  following  the reverse split would cease to be
shareholders and would receive a cash payment for their fractional shares. After
a reverse  split,  there might be no  established  trading market for our common
shares,  although  we expect  that our  common  shares may then be quoted on the
"pink sheets."

                                       9





WE MAY BE EXPOSED TO  LIABILITY  AS A RESULT OF BEING NAMED AS A DEFENDANT  IN A
LAWSUIT  BROUGHT UNDER THE SO-CALLED  "QUI TAM"  PROVISIONS OF THE FEDERAL FALSE
CLAIMS ACT.

            The Company, Lynch Interactive  Corporation,  which was formed via a
tax-free   spin-off  from  Lynch   Corporation  on  September  1,  1999  ("Lynch
Interactive"),  and various  other parties are  defendants in a lawsuit  brought
under the so-called "qui tam"  provisions of the federal False Claims Act in the
United States  District Court for the District of Columbia.  The main allegation
in the  case is that the  defendants  participated  in the  creation  of  "sham"
bidding  entities  that  allegedly  defrauded  the U.S.  Treasury  Department by
improperly participating in Federal Communications  Commission spectrum auctions
restricted to small  businesses,  and obtained bidding credits in other spectrum
auctions  allocated  to "small" and "very small"  businesses.  While the lawsuit
seeks to recover an  unspecified  amount of  damages,  which would be subject to
mandatory  trebling  under the  statute,  a report  prepared  for the relator (a
private  individual who filed the action on behalf of the United States) in 2005
alleges  damages of  approximately  $91  million in respect of bidding  credits,
approximately $70 million in respect of government loans and approximately  $206
million in  respect of  subsequent  resales of  licenses,  in each case prior to
trebling.  Although Lynch Interactive is contractually bound to indemnify us for
any  losses  or  damages  we may  incur  as a  result  of  this  lawsuit,  Lynch
Interactive  may lack the capital  resources to do so. As a result,  we could be
held liable and forced to pay a significant amount of damages without recourse.

WE DO  NOT  ANTICIPATE  PAYING  CASH  DIVIDENDS  ON  OUR  COMMON  SHARES  IN THE
FORESEEABLE FUTURE.

            We  anticipate  that all of our  earnings  will be retained  for the
development of our business.  The Board of Directors has adopted a policy of not
paying cash  dividends on our common shares.  We do not  anticipate  paying cash
dividends on our common shares in the foreseeable future.

THERE IS A LIMITED  MARKET FOR OUR COMMON  SHARES.  OUR  COMMON  SHARE  PRICE IS
LIKELY TO BE HIGHLY VOLATILE AND COULD DROP UNEXPECTEDLY.

            There is a limited  public  market  for our  common  shares,  and we
cannot assure you that an active trading market will develop. As a result of low
trading volume in our common shares,  the purchase or sale of a relatively small
number of common shares could result in  significant  share price  fluctuations.
Our share price may fluctuate  significantly in response to a number of factors,
including the following, several of which are beyond our control:

     o      changes in financial  estimates  or  investment  recommendations  by
            securities analysts relating to our common shares;
     o      loss  of a  major  customer;
     o      announcements  by us or our  competitors of  significant  contracts,
            acquisitions,  strategic  partnerships,  joint  ventures  or capital
            commitments; and
     o      changes in key personnel.

            In the past,  securities  class  action  litigation  has often  been
brought against a company following periods of volatility in the market price of
its  securities.  We could be the target of similar  litigation  in the  future.

                                       10





Securities  litigation,  regardless of merit or ultimate  outcome,  would likely
cause  us  to  incur  substantial  costs,  divert  management's   attention  and
resources,  harm our reputation in the industry and the  securities  markets and
reduce our profitability.

SECURITIES  ANALYSTS MAY NOT INITIATE COVERAGE OF OUR COMMON SHARES OR MAY ISSUE
NEGATIVE REPORTS, AND THIS MAY HAVE A NEGATIVE IMPACT ON THE MARKET PRICE OF OUR
COMMON SHARES.

            We cannot assure you that securities analysts will initiate coverage
and publish  research  reports on us. It is difficult for companies with smaller
market  capitalizations,  such as us, to attract independent  financial analysts
who will cover our common  shares.  If securities  analysts do not, this lack of
research coverage may adversely affect the market price of our common shares.

IF WE ARE UNABLE TO INTRODUCE INNOVATIVE  PRODUCTS,  DEMAND FOR OUR PRODUCTS MAY
DECREASE.

            Our  future  operating  results  are  dependent  on our  ability  to
continually  develop,  introduce  and  market  innovative  products,  to  modify
existing products,  to respond to technological  change and to customize some of
our products to meet customer requirements. There are numerous risks inherent in
this  process,  including  the risks  that we will be unable to  anticipate  the
direction  of  technological  change or that we will be unable  to  develop  and
market new products and  applications  in a timely or  cost-effective  manner to
satisfy customer demand.

OUR OPERATING  RESULTS AND  FINANCIAL  CONDITION  COULD BE MATERIALLY  ADVERSELY
AFFECTED BY ECONOMIC,  POLITICAL,  HEALTH, REGULATORY AND OTHER FACTORS EXISTING
IN FOREIGN COUNTRIES IN WHICH WE OPERATE.

            As we  have  significant  international  operations,  our  operating
results  and  financial  condition  could be  materially  adversely  affected by
economic,  political,  health,  regulatory and other factors existing in foreign
countries  in which we  operate.  Our  international  operations  are subject to
inherent risks, which may materially adversely affect us, including:

     o      political  and  economic  instability  in  countries  in  which  our
            products are manufactured and sold;
     o      expropriation or the imposition of government controls;
     o      sanctions  or  restrictions  on trade  imposed by the United  States
            government;
     o      export license requirements;
     o      trade restrictions;
     o      currency controls or fluctuations in exchange rates;
     o      high levels of inflation or deflation;
     o      greater difficulty in collecting our accounts  receivable and longer
            payment cycles;
     o      changes  in  labor  conditions  and  difficulties  in  staffing  and
            managing our international operations; and
     o      limitations  on  insurance  coverage  against   geopolitical  risks,
            natural disasters and business operations.

            In addition,  these same factors may also place us at a  competitive
disadvantage  when compared to some of our foreign  competitors.  In response to
competitive  pressures  and  customer   requirements,   we  may  further  expand

                                       11





internationally at lower cost locations.  If we expand into these locations,  we
will be required to incur additional capital expenditures.

OUR  BUSINESSES  ARE CYCLICAL.  THE RECENT  DECLINE IN DEMAND IN THE  ELECTRONIC
COMPONENT AND GLASS COMPONENT  INDUSTRIES MAY CONTINUE,  RESULTING IN ADDITIONAL
ORDER  CANCELLATIONS  AND  DEFERRALS AND LOWER  AVERAGE  SELLING  PRICES FOR OUR
PRODUCTS.

            Our  subsidiaries  sell to  industries  that are subject to cyclical
economic  changes.  The electronic  component and glass component  industries in
general,  and  specifically  the  Company,  have  for  the  past  several  years
experienced a decline in product  demand on a global  basis,  resulting in order
cancellations  and deferrals and lower average selling  prices.  This decline is
primarily  attributable to a slowing of growth in the demand for components used
by  telecommunications   infrastructure  manufacturers  and  newer  technologies
introduced in the glass display industry. We cannot assure you that any expected
or perceived  improvements in the economy and the electronic component and glass
component  industry  will occur.  The  slowdown may continue and may become more
pronounced.  A slowdown in demand, as well as recessionary  trends in the global
economy,  make it more difficult for us to predict our future sales,  which also
makes it more difficult to manage our operations.

OUR  MARKETS  ARE HIGHLY  COMPETITIVE,  AND WE MAY LOSE  BUSINESS  TO LARGER AND
BETTER-FINANCED COMPETITORS.

            Our   markets   are   highly   competitive   worldwide,   with   low
transportation  costs and few import  barriers.  We compete  principally  on the
basis of  product  quality  and  reliability,  availability,  customer  service,
technological  innovation,  timely delivery and price.  All of the industries in
which we compete have become increasingly  concentrated and globalized in recent
years.  Our major  competitors,  some of which are larger than us, and potential
competitors have  substantially  greater financial  resources and more extensive
engineering,  manufacturing, marketing and customer support capabilities than we
have.

OUR SUCCESS  DEPENDS ON OUR ABILITY TO RETAIN OUR KEY  MANAGEMENT  AND TECHNICAL
PERSONNEL AND ATTRACTING, RETAINING, AND TRAINING NEW TECHNICAL PERSONNEL.

            Our future  growth and  success  will  depend in large part upon our
ability to retain our existing  management and technical team and to recruit and
retain  highly  skilled  technical  personnel,  including  engineers.  The labor
markets in which we operate are highly  competitive  and most of our  operations
are not located in highly  populated  areas. As a result,  we may not be able to
retain and recruit key  personnel.  Our  failure to hire,  retain or  adequately
train key personnel could have a negative impact on our performance.

WE MAY NOT REALIZE THE SYNERGIES OR ACHIEVE THE INTENDED  OBJECTIVES SOUGHT FROM
MTRON'S ACQUISITION OF PTI.

            Effective  September 30, 2004,  Mtron  completed its  acquisition of
PTI. The value of this  acquisition  is largely based on the  synergies  that we
believe will be created by the integration of these two companies.  This process
involves  a  number  of  risks,  including  the  diversion  of our  management's
attention  from  our  existing   business  to  integrate  PTI's  operations  and
personnel,  and possible  adverse  effects on our operating  results  during the
integration  process.  In  addition,  we may be  unable to  integrate,  operate,

                                       12





maintain and manage PTI's  operations or  employees.  We also may not be able to
maintain uniform standards, controls, procedures and policies, and this may lead
to operational inefficiencies.

MTRONPTI'S  BACKLOG  MAY NOT BE  INDICATIVE  OF FUTURE  SALES AND MAY  ADVERSELY
AFFECT OUR BUSINESS.

            MtronPTI's  backlog  comprises  orders  that are subject to specific
production release orders under written contracts,  oral and written orders from
customers with which MtronPTI has had  long-standing  relationships  and written
purchase  orders  from sales  representatives.  MtronPTI's  customers  may order
components  from  multiple  sources to ensure  timely  delivery  when backlog is
particularly  long and may cancel or defer orders without  significant  penalty.
They often cancel orders when business is weak and inventories are excessive,  a
phenomenon that MtronPTI has experienced in the recent economic  slowdown.  As a
result,  MtronPTI's  backlog as of any particular date may not be representative
of actual net sales for any succeeding period.

MTRONPTI RELIES UPON ONE CONTRACT  MANUFACTURER FOR A SIGNIFICANT PORTION OF ITS
FINISHED  PRODUCTS,  AND A DISRUPTION IN ITS RELATIONSHIP  COULD HAVE A NEGATIVE
IMPACT ON MTRONPTI'S SALES.

            In 2004,  approximately 12% of MtronPTI's net sales was attributable
to  finished  products  that  were  manufactured  by  an  independent   contract
manufacturer  located in both Korea and China.  We expect this  manufacturer  to
account for a smaller but  substantial  portion of MtronPTI's  net sales in 2005
and a material portion of MtronPTI's sales for the next several years.  MtronPTI
does not have a written,  long-term supply contract with this  manufacturer.  If
this manufacturer  becomes unable to provide products in the quantities  needed,
or at acceptable prices,  MtronPTI would have to identify and qualify acceptable
replacement  manufacturers  or  manufacture  the  products  internally.  Due  to
specific  product  knowledge and process  capability,  MtronPTI could  encounter
difficulties  in  locating,  qualifying  and  entering  into  arrangements  with
replacement manufacturers. As a result, a reduction in the production capability
or financial viability of this manufacturer, or a termination of, or significant
interruption in, MtronPTI's  relationship with this manufacturer,  may adversely
affect MtronPTI's results of operations and our financial condition.

CONTINUED MARKET ACCEPTANCE OF MTRONPTI'S  PACKAGED QUARTZ CRYSTALS,  OSCILLATOR
MODULES AND  ELECTRONIC  FILTERS IS CRITICAL TO OUR SUCCESS,  BECAUSE  FREQUENCY
CONTROL DEVICES ACCOUNT FOR NEARLY ALL OF MTRONPTI'S SALES.

            Virtually all of MtronPTI's  2003 and 2004 net sales came from sales
of  frequency  control  devices,  which  consist of  packaged  quartz  crystals,
oscillator modules and electronic filters. We expect that this product line will
continue  to  account  for  substantially  all of  MtronPTI's  net sales for the
foreseeable  future.  Any decline in demand for this  product line or failure to
achieve continued market acceptance of existing and new versions of this product
line may harm MtronPTI's business and our financial condition.

                                       13





MTRONPTI'S  FUTURE RATE OF GROWTH IS HIGHLY  DEPENDENT  ON THE  DEVELOPMENT  AND
GROWTH OF THE MARKET FOR COMMUNICATIONS AND NETWORK EQUIPMENT.

            MtronPTI's business depends heavily upon capital expenditures by the
providers  of  communications  and network  services.  In 2004,  the majority of
MtronPTI's  net  sales  were to  manufacturers  of  communications  and  network
infrastructure  equipment,  including  indirect sales through  distributors  and
contract  manufacturers.  In 2005,  MtronPTI  expects a smaller but  significant
portion of its net sales to be to  manufacturers of  communications  and network
infrastructure   equipment.   MtronPTI   intends  to   increase   its  sales  to
communications and network infrastructure equipment manufacturers in the future.
Communications  and  network  service  providers  have  experienced  periods  of
capacity shortage and periods of excess capacity. In periods of excess capacity,
communications systems and network operators cut purchases of capital equipment,
including  equipment that incorporates  MtronPTI's  products.  A slowdown in the
manufacture and purchase of communications and network infrastructure  equipment
could  substantially  reduce  MtronPTI's  net sales and  operating  results  and
adversely  affect  our  financial  condition.   Moreover,   if  the  market  for
communications  or network  infrastructure  equipment fails to grow as expected,
MtronPTI  may be unable to sustain its growth.  In addition,  MtronPTI's  growth
depends  upon the  acceptance  of its  products  by  communications  and network
infrastructure equipment manufacturers.  If, for any reason, these manufacturers
do not find  MtronPTI's  products to be  appropriate  for their use,  our future
growth will be adversely affected.

COMMUNICATIONS AND NETWORK INFRASTRUCTURE  EQUIPMENT MANUFACTURERS  INCREASINGLY
RELY UPON CONTRACT MANUFACTURERS, THEREBY DIMINISHING MTRONPTI'S ABILITY TO SELL
ITS PRODUCTS DIRECTLY TO THOSE EQUIPMENT MANUFACTURERS.

            There  is  a  growing   trend  among   communications   and  network
infrastructure  equipment  manufacturers to outsource the manufacturing of their
equipment  or  components.  As a result,  MtronPTI's  ability to persuade  these
original  equipment  manufacturers to specify our products has been reduced and,
in the absence of a  manufacturer's  specification of MtronPTI's  products,  the
prices that MtronPTI can charge for them may be subject to greater competition.

MTRONPTI'S  GOVERNMENT  CONTRACTS CONTAIN  PROVISIONS THAT ARE UNFAVORABLE TO IT
AND HAVE A NUMBER OF SPECIFIC RISKS THAT MAY RESULT IN LOST ORDERS AND PROFITS.

            Many  of  MtronPTI's  contracts  with  government  agencies  contain
provisions that give the governments  rights and remedies not typically found in
private commercial contracts, including provisions enabling the government to:

     o      terminate  or  cancel  existing  contracts  without  good  reason or
            penalty;
     o      suspend  MtronPTI from doing  business with a foreign  government or
            prevent MtronPTI from selling its products in certain countries;
     o      audit and object to MtronPTI's  contract-related costs and expenses,
            including allocated indirect costs; and
     o      change  specific  terms  and  conditions  in  MtronPTI's  contracts,
            including  changes  that would  reduce the value of the  contract to
            MtronPTI.

                                       14





            MtronPTI's  business  generated from  government  contracts could be
materially and adversely affected if:

      o     MtronPTI's  reputation or relationship with government agencies were
            impaired;
      o     MtronPTI were  suspended or otherwise  prohibited  from  contracting
            with a domestic or foreign government;
      o     any of MtronPTI's  products were to fail to meet the requirements of
            certain applicable specified military standards;
      o     levels of  government  spending  were to decrease;
      o     MtronPTI were barred from entering into new government  contracts or
            extending  existing  government  contracts  based on  violations  or
            suspected violations of laws or regulations; or
      o     MtronPTI were not granted  security  clearances  required to provide
            its  services  and  solutions  to  governments,   or  such  security
            clearances were revoked.

FUTURE CHANGES IN MTRONPTI'S  ENVIRONMENTAL LIABILITY AND COMPLIANCE OBLIGATIONS
MAY INCREASE COSTS AND DECREASE PROFITABILITY.

            MtronPTI's   manufacturing   operations,   products  and/or  product
packaging  are  subject to  environmental  laws and  regulations  governing  air
emissions,  wastewater discharges, and the handling, disposal and remediation of
hazardous substances,  wastes and other chemicals.  In addition,  more stringent
environmental  regulations may be enacted in the future, and we cannot presently
determine the  modifications,  if any, in MtronPTI's  operations that any future
regulations  might require,  or the cost of compliance  that would be associated
with these regulations.

MTRONPTI  MAY BE UNABLE TO MODIFY ITS PRODUCTS OR MAY INCUR  INCREASED  COSTS TO
MEET  THE  REQUIREMENTS  OF  THE  EUROPEAN  UNION'S   RESTRICTION  ON  HAZARDOUS
SUBSTANCES DIRECTIVE.

            MtronPTI may be unable to modify its products or may incur increased
costs to meet the requirements of the European Union's  Restriction on Hazardous
Substances Directive. If MtronPTI is unable to comply with these regulations, it
may not be permitted to ship its products to the European Union.

LYNCH SYSTEMS'  REVENUE IS LARGELY  DEPENDENT ON DEMAND FOR ITS  TELEVISIONS AND
COMPUTER  MONITORS BASED ON CATHODE-RAY  TUBE  TECHNOLOGY.  THIS TECHNOLOGY WILL
EVENTUALLY BE REPLACED BY PLASMA AND LIQUID CRYSTAL DISPLAYS.

            Lynch Systems  generates a  significant  portion of its revenue from
sales to glass producers that supply  television and computer  monitor  displays
that are based on  cathode-ray  tube  technology.  This market is being  rapidly
penetrated  by  thinner,  lighter  weight  plasma  displays  and liquid  crystal
displays.  Although cathode-ray tube televisions and computer monitors currently
retain  advantages  in image  quality and price,  glass  producers are investing
billions  of dollars to improve  the quality and lower the unit price of plasma,
liquid  crystal and other display types.  We believe that market  penetration by
plasma and liquid crystal display  producers will continue and eventually render
obsolete cathode-ray tube technology and this Lynch Systems product line.

                                       15





LYNCH SYSTEMS' DEPENDENCE ON A FEW SIGNIFICANT CUSTOMERS EXPOSES IT TO OPERATING
RISKS.

            Lynch  Systems'  sales to its ten largest  customers  accounted  for
approximately  80% of its net sales in 2004, 2003 and 2002. Lynch Systems' sales
to its largest customer  accounted for approximately 36%, 42% and 27% of its net
sales in 2004,  2003 and 2002.  If a  significant  customer  reduces,  delays or
cancels its orders for any reason,  the  business and results of  operations  of
Lynch Systems would be negatively affected.

AN ORDER TO BUILD MULTIPLE MACHINES IN THE FUTURE WITH A SIGNIFICANT CUSTOMER IN
THE  TABLEWARE  MARKET  IS  CONTINGENT  UPON  THE  SUCCESSFUL  INSTALLATION  AND
OPERATION OF THE MACHINES CURRENTLY IN PRODUCTION.

            Lynch  Systems  has a  significant  order  for  glass  manufacturing
machines  that are  scheduled  to be shipped  and  installed  in the  customer's
factories in 2005. We expect that this contract will represent approximately 33%
of Lynch Systems' revenues in 2005. Many of these machines utilize new processes
and require  customer  training.  The ability of the  customer's  personnel  and
resources to operate these machines  successfully  is critical.  If the customer
does not  realize the full  benefit  from these  machines,  new orders from this
customer may be canceled.

THE RESULTS OF LYNCH  SYSTEMS'  OPERATIONS  ARE SUBJECT TO  FLUCTUATIONS  IN THE
AVAILABILITY AND COST OF STEEL USED TO MANUFACTURE GLASS FORMING EQUIPMENT.

            Lynch Systems uses large amounts of steel to  manufacture  its glass
forming  equipment.  The price of steel has risen  substantially  and demand for
steel is very  high.  Lynch  Systems  has  only  been  able to pass  some of the
increased costs to its customers.  As a result, Lynch Systems' profit margins on
glass forming  equipment  have  decreased.  If the price of and demand for steel
continues to rise, our profit margins will continue to decrease.

LYNCH SYSTEMS MAY BE UNABLE TO PROTECT ITS INTELLECTUAL PROPERTY.

            The success of Lynch Systems'  business  depends,  in part, upon its
ability to protect  trade  secrets,  designs,  drawings and  patents,  obtain or
license  patents and operate  without  infringing on the  intellectual  property
rights of  others.  Lynch  Systems  relies on a  combination  of trade  secrets,
designs, drawings,  patents,  nondisclosure agreements and technical measures to
protect its proprietary  rights in its products and technology.  The steps taken
by Lynch Systems in this regard may not be adequate to prevent  misappropriation
of its  technology.  In addition,  the laws of some  foreign  countries in which
Lynch Systems operates do not protect its proprietary  rights to the same extent
as do the  laws of the  United  States.  Although  Lynch  Systems  continues  to
evaluate and  implement  protective  measures,  we cannot  assure you that these
efforts will be successful. Lynch Systems' inability to protect its intellectual
property rights could diminish or eliminate the  competitive  advantages that it
derives from its technology, cause Lynch Systems to lose sales or otherwise harm
its business.

                SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

            This  prospectus and documents  incorporated  by reference into this
prospectus contain forward-looking  statements within the meaning of Section 27A
of the  Securities  Act of 1933, as amended,  and Section 21E of the  Securities
Exchange Act of 1934, as amended,  that are not historical facts, but rather are

                                       16





based on current expectations,  estimates and projections about our business and
industry, our beliefs and assumptions.  Words such as "anticipates,"  "expects,"
"intends," "plans,"  "believes,"  "seeks,"  "estimates," and variations of these
words  and  similar   expressions  are  intended  to  identify   forward-looking
statements. These statements are based on our current plans and expectations and
involve risks and uncertainties over which we have no control,  that could cause
actual future  activities  and results of operations to be materially  different
from those set forth in the forward-looking  statements.  Important factors that
could cause actual future  activities  and operating  results to differ  include
fluctuating  demand for capital goods such as large glass presses,  delay in the
recovery  of demand for  components  used by  telecommunications  infrastructure
manufacturers and exposure to foreign economies. Important information regarding
risks and uncertainties is also set forth elsewhere in this document,  including
in those  described in "Risk Factors"  beginning on page 5, as well as elsewhere
in  this  prospectus  and in  documents  incorporated  by  reference  into  this
prospectus.   You  are   cautioned   not  to  place  undue   reliance  on  these
forward-looking  statements,  which reflect our management's view only as of the
date of  this  prospectus  or as of the  date of any  document  incorporated  by
reference into this prospectus.  All subsequent written or oral  forward-looking
statements  attributable  to us or persons  acting on our  behalf are  expressly
qualified  in their  entirety by these  cautionary  statements.  We undertake no
obligation  to update these  statements  or publicly  release the results of any
revisions to the  forward-looking  statements that we may make to reflect events
or  circumstances  after the date of this prospectus or the date of any document
incorporated  into this prospectus or to reflect the occurrence of unanticipated
events.

            You are also urged to  carefully  review and  consider  the  various
disclosures  made by us in this  document,  as  well  as in our  prior  periodic
reports on Forms 10-K,  10-Q and 8-K,  filed with the  Securities  and  Exchange
Commission and listed under the caption  "Incorporation by Reference" on page 32
of this prospectus.

            We make available,  free of charge,  our annual report on Form 10-K,
quarterly reports on Form 10-Q, and current reports on Form 8-K, if any.

            We  also  make  this   information   available  on  our  website  at
www.lynchcorp.com.

                   DESCRIPTION OF SECURITIES TO BE REGISTERED

            Our authorized  capital consists of 10,000,000  common shares with a
par value of $.0.01 per share. As of August 31, 2005,  there were  approximately
1,616,026 common shares issued and outstanding. Additionally, there were 600,000
common shares  reserved for issuance  upon exercise of options  granted or to be
granted  pursuant  our 2001  Equity  Incentive  Plan.  The holders of our common
shares  are  entitled  to one vote for each  common  share held of record on all
matters to be voted on by  shareholders.  The  holders of our common  shares are
entitled to receive such  dividends,  if any, as may be declared by the Board of
Directors in its discretion out of funds legally available.  Upon liquidation or
dissolution  of the  Company,  the holders of our common  shares are entitled to
receive  on  a  pro  rata  basis  all  assets   remaining  for  distribution  to
shareholders  after the  payment  of debts and  liquidation  preferences  on any
capital stock. Our common shares have no preemptive or other subscription rights
and  there  are no  other  conversion  rights  or  redemption  or  sinking  fund
provisions with respect to such common shares.

                                       17





            The  Company's  Transfer  Agent and  Registrar  is  Mellon  Investor
Services LLC.

                                USE OF PROCEEDS

            If all of the rights are exercised in full at $_______ per share, we
would receive net cash proceeds of approximately $_______ million, after payment
of fees and expenses.  No discount or  commission is payable in connection  with
any such exercise.

            The funds, if any, received upon exercise of the rights will be used
for  general  corporate  purposes,  working  capital  and to make  acquisitions,
although the Company has not identified any specific acquisitions at this time.

                              THE RIGHTS OFFERING

            Our Board of  Directors  has proposed  that we raise equity  capital
through this offering to all of our  shareholders.  Through this prospectus,  we
are offering  common  shares that rights  holders may purchase  upon  exercising
their subscription rights.

SUBSCRIPTION RIGHTS

            BASIC SUBSCRIPTION  PRIVILEGE.  We will distribute to the holders of
record of our common shares,  at the close of business on ___________,  2005, at
no charge, one transferable  subscription right for each common share owned. The
subscription rights will be evidenced by Subscription Certificates.  Every three
such rights will entitle the holder to subscribe for one common share.  Assuming
that all rights are exercised, including those that may be exercised as a result
of the oversubscription  privilege, an aggregate of approximately 538,676 common
shares will be sold. We will deliver to  subscribers  certificates  representing
common shares purchased through the exercise of the basic subscription privilege
as  soon  as  practicable   after  the  expiration   date,   anticipated  to  be
approximately seven to 10 business days. You are not required to exercise any or
all of your subscription rights.

            If, pursuant to the exercise of subscription  rights,  the number of
common  shares that a rights holder would be entitled to receive would result in
receipt of fractional  shares,  the  aggregate  number of common shares that the
holder is entitled to purchase  will be rounded up to the nearest  whole number.
Rights holders will not receive cash in lieu of fractional shares.

            OVERSUBSCRIPTION  PRIVILEGE.  Subject  to the  allocation  described
below, shareholders on the record date who fully exercise the rights distributed
to them by us will also be entitled to  subscribe  for and  purchase  additional
common shares that are not purchased by other rights holders through their basic
subscription  privileges.  The maximum  number of shares  that you may  purchase
under the  oversubscription  privilege  is equal to the  number  of  shares  you
purchased under the basic subscription privilege. If the number of common shares
remaining  after  the  exercise  of all  basic  subscription  privileges  is not
sufficient to satisfy  requests from all shareholders for common shares pursuant
to oversubscription  privileges,  you will be allocated additional common shares
pro rata,  based on the number of common shares you purchased  through the basic
subscription  privilege in  proportion to the total number of common shares that
you  and  other  oversubscribing   shareholders   purchased  through  the  basic
subscription privilege. Once you have exercised your oversubscription privilege,
you may not revoke your exercise.

                                       18





            If you wish to exercise your oversubscription  privilege, you should
indicate the number of additional  common shares that you would like to purchase
in the space provided on your  Subscription  Certificate.  When you send in your
Subscription  Certificate,  you must also send the full  purchase  price for the
number of  additional  common  shares that you have  requested  to purchase  (in
addition to the  payment  due for common  shares  purchased  through  your basic
subscription privilege). After all common shares requested pursuant to the basic
subscription  privilege are allocated,  a  determination  will be made as to the
number  of common  shares  available  for  issuance  under the  oversubscription
privilege.   For   purposes  of   allocating   the  common   shares   under  the
oversubscription privilege, there shall be calculated for each holder seeking to
exercise  the  oversubscription  privilege a proration  factor.  This  proration
factor will be based on the number of common  shares  purchased by a record date
shareholder through the basic subscription  privilege in proportion to the total
number of common shares  purchased by all record date  shareholders  pursuant to
the basic subscription privilege. For each holder, this proration factor will be
applied to the  common  shares  available  for  purchase  upon  exercise  of the
oversubscription privilege and common shares will be allocated accordingly. This
process will be repeated  until one of the following  conditions is met: (i) all
oversubscribing  holders'  requests are filled, or (ii) there are no more common
shares available for allocation.

            As soon as practicable  after the expiration  date,  Mellon Investor
Services LLC,  acting as our  subscription  agent,  will determine the number of
common shares that you may purchase pursuant to the oversubscription  privilege.
You will receive certificates  representing these common shares and a refund for
any excess  subscription  payments as soon as  practicable  after the expiration
date,  anticipated  to be  approximately  seven to 10  business  days  after the
expiration  date.  If you  request  and pay for  more  common  shares  than  are
allocated  to  you,  we will  refund  that  overpayment,  without  interest.  In
connection with the exercise of the oversubscription  privilege,  banks, brokers
and other nominee holders of subscription rights who act on behalf of beneficial
owners will be required to certify to us and to the subscription agent as to the
aggregate number of subscription rights that have been exercised, and the number
of  common  shares  that  are  being  requested  through  the   oversubscription
privilege,  by each  beneficial  owner on whose  behalf  the  nominee  holder is
acting.

SUBSCRIPTION PRICE

            Three  subscription  rights  plus  $______  entitles  the  holder to
purchase one common share.  The per share price  represents a discount of ____ %
from [the closing sale price of our common shares on ____ __, 2005] [the average
of the closing sales prices of our common shares over the  __-trading day period
ending _____ __, 2005].  The  subscription  price does not necessarily  bear any
relationship to our past or expected  future results of operations,  cash flows,
current financial  condition,  or any other  established  criteria for value. No
change will be made to the cash  subscription  price by reason of changes in the
trading price of our common shares prior to the closing of this offering.

DETERMINATION OF SUBSCRIPTION PRICE

            Our Board of Directors  set all of the terms and  conditions of this
offering,  including the  subscription  price. In establishing  the subscription
price, our Board of Directors considered the following factors:

                                       19





       o    strategic alternatives for capital raising,
       o    the market price of our common shares,
       o    the pricing of similar transactions,
       o    the amount of proceeds desired,
       o    our business prospects,
       o    our recent and anticipated operating results, and
       o    general conditions in the securities markets.

            We determined the  subscription  price after taking into account the
preceding  factors.  We did not seek or obtain any opinion of financial advisors
or investment  bankers in establishing the subscription  price for the offering.
You should not consider the subscription  price as an indication of the value of
our company or our common shares.  We cannot assure you that you will be able to
sell common shares purchased during this offering at a price equal to or greater
than the subscription  price. On _________,  2005, the closing sale price of our
common shares was $_____ per share.

EXPIRATION DATE, EXTENSIONS AND TERMINATION

            You may  exercise  your  subscription  right at any time before 5:00
p.m.,  New York City time, on __________,  2005,  the  expiration  date for this
offering.  However,  we may  extend the  offering  period  for  exercising  your
subscription  rights  in our sole  discretion,  but in no event by more  than 15
additional  days.  If you do not exercise  your  subscription  rights before the
expiration date, your unexercised  subscription rights will be null and void. We
will not be  obligated  to honor your  exercise  of  subscription  rights if the
subscription  agent  receives the documents  relating to your exercise after the
expiration  date,  regardless of when you transmitted the documents,  unless you
have timely transmitted the documents under the guaranteed  delivery  procedures
described below.

            We have the sole  discretion to extend the expiration date by giving
oral or written  notice to the  subscription  agent on or before  the  scheduled
expiration date. If we elect to extend the expiration of this offering,  we will
issue a press release announcing the extension no later than 9:00 a.m., New York
City time, on the next business day after the most recently announced expiration
date.

WITHDRAWAL AND AMENDMENT

            We reserve the right to withdraw or terminate  this  offering at any
time for any reason. In the event that this offering is withdrawn or terminated,
all funds received from  subscriptions by shareholders  will be returned as soon
as  practicable,  anticipated  to be  approximately  three to five business days
after such date of such withdrawal or termination.  Interest will not be payable
on any returned funds.

            We reserve the right to amend the terms of this offering. If we make
an amendment that we consider material, we will:

      o     mail notice of the amendment to all shareholders of record as of the
            record date;
      o     extend  the  expiration  date by at least 10 days;  and
      o     offer  all   subscribers   no  less  than  10  days  to  revoke  any
            subscription already submitted.

                                       20





            The extension of the expiration date will not, in and of itself,  be
treated as a material amendment for these purposes.

INTENTIONS OF THE COMPANY'S DIRECTORS

            At a meeting of our Board of  Directors  convened to  determine  the
terms of the proposed  offering,  our directors  advised the Company that, as to
the shares owned  directly or  indirectly  by them,  they intend to exercise the
basic  subscription  privilege  under rights  received and might  exercise their
oversubscription  privilege with respect to additional  shares that might become
available  for  purchase.  The  expressed  intention of the  directors  does not
constitute a binding obligation on their part.

METHOD OF SUBSCRIPTION - EXERCISE OF SUBSCRIPTION RIGHTS

            You  may  exercise  your  subscription   rights  by  delivering  the
following to the  subscription  agent,  at or prior to 5:00 p.m.,  New York City
time, on ______________, 2005, the date on which the rights expire:

      o     your properly completed and executed  Subscription  Certificate with
            any   required   signature    guarantees   or   other   supplemental
            documentation; and
      o     your  full   subscription   price  payment  for  each  common  share
            subscribed  for under your  basic  subscription  privilege  and your
            oversubscription privilege.

            You  should  read  and  follow  the  Instructions  for Use of  Lynch
Corporation Subscription Certificates carefully.

SIGNATURE GUARANTEE MAY BE REQUIRED

            Your signature on each  Subscription  Certificate must be guaranteed
by an  eligible  institution  such as a  member  firm of a  registered  national
securities  exchange  or a member  of the  National  Association  of  Securities
Dealers,  Inc., or from a commercial  bank or trust company  having an office or
correspondent in the United States,  subject to standards and procedures adopted
by the subscription agent, unless:

      o     your Subscription  Certificate provides that common shares are to be
            delivered to you as record holder of those subscription rights; or
      o     you are an eligible institution.

DELIVERY OF SUBSCRIPTION MATERIALS AND PAYMENT

            You should deliver your Subscription  Certificate and payment of the
subscription  price  or,  if  applicable,  Notice  of  Guaranteed  Delivery  for
Subscription  Certificates,  to the  subscription  agent by mail,  by  overnight
courier or by hand to:

                                       21





BY UNITED STATES MAIL DELIVERY:      BY OVERNIGHT COURIER:               BY HAND:
- ------------------------------       --------------------                -------
Mellon Investor Services LLC         Mellon Investor Services LLC        Mellon Investor Services LLC
Post Office Box 3301                 480 Washington Blvd.                120 Broadway, 13th Floor
South Hackensack, NJ 07606           Mail Drop - Reorg                   New York, NY 10271
Attn: Reorganization Department      Jersey City, NJ 07310               Attn: Reorganization
                                     Attn: Reorganization                Department
                                     Department

            You are responsible for the method of delivery of your  Subscription
Certificate(s)  with your subscription price payment to the subscription  agent.
If you send your Subscription  Certificate(s)  and subscription price payment by
mail, we recommend that you send them by registered mail, properly insured, with
return receipt requested. You should allow a sufficient number of days to ensure
delivery to the subscription agent prior to the time this offering expires.

            DO NOT SEND YOUR SUBSCRIPTION  CERTIFICATE(S) AND SUBSCRIPTION PRICE
PAYMENT TO THE COMPANY.  Your  delivery to an address other than the address set
forth above will not constitute valid delivery.

METHOD OF PAYMENT

            Your payment of the subscription  price must be made in U.S. dollars
for the full number of common shares you are  subscribing  (or  oversubscribing)
for by either bank draft (cashier's  check) or certified check drawn upon a U.S.
bank or money order payable to the subscription agent.

PLEASE  NOTE THAT  COMMON  SHARES  MAY NOT BE PAID FOR BY  UNCERTIFIED  PERSONAL
CHECK.

RECEIPT OF PAYMENT

            Your payment will be considered  received by the subscription  agent
only upon receipt by the  subscription  agent of a certified check or bank draft
drawn upon a U.S. bank or a money order.

CALCULATION OF SUBSCRIPTION RIGHTS EXERCISED

            If you do not  indicate  the  number of  subscription  rights  being
exercised,  or do not forward full payment of the total  subscription  price for
the number of subscription  rights that you indicate are being  exercised,  then
you will be deemed to have  exercised  your basic  subscription  privilege  with
respect to the maximum number of rights that may be exercised with the aggregate
subscription price payment you delivered to the subscription agent.

YOUR FUNDS WILL BE HELD BY THE SUBSCRIPTION AGENT UNTIL COMMON SHARES ARE ISSUED

            The  subscription  agent will hold your payment of the  subscription
price payment in a segregated  account with other  payments  received from other
rights holders until we issue your common shares to you. If this offering is not

                                       22





completed,  or we do not apply  your full  subscription  price  payment  to your
purchase  of  common  shares,  the  subscription  agent  will  return as soon as
practicable, without interest, all excess subscription payments.

NO REVOCATION

            Once you have exercised your  subscription  privileges,  you may not
revoke your exercise.  Subscription rights not exercised prior to the expiration
date of this offering will expire.

TRANSFERABILITY OF RIGHTS

            The  rights  are  transferable  until the  opening of trading on the
expiration  date and are expected to be  authorized  for trading on the American
Stock Exchange.  Trading of the rights will be conducted on a regular-way  basis
from ________,  2005 through the opening of trading on the expiration  date. Any
commissions  in  connection  with the sale of rights will be paid by the selling
rights  holder.  We cannot assure you that a market for the rights will develop,
or of the prices at which rights may be sold if a market does develop.

            You  may  transfer  all of the  rights,  excluding  oversubscription
rights,   evidenced  by  a  single  Subscription   Certificate  by  signing  the
Subscription  Certificate for transfer in accordance  with the appropriate  form
printed  on the  Subscription  Certificate.  You may  transfer  a portion of the
rights,  excluding  oversubscription  rights, evidenced by a single Subscription
Certificate  by  delivering  to Mellon  Investor  Services LLC the  Subscription
Certificate properly signed for transfer,  with separate written instructions to
register a portion of the rights in the name of your  transferee  and to issue a
new Subscription  Certificate to the transferee covering the transferred rights.
In that event and by appropriate written instructions,  you may elect to receive
a new Subscription Certificate covering the rights you did not transfer.

            If you wish to transfer all or a portion of your rights,  you should
allow a sufficient amount of time prior to the expiration time for:

      o     the transfer  instructions  to be received  and  processed by Mellon
            Investor Services LLC;
      o     new Subscription Certificates to be issued and transmitted; and
      o     the rights  evidenced  by the new  Subscription  Certificates  to be
            exercised or sold by the intended recipients.

            It may require from two to 10 business  days,  or more,  to complete
transfers of rights, depending upon how you deliver the Subscription Certificate
and payment and the number of transactions you request.  Neither the Company nor
the  subscription  agent  will be liable to you or any  transferee  of rights if
Subscription  Certificates  or any other required  documents are not received in
time for exercise or sale prior to the expiration time.

            If  you  exercise  or  sell  rights  in  part,  a  new  Subscription
Certificate  for  the  remaining  rights  will  be  issued  to you  only  if the
subscription  agent receives a properly endorsed  Subscription  Certificate from
you no later than 5:00 p.m.,  Eastern Time,  on the fifth  business day prior to
the expiration  date.  The  subscription  agent will not issue new  Subscription
Certificates for partially exercised or sold Subscription Certificates submitted

                                       23





after that time and date. If you do submit a Subscription Certificate after that
time and  date,  you will not be able to  exercise  the  unexercised  or  unsold
rights.

            Unless you make other  arrangements  with the subscription  agent, a
new Subscription  Certificate issued after 5:00 p.m., Eastern Time, on the fifth
business day before the expiration date will be held for pick-up by you at:

                                Mellon Bank, N.A.
                          c/o Mellon Investor Services
                            120 Broadway, 13th Floor
                            New York, New York 10271
                         Attn: Reorganization Department

            If you  request a  reissuance  of a  Subscription  Certificate,  the
delivery of that document will be at your risk.

            You,  and  not  the  Company  or the  subscription  agent,  will  be
responsible  for  paying any  commissions,  fees and other  expenses,  including
brokerage  commissions and transfer taxes, that you may incur in the purchase or
sale of the rights.

ISSUANCE OF SHARE CERTIFICATES

            Share certificates for common shares purchased in this offering will
be issued as soon as practicable  after the expiration  date,  anticipated to be
approximately  seven  to  10  business  days  after  the  expiration  date.  Our
subscription  agent  will  deliver  subscription   payments  to  us  only  after
consummation  of this  offering  and the issuance of share  certificates  to our
shareholders  that  exercised  rights.  Unless you  instruct  otherwise  in your
Subscription  Certificate  form,  common  shares  purchased  by the  exercise of
subscription  rights will be registered in the name of the person exercising the
rights.

GUARANTEED DELIVERY PROCEDURES

            If you wish to exercise  your  subscription  rights,  but you do not
have sufficient  time to deliver the  Subscription  Certificate  evidencing your
rights to the subscription agent on or before the time your subscription  rights
expire,  you may exercise your subscription  rights by the following  guaranteed
delivery procedures:

      o     deliver  your  subscription  price  payment in full for each  common
            share you subscribed for under your  subscription  privileges in the
            manner set forth in "Method of Payment" to the subscription agent on
            or prior to the expiration date;
      o     deliver  the  form  entitled  Notice  of  Guaranteed   Delivery  for
            Subscription  Certificates,  substantially in the form provided with
            the  Instructions  as  to  Use  of  Lynch  Corporation  Subscription
            Certificates distributed with your Subscription Certificates,  on or
            prior to the expiration date; and
     o      deliver the properly completed  Subscription  Certificate evidencing
            your  rights  being   exercised  and  the  related   nominee  holder

                                       24





            certification,   if   applicable,   with  any  required   signatures
            guaranteed,  to the  subscription  agent within three  business days
            following the expiration date.

            Your Notice of  Guaranteed  Delivery for  Subscription  Certificates
must be delivered in substantially  the same form provided with the Instructions
as to  Use  of  Lynch  Corporation  Subscription  Certificates,  which  will  be
distributed to you with your Subscription Certificate. Your Notice of Guaranteed
Delivery for Subscription  Certificates must come from an eligible  institution,
or other eligible  guarantee  institutions which are members of, or participants
in, a signature guarantee program acceptable to the subscription agent.

            In your Notice of Guaranteed Delivery for Subscription Certificates,
you must state:

      o     your name;
      o     the number of subscription  rights  represented by your Subscription
            Certificates  and the number of common  shares  you are  subscribing
            (and oversubscribing) for; and
      o     your guarantee that you will deliver to the  subscription  agent any
            Subscription Certificates evidencing the subscription rights you are
            exercising within three business days following the expiration date.

            You may deliver your Notice of Guaranteed  Delivery for Subscription
Certificates to the subscription  agent in the same manner as your  Subscription
Certificates  at the address set forth above  under  "Delivery  of  Subscription
Materials  and  Payment."  Alternately,  on the  expiration  date ONLY,  you may
transmit your Notice of Guaranteed Delivery for Subscription Certificates to the
subscription agent via facsimile transmission (Facsimile No.: 201-680-4626). ALL
FACSIMILE  DELIVERIES MUST BE CONFIRMED.  To confirm facsimile  deliveries,  you
must call 201-680-4860.

            Please call the information  agent to request any additional  copies
of the form of Notice of Guaranteed  Delivery for Subscription  Certificates you
may need.

DETERMINATIONS REGARDING THE EXERCISE OF YOUR SUBSCRIPTION RIGHTS

            We will decide all questions  concerning the  timeliness,  validity,
form and  eligibility  of your  exercise  of your  subscription  rights  and our
determinations will be final and binding. We, in our sole discretion,  may waive
any defect or  irregularity,  or permit a defect or irregularity to be corrected
within such time as we may  determine.  Non-material  defects or  irregularities
will be waived  provided that we can determine your  intentions  with respect to
exercising your rights.  If there is any defect or irregularity  that results in
an ambiguity  regarding your  intentions with respect to exercising your rights,
such defect or irregularity will not be waived. In such event, we will treat any
identical  defects or irregularities  the same way for all shareholders.  We may
reject the exercise of any of your subscription  rights because of any defect or
irregularity.  We  will  not  receive  or  accept  any  subscription  until  all
irregularities  have been  waived by us or cured by you  within  such time as we
decide, in our sole discretion.

            Neither  we nor the  subscription  agent  will be under  any duty to
notify you of any defect or  irregularity  in connection with your submission of
Subscription Certificates and we will not be liable for failure to notify you of
any defect or  irregularity.  We reserve  the right to reject  your  exercise of

                                       25





subscription rights if your exercise is not in accordance with the terms of this
offering or in proper form.  Under Section 18 of the  Securities Act of 1933, as
amended,  our common stock and the subscription rights offered hereby are exempt
from state regulation or "blue sky" laws because our common shares are listed on
the  American  Stock  Exchange.  If you are a foreign  shareholder  with a legal
residence  outside of the United  States,  we will not accept  your  exercise of
rights if our issuance of common  shares to you could be deemed  unlawful  under
applicable  law  or if  compliance  with  applicable  law  would  be  materially
burdensome to us. We have no reason to believe that a significant  number of our
shares is owned by foreign shareholders.

            If you are given notice of a defect in your  subscription,  you will
have five  business days after the giving of notice to correct it. You will not,
however, be allowed to cure any defect later than 5:00 p.m., New York City time,
on ________________, 2005. We will not consider an exercise to be made until all
defects have been cured or waived.

NOTICE TO BANKERS, TRUSTEES OR OTHER DEPOSITARIES

            If you are a broker,  a trustee or a depositary  for  securities who
holds  common  shares for the  account of others at the close of business on the
record date, you should notify the respective  beneficial  owners of such common
shares of this  offering as soon as possible to find out their  intentions  with
respect to exercising their subscription  rights. You should obtain instructions
from the beneficial owners with respect to the subscription rights, as set forth
in the instructions we have provided to you for your  distribution to beneficial
owners.  If  the  beneficial  owner  so  instructs,   you  should  complete  the
appropriate Subscription  Certificates and submit them to the subscription agent
with the proper payment. If you hold common shares for the accounts of more than
one  beneficial  owner,  you may exercise the number of  subscription  rights to
which all such  beneficial  owners in the  aggregate  otherwise  would have been
entitled had they been direct record  holders of our common shares on the record
date,  provided that you, as a nominee record  holder,  make a proper showing to
the   subscription   agent  by  submitting  the  form  entitled  Nominee  Holder
Certification which we will provide to you with your offering materials.

NOTICE TO BENEFICIAL OWNERS

            If you are a beneficial  owner of our common  shares or will receive
your subscription  rights through a broker,  custodian bank or other nominee, we
will ask your  broker,  custodian  bank or other  nominee  to notify you of this
offering.  If you wish to exercise your  subscription  rights,  you will need to
have your  broker,  custodian  bank or other  nominee  act for you.  If you hold
certificates of our common shares directly and would prefer to have your broker,
custodian bank or other nominee exercise your  subscription  rights,  you should
contact  your  nominee  and  request it to effect the  transaction  for you.  To
indicate  your  decision with respect to your  subscription  rights,  you should
complete and return to your  broker,  custodian  bank or other  nominee the form
entitled  Beneficial Owner Election Form. You should receive this form from your
broker,  custodian bank or other nominee with the other offering  materials.  If
you wish to obtain a separate Subscription  Certificate,  you should contact the
nominee as soon as possible and request that a separate Subscription Certificate
be issued to you.

                                       26





COMMON SHARES OUTSTANDING AFTER THIS OFFERING

            Upon the  issuance  of the common  shares  offered in this  offering
(assuming that all of the subscription  rights are exercised),  2,154,702 common
shares will be issued and  outstanding.  This would represent an approximate 33%
increase in the number of outstanding  common shares.  If only 10% or 50% of the
subscription  rights are exercised,  then 1,669,894 and 1,885,364  common shares
will be issued and outstanding, respectively, which represents an approximate 3%
and 17% increase in the number of outstanding common shares, respectively.

SUBSCRIPTION AGENT

            We have appointed Mellon Investor Services LLC as subscription agent
for this offering. We will pay the fees and certain expenses of the subscription
agent,  which we estimate will total  approximately  $__________.  Under certain
circumstances,  we may indemnify the subscription agent from certain liabilities
that may arise in connection with this offering.

INFORMATION AGENT

            We have appointed Mellon Investor  Services LLC as information agent
for this offering.  We will pay the fees and certain expenses of the information
agent,  which we estimate will total  approximately  $__________.  Under certain
circumstances,  we may indemnify the information agent from certain  liabilities
that may arise in connection with this offering.

FEES AND EXPENSES

            Other  than  for  fees  charged  by the  information  agent  and the
subscription agent, you are responsible for paying any other commissions,  fees,
taxes or  other  expenses  incurred  in  connection  with  the  exercise  of the
subscription  rights.  Neither we, the  information  agent nor the  subscription
agent will pay such expenses.

NO BOARD RECOMMENDATION

            An investment  in our common  shares must be made  according to each
investor's  evaluation  of its own best  interests.  Accordingly,  our  Board of
Directors  makes no  recommendation  to rights  holders  regarding  whether they
should  exercise  their  subscription  rights.  At a  meeting  of our  Board  of
Directors  convened  to  determine  the  terms  of the  proposed  offering,  our
directors  advised  the  Company  that,  as to  the  shares  owned  directly  or
indirectly  by them,  they intend to exercise the basic  subscription  privilege
under rights received and might exercise their  oversubscription  privilege with
respect to  additional  shares that might become  available  for  purchase.  The
expressed intention of the directors does not constitute a binding obligation on
their part. John C. Ferrara (Chief Executive Officer and Director), Marc Gabelli
(Chairman of the Board of Directors and 5% holder),  E. Val Cerutti  (Director),
Avrum  Gray  (Director)  and  Anthony  R.  Pustorino   (Director)   collectively
beneficially own 349,198 common shares or 21.6% of the common shares outstanding
as of August  31,  2005.  Assuming  that  each of the  persons  mentioned  above
exercises his basic  subscription  privilege in full, they will collectively own
an additional  116,401 common shares,  or a total of 465,599 common shares after
this offering is completed.

                                       27





IF YOU HAVE QUESTIONS ABOUT EXERCISING RIGHTS

            If you have  questions or need  assistance  concerning the procedure
for exercising  subscription  rights,  or if you would like additional copies of
this prospectus or other forms related to this offering,  you should contact the
information agent at the following address and telephone number:

BY UNITED STATES MAIL DELIVERY:      BY OVERNIGHT COURIER:               BY HAND:
- ------------------------------       --------------------                -------
Mellon Investor Services LLC         Mellon Investor Services LLC        Mellon Investor Services LLC
Post Office Box 3301                 480 Washington Blvd.                120 Broadway, 13th Floor
South Hackensack, NJ 07606           Mail Drop - Reorg                   New York, NY 10271
Attn: Reorganization Department      Jersey City, NJ 07310               Attn: Reorganization
                                     Attn: Reorganization                Department
                                     Department

                       Toll Free Telephone: (866) 340-1578
                Direct Line for Banks and Brokers: (201) 680-6579

             MATERIAL UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

            The following  discussion is a summary of the material U.S.  federal
income tax  consequences  of (i) the  dividend by us of  subscription  rights to
holders of common  shares  that hold such common  shares as a capital  asset for
federal  income  tax  purposes,  and  (ii) the  exercise  of such  rights.  This
discussion is based on laws, regulations, rulings and decisions in effect on the
date of this  prospectus,  all of which are  subject  to change  (possibly  with
retroactive  effect) and to differing  interpretations.  This discussion applies
only to holders that are U.S. persons, which is defined as a citizen or resident
of the United States, a domestic partnership, a domestic corporation, any estate
(other  than a  foreign  estate),  and any trust so long as a court  within  the
United States is able to exercise primary supervision over the administration of
the  trust  and one or more U.S.  persons  have the  authority  to  control  all
substantial decisions of the trust.  Generally,  for federal income tax purposes
an estate is  classified  as a "foreign  estate"  based on the  location  of the
estate assets, the country of the estate's domiciliary  administration,  and the
nationality and residency of the domiciliary's personal representative.

            This  discussion  does not  address  all  aspects of federal  income
taxation  that  may  be  relevant  to  holders  in  light  of  their  particular
circumstances  or to holders who may be subject to special tax  treatment  under
the Internal Revenue Code of 1986, as amended,  including  holders of options or
warrants,  holders who are dealers in  securities or foreign  currency,  foreign
persons (defined as all persons other than U.S. persons),  insurance  companies,
tax-exempt organizations, banks, financial institutions, broker-dealers, holders
who hold common  shares as part of a hedge,  straddle,  conversion or other risk
reduction transaction, or who acquired common shares pursuant to the exercise of
compensatory share options or warrants or otherwise as compensation.

                                       28





            We have not  sought,  and will not seek,  an opinion of counsel or a
ruling from the  Internal  Revenue  Service  regarding  the  federal  income tax
consequences  of the  distribution  of the rights or the related share issuance.
The following  summary does not address the tax consequences of the distribution
of the rights or the related share issuance under foreign,  state,  or local tax
laws.  ACCORDINGLY,  EACH  HOLDER OF COMMON  SHARES  SHOULD  CONSULT ITS OWN TAX
ADVISOR WITH RESPECT TO THE PARTICULAR TAX  CONSEQUENCES OF THE  DISTRIBUTION OF
THE RIGHTS OR THE RELATED COMMON SHARE ISSUANCE TO SUCH HOLDER.

            The federal income tax consequences for a holder of common shares on
the  receipt of  subscription  rights  and the  exercise  of such  rights are as
follows:

     o      A holder will not recognize  taxable  income for federal  income tax
            purposes in connection with the receipt of subscription rights.

     o      Except as provided in the following  sentence,  the tax basis of the
            subscription rights received by a holder will be zero. If either (i)
            the fair market  value of the  subscription  rights on the date such
            subscription  rights are distributed is equal to at least 15% of the
            fair market value on such date of the common  shares with respect to
            which  the  subscription  rights  are  received  or (ii) the  holder
            irrevocably  elects,  by attaching a statement to its federal income
            tax return for the taxable year in which the subscription rights are
            received, to allocate part of the tax basis of such common shares to
            the  subscription  rights,  then upon  exercise of the  subscription
            rights,  the  holder's  tax  basis  in the  common  shares  will  be
            allocated  between the common shares and the subscription  rights in
            proportion  to their  respective  fair market values on the date the
            subscription  rights are distributed.  A holder's holding period for
            the  subscription  rights received will include the holder's holding
            period for the common shares with respect to which the  subscription
            rights were  received.  We intend to notify the holders  whether the
            fair market  value of the  subscription  rights will equal or exceed
            15% of the fair  market  value of the  common  shares  to which  the
            subscription  rights  relate  and the  fair  market  value  of those
            subscription   rights.   Notification   will  be  made  by   written
            communication that will be included with the share certificates that
            are mailed to those holders who exercise their subscription  rights.
            Holders  should be aware that the  Internal  Revenue  Service is not
            bound by our valuation of the subscription rights.

     o      A holder that sells the subscription  rights will recognize  capital
            gain or loss, depending on the amount realized upon the sale and the
            holder's tax basis (if any) in the subscription  rights. The gain or
            loss will be  long-term  or  short-term  depending  on the  holder's
            holding period for the subscription rights (discussed above).

     o      A holder that allows the subscription rights received to expire will
            not  recognize  any gain or loss,  and the tax  basis of the  common
            shares owned by such holder with respect to which such  subscription
            rights  were  distributed  will be  equal  to the tax  basis of such
            common  shares  immediately  before the receipt of the  subscription
            rights.

     o      A holder will not  recognize  any gain or loss upon the  exercise of
            the subscription rights.

                                       29





     o      The tax basis of the common shares acquired  through exercise of the
            subscription rights will equal the sum of the subscription price for
            the  common  shares  and the  holder's  tax  basis,  if any,  in the
            subscription rights as described above.

     o      The holding period for the common shares acquired  through  exercise
            of the  subscription  rights will begin on the date the subscription
            rights are exercised.

            Holders who exercise their  subscription  rights will be required to
furnish  a  Substitute  Form  W-9  (which  appears  as part of the  Subscription
Certificate) to avoid the imposition of the 28% backup withholding tax.

                              PLAN OF DISTRIBUTION

            We are offering our common shares  underlying the rights directly to
you. We have not employed any brokers,  dealers or  underwriters  in  connection
with the solicitation or exercise of subscription rights in this offering and no
commissions,  fees or discounts  will be paid in connection  with this offering.
Mellon Investor  Services LLC is acting as our subscription  agent to effect the
exercise  of the  rights  and the  issuance  of the  underlying  common  shares.
Therefore,  we anticipate that our officers' and employees' role will be limited
to:

     o      Responding  to  inquiries  of  potential  purchasers,  provided  the
            response is limited to  information  contained  in the  registration
            statement of which this prospectus is a part; and
     o      Ministerial  and clerical  work  involved in effecting  transactions
            pertaining to the sale of common shares underlying the rights.

            We intend to  distribute  and deliver this  prospectus by hand or by
mail  only,  and not by  electronic  delivery.  Also,  we intend to use  printed
prospectuses only, and not any other forms of prospectus.

            We have  distributed  to the holders of record of our common shares,
at the close of business on  __________,  2005, at no charge,  one  transferable
subscription  right for each common share they own. Every three such rights will
entitle  the holder  thereof to  subscribe  for a right to  purchase  one of our
common shares at a subscription  price of $_____ per share. You may exercise any
number of your  subscription  rights,  or you may  choose  not to  exercise  any
subscription  rights. We will not distribute any fractional common shares or pay
cash in lieu of fractional common shares, but will round up the aggregate number
of common shares you are entitled to receive to the nearest whole number.

            We do not expect that all of our  shareholders  will exercise all of
their basic subscription privileges. By extending oversubscription privileges to
our record date  shareholders,  we are providing such shareholders that exercise
all of their basic  subscription  privileges  with the  opportunity  to purchase
those common shares that are not purchased by other shareholders.

            If you wish to exercise your oversubscription  privilege, you should
indicate the number of additional  common shares that you would like to purchase
(not to  exceed  the  number  purchased  by you  under  the  basic  subscription
privilege) in the space provided on your Subscription Certificate. When you send
in your Subscription Certificate, you must also send the full purchase price for

                                       30





the number of additional  common shares that you have  requested to purchase (in
addition to the  payment  due for common  shares  purchased  through  your basic
subscription  privilege).  If the number of common  shares  remaining  after the
exercise of all basic  subscription  privileges is not sufficient to satisfy all
requests for common shares pursuant to oversubscription  privileges, you will be
allocated   additional  common  shares  pro  rata  (subject  to  elimination  of
fractional  common  shares),  based on the number of common shares you purchased
through the basic  subscription  privilege in  proportion to the total number of
common shares that you and other oversubscribing  shareholders purchased through
the basic subscription  privilege.  However, if your pro rata allocation exceeds
the number of common shares you requested on your Subscription Certificate, then
you will receive only the number of common  shares that you  requested,  and the
remaining  common  shares from your pro rata  allocation  will be divided  among
other rights holders exercising their oversubscription privileges.

            As soon as practicable  after the expiration  date,  Mellon Investor
Services LLC, acting as our subscription agent, and we will determine the number
of  common  shares  that  you  may  purchase  pursuant  to the  oversubscription
privilege.  You will receive  certificates  representing  these common shares as
soon as practicable  after the expiration date,  anticipated to be approximately
seven to 10 business days after the expiration  date. If you request and pay for
more common shares than are  allocated to you, we will refund that  overpayment,
without  interest.  In  connection  with the  exercise  of the  oversubscription
privilege,  banks,  brokers and other nominee holders of subscription rights who
act on behalf of beneficial  owners will be required to certify to us and to the
subscription  agent as to the aggregate number of subscription  rights that have
been exercised, and the number of common shares that are being requested through
the  oversubscription  privilege,  by each beneficial  owner on whose behalf the
nominee holder is acting.

            We will pay Mellon Investor Services LLC, as the information  agent,
a fee of approximately  $______ plus expenses,  and as the subscription agent, a
fee of  approximately  $________ plus  expenses,  for its services in connection
with  this   offering.   We  also  have  agreed  to  indemnify,   under  certain
circumstances,  Mellon  Investor  Services  LLC, in its capacity as  information
agent and subscription agent, from any liability it may incur in connection with
this offering.

            Our  subscription  rights  will  be  listed  on the  American  Stock
Exchange  under the symbol  "LGL.RT." Our common shares issued upon the exercise
of  subscription  rights will be listed on the American Stock Exchange under the
symbol  "LGL," the same symbol  under  which our  currently  outstanding  common
shares now trade.

                                  LEGAL MATTERS

            The  validity of the common  shares  offered  hereby has been passed
upon by Olshan  Grundman Frome  Rosenzweig & Wolosky LLP, Park Avenue Tower,  65
East 55th Street, New York, New York 10022.

                                       31





                                     EXPERTS

            Ernst & Young LLP,  independent  registered  public accounting firm,
has audited our consolidated  financial statements and schedules included in our
Annual Report on Form 10-K for the year ended December 31, 2004, as set forth in
their report, which is incorporated by reference in this registration statement.
Our financial statements and schedules are incorporated by reference in reliance
on Ernst & Young LLP's report, given on their authority as experts in accounting
and auditing.

                   INFORMATION WITH RESPECT TO THE REGISTRANT

            This prospectus is accompanied by a copy of our latest Annual Report
on Form 10-K and Quarterly Report on Form 10-Q.

                       WHERE YOU CAN FIND MORE INFORMATION

            We have filed a registration  statement on Form S-2 with the SEC for
our common shares offered in this offering. This prospectus does not contain all
the information set forth in the registration statement. You should refer to the
registration statement and its exhibits for additional information.  Whenever we
make references in this prospectus to any of our contracts,  agreements or other
documents,  the references are not necessarily  complete and you should refer to
the exhibits attached to the registration statement for the copies of the actual
contract, agreement or other document.

            The  SEC  maintains  an  Internet  site at  http://www.sec.gov  that
contains  reports,  proxy and  information  statements,  and  other  information
regarding  us. You may also read and copy any  document  we file with the SEC at
its Public  Reference Room at 450 Fifth Street,  N.W.,  Washington,  D.C. 20549.
Please call the SEC at 1-800-SEC-0330  for further  information on the operation
of the Public Reference Room.

            Our common shares are listed on the American  Stock Exchange and our
reports and other  information  about us may also be inspected at the offices of
the  American  Stock  Exchange at 86 Trinity  Place,  New York,  New York 10006.
Additional  information  about us is available over the Internet at our web site
at WWW.LYNCHCORP.COM.

                           INCORPORATION BY REFERENCE

            The following documents filed by us with the SEC are incorporated by
reference in this prospectus:

(1)   Our Annual  Report on Form 10-K for the fiscal  year  ended  December  31,
      2004;
(2)   Our Quarterly  Report on Form 10-Q for the fiscal  quarter ended March 31,
      2005;
(3)   Our  Quarterly  Report on Form 10-Q for the fiscal  quarter ended June 30,
      2005;
(4)   Our Current Report on Form 8-K/A filed on January 3, 2005;
(5)   Our Current Report on Form 8-K filed on January 4, 2005;
(6)   Our Current Report on Form 8-K filed on April 29, 2005;
(7)   Our Current Report on Form 8-K filed on May 16, 2005;
(8)   Our Current Report on Form 8-K filed on July 6, 2005;

                                       32





(9)   Our Current Report on Form 8-K filed on August 30, 2005;
(10)  Our Current Report on Form 8-K filed on September 9, 2005;
(11)  Our Current Report on Form 8-K filed on October 4, 2005; and
(12)  Our Current Report on Form 8-K filed on October 11, 2005.

            You may request a copy of these filings  (excluding  the exhibits to
such filings  that we have not  specifically  incorporated  by reference in such
filings) at no cost, by writing or telephoning us as follows:

                                Lynch Corporation
                         140 Greenwich Avenue, 4th Floor
                          Greenwich, Connecticut 06830
                              Attention: Secretary
                                 (203) 622-1150

                                       33





                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14.    OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

            The  following  table sets forth the various  expenses  that will be
paid  by us in  connection  with  the  securities  being  registered.  With  the
exception of the Securities and Exchange Commission ("SEC") registration fee and
the  American  Stock  Exchange  ("AMEX")  listing  fee,  all  amounts  shown are
estimates.

SEC registration fee................................    $               525.60
AMEX listing fee....................................    $            10,783.52
Printing and engraving..............................    $            30,000.00
Legal fees and expenses (including Blue Sky fees)...    $            50,000.00
Accounting Fees and Expenses........................    $            10,000.00
Miscellaneous.......................................    $             5,000.00
Subscription Agent..................................    $            30,000.00
Information Agent...................................    $            10,000.00
                                                      --------------------------
            Total...................................    $           146,309.12

ITEM 15.    INDEMNIFICATION OF DIRECTORS AND OFFICERS.

            Except  as  hereinafter  set  forth,  there is no  statute,  charter
provision,  by-law,  contract or other  arrangement  under which any controlling
person,  director  or officer of the  Company is insured or  indemnified  in any
manner against liability which he may incur in his capacity as such.

            Article  VI,  Section  6.2  of  Registrant's  Restated  Articles  of
Incorporation  provides that to the extent not inconsistent with applicable law,
every  director  and officer  shall be  indemnified  by  Registrant  against all
liability  and  reasonable  expense  that may be  incurred  by such  director or
officer in connection with or resulting from any claim,  (i) if such director or
officer is wholly  successful  with respect to the claim,  or (ii) if not wholly
successful, then if such director or officer is determined to have acted in good
faith,  in what the  director  or  officer  reasonably  believed  to be the best
interests of  Registrant  or at least not opposed to its best  interest  and, in
addition,  with  respect  to any  criminal  claim  is  determined  to  have  had
reasonable  cause to believe  that his conduct  was lawful or had no  reasonable
cause to believe that his conduct was unlawful. The termination of any claim, by
judgment,  order,  settlement  (whether  with or  without  court  approval),  or
conviction or upon a plea of guilty or of nolo  contendere,  or its  equivalent,
shall not  create a  presumption  that a director  or  officer  did not meet the
standards  of  conduct  set forth in clause  (ii)  hereof.  For a more  detailed
description,  reference is made to Article VI,  Section 6.2 of the  Registrant's
Restated  Articles of Incorporation  filed as Exhibit 3(a) hereto which contains
certain  indemnification  provisions  pursuant  to  authority  contained  in the
Indiana Business Corporation Law.

            Registrant's   directors   and  officers  are  also  covered   under
Registrant's  directors  and  officers  insurance  policy up to a maximum of $10
million.

                                      II-1





            Insofar  as  indemnification   for  liabilities  arising  under  the
Securities  Act of 1933 may be  permitted  to  directors,  officers  or  persons
controlling the Registrant pursuant to the foregoing provisions,  the Registrant
has been informed that in the opinion of the Securities and Exchange  Commission
such indemnification is against public policy as expressed in the Securities Act
of 1933 and is therefore unenforceable.

            The  following  sections  of  Chapter  37 of  the  Indiana  Business
Corporation Law provide as follows:

Section 23-1-37-8  Permissive Indemnification

            (a) A  corporation  may  indemnify an  individual  made a party to a
proceeding  because  the  individual  is or  was a  director  against  liability
incurred in the proceeding if:

            (1) the individual's conduct was in good faith; and

            (2) the individual reasonably believed:

                (A) in the case of conduct in the individual's official capacity
with the corporation,  that the individual's  conduct was in its best interests;
and

                (B) in all other  cases,  that the  individual's  conduct was at
least not opposed to its best interests; and

            (3) in the case of any criminal proceeding, the individual either:

                (A) had reasonable cause to believe the individual's conduct was
lawful; or

                (B) had no reasonable cause to believe the individual's  conduct
was unlawful.

            (b) A director's  conduct  with respect to an employee  benefit plan
for a purpose the  director  reasonably  believed to be in the  interests of the
participants  in and  beneficiaries  of the plan is conduct that  satisfies  the
requirement of subsection (a)(2)(B).

            (c) The termination of a proceeding by judgment,  order, settlement,
conviction,  or upon a plea of nolo  contendere  or its  equivalent  is not,  of
itself,  determinative  that the  director  did not meet the standard of conduct
described in this section.

Section 23-1-37-9  Mandatory Indemnification

            Unless limited by its articles of incorporation, a corporation shall
indemnify a director who was wholly successful,  on the merits or otherwise,  in
the defense of any  proceeding  to which the  director  was a party  because the
director is or was a director of the  corporation  against  reasonable  expenses
incurred by the director in connection with the proceeding.

Section 23-1-37-10  Advance Indemnification

            (a) A corporation  may pay for or reimburse the reasonable  expenses
incurred  by a  director  who is a party to a  proceeding  in  advance  of final
disposition of the proceeding if:

                                      II-2





            (1) the director furnishes the corporation a written  affirmation of
the  director's  good faith  belief that the  director  has met the  standard of
conduct described in section 8 of this chapter;

            (2) the director  furnishes the  corporation a written  undertaking,
executed  personally or on the director's  behalf, to repay the advance if it is
ultimately  determined  that the  director did not meet the standard of conduct;
and

            (3) a  determination  is made  that the  facts  then  known to those
making the determination would not preclude indemnification under this chapter.

            (b)  The  undertaking  required  by  subsection  (a)(2)  must  be an
unlimited general  obligation of the director but need not be secured and may be
accepted without reference to financial ability to make repayment.

            (c) Determinations and authorizations of payments under this section
shall be made in the manner specified in section 12 of this chapter.

Section 23-1-37-11  Application for Indemnification

            Unless a corporation's  articles of incorporation provide otherwise,
a  director  of the  corporation  who is a party to a  proceeding  may apply for
indemnification  to the court  conducting  the proceeding or to another court of
competent jurisdiction. On receipt of an application, the court after giving any
notice the court considers necessary may order indemnification if it determines:

            (1) the  director  is entitled to  mandatory  indemnification  under
section  9 of this  chapter,  in which  case the  court  shall  also  order  the
corporation  to pay  the  director's  reasonable  expenses  incurred  to  obtain
court-ordered indemnification; or

            (2)  the   director   is   fairly   and   reasonably   entitled   to
indemnification  in view of all the relevant  circumstances,  whether or not the
director met the standard of conduct set forth in section 8 of this chapter.

Section 23-1-37-12  Procedure for Determining Indemnification

            (a) A corporation  may not  indemnify a director  under section 8 of
this chapter unless  authorized in the specific case after a  determination  has
been  made  that   indemnification   of  the  director  is  permissible  in  the
circumstances  because the director has met the standard of conduct set forth in
section 8 of this chapter.

            (b) The determination  shall be made by any one (1) of the following
procedures:

                 (1) By the  board of  directors  by  majority  vote of a quorum
consisting of directors not at the time parties to the proceeding.

                 (2) If a quorum cannot be obtained  under  subdivision  (1), by
majority vote of a committee duly designated by the board of directors (in which

                                      II-3





designation directors who are parties may participate), consisting solely of two
(2) or more directors not at the time parties to the proceeding.

                 (3) By special legal counsel:

                     (A) selected by the board of directors or its  committee in
the manner prescribed in subdivision (1) or (2); or

                     (B) if a  quorum  of  the  board  of  directors  cannot  be
obtained  under  subdivision  (1) and a  committee  cannot be  designated  under
subdivision  (2),  selected by majority  vote of the full board of directors (in
which selection directors who are parties may participate).

                 (4) By the  shareholders,  but common  shares owned by or voted
under the control of directors who are at the time parties to the proceeding may
not be voted on the determination.

            (d)   Authorization   of   indemnification   and  evaluation  as  to
reasonableness of expenses shall be made in the same manner as the determination
that indemnification is permissible, except that if the determination is made by
special legal counsel,  authorization  of  indemnification  and evaluation as to
reasonableness  of expenses  shall be made by those  entitled  under  subsection
(b)(3) to select counsel.

Section 23-1-37-13  Indemnification of Officers, Agents and Employees

            Unless a corporation's articles of incorporation provide otherwise:

            (1) an officer of the  corporation,  whether or not a  director,  is
entitled to mandatory  indemnification  under section 9 of this chapter,  and is
entitled to apply for  court-ordered  indemnification  under  section 11 of this
chapter, in each case to the same extent as a director;

            (2) the  corporation  may indemnify and advance  expenses under this
chapter to an officer,  employee, or agent of the corporation,  whether or not a
director, to the same extent as to a director; and

            (3) a  corporation  may also  indemnify  and advance  expenses to an
officer,  employee,  or  agent,  whether  or  not a  director,  to  the  extent,
consistent  with  public  policy,  that  may  be  provided  by its  articles  of
incorporation,  bylaws, general or specific action of its board of directors, or
contract.

Section 23-1-37-14  Insurance

            A  corporation  may purchase and maintain  insurance on behalf of an
individual  who  is or  was a  director,  officer,  employee,  or  agent  of the
corporation,  or who,  while a  director,  officer,  employee,  or  agent of the
corporation,  is or was serving at the request of the corporation as a director,
officer,  partner,  member,  manager,  trustee,  employee,  or agent of  another
foreign or domestic corporation,  partnership,  limited liability company, joint
venture,  trust,  employee benefit plan, or other enterprise,  against liability
asserted  against or incurred by the individual in that capacity or arising from
the individual's status as a director,  officer,  member, manager,  employee, or

                                      II-4





agent,  whether  or not the  corporation  would  have  power  to  indemnify  the
individual against the same liability under section 8 or 9 of this chapter. The:

                 (4) corporation may purchase insurance under this section from;
and

                 insurance  purchased  under this  section may be  reinsured  in
whole or in part by;

an insurer that is owned by or otherwise affiliated with the corporation whether
the insurer does or does not do business with other persons.

Section 23-1-37-15  Indemnification Under Chapter Not Exclusive

            (a) The  indemnification  and advance for  expenses  provided for or
authorized by this chapter does not exclude any other rights to  indemnification
and advance for expenses that a person may have under:

            (1) a corporation's articles of incorporation or bylaws;

            (2) a resolution  of the board of directors or of the  shareholders;
or

            (3) any other  authorization,  whenever adopted,  after notice, by a
majority vote of all the voting common shares then issued and outstanding.

            (b) If the articles of  incorporation,  bylaws,  resolutions  of the
board of directors or of the shareholders,  or other duly adopted  authorization
of indemnification or advance for expenses limit  indemnification or advance for
expenses,  indemnification and advance for expenses are valid only to the extent
consistent with the articles, bylaws, resolution of the board of directors or of
the  shareholders,  or other duly adopted  authorization of  indemnification  or
advance for expenses.

            (c) This  chapter  does not  limit a  corporation's  power to pay or
reimburse  expenses  incurred  by a  director,  officer,  employee,  or agent in
connection  with the person's  appearance as a witness in a proceeding at a time
when the  person  has not  been  made a named  defendant  or  respondent  to the
proceeding.

ITEM 16.    EXHIBITS.

EXHIBIT
  NO.                               DESCRIPTION
- -------                             -----------

  3(a)      Restated  Articles of Incorporation of the Company  (incorporated by
            reference to Exhibit  3(a) to the  Company's  Annual  Report on Form
            10-K for the period ended December 31, 2004).
   (b)      Articles  of  Amendment  of the  Articles  of  Incorporation  of the
            Company  (incorporated by reference to Exhibit 3(b) to the Company's
            Annual Report on Form 10-K for the period ended December 31, 2004).
   (c)      By-laws of the Company  (incorporated by reference to Exhibit 3.1 to
            the Company's Current Report on Form 8-K dated December 22, 2004).
  5**       Opinion of Olshan Grundman Frome Rosenzweig & Wolosky LLP.
 10(a)      Lynch Corporation  401(k) Savings Plan (incorporated by reference to
            Exhibit  10(b) to the  Company's  Annual Report on Form 10-K for the
            period ended December 31, 1995).
   (b)      Directors Stock Plan  (incorporated by reference to Exhibit 10(o) to
            the Company's Form 10-K for the year ended December 31, 1997).
   (c)      Lynch  Corporation  2001 Equity  Incentive Plan adopted December 10,
            2001  (incorporated  by reference to Exhibit  10(y) to the Company's
            Form 10-K for the year ended December 31, 2001).
   (d)      Amended and Restated Credit  Agreement by and between Lynch Systems,
            Inc. and SunTrust  Bank dated as of June 10, 2002  (incorporated  by
            reference to Exhibit 10(z) to the  Company's  Form 10-K for the year
            ended December 31, 2002).
   (e)      Unlimited   Continuing   Guaranty  Agreement  by  Guarantor,   Lynch
            Corporation,  dated June 10,  2002  (incorporated  by  reference  to
            Exhibit  10(aa)  to the  Company's  Form  10-K  for the  year  ended
            December 31, 2002).
   (f)      First Amendment and Waiver to Amended and Restated Credit  Agreement
            between  Lynch  Systems,  Inc. and SunTrust  Bank dated May 30, 2003
            (incorporated  by reference to Exhibit  10(ee) to the Company's Form
            10-Q for the period ending June 30, 2003).
   (g)      Term Loan Promissory  Note between Lynch Systems,  Inc. and SunTrust
            Bank dated  August 4, 2003  (incorporated  by  reference  to Exhibit
            10(ff) to the  Company's  Form 10-Q for the period  ending  June 30,
            2003).
   (h)      Second Amendment to Security Deed and Agreement dated August 4, 2003
            between  Lynch  Systems,  Inc. and SunTrust  Bank  (incorporated  by
            reference  to  Exhibit  10(gg)  to the  Company's  Form 10-Q for the
            period ending June 30, 2003).
   (i)      Mortgage  dated  October 21, 2002 by  Mortgagor,  Mtron  Industries,
            Inc.,  to  Mortgagee,   Yankton  Area   Progressive   Growth,   Inc.
            (incorporated by reference to Exhibit 10(hh) to the Company's Annual
            Report on Form 10-K for the year ended December 31, 2003).
   (j)      Promissory  Note  between  Mtron  Industries,  Inc. and Yankton Area
            Progressive  Growth,  Inc., dated October 21, 2002  (incorporated by
            reference to Exhibit  10(ii) to the Company's  Annual Report on Form
            10-K for the year ended December 31, 2003).
   (k)      Standard Loan  Agreement by and between Mtron  Industries,  Inc. and
            Areawide Business Council, Inc., dated October 10, 2002 and Exhibits
            thereto   (incorporated  by  reference  to  Exhibit  10(jj)  to  the
            Company's Annual Report on Form 10-K for the year ended December 31,
            2003).
   (l)      Loan  Agreement  by and between  Mtron  Industries,  Inc.  and South
            Dakota  Board of  Economic  Development,  dated  December  19,  2002
            (incorporated by reference to Exhibit 10(kk) to the Company's Annual
            Report on Form 10-K for the year ended December 31, 2003).
   (m)      Promissory  Note  between  Mtron  Industries,  Inc. and South Dakota
            Board of Economic Development, dated December 19, 2002 (incorporated
            by reference to Exhibit  10(ll) to the  Company's  Annual  Report on
            Form 10-K for the year ended December 31, 2003).
   (n)      Employment Agreement by and between Mtron Industries, Inc. and South
            Dakota  Board of  Economic  Development,  dated  December  19,  2002

                                      II-6





            (incorporated by reference to Exhibit 10(mm) to the Company's Annual
            Report on Form 10-K for the year ended December 31, 2003).
   (o)      Loan  Agreement  by  and  among  Mtron   Industries,   Inc.,   Piezo
            Technology,  Inc. and First National Bank of Omaha  (incorporated by
            reference to Exhibit 10.1 to the  Company's  Current  Report on Form
            8-K dated October 20, 2004).
   (p)      Unconditional  Guaranty  for  Payment  and  Performance  with  First
            National Bank of Omaha (incorporated by reference to Exhibit 10.2 to
            the Company's Current Report on Form 8-K dated October 20, 2004).
   (q)      Registration Rights Agreement by and between the Company and Venator
            Merchant  Fund,  L.P.  dated  October  15,  2004   (incorporated  by
            reference to Exhibit 10.4 to the  Company's  Current  Report on Form
            8-K dated October 20, 2004).
 13(a)      Annual Report to Shareholders for the year ended December 31, 2004.
   (b)      Form 10-Q for the quarter ended June 30, 2005.
 23(a)*     Consent of Independent  Registered  Public Accounting Firm - Ernst &
            Young LLP.
   (b)**    Consent of Olshan Grundman Frome  Rosenzweig & Wolosky LLP (included
            in Exhibit 5).
 24*        Powers of Attorney.
 99(a)*     Form of  Instructions  for  Use of  Lynch  Corporation  Subscription
            Certificates.
   (b)*     Form of Notice of Guaranteed Delivery for Subscription Certificates.
   (c)*     Form of Letter to Shareholders.
   (d)*     Form of  Letter  to  Securities  Dealers,  Commercial  Banks,  Trust
            Companies and Other Nominees.
   (e)*     Form of Letter to Clients of  Security  Holders  Who Are  Beneficial
            Holders.
   (f)**    Form of Nominee Holder Certification Form.
   (g)**    Beneficial Owner Election Form.
   (h)**    Guidelines for  Certification of Taxpayer  Identification  Number on
            Substitute Form W-9.
   (i)*     Form of Subscription and Information  Agent Agreement  between Lynch
            Corporation and Mellon Bank, N.A.
   (j)*     Form of Subscription Certificate.

- ----------------------
*     Filed herewith
**    Previously filed


ITEM 17.    UNDERTAKINGS.

(a)         The undersigned registrant hereby undertakes:

   (1)  To file,  during any period in which  offers or sales are being made,  a
        post-effective amendment to this registration statement:

          (i)  to include any  prospectus  required  by Section  10(a)(3) of the
               Securities Act of 1933;

          (ii) to reflect in the  prospectus  any facts or events  arising after
               the  effective  date of the  registration  statement (or the most
               recent post-effective  amendment thereof) which,  individually or

                                      II-7





               in  the  aggregate,   represent  a  fundamental   change  in  the
               information   set   forth   in   the   registration    statement.
               Notwithstanding the foregoing, any increase or decrease in volume
               of  securities  offered (if the total dollar value of  securities
               offered  would not  exceed  that  which was  registered)  and any
               deviation  from  the low or  high  end of the  estimated  maximum
               offering  range may be reflected in the form of prospectus  filed
               with the Commission pursuant to Rule 424(b) if, in the aggregate,
               the changes in volume and price represent no more than 20 percent
               change in the maximum  aggregate  offering price set forth in the
               "Calculation  of   Registration   Fee"  table  in  the  effective
               registration statement; and

         (iii) to include any material  information  with respect to the plan of
               distribution   not  previously   disclosed  in  the  registration
               statement  or any  material  change  to such  information  in the
               registration statement;

   (2)  That, for the purpose of determining  any liability under the Securities
        Act,  each  such  post-effective  amendment  shall be deemed to be a new
        registration  statement relating to the securities offered therein,  and
        the offering of such  securities  at that time shall be deemed to be the
        initial BONA FIDE offering thereof.

   (3)  To remove from  registration by means of a post-effective  amendment any
        of  the  securities   being   registered  which  remain  unsold  at  the
        termination of the offering.

(e)   The  undersigned  registrant  hereby  undertakes to deliver or cause to be
      delivered  with the  prospectus,  to each person to whom the prospectus is
      sent or given,  the latest  annual  report,  to security  holders  that is
      incorporated by reference in the prospectus and furnished  pursuant to and
      meeting the  requirements of Rule 14a-3 or Rule 14c-3 under the Securities
      Exchange Act of 1934; and, where interim financial information required to
      be  presented  by  Article  3 of  Regulation  S-X is not set  forth in the
      prospectus,  to deliver,  or cause to be  delivered to each person to whom
      the  prospectus  is sent or given,  the latest  quarterly  report  that is
      specifically  incorporated  by reference in the prospectus to provide such
      interim financial information.

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

                                      II-8





                                   SIGNATURES

            Pursuant to the  requirements  of the  Securities  Act of 1933,  the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-2 and has duly caused this amendment to
the  registration  statement  to be  signed on its  behalf  by the  undersigned,
thereunto duly authorized, in the Town of Greenwich, State of Connecticut on the
12th day of October, 2005.

                                         LYNCH CORPORATION

                                         By: /s/ John C. Ferrara
                                             -----------------------------------
                                                  John C. Ferrara
                                                  Chief Executive Officer

                                POWER OF ATTORNEY

            KNOW ALL MEN BY THESE  PRESENTS,  that each person  whose  signature
appears below  constitutes  and appoints John C. Ferrara and Eugene Hynes as his
true  and  lawful  attorney-in-fact,  each  acting  alone,  with  full  power of
substitution and resubstitution for him and in his name, place and stead, in any
and all  capacities,  to sign any and all amendments,  including  post-effective
amendments  to  this  registration  statement,   and  any  related  registration
statement  filed  pursuant to Rule 462(b) of the Act and to file the same,  with
exhibits  thereto,  and  other  documents  in  connection  therewith,  with  the
Securities  and Exchange  Commission,  hereby  ratifying and confirming all that
said attorneys-in-fact or their substitutes,  each acting along, may lawfully do
or cause to be done by virtue hereof.

            Pursuant to the  requirements  of the Securities  Act of 1933,  this
amendment to the  registration  statement has been signed below by the following
persons in the capacities and on the dates indicated.

          SIGNATURE                        TITLE                             DATE
          ---------                        -----                             ----

/s/ John C. Ferrara
- --------------------------    Chief Executive Officer and Director      October 12, 2005
John C. Ferrara               (Principal Executive Officer)

* /s/ John C. Ferrara
- --------------------------    Vice President, Treasurer and Secretary   October 12, 2005
Eugene Hynes                  (Principal Financial and Accounting
                              Officer)

* /s/ John C. Ferrara
- -------------------------     Chairman of the Board of Directors        October 12, 2005
Marc Gabelli

* /s/ John C. Ferrara
- -------------------------     Director                                  October 12, 2005
E. Val Cerutti

* /s/ John C. Ferrara
- -------------------------     Director                                  October 12, 2005
Avrum Gray

* /s/ John C. Ferrara
- -------------------------     Director                                  October 12, 2005
Anthony R. Pustorino

/s/ John C. Ferrara
- ------------------------
*By John C. Ferrara, Attorney-in-Fact

                                      II-9





                              EXHIBIT INDEX

EXHIBIT
  NO.                               DESCRIPTION
- -------                             -----------

  3(a)      Restated  Articles of Incorporation of the Company  (incorporated by
            reference to Exhibit  3(a) to the  Company's  Annual  Report on Form
            10-K for the period ended December 31, 2004).
   (b)      Articles  of  Amendment  of the  Articles  of  Incorporation  of the
            Company  (incorporated by reference to Exhibit 3(b) to the Company's
            Annual Report on Form 10-K for the period ended December 31, 2004).
   (c)      By-laws of the Company  (incorporated by reference to Exhibit 3.1 to
            the Company's Current Report on Form 8-K dated December 22, 2004).
  5**       Opinion of Olshan Grundman Frome Rosenzweig & Wolosky LLP.
 10(a)      Lynch Corporation  401(k) Savings Plan (incorporated by reference to
            Exhibit  10(b) to the  Company's  Annual Report on Form 10-K for the
            period ended December 31, 1995).
   (b)      Directors Stock Plan  (incorporated by reference to Exhibit 10(o) to
            the Company's Form 10-K for the year ended December 31, 1997).
   (c)      Lynch  Corporation  2001 Equity  Incentive Plan adopted December 10,
            2001  (incorporated  by reference to Exhibit  10(y) to the Company's
            Form 10-K for the year ended December 31, 2001).
   (d)      Amended and Restated Credit  Agreement by and between Lynch Systems,
            Inc. and SunTrust  Bank dated as of June 10, 2002  (incorporated  by
            reference to Exhibit 10(z) to the  Company's  Form 10-K for the year
            ended December 31, 2002).
   (e)      Unlimited   Continuing   Guaranty  Agreement  by  Guarantor,   Lynch
            Corporation,  dated June 10,  2002  (incorporated  by  reference  to
            Exhibit  10(aa)  to the  Company's  Form  10-K  for the  year  ended
            December 31, 2002).
   (f)      First Amendment and Waiver to Amended and Restated Credit  Agreement
            between  Lynch  Systems,  Inc. and SunTrust  Bank dated May 30, 2003
            (incorporated  by reference to Exhibit  10(ee) to the Company's Form
            10-Q for the period ending June 30, 2003).
   (g)      Term Loan Promissory  Note between Lynch Systems,  Inc. and SunTrust
            Bank dated  August 4, 2003  (incorporated  by  reference  to Exhibit
            10(ff) to the  Company's  Form 10-Q for the period  ending  June 30,
            2003).
   (h)      Second Amendment to Security Deed and Agreement dated August 4, 2003
            between  Lynch  Systems,  Inc. and SunTrust  Bank  (incorporated  by
            reference  to  Exhibit  10(gg)  to the  Company's  Form 10-Q for the
            period ending June 30, 2003).
   (i)      Mortgage  dated  October 21, 2002 by  Mortgagor,  Mtron  Industries,
            Inc.,  to  Mortgagee,   Yankton  Area   Progressive   Growth,   Inc.
            (incorporated by reference to Exhibit 10(hh) to the Company's Annual
            Report on Form 10-K for the year ended December 31, 2003).
   (j)      Promissory  Note  between  Mtron  Industries,  Inc. and Yankton Area
            Progressive  Growth,  Inc., dated October 21, 2002  (incorporated by
            reference to Exhibit  10(ii) to the Company's  Annual Report on Form
            10-K for the year ended December 31, 2003).
   (k)      Standard Loan  Agreement by and between Mtron  Industries,  Inc. and
            Areawide Business Council, Inc., dated October 10, 2002 and Exhibits
            thereto   (incorporated  by  reference  to  Exhibit  10(jj)  to  the
            Company's Annual Report on Form 10-K for the year ended December 31,
            2003).
   (l)      Loan  Agreement  by and between  Mtron  Industries,  Inc.  and South
            Dakota  Board of  Economic  Development,  dated  December  19,  2002
            (incorporated by reference to Exhibit 10(kk) to the Company's Annual
            Report on Form 10-K for the year ended December 31, 2003).
   (m)      Promissory  Note  between  Mtron  Industries,  Inc. and South Dakota
            Board of Economic Development, dated December 19, 2002 (incorporated
            by reference to Exhibit  10(ll) to the  Company's  Annual  Report on
            Form 10-K for the year ended December 31, 2003).
   (n)      Employment Agreement by and between Mtron Industries, Inc. and South
            Dakota  Board of  Economic  Development,  dated  December  19,  2002







            (incorporated by reference to Exhibit 10(mm) to the Company's Annual
            Report on Form 10-K for the year ended December 31, 2003).
   (o)      Loan  Agreement  by  and  among  Mtron   Industries,   Inc.,   Piezo
            Technology,  Inc. and First National Bank of Omaha  (incorporated by
            reference to Exhibit 10.1 to the  Company's  Current  Report on Form
            8-K dated October 20, 2004).
   (p)      Unconditional  Guaranty  for  Payment  and  Performance  with  First
            National Bank of Omaha (incorporated by reference to Exhibit 10.2 to
            the Company's Current Report on Form 8-K dated October 20, 2004).
   (q)      Registration Rights Agreement by and between the Company and Venator
            Merchant  Fund,  L.P.  dated  October  15,  2004   (incorporated  by
            reference to Exhibit 10.4 to the  Company's  Current  Report on Form
            8-K dated October 20, 2004).
 13(a)      Annual Report to Shareholders for the year ended December 31, 2004.
   (b)      Form 10-Q for the quarter ended June 30, 2005.
 23(a)*     Consent of Independent  Registered  Public Accounting Firm - Ernst &
            Young LLP.
   (b)**    Consent of Olshan Grundman Frome  Rosenzweig & Wolosky LLP (included
            in Exhibit 5).
 24*        Powers of Attorney.
 99(a)*     Form of  Instructions  for  Use of  Lynch  Corporation  Subscription
            Certificates.
   (b)*     Form of Notice of Guaranteed Delivery for Subscription Certificates.
   (c)*     Form of Letter to Shareholders.
   (d)*     Form of  Letter  to  Securities  Dealers,  Commercial  Banks,  Trust
            Companies and Other Nominees.
   (e)*     Form of Letter to Clients of  Security  Holders  Who Are  Beneficial
            Holders.
   (f)**    Form of Nominee Holder Certification Form.
   (g)**    Beneficial Owner Election Form.
   (h)**    Guidelines for  Certification of Taxpayer  Identification  Number on
            Substitute Form W-9.
   (i)*     Form of Subscription and Information  Agent Agreement  between Lynch
            Corporation and Mellon Bank, N.A.
   (j)*     Form of Subscription Certificate.

- ----------------------
*     Filed herewith
**    Previously filed

EX-23

                                                                      EXHIBIT 23

            Consent of Independent Registered Public Accounting Firm

We consent to the reference to our firm under the caption "Experts" in Amendment
No. 4 to the Registration  Statement (S-2 No. 333-126335) and related Prospectus
of Lynch  Corporation for the registration of 538,676 shares of its common stock
and 1,616,026  subscription rights and to the incorporation by reference therein
of our report dated March 16, 2005, except as to Note 4, as to which the date is
March 31,  2005,  with  respect to the  consolidated  financial  statements  and
schedules of Lynch Corporation included in its Annual Report (Form 10-K) for the
year ended December 31, 2004 filed with the Securities and Exchange Commission.

                                                           /s/ ERNST & YOUNG LLP
                                                           ERNST & YOUNG LLP

Providence, Rhode Island
October 10, 2005

EX-99.(A)

                                                                   EXHIBIT 99(a)

                             INSTRUCTIONS FOR USE OF

                                LYNCH CORPORATION

                            SUBSCRIPTION CERTIFICATES

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


            CONSULT MELLON INVESTOR SERVICES LLC, YOUR BANK OR BROKER
                        AS TO ANY QUESTIONS YOU MAY HAVE

            The  following  instructions  relate to a rights  offering  by Lynch
Corporation,  an  Indiana  corporation  (the  "Company"),  to the  holders  (the
"Holders")  of its  common  shares,  par  value  $0.01 per  share  (the  "Common
Shares"),  as described in the Company's  prospectus  dated  ________ ___, 2005.
Holders of record of Common Shares at the close of business __________ ___, 2005
(the  "Record   Date")  will  receive  one   transferable   subscription   right
("Subscription  Right")  for each  Common  Share held by them as of the close of
business on the Record Date. An aggregate of 1,616,026  Subscription  Rights are
exercisable  to  purchase  an  aggregate  of  538,676   Common   Shares.   Three
Subscription  Rights plus payment of $_______  (the  "Subscription  Price") will
entitle the Holder to subscribe  for one Common  Share (the "Basic  Subscription
Privilege"). In addition, shareholders on the Record Date who fully exercise the
rights  distributed  to them by us will also be  entitled to  subscribe  for and
purchase  additional  Common  Shares  that are not  purchased  by other  Holders
through their Basic Subscription Privileges (the "Oversubscription  Privilege").
The  maximum   number  of  Common  Shares  that  you  may  purchase   under  the
Oversubscription Privilege is equal to the number of Common Shares you purchased
under the Basic Subscription Privilege. If the number of Common Shares remaining
after the exercise of all Basic  Subscription  Privileges  is not  sufficient to
satisfy all requests for Common Shares pursuant to Oversubscription  Privileges,
oversubscribing  Holders will be allocated  additional  Common  Shares pro rata,
based on the number of Common  Shares  each such  Holder  purchased  through the
Basic Subscription  Privilege in proportion to the total number of Common Shares
that each such Holder and other  oversubscribing  Holders  purchased through the
Basic Subscription Privilege.

            If, pursuant to the exercise of Subscription  Rights,  the number of
Common Shares that a Holder would be entitled to receive would result in receipt
of fractional  shares,  the aggregate number of Common Shares that the Holder is
entitled to purchase  will be rounded up to the nearest  whole  number.  Holders
will not receive cash in lieu of fractional shares.

            The Subscription  Rights will expire on _________ ___, 2005, at 5:00
p.m.,  New York City time,  unless  extended for up to 15 days (the  "Expiration
Date").

            You should  indicate your wishes with regard to the exercise of your
Subscription  Rights by completing the  appropriate  section on the back of your
Subscription  Certificate and returning the  Subscription  Certificate to Mellon
Bank, N.A. c/o Mellon Investor  Services LLC (the  "Subscription  Agent") in the
envelope provided.







THE SUBSCRIPTION AGENT MUST RECEIVE YOUR COMPLETED  SUBSCRIPTION  CERTIFICATE ON
OR BEFORE THE EXPIRATION DATE. IN ADDITION,  THE SUBSCRIPTION AGENT MUST RECEIVE
PAYMENT OF THE SUBSCRIPTION PRICE,  INCLUDING FINAL CLEARANCE OF ANY CHECKS, FOR
ALL  SUBSCRIPTION  RIGHTS  EXERCISED ON OR BEFORE THE  EXPIRATION  DATE.  ONCE A
HOLDER OF SUBSCRIPTION  RIGHTS HAS EXERCISED THE  SUBSCRIPTION  PRIVILEGE,  SUCH
EXERCISE MAY NOT BE REVOKED.

            1.  SUBSCRIPTION   PRIVILEGES.   To  exercise  Subscription  Rights,
properly  complete  and  execute  your  Subscription  Certificate  and  send it,
together  with  payment  in full of the  Subscription  Price for  Common  Shares
subscribed  for pursuant to the Basic  Subscription  Privilege and Common Shares
subscribed  for pursuant to the  Oversubscription  Privilege  (not to exceed the
number  purchased  by  you  under  the  Basic  Subscription  Privilege),  to the
Subscription  Agent.  Delivery of the  Subscription  Certificate must be made by
mail, by overnight  courier or by hand.  FACSIMILE  DELIVERY OF THE SUBSCRIPTION
CERTIFICATE  WILL NOT BE ACCEPTED AND WILL NOT CONSTITUTE  VALID  DELIVERY.  All
payments must be made in United States dollars by bank draft  (cashier's  check)
or  certified  check  drawn upon a U.S.  bank or money  order  payable to Mellon
Investor  Services  LLC.  The  Subscription  Price  will be  deemed to have been
received  by the  Subscription  Agent  under  the  conditions  described  in the
paragraph below entitled ACCEPTANCE OF PAYMENTS.

            Banks,  brokers and other nominee holders of Subscription Rights who
exercise  the  Subscription   Privilege  on  behalf  of  beneficial   owners  of
Subscription Rights will be required to certify to the Subscription Agent and to
the Company as to the  aggregate  number of  Subscription  Rights that have been
exercised by each beneficial  owner of Subscription  Rights on whose behalf such
nominee  holder  is  acting  by  submitting  the form  entitled  Nominee  Holder
Certification.

            If you hold  certificates  for our Common Shares  directly and would
prefer  to have your  broker,  custodian  bank or other  nominee  exercise  your
Subscription  Rights,  you should  contact your nominee and request it to effect
the  transaction  for you.  To  indicate  your  decision  with  respect  to your
Subscription  Rights,  you should complete and return to your broker,  custodian
bank or other nominee the form entitled Beneficial Owner Election Form.

            ACCEPTANCE  OF  PAYMENTS.  Payments  will be  deemed  to  have  been
received by the  Subscription  Agent only upon the  receipt by the  Subscription
Agent of a certified check or bank draft (cashier's  check) drawn on a U.S. bank
or money order.

            CONTACTING  THE  SUBSCRIPTION  AGENT.  The  addresses  and telephone
numbers of the Subscription Agent are as follows:

                                      -2-





BY UNITED STATES MAIL DELIVERY:      BY OVERNIGHT COURIER:               BY HAND:
- ------------------------------       --------------------                -------
Mellon Investor Services LLC         Mellon Investor Services LLC        Mellon Investor Services LLC
Post Office Box 3301                 480 Washington Blvd.                120 Broadway, 13th Floor
South Hackensack, NJ 07606           Mail Drop - Reorg                   New York, NY 10271
Attn: Reorganization Department      Jersey City, NJ 07310               Attn: Reorganization
                                     Attn: Reorganization                Department
                                     Department

                       Toll Free Telephone: (866) 340-1578
        Direct Line for Banks and Brokers to Call Collect: (201) 680-6579

            The Subscription Agent must receive the Subscription Certificate and
payment of the estimated  Subscription  Price on or before the Expiration  Date.
DEPOSIT IN THE MAIL WILL NOT CONSTITUTE  DELIVERY TO THE SUBSCRIPTION AGENT. The
Subscription  Agent has discretion to refuse to accept any improperly  completed
or unexecuted rights certificate.

            NO SUBSCRIPTION RIGHTS AMOUNT; EFFECT OF OVER AND UNDERPAYMENTS.  If
you have not indicated the number of Subscription Rights being exercised,  or if
you do not deliver the dollar amount sufficient to purchase the number of Common
Shares  subscribed  for, you will be deemed to have  exercised the  Subscription
Privilege with respect to the maximum number of whole  Subscription  Rights that
may be exercised for the Subscription  Price payment you deliver under the Basic
Subscription Privilege. To the extent that the dollar amount you deliver exceeds
the product of the  Subscription  Price multiplied by the number of Subscription
Rights evidenced by the Subscription  Certificate you deliver, any excess amount
will be returned to you.

            2. DELIVERY OF SHARE  CERTIFICATES.  Share  certificates  for Common
Shares  purchased in this offering will be issued as soon as  practicable  after
the Expiration Date,  anticipated to be approximately seven to 10 business days.
Our  Subscription  Agent will  deliver  subscription  payments  to us only after
consummation  of this  offering  and the issuance of share  certificates  to our
shareholders that exercised their rights.  Unless you instruct otherwise in your
Subscription  Certificate,  Common  Shares  purchased  through  the  exercise of
Subscription  Rights will be registered in the name of the person exercising the
rights.

            The  Subscription  Agent  will  promptly  mail  to  each  Holder  of
Subscription Rights any excess funds received (without interest or deduction) in
payment of the Subscription  Price for Common Shares that are subscribed for but
not allocated to such Holder  pursuant to the Basic  Subscription  Privilege and
the Oversubscription Privilege as soon as practicable after the Expiration Date,
anticipated to be approximately seven to 10 business days.

                                      -3-





            3.  TO  HAVE  A  SUBSCRIPTION   CERTIFICATE   DIVIDED  INTO  SMALLER
DENOMINATIONS.  To have a Subscription Certificate divided into certificates for
smaller  numbers of Subscription  Rights,  send your  Subscription  Certificate,
together with complete instructions (including specification of the whole number
of  Subscription  Rights  you  wish to be  evidenced  by each  new  Subscription
Certificate)  signed by you, to the  Subscription  Agent,  allowing a sufficient
amount of time for new  Subscription  Certificates  to be issued and returned so
that they can be used prior to the Expiration Date. Alternatively, you may ask a
bank or broker to effect such actions on your  behalf.  As a result of delays in
the mail, the time of the transmittal,  the necessary  processing time and other
factors,  you may not  receive  such new  Subscription  Certificates  in time to
enable you to complete an exercise by the Expiration  Date.  Neither the Company
nor the Subscription Agent will be liable to you for any such delays.

            4. EXECUTION.

               (a)  EXECUTION  BY  REGISTERED   HOLDER.  The  signature  on  the
Subscription  Certificate must correspond with the name of the registered holder
exactly as it appears on the face of the  Subscription  Certificate  without any
alteration or change whatsoever.  Persons who sign the Subscription  Certificate
in a  representative  or other  fiduciary  capacity must indicate their capacity
when  signing  and,  unless  waived  by the  Subscription  Agent in its sole and
absolute  discretion,  must  present  to  the  Subscription  Agent  satisfactory
evidence of their authority to act.

               (b)  EXECUTION BY PERSON  OTHER THAN  REGISTERED  HOLDER.  If the
Subscription  Certificate is executed by a person other than the Holder named on
the face of the  Subscription  Certificate,  proper evidence of authority of the
person executing the Subscription Certificate must accompany the same unless the
Subscription Agent, in its discretion, dispenses with proof of authority.

               (c) SIGNATURE GUARANTEES. Your signature must be guaranteed by an
Eligible  Guarantor  Institution  if you  specify  special  issuance or delivery
instructions.

            5.  METHOD OF  DELIVERY.  The  method of  delivery  of  Subscription
Certificates and the payment of the Subscription Price to the Subscription Agent
will be at the election and risk of the Holder of the  Subscription  Rights.  If
sent by mail, it is recommended that they be sent by registered  mail,  properly
insured, with return receipt requested,  and that a sufficient number of days be
allowed to ensure  delivery to the  Subscription  Agent prior to the  Expiration
Date.

            6.  SPECIAL  PROVISIONS  RELATING TO THE  DELIVERY  OF  SUBSCRIPTION
RIGHTS  THROUGH  DEPOSITORY  FACILITY  PARTICIPANTS.  In the case of  holders of
Subscription Rights that are held of record through The Depository Trust Company
("DTC"),  exercises of the Subscription Privilege may be effected by instructing
DTC to transfer  Subscription  Rights from the DTC account of such holder to the
DTC account of the Subscription Agent, together with payment of the Subscription
Price  for  each  Common  Share  subscribed  for  pursuant  to the  Subscription
Privilege.

                                      -4-

EX-99.(B)

                                                                   EXHIBIT 99(b)

                                LYNCH CORPORATION

                          NOTICE OF GUARANTEED DELIVERY
                          FOR SUBSCRIPTION CERTIFICATES

            This form, or one substantially  equivalent hereto,  must be used to
exercise  subscription  rights  (the  "Subscription  Rights")  pursuant  to  the
offering described in the prospectus dated ________ ___, 2005 (the "Prospectus")
of Lynch Corporation,  an Indiana corporation (the "Company"),  if a holder (the
"Holder") of Subscription  Rights cannot deliver the  certificate(s)  evidencing
the Subscription Rights (the "Subscription Certificate(s)"), to the subscription
agent listed below (the "Subscription Agent") at or prior to 5:00 P.M., New York
City  time,  _________  ___,  2005,  unless  extended  for  up to 15  days  (the
"Expiration Date").

            You may deliver your Notice of Guaranteed  Delivery for Subscription
Certificates to the Subscription  Agent in the same manner as your  Subscription
Certificates  at the address set forth above  under  "Delivery  of  Subscription
Materials and Payment." On the third business day following the Expiration  Date
ONLY,  you may transmit  your Notice of  Guaranteed  Delivery  for  Subscription
Certificates to the  Subscription  Agent via facsimile  transmission  (Facsimile
No.:  201-680-4626).  ALL FACSIMILE  DELIVERIES  MUST BE  CONFIRMED.  To confirm
facsimile deliveries, you must call (201) 680-4860.

            Payment of the  subscription  price for each of the Company's Common
Shares subscribed for upon exercise of such Subscription Rights must be received
by the Subscription  Agent in the manner specified in "Method of Payment" in the
Prospectus at or prior to 5:00 P.M., New York City time, on the Expiration  Date
even if the Subscription  Certificate(s)  evidencing such Subscription Rights is
(are) being delivered pursuant to the Guaranteed Delivery Procedures thereof.

BY UNITED STATES MAIL DELIVERY:      BY OVERNIGHT COURIER:               BY HAND:
- ------------------------------       --------------------                -------
Mellon Investor Services LLC         Mellon Investor Services LLC        Mellon Investor Services LLC
Post Office Box 3301                 480 Washington Blvd.                120 Broadway, 13th Floor
South Hackensack, NJ 07606           Mail Drop - Reorg                   New York, NY 10271
Attn: Reorganization Department      Jersey City, NJ 07310               Attn: Reorganization
                                     Attn: Reorganization                Department
                                     Department

            Delivery of this  instrument  to an address  other than as set forth
above or  transmission  of this instrument via facsimile other than as set forth
above does not constitute a valid delivery.






            If you have any questions or require  additional  copies of relevant
documents, please contact:

                          Mellon Investor Services LLC
                    480 Washington Blvd. - Mail Drop - Reorg
                              Jersey City, NJ 07310
                       Toll Free Telephone: (866) 340-1578
        Direct Line for Banks and Brokers to Call Collect: (201) 680-6579


                                       2





Ladies and Gentlemen:

            The undersigned hereby represents that the undersigned is the Holder
of  Subscription  Certificate(s)  representing   _________________  Subscription
Rights and that such  Subscription  Certificate(s)  cannot be  delivered  to the
Subscription Agent at or before 5:00 P.M., New York City time, on the Expiration
Date.  Upon the terms and subject to the conditions set forth in the Prospectus,
receipt  of which is  hereby  acknowledged,  the  undersigned  hereby  elects to
exercise (i) the Basic Subscription  Privilege to subscribe for one Common Share
for  each  three   Subscription   Rights   represented   by  such   Subscription
Certificate(s)  and  (ii)  the  Oversubscription   Privilege  relating  to  such
Subscription  Rights,  to the extent that Common  Shares that are not  otherwise
purchased pursuant to the exercise of Subscription  Rights (the "Excess Shares")
are  available  therefor,  for an  aggregate  of up to  ________________  Excess
Shares, subject to availability and proration as described in the Prospectus.

            The undersigned  understands that payment of the Subscription  Price
for  each  Common  Share  subscribed  for  pursuant  to the  Basic  Subscription
Privilege  and  the   Oversubscription   Privilege   must  be  received  by  the
Subscription Agent at or before 5:00 P.M., New York City time, on the Expiration
Date  and   represents   that  such  payment,   in  the   aggregate   amount  of
$__________________ is being delivered to the Subscription Agent herewith in the
manner set forth below (check appropriate box):

            /_/        Certified check

            /_/        Bank draft (cashier's check)

            /_/        Money Order



Signature(s) _________________________          Address ________________________
______________________________________          ________________________________
Name(s) ____________________________            ________________________________
___________________________________             Area Code and Tel. No(s).

Subscription Certificate No(s). (if available)
______________________________________________

                                       3





                              Guarantee of Delivery
        (Not To Be Used For Subscription Certificate Signature Guarantee)

            The undersigned,  a member firm of a registered  national securities
exchange or of the  National  Association  of  Securities  Dealers,  Inc.,  or a
commercial bank or trust company having an office or correspondent in the United
States,  or a bank,  stockbroker,  savings and loan  association or credit union
with membership in an approved signature guarantee  medallion program,  pursuant
to Rule 17Ad-15 of the Securities  Exchange Act of 1934, as amended,  guarantees
that the undersigned  will deliver to the  Subscription  Agent the  certificates
representing the Subscription  Rights being exercised hereby,  with any required
signature  guarantee  and any other  required  documents,  all within  three (3)
business days after the date hereof.

_______________________________________         Dated: _________________________

_______________________________________         ________________________________
(Address)                                       (Name of Firm)

_______________________________________         ________________________________
(Area Code and Telephone Number)                (Authorized Signature)

            The  institution  that  completes  this  form must  communicate  the
guarantee  to  the   Subscription   Agent  and  must  deliver  the  Subscription
Certificate(s)  to the  Subscription  Agent  within the time period shown in the
Prospectus of Lynch  Corporation,  dated __________ ___, 2005.  Failure to do so
could result in a financial loss to such institution.

                                       4

EX-99.(C)

                                                                   EXHIBIT 99(c)


                                LYNCH CORPORATION
                         140 GREENWICH AVENUE, 4TH FLOOR
                          GREENWICH, CONNECTICUT 06830





                                                   ___________ ____, 2005

Dear Shareholder:

            On  behalf  of the  Board of  Directors  of Lynch  Corporation  (the
"Company"),  we are pleased to provide details on the Company's  rights offering
to purchase  common  shares (the "Common  Shares").  The Common Shares are being
offered at the subscription price of $______ per share.

            Each  beneficial  owner of the Company's  Common Shares will receive
one  subscription  right  ("Subscription  Right") for each Common  Share that it
owned on  _____________  ___, 2005.  Every three such  Subscription  Rights will
entitle  such  beneficial  owner  to  subscribe  for one  Common  Share  ("Basic
Subscription  Privilege").  If, pursuant to the exercise of Subscription Rights,
the number of Common Shares that a beneficial owner would be entitled to receive
would result in receipt of fractional  shares,  the  aggregate  number of Common
Shares that such beneficial  owner is entitled to purchase will be rounded up to
the  nearest  whole  number.  You will not  receive  cash in lieu of  fractional
shares.

            If you were a shareholder  on the record date and fully exercise the
Basic  Subscription  Privilege  issued to you, you may subscribe for  additional
Common Shares  through the  oversubscription  privilege.  The maximum  number of
Common  Shares that you may  purchase  under the  oversubscription  privilege is
equal to the  number  of shares  you  purchased  under  the  Basic  Subscription
Privilege.  If the Company's other shareholders receiving rights do not elect to
purchase  all of the  Common  Shares  offered  under  their  basic  subscription
privilege,  then Common Shares purchased through the oversubscription  privilege
will be allocated  pro rata based on the number of Common  Shares each  eligible
subscriber  for  additional   Common  Shares  has  purchased   under  the  basic
subscription  privilege,  as more fully  described in the Company's  prospectus,
dated _________ ___, 2005.

            Enclosed are copies of the following documents:

            1.   the Prospectus;

            2.   the  Instructions  for Use of  Lynch  Corporation  Subscription
                 Certificates;

            3.   the Subscription Certificate; and

            4.   a return  envelope  addressed to Mellon  Bank,  N.A. c/o Mellon
                 Investor Services LLC, the Subscription Agent.







            The  enclosed  Prospectus  describes  the  rights  offering  and the
procedure  to follow if you choose to  exercise  your  rights.  Please  read the
Prospectus and other enclosed materials carefully.

            Your prompt action is requested.  The rights offering will expire at
5:00 p.m., New York City time, on __________  ___, 2005,  unless extended for up
to 15 days (the "Expiration Date").

            To  exercise  your  rights,   a  properly   completed  and  executed
Subscription  Certificate  and  payment  in full  for all of the  Common  Shares
purchased  must be  delivered  to the  Subscription  Agent as  indicated  in the
Prospectus prior to 5:00 p.m., New York City time, on the Expiration Date.

            Additional  copies of the enclosed  materials  may be obtained  from
Mellon  Investor  Services  LLC.  Their  toll-free  telephone  number  is  (866)
340-1578.

            We are pleased to offer you this  opportunity and hope that you will
consider a further investment in the Company.


                                               Very truly yours,



                                               LYNCH CORPORATION

                                      -2-

EX-99.(D)

                                                                   EXHIBIT 99(d)

                                LYNCH CORPORATION
                         140 Greenwich Avenue, 4th Floor
                          Greenwich, Connecticut 06830


                            1,616,026 COMMON SHARES,
              ISSUABLE UPON EXERCISE OF 538,676 SUBSCRIPTION RIGHTS

            THE SUBSCRIPTION RIGHTS ARE EXERCISABLE UNTIL 5:00 P.M.,
           NEW YORK CITY TIME, ON ________ ___, 2005 UNLESS EXTENDED.


                                                 __________ ___, 2005

To:  Securities Dealers, Commercial Banks, Trust Companies, and Other Nominees

            This letter is being distributed to securities  dealers,  commercial
banks,  trust  companies and other  nominees in connection  with the offering by
Lynch  Corporation  of an aggregate of 538,676  common shares at a  subscription
price  of  $_______  per  share   pursuant  to  the  exercise  of   transferable
subscription  rights (the "Subscription  Rights")  initially  distributed to all
holders of record of common shares as of the close of business on _________ ___,
2005. The Subscription  Rights,  including the oversubscription  privilege,  are
described in the enclosed prospectus and evidenced by a Subscription Certificate
registered in your name or in the name of your nominee.

            Each  beneficial  owner of common shares  registered in your name or
the name of your nominee is entitled to one  Subscription  Right for each Common
Share owned by such  beneficial  owner.  A  shareholder  may purchase one Common
Share for every three  Subscription  Rights  exercised (the "Basic  Subscription
Privilege"). In addition, shareholders on the record date who fully exercise the
rights  distributed  to them by us will also be  entitled to  subscribe  for and
purchase additional common shares that are not purchased by other rights holders
through their Basic Subscription Privileges (the "Oversubscription  Privilege").
The maximum  number of shares that you may purchase  under the  Oversubscription
Privilege  is equal to the  number  of  shares  you  purchased  under  the Basic
Subscription  Privilege.  If the  number of common  shares  remaining  after the
exercise of all Basic  Subscription  Privileges is not sufficient to satisfy all
requests  for  common  shares  pursuant  to  Oversubscription  Privileges,  each
oversubscribing  holder will be  allocated  additional  common  shares pro rata,
based on the number of common  shares  such holder  purchased  through the Basic
Subscription  Privilege in  proportion to the total number of common shares that
such  holder  and other  oversubscribing  holders  purchased  through  the Basic
Subscription Privilege.







            If, pursuant to the exercise of Subscription  Rights,  the number of
common  shares that a  Shareholder  would be entitled to receive would result in
receipt of fractional  shares,  the aggregate  number of common shares that such
Shareholder  is  entitled to  purchase  will be rounded up to the nearest  whole
number. Shareholders will not receive cash in lieu of fractional shares.

            We are asking you to contact  your  clients for whom you hold common
shares  registered  in your  name  or in the  name of  your  nominee  to  obtain
instructions with respect to the Subscription Rights.

            Enclosed are copies of the following documents for you to use:

            1.   Prospectus;

            2.   Form of Letter from Lynch Corporation to its Shareholders;

            3.   Instructions   for  Use  of  Lynch   Corporation   Subscription
                 Certificates;

            4.   Return  envelope  addressed  to Mellon  Bank,  N.A.  c/o Mellon
                 Investor Services LLC as Subscription Agent.

            Your prompt action is requested. The Subscription Rights will expire
at 5:00 P.M., New York City time, on _________ ___, 2005, unless extended for up
to 15 days (the "Expiration Date").

            To exercise  Subscription  Rights,  properly  completed and executed
Subscription  Certificates  and  payment  in full  for all  Subscription  Rights
exercised  must be  delivered  to the  Subscription  Agent as  indicated  in the
Prospectus prior to the Expiration Date.

            Lynch  Corporation  will  not pay any  fees  or  commissions  to any
broker,  dealer or other person for soliciting  subscriptions  for  Subscription
Rights pursuant to the rights offering,  other than the  Subscription  Agent and
Information Agent as described in the Prospectus.

            Additional  copies of the  enclosed  materials  may be  obtained  by
contacting  Mellon Investor  Services LLC toll free at (866) 340-1578 or collect
at (201) 680-6579.


                                Very truly yours,


                                LYNCH CORPORATION

                                      -2-





NOTHING HEREIN OR IN THE ENCLOSED  DOCUMENTS SHALL  CONSTITUTE YOU OR ANY PERSON
AS AN AGENT OF LYNCH  CORPORATION,  THE  SUBSCRIPTION  AGENT OR ANY OTHER PERSON
MAKING OR DEEMED TO BE MAKING  OFFERS  OF THE  SECURITIES  ISSUABLE  UPON  VALID
EXERCISE  OF THE  RIGHTS,  OR  AUTHORIZE  YOU OR ANY  OTHER  PERSON  TO MAKE ANY
STATEMENTS  ON BEHALF OF ANY OF THEM WITH  RESPECT  TO THE  OFFERING  EXCEPT FOR
STATEMENTS MADE IN THE PROSPECTUS.



                                      -3-

EX-99.(E)

                                                                   EXHIBIT 99(e)

                                LYNCH CORPORATION



                                                 _________ ___, 2005


TO OUR CLIENTS:


            Enclosed for your  consideration  are a prospectus  dated  _________
___, 2005 (the  "Prospectus"),  and the  "Instructions as to Use of Subscription
Certificates"  relating  to  the  offering  (the  "Rights  Offering")  by  Lynch
Corporation  (the "Company") of its Common Shares (as defined below) pursuant to
transferable  subscription rights (the "Subscription Rights") distributed to all
holders  ("Holders") of record of Common Shares,  $0.01 par value per share (the
"Common  Shares"),  at the close of business on _________ ___, 2005 (the "Record
Date"). The Subscription Rights are described in the Prospectus.

            In the Rights  Offering,  the Company is offering  an  aggregate  of
538,676 Common Shares, as described in the Prospectus.

            The Subscription Rights will expire, if not exercised, at 5:00 P.M.,
New York City time, on _________  ___, 2005,  unless  extended for up to 15 days
(the "Expiration Date").

            As described in the  Prospectus,  you will receive one  Subscription
Right for each Common Share carried by us in your account as of the Record Date.
Every three such  Subscription  Rights will  entitle  you to  subscribe  for one
Common Share (the "Basic Subscription Privilege") at the cash price of $________
per share (the "Subscription Price").

            In addition,  shareholders on the Record Date who fully exercise the
rights  distributed  to them by us will also be  entitled to  subscribe  for and
purchase  additional  Common  Shares  that are not  purchased  by other  Holders
through their Basic Subscription Privileges (the "Oversubscription  Privilege").
The  maximum   number  of  Common  Shares  that  you  may  purchase   under  the
Oversubscription Privilege is equal to the number of Common Shares you purchased
under the Basic Subscription Privilege. If the number of Common Shares remaining
after the exercise of all Basic  Subscription  Privileges  is not  sufficient to
satisfy all requests for Common Shares pursuant to Oversubscription  Privileges,
you will be allocated  additional Common Shares prorata,  based on the number of
Common  Shares you  purchased  through  your  Basic  Subscription  Privilege  in
proportion   to  the  total   number  of  Common   Shares  that  you  and  other
oversubscribing Holders purchased through the Basic Subscription Privilege.

            The Subscription  Rights are evidenced by transferable  Subscription
Certificates  and will cease to have any value at the close of  business  on the
Expiration Date.

            The materials  enclosed are being forwarded to you as the beneficial
owner of Common Shares  carried by us in your account but not registered in your
name.  Exercises  of  Subscription  Rights  may be made only by us as the record
owner and pursuant to your instructions. Accordingly, we request instructions as







to whether you wish us to elect to subscribe  for any Common Shares to which you
are entitled  pursuant to the terms and subject to the  conditions  set forth in
the enclosed  Prospectus.  However, we urge you to read the Prospectus and other
enclosed materials carefully before instructing us to exercise your Subscription
Rights.

            Your  instructions to us should be forwarded as promptly as possible
in  order to  permit  us to  exercise  Subscription  Rights  on your  behalf  in
accordance with the provisions of the Rights  Offering.  Once you have exercised
your Basic  Subscription  Privilege and your  Oversubscription  Privilege,  such
exercise may not be revoked.

            If you wish to have us, on your behalf,  exercise  the  Subscription
Rights for any Common Shares to which you are entitled, please so instruct us by
completing,  executing and returning to us the "Beneficial  Owner Election Form"
included herewith.

            Any  questions  or requests  for  assistance  concerning  the Rights
Offering should be directed to the Information Agent at:

                          Mellon Investor Services LLC
                     480 Washington Blvd. - Mail Drop - Reorg
                              Jersey City, NJ 07310
                       Toll Free Telephone: (866) 340-1578
                Direct Line for Banks and Brokers: (201) 680-6579

                                       2

EX-99.(I)

                                                                   EXHIBIT 99(i)



MELLON












                   SUBSCRIPTION & INFORMATION AGENT AGREEMENT








            THIS SUBSCRIPTION AGENT AGREEMENT (this  "Agreement")  between Lynch
Corporation,  an Indiana  corporation  (the  "Company")  and Mellon Bank N.A., a
Pennsylvania company ("Mellon"), is dated as of _______________.

1.          APPOINTMENT

            (a) The  Company  is making an offer (the  "Subscription  Offer") to
issue to the  holders of record of its  outstanding  shares of Common  Stock par
value  $_______  per share (the  "Common  Stock"),  at the close of  business on
_________ (the "Record  Date"),  the right to subscribe for and purchase (each a
"Right")  shares of Common Stock (the  "Additional  Common Stock") at a purchase
price of  _______  per  share of  Additional  Common  Stock  (the  "Subscription
Price"),  payable by cashier's or certified check, upon the terms and conditions
set forth herein.  The term "Subscribed"  shall mean submitted for purchase from
the Company by a stockholder  in accordance  with the terms of the  Subscription
Offer, and the term "Subscription" shall mean any such submission.

            (b) The Subscription  Offer will expire at _________,  New York City
Time,  on (the  "Expiration  Time"),  unless the Company shall have extended the
period of time for which the Subscription Offer is open, in which event the term
"Expiration  Time" shall mean the latest time and date at which the Subscription
Offer, as so extended by the Company from time to time, shall expire.

            (c) The  Company  filed a  Registration  Statement  relating  to the
Additional  Common Stock with the Securities and Exchange  Commission  under the
Securities Act of 1933, as amended, on ___________.  Said Registration Statement
was declared  effective on  ______________.  The terms of the Additional  Common
Stock  are  more  fully  described  in  the  Prospectus   forming  part  of  the
Registration Statement as it was declared effective, and the accompanying Letter
of  Instruction.  Copies of the  Prospectus,  the Letter of Instruction  and the
Notice of  Guaranteed  Delivery  are annexed  hereto as Exhibit 2, Exhibit 3 and
Exhibit 4,  respectively.  All terms used and not defined  herein shall have the
same meaning as in the  Prospectus.  Promptly after the Record Date, the Company
will provide Mellon with a list of holders of Common Stock as of the Record Date
(the "Record Stockholders List").

            (d) The Company hereby appoints Mellon to act as subscription  agent
(the "Subscription  Agent") and information agent (the "Information  Agent") for
the Subscription Offer in accordance with and subject to the following terms and
conditions.

2.          SUBSCRIPTION OF RIGHTS

            (a)  The  Rights  are   evidenced   by   transferable   subscription
certificates (the "Certificates"), a copy of the form of which is annexed hereto
as Exhibit 5. The Certificates entitle the holders to subscribe, upon payment of
the Subscription Price, for shares of Additional Common Stock at the rate of one
share for each three Rights evidenced by a Certificate (the "Basic  Subscription
Privilege").  No fractional  shares will be issued,  but the Subscription  Offer
includes  a  step-up  privilege   entitling  the  holder  of  a  Certificate  or
combination  of  Certificates  evidencing  fewer than three  Rights,  or a total
number of Rights not evenly  divisible by three,  if said holder fully exercises
the  Certificate  or  Certificates   accompanying  the  Subscription  Offer,  to







subscribe and pay the Subscription Price for one full share of Additional Common
Stock in lieu of a fractional  share without  furnishing any  additional  Rights
(the "Step-up  Privilege").  Reference is made to the  Prospectus for a complete
description of the Basic Subscription Privilege and the Step-up Privilege.

            (b)  Further,  the  Subscription  Offer  provides  that  subscribing
shareholders,  and only those subscribing  shareholders who were shareholders on
the  Record  Date and who  exercise  their  Rights  in  full,  may  exercise  an
Over-subscription  right as more fully described in the Registration  Statement.
Mellon shall,  after the initial  allocation of Additional Common Stock to those
shareholders  exercising their Basic Subscription Right,  allocate any remaining
Basic Subscription, as more fully described in the Registration Statement.

3.          DUTIES OF SUBSCRIPTION AGENT

            As Subscription Agent, Mellon is authorized and directed to:

            (a)     Issue the  Certificates in accordance with this Agreement in
the names of the holders of the Common Stock of record on the Record Date,  keep
such records as are necessary for the purpose of recording  such  issuance,  and
furnish a copy of such records to the Company. The Certificates may be signed on
behalf of the Subscription Agent by the manual or facsimile  signature of a Vice
President  or Assistant  Vice  President of the  Subscription  Agent,  or by the
manual signature of any of its other authorized officers.

            (b)     Promptly after Mellon receives the Record Stockholders List,
Mellon shall:

                    (i)     mail or cause to be mailed,  by first class mail, to
            each  holder of Common  Stock of record  on the  Record  Date  whose
            address  of record is within the United  States  and  Canada,  (i) a
            Certificate  evidencing  the  Rights to which  such  stockholder  is
            entitled  under  the  Subscription   Offer,   (ii)  a  copy  of  the
            Prospectus,  (iii)  a  Letter  of  Instruction,  (iv)  a  Notice  of
            Guaranteed  Delivery  and (v) a  return  envelope  addressed  to the
            Subscription Agent; and

                    (ii)    mail or cause to be  mailed,  by air  mail,  to each
            holder of Common Stock of record on the Record Date whose address of
            record is outside the United States and Canada,  or is an A.P.O.  or
            F.P.O.  address  (i) a copy  of the  Prospectus,  (ii) a  Notice  of
            Guaranteed  Delivery  and (iii) a Letter of  Instruction  (different
            from the Letter of Instruction sent to stockholders whose address of
            record is within the United States and Canada). Mellon shall refrain
            from mailing Certificates  issuable to any holder of Common Stock of
            record on the  Record  Date whose  address of record is outside  the
            United States and Canada,  or is an A.P.O.  or F.P.O.  address,  and
            hold such  Certificates for the account of such stockholder  subject
            to  such  stockholder  making  satisfactory  arrangements  with  the
            Subscription  Agent for the  exercise  or other  disposition  of the
            Rights  evidenced  thereby,  and  follow  the  instructions  of such
            stockholder  for the  exercise,  sale or other  disposition  of such
            Rights if such  instructions  are  received at or before 11:00 a.m.,
            New York City Time, on ________________.

            (c)     Mail  or  deliver  a copy  of  the  Prospectus  (i) to  each
assignee or transferee of Certificates upon receiving  appropriate  documents to
register  the  assignment  or transfer  thereof and (ii) with  certificates  for







shares of Additional Common Stock when such are issued to persons other than the
registered holder of the Certificate.

            (d)     Accept   Subscriptions  upon  the  due  exercise  (including
payment of the Subscription  Price) on or prior to the Expiration Time of Rights
in accordance with the terms of the Certificates and the Prospectus.

            (e)     Subject  to the next  sentence,  accept  Subscriptions  from
stockholders  whose  Certificates  are  alleged  to have  been  lost,  stolen or
destroyed  upon receipt by Mellon of an affidavit of theft,  loss or destruction
and  a  bond  of  indemnity  in  form  and  substance  satisfactory  to  Mellon,
accompanied by payment of the Subscription  Price for the total number of shares
of Additional  Common Stock  Subscribed  for. Upon receipt of such affidavit and
bond of indemnity and compliance with any other  applicable  requirements,  stop
orders shall be placed on said  Certificates and Mellon shall withhold  delivery
of the  shares  of  Additional  Common  Stock  Subscribed  for  until  after the
Certificates  have expired and it has been determined that the Rights  evidenced
by the Certificates  have not otherwise been purported to have been exercised or
otherwise surrendered.

            (f)     Accept  Subscriptions,   without  further  authorization  or
direction from the Company,  without procuring  supporting legal papers or other
proof of authority to sign (including without limitation proof of appointment of
a fiduciary or other person acting in a  representative  capacity),  and without
signatures of co-fiduciaries, co-representatives or any other person:

                    (i) if the  Certificate  is  registered  in  the  name  of a
            fiduciary and is executed by and the  Additional  Common Stock is to
            be issued in the name of such fiduciary;

                    (ii) if the  Certificate  is registered in the name of joint
            tenants and is executed by one of the joint  tenants,  provided  the
            certificate  representing  the Additional  Common Stock is issued in
            the names of, and is to be delivered to, such joint tenants;

                    (iii)  if the  Certificate  is  registered  in the name of a
            corporation and is executed by a person in a manner which appears or
            purports to be done in the capacity of an officer, or agent thereof,
            provided the Additional  Common Stock is to be issued in the name of
            such corporation; or

                    (iv) if the  Certificate  is  registered  in the  name of an
            individual  and is  executed by a person  purporting  to act as such
            individual's  executor,  administrator  or personal  representative,
            provided,  the  Additional  Common Stock is to be  registered in the
            name of the subscriber as executor or administrator of the estate of
            the deceased  registered holder and there is no evidence  indicating
            the  subscriber is not the duly  authorized  representative  that he
            purports to be.

            (g)     Accept  Subscriptions  not  accompanied by  Certificates  if
submitted by a firm having  membership in the New York Stock Exchange or another
national  securities exchange or by a commercial bank or trust company having an
office in the United States together with the Notice of Guaranteed  Delivery and
accompanied  by  proper  payment  for the total  number of shares of  Additional
Common Stock Subscribed for.







            (h)     Accept    Subscriptions   even   though   unaccompanied   by
Certificates,  under  the  circumstances  and in  compliance  with the terms and
conditions set forth in the Prospectus under the heading  "SUBSCRIPTION  OFFER -
Method of Exercising Rights".

            (i)     Refer  to  the  Company  for  specific  instructions  as  to
acceptance or  rejection,  Subscriptions  received  after the  Expiration  Time,
Subscriptions  not  authorized to be accepted  pursuant to this Paragraph 1, and
Subscriptions   otherwise  failing  to  comply  with  the  requirements  of  the
Prospectus and the terms and conditions of the Certificates.

4.          DUTIES AS INFORMATION AGENT

            In its capacity as Information Agent, Mellon shall:

            (a)     assist in the  coordination  of all printing  activities and
            advertisement placement if required;

            (b)     establishing contacts with brokers, dealers, banks and other
            nominees on the Company's behalf;

            (c)     determining the material requirements;

            (d)     assistance with document review;

            (e)     facilitate the  distribution  of materials to the registered
            and beneficial owners and to other interested parties;

            (f)     providing a  dedicated  toll-free  line for all  shareholder
            queries;

            (g)     provide status reporting to Company management; and

            (h)     facilitate  payment  of  all   broker-forwarding   invoices,
            subject to collection from the Company of monies for this purpose.

5.          ACCEPTANCE OF SUBSCRIPTIONS

            Upon acceptance of a Subscription, Mellon shall:

            (a) Hold all monies received in a special account for the benefit of
the Company.  Promptly  following the Expiration Time Mellon shall distribute to
the  Company  the funds in such  account  and issue  certificates  for shares of
Additional  Common Stock issuable with respect to  Subscriptions  that have been
accepted.  Mellon will not be  obligated  to  calculate  or pay  interest to any
holder or any other party claiming  through a holder or otherwise.  It is hereby
agreed immediately following the effective date of the Subscription, immediately
available funds,  represented by certified check,  money order, or wire transfer
but not personal check, will be deposited with Mellon.

            (b) Advise the Company  daily by  telecopy  and confirm by letter to
the  attention of Eugene Hynes (the  "Company  Representative")  as to the total
number of shares of  Additional  Common Stock  Subscribed  for,  total number of







Rights sold, total number of Rights  partially  Subscribed for and the amount of
funds  received,  with  cumulative  totals for each; and in addition  advise the
Company Representative,  by telephone at (203) 622-1150,  confirmed by telecopy,
of the  amount  of funds  received  identified  in  accordance  with (a)  above,
deposited,   available  or  transferred  in  accordance  with  (a)  above,  with
cumulative totals; and

            (c) As promptly as possible but in any event on or before 3:30 p.m.,
New York City Time,  on the first full  business day  following  the  Expiration
Time,  advise the Company  Representative  in  accordance  with (b) above of the
number of shares Subscribed for, the number of Subscription  guarantees received
and the number of shares of Additional Common Stock unsubscribed for.

6.          COMPLETION OF SUBSCRIPTION OFFER

            Upon completion of the Subscription Offer:

            (a) Mellon shall  requisition  certificates  from the Transfer Agent
for  the  Common  Stock  for  shares  of  Additional   Common  Stock  for  which
Subscriptions have been received.

            (b) The  Certificates  shall be issued in registered  form only. The
Company  shall  appoint  and have in office at all  times a  Transfer  Agent and
Registrar  for the  Certificates,  which  shall  keep  books and  records of the
registration and transfers and exchanges of Certificates (such books and records
are hereinafter called the "Certificate  Register").  The Company shall promptly
notify the Transfer Agent and Registrar of the exercise of any Certificates. The
Company shall  promptly  notify  Mellon of any change in the Transfer  Agent and
Registrar of the Certificates.

            (c) All  Certificates  issued upon any  registration  of transfer or
exchange  of  Certificates  shall  be the  valid  obligations  of  the  Company,
evidencing  the same  obligations,  and entitled to the same benefits under this
Agreement, as the Certificates  surrendered for such registration of transfer or
exchange.

            (d) Any  Certificate  when duly  endorsed  in blank  shall be deemed
negotiable,  and when a  Certificate  shall  have been so  endorsed  the  holder
thereof  may be treated by the  Company,  Mellon and all other  persons  dealing
therewith  as the  absolute  owner  thereof  for any  purpose  and as the person
entitled to exercise the rights represented  thereby, any notice to the contrary
notwithstanding,  but until  such  transfer  is  registered  in the  Certificate
Register,  the Company and Mellon may treat the registered holder thereof as the
owner for all purposes.

            (e) For so long as this  Agreement  shall be in effect,  the Company
will reserve for  issuance  and keep  available  free from  preemptive  rights a
sufficient number of shares of Additional Common Stock to permit the exercise in
full of all Rights issued  pursuant to the  Subscription  Offer.  Subject to the
terms and conditions of this  Agreement,  Mellon will request the Transfer Agent
for the Common Stock to issue certificates  evidencing the appropriate number of
shares of  Additional  Common  Stock as  required  from time to time in order to
effectuate the Subscriptions.







            (f) The  Company  shall take any and all action,  including  without
limitation obtaining the authorization, consent, lack of objection, registration
or approval of any  governmental  authority,  or the taking of any other  action
under the laws of the  United  States of America  or any  political  subdivision
thereof,  to insure that all shares of Additional Common Stock issuable upon the
exercise  of the  Certificates  at the  time  of  delivery  of the  certificates
therefor (subject to payment of the Subscription Price) will be duly and validly
issued and fully paid and  non-assessable  shares of Common Stock, free from all
preemptive rights and taxes, liens, charges and security interests created by or
imposed upon the Company with respect thereto.

            (g) The Company shall from time to time take all action necessary or
appropriate to obtain and keep effective all  registrations,  permits,  consents
and  approvals  of  the  Securities  and  Exchange   Commission  and  any  other
governmental  agency or authority  and make such filings under Federal and state
laws which may be necessary or  appropriate  in  connection  with the  issuance,
sale,  transfer and delivery of Certificates  or Additional  Common Stock issued
upon exercise of Certificates.

7.          PROCEDURE FOR DISCREPANCIES

            Mellon shall follow its regular  procedures  to attempt to reconcile
any  discrepancies  between the number of shares of Additional Common Stock that
any  Certificate  may indicate are to be issued to a stockholder  and the number
that the Record  Stockholders  List indicates may be issued to such stockholder.
In any instance where Mellon cannot  reconcile such  discrepancies  by following
such procedures, Mellon will consult with the Company for instructions as to the
number of shares of Additional  Common Stock, if any, it is authorized to issue.
In the  absence  of such  instructions,  Mellon is  authorized  not to issue any
shares of Additional Common Stock to such stockholder.

8.          PROCEDURE FOR DEFICIENT ITEMS

            Mellon shall examine the Certificates received by it as Subscription
Agent to ascertain  whether they appear to have been  completed  and executed in
accordance  with the  applicable  Letter of  Instruction.  In the  event  Mellon
determines that any Certificate does not appear to have been properly  completed
or executed,  or where the  Certificates  do not appear to be in proper form for
Subscription,  or any other  irregularity  in connection  with the  Subscription
appears to exist, Mellon shall follow, where possible, its regular procedures to
attempt to cause such irregularity to be corrected.  Mellon is not authorized to
waive any irregularity in connection with the Subscription,  unless Mellon shall
have received from the Company the Certificate  which was delivered,  duly dated
and  signed  by an  authorized  officer  of the  Company,  indicating  that  any
irregularity  in such  Certificate  has been  cured  or  waived  and  that  such
Certificate  has been  accepted  by the  Company.  If any such  irregularity  is
neither corrected nor waived, Mellon will return to the subscribing  stockholder
(at its  option by either  first  class  mail  under a  blanket  surety  bond or
insurance  protecting Mellon and the Company from losses or liabilities  arising
out of the  non-receipt  or nondelivery of  Certificates  or by registered  mail
insured  separately for the value of such  Certificates)  to such  stockholder's
address  as set  forth  in the  Subscription  any  Certificates  surrendered  in
connection  therewith and any other documents  received with such  Certificates,
and a letter of notice to be furnished by the Company explaining the reasons for
the return of the Certificates and other documents.







9.          DATE/TIME STAMP

            Each document  received by Mellon  relating to its duties  hereunder
shall be dated and time stamped when received.

10.         TRANSFER PROCEDURES

            If certificates  representing  shares of Additional Common Stock are
to be  delivered  by Mellon to a person  other  than the  person in whose name a
surrendered  Certificate  is registered,  Mellon shall issue no certificate  for
Additional  Common Stock until the  Certificate so surrendered has been properly
endorsed (or otherwise put in proper form for transfer).

11.         TAX REPORTING

            Should any issue arise  regarding  federal  income tax  reporting or
withholding,  Mellon shall take such action as the Company reasonably  instructs
in writing.

12.         TERMINATION

            The Company may terminate this Agreement at any time by so notifying
Mellon in  writing.  Mellon may  terminate  this  Agreement  upon 30 days' prior
notice to the Company.  Upon any such termination,  Mellon shall be relieved and
discharged of any further responsibilities with respect to its duties hereunder.
Upon payment of all Mellon's outstanding fees and expenses, Mellon shall forward
to the  Company or its  designee  promptly  any  Certificate  or other  document
relating  to  Mellon's  duties  hereunder  that  Mellon  may  receive  after its
appointment  has so  terminated.  Sections  13, 14, 15 and 20 of this  Agreement
shall survive any termination of this Agreement.

13.         AUTHORIZATIONS AND PROTECTIONS

            As agent for the Company hereunder Mellon:

            (a)  shall   have  no  duties  or   obligations   other  than  those
specifically  set forth herein or as may subsequently be agreed to in writing by
Mellon and the Company;

            (b)  shall  have no  obligation  to issue any  shares of  Additional
Common  Stock  unless the Company  shall have  provided a  sufficient  number of
certificates for such Additional Common Stock;

            (c) shall be  regarded  as making no  representations  and having no
responsibilities as to the validity,  sufficiency,  value, or genuineness of any
Certificates  surrendered  to Mellon  hereunder or shares of  Additional  Common
Stock issued in exchange therefor, and will not be required to or be responsible
for and will make no representations as to, the validity,  sufficiency, value or
genuineness of the Subscription Offer;

            (d) shall not be obligated to take any legal action  hereunder;  if,
however,  Mellon  determines to take any legal action  hereunder,  and where the
taking of such action might, in Mellon's  judgment,  subject or expose it to any






expense or  liability  Mellon  shall not be required to act unless it shall have
been furnished with an indemnity satisfactory to it;

            (e) may rely on and  shall  be fully  authorized  and  protected  in
acting or  failing to act upon any  certificate,  instrument,  opinion,  notice,
letter,  telegram,  telex,  facsimile transmission or other document or security
delivered  to Mellon and believed by it to be genuine and to have been signed by
the proper party or parties;

            (f) shall not be liable or responsible  for any recital or statement
contained in the Prospectus or any other documents relating thereto;

            (g) shall not be liable or  responsible  for any failure on the part
of the Company to comply with any of its covenants and  obligations  relating to
the  Subscription   Offer,   including  without  limitation   obligations  under
applicable securities laws;

            (h) may rely on and  shall  be fully  authorized  and  protected  in
acting or failing to act upon the written,  telephonic or oral  instructions  of
officers of the Company with respect to any matter  relating to Mellon acting as
Subscription Agent covered by this Agreement (or supplementing or qualifying any
such actions);

            (i) may  consult  with  counsel  satisfactory  to Mellon,  including
internal  counsel,  and the advice of such  counsel  shall be full and  complete
authorization  and  protection  in  respect of any action  taken,  suffered,  or
omitted by Mellon  hereunder  in good faith and in  reliance  upon the advice of
such counsel;

            (j) may perform any of its duties hereunder either directly or by or
through  agents or attorneys and Mellon shall not be liable or  responsible  for
any misconduct or negligence on the part of any agent or attorney appointed with
reasonable care by Mellon hereunder; and

            (k) Are not  authorized,  and shall have no  obligation,  to pay any
brokers, dealers, or soliciting fees to any person.

14.         INDEMNIFICATION

            The Company  agrees to  indemnify  Mellon for,  and hold it harmless
from and against, any loss, liability,  claim or expense ("Loss") arising out of
or in connection with Mellon's performance of its duties under this Agreement or
this  appointment,  including the costs and expenses of defending itself against
any Loss or enforcing this Agreement,  except to the extent that such Loss shall
have been  determined  by a court of  competent  jurisdiction  to be a result of
Mellon's gross negligence or intentional misconduct.

15.         LIMITATION OF LIABILITY

            (a) In the absence of gross negligence or intentional  misconduct on
its part, Mellon shall not be liable for any action taken,  suffered, or omitted
by it or for any error of judgment made by it in the  performance  of its duties
under   this   Agreement.   Anything   in  this   agreement   to  the   contrary
notwithstanding,  in no event  shall  Mellon be liable  for  special,  indirect,
incidental or consequential loss or damage of any kind whatsoever (including but
not limited to lost profits),  even if Mellon has been advised of the likelihood







of such damages and  regardless  of the form of action.  Any liability of Mellon
will be limited to the amount of fees paid by the Company hereunder.

            (b) In the event any question or dispute  arises with respect to the
proper  interpretation  of this  Agreement or Mellon's  duties  hereunder or the
rights of the Company or of any  holders  surrendering  certificates  for Shares
pursuant  to the  Subscription  Offer,  Mellon  shall not be required to act and
shall not be held liable or  responsible  for refusing to act until the question
or  dispute  has  been  judicially  settled  (and  Mellon  may,  if it  deems it
advisable,  but shall not be obligated to, file a suit in  interpleader or for a
declaratory  judgment for such purpose) by final judgment rendered by a court of
competent  jurisdiction,  binding on all stockholders and parties  interested in
the  matter  which is no longer  subject  to review or  appeal,  or settled by a
written  document in form and substance  satisfactory  to Mellon and executed by
the Company and each such stockholder and party. In addition, Mellon may require
for such purpose,  but shall not be obligated to require,  the execution of such
written  settlement by all the  stockholders and all other parties that may have
an interest in the settlement.

16.         REPRESENTATIONS, WARRANTIES AND COVENANTS

            The Company  represents,  warrants and covenants that (a) it is duly
incorporated,  validly  existing  and in good  standing  under  the  laws of its
jurisdiction  of   incorporation,   (b)  the  making  and  consummation  of  the
Subscription   Offer  and  the  execution,   delivery  and  performance  of  all
transactions  contemplated thereby (including without limitation this Agreement)
have been duly authorized by all necessary  corporate action and will not result
in a breach of or constitute a default under the certificate of incorporation or
bylaws of the Company or any indenture,  agreement or instrument to which either
is a party or is bound,  (c) this Agreement has been duly executed and delivered
by the  Company  and  constitutes  a legal,  valid,  binding  obligation  of the
Company,  enforceable  against the Company in accordance with its terms, (d) the
Subscription  Offer will comply in all  material  respects  with all  applicable
requirements  of law  and  (e) to the  best  of  their  knowledge,  there  is no
litigation  pending or threatened  as of the date hereof in connection  with the
Subscription Offer.

17.         Notices

            All notices,  demands and other communications given pursuant to the
terms and provisions  hereof shall be in writing,  shall be deemed  effective on
the date of receipt, and may be sent by facsimile,  overnight delivery services,
or by certified or registered mail, return receipt requested to:

            If to the Company:              with an additional copy to:

Lynch Corporation                       Mark L. Lakin, Esq.
140 Greenwich Avenue, 4th Floor         Olshan Grundman Frome Rosenzweig &
Greenwich, Connecticut  06830           Wolosky LLP
Attn: Eugene Hynes                      Park Avenue Tower
Tel: (203) 622-1150                     65 East 55th Street
Fax: (203) 622-1360                     New York, New York  10022
                                        Tel: (212) 451-2249
                                        Fax: (212) 451-2222







            If to Mellon:                   with an additional copy to:

Mellon Bank, N.A.                       Mellon Bank, N.A.
C/O Mellon Investor Services            C/O Mellon Investor Services
480 Washington Blvd.                    480 Washington Blvd.
Jersey City, NJ 07310                   Jersey City, NJ 07310
Attn: Mark Smith                        Attn: Legal Department
Tel:                                    Tel:
Fax:                                    Fax:

18.         SPECIMEN SIGNATURES

            Set forth in  Exhibit  6 hereto is a list of the names and  specimen
signatures  of the  persons  authorized  to  act  for  the  Company  under  this
Agreement.  The Secretary of the Company  shall,  from time to time,  certify to
Mellon the names and  signatures of any other persons  authorized to act for the
Company, as the case may be, under this Agreement.

19.         INSTRUCTIONS

            Any  instructions  given  to  Mellon  orally,  as  permitted  by any
provision  of this  Agreement,  shall be  confirmed in writing by the Company as
soon as  practicable.  Mellon  shall not be liable or  responsible  and shall be
fully authorized and protected for acting, or failing to act, in accordance with
any  oral  instructions  which do not  conform  with  the  written  confirmation
received in accordance with this Section.

20.         Fees

            Whether or not any Certificates  are surrendered to Mellon,  for its
services as Subscription  Agent and  Information  Agent  hereunder,  the Company
shall pay to Mellon compensation in accordance with the fee schedule attached as
Exhibit  1 hereto,  together  with  reimbursement  for  out-of-pocket  expenses,
including  reasonable  fees and  disbursements  of counsel.  All amounts owed to
Mellon  hereunder are due upon receipt of the invoice.  Delinquent  payments are
subject to a late payment  charge of one and one half  percent  (1.5%) per month
commencing forty-five (45) days from the invoice date.

21.         TERMINATION

            Either  party may  terminate  this  Agreement  upon thirty (30) days
prior written notice to the other party.  Unless so  terminated,  this Agreement
shall continue in effect until all  Additional  Shares of Common Stock have been
received and paid for by eligible holders. In the event of such termination, the
Company will  appoint a successor  Subscription  Agent and inform  Mellon of the
name and address of any successor Subscription Agent so appointed, provided that







no failure by the Company to appoint such a successor  Subscription  Agent shall
affect  the  termination  of  this  Agreement  or the  discharge  of  Mellon  as
Subscription  Agent  hereunder.  Upon  any  such  termination,  Mellon  shall be
relieved  and  discharged  of any further  responsibilities  with respect to its
duties hereunder.  Upon payment of all outstanding fees and expenses  hereunder,
Mellon shall  promptly  forward to the Company or its designee any  certificates
for Shares, Certificates,  Election Forms, or any other document that Mellon may
receive after its appointment has so terminated.

22.         FORCE MAJEURE

            Mellon  shall not be liable for any failure or delay  arising out of
conditions  beyond its reasonable  control  including,  but not limited to, work
stoppages,  fires, civil disobedience,  riots, rebellions,  storms,  electrical,
mechanical,  computer  or  communications  facilities  failures,  acts of God or
similar occurrences.

23.         MISCELLANEOUS

            (a) This Agreement  shall be governed by and construed in accordance
with the laws of the State of New York  without  giving  effect to  conflict  of
laws, rules or principles.

            (b) No  provision  of this  Agreement  may be  amended,  modified or
waived, except in writing signed by all of the parties hereto.

            (c) Except as expressly set forth elsewhere in this  Agreement,  all
notices,  instructions  and  communications  under  this  Agreement  shall be in
writing,  shall be  effective  upon  receipt and shall be  addressed,  if to the
Company,  to its address set forth beneath its signature to this Agreement,  or,
if to the Subscription Agent, to Mellon Bank, N.A. c/o Mellon Investor Services,
480 Washington Blvd., Jersey City, New Jersey 07310, Attention: Reorganization
Department,  or to such other  address as a party  hereto shall notify the other
parties.

            (d) In the  event  that any  claim  of  inconsistency  between  this
Agreement and the terms of the  Subscription  Offer arise, as they may from time
to time be amended,  the terms of the Subscription  Offer shall control,  except
with  respect to Mellon's  duties,  liabilities  and rights,  including  without
limitation  compensation and  indemnification,  which shall be controlled by the
terms of this Agreement.

            (e) If any  provision  of this  Agreement  shall  be  held  illegal,
invalid,  or unenforceable  by any court,  this Agreement shall be construed and
enforced as if such provision had not been contained  herein and shall be deemed
an Agreement among the parties hereto to the full extent permitted by applicable
law.

            (f) This Agreement  shall be binding upon,  inure to the benefit of,
and be  enforceable  by, the  respective  successors  and assigns of the parties
hereto.

            (g) This  Agreement  may not be  assigned  by any party  without the
prior written consent of all parties.

            (h) Sections 13, 14, 15, and 20 hereof shall survive  termination of
this Agreement.







            IN WITNESS WHEREOF,  the parties hereto have executed this Agreement
by their duly authorized officers as of the day and year above written.

LYNCH CORPORATION

By:
       ----------------------------------------
Name:  John C. Ferrara
Title: President and Chief Executive Officer

Accepted as of the date above first written:



MELLON BANK, N.A.
AS SUBSCRIPTION & INFORMATION AGENT

By:
       ----------------------------------------
Name:
Title:






Exhibit 1   Fee Schedule
Exhibit 2   Prospectus
Exhibit 3   Letter of Instruction
Exhibit 4   Notice of Guaranteed Delivery
Exhibit 5   Form of Certificate
Exhibit 6   List of Authorized Representatives








                                    Exhibit 1

                                SCHEDULE OF FEES
                              AS SUBSCRIPTION AGENT

SET-UP & ADMINISTRATIVE FEE                                                                      $10,000.00

PROCESS BASIC SUBSCRIPTIONS, EACH                                                                    $15.00

ISSUING SUBSCRIPTION CERTIFICATES TO RECORD DATE HOLDERS, EACH                                       $5.00

PROCESSING OVERSUBSCRIPTIONS, INCLUDING PRO-RATIONS & REFUNDS, EACH                              $10.00

ADDITIONAL HANDLING ITEMS, EACH                                                                      $25.00
Including   Notice  of   Guaranteed   Deliveries,   Withdrawals,   Legal  Items,
Correspondence,  Partials,  Defective Items, Lost Items, Window Items, Items not
providing  a  Taxpayer   Identification   Number,   Over-Subscriptions,   Backup
Withholding, Multiple Checks (per check), Foreign Holders, etc.

ISSUING AND COLLECTING DUE BILLS, EACH                                                               $25.00

AFFIXING RESTRICTIVE LEGENDS ON CERTIFICATES, EACH                                                   $50.00

MIDNIGHT EXPIRATIONS, EACH (ONLY IF APPLICABLE)                                                      $5,000.00, each
Includes System Time, Security, Window Facility,
Post Office Pick Up, etc.

EXTENSION OF OFFER, EACH (ONLY IF APPLICABLE)                                                        $5,000.00, each

OFFICE OF FOREIGN ASSET CONTROL (OFAC) REPORTING, EACH HOLDER                                        $1.00 per year

SPECIAL SERVICES, ONLY IF APPLICABLE:
* Additional Changes to the Shareholder File                           $50.00/account
   (including transfer journal updates)
* Sale/Transfer of Rights Through Mellon                               $25.00/account
* Internal Attorney Review of the Agreement (if                        $1,000.00
   there are any variations of the standard language)
* Conversion Delays/Mail Date Changes                                  $500.00 each
* Programming Fees                                                     $250.00/hour
* Consultative Services                                                $200.00/hour
* Archive Storage, per month                                           $50.00
* Changes to Standard Documents                                        By Appraisal
* Additional Special Services                                          By Appraisal

OUT OF POCKET EXPENSES                                                                               Additional
Including Postage, Printing, Stationery,
Overtime, Transportation, etc.

MINIMUM FEE, EXCLUSIVE OF SPECIAL SERVICES                                                           $30,000.00
If the aggregate amount of fees to be charged as described
above, exclusive of Special Services, Midnight Expirations,
Extensions of Offer,  and Out of Pocket  Expenses,  is less than
$30,000.00,  a total fee of $30,000.00 will apply.







                                SCHEDULE OF FEES
                              AS INFORMATION AGENT

INFORMATION AGENT FEE                                                  $7,500.00

FACILITY FEE                                                           $350.00 Per Week

EXTENSION FEE                                                          $1,000.00 per Extension

OUTGOING & INBOUND CALLS                                           $39.50 per CSR hour

INBOUND CALLS TO IVR                                                   $1.95 per Call

PRINTING & LOGISTICS                                               By Appraisal
(Any estimate is based on the current information)

MEDIA, DRAFTING & PROGRAMMING SERVICES                             $250.00 per hour

SPECIAL SERVICES, IF APPLICABLE

            *   Wall Street Journal National Edition                   By Appraisal
                Advertisement

            *   New York Times Advertisement                           By Appraisal

            *   Additional Special Services                            By Appraisal







                                MELLON BANK, N.A.

                                SCHEDULE OF FEES
                    EXECUTIVE WHITE GLOVE SERVICE *(OPTIONAL)


Servicing Fee                                            $1,000.00 per executive

Out of-pocket expenses                                   Additional

MELLON'S  EXECUTIVE  WHITE  GLOVE  SERVICE  ALLOWS  CLIENTS  TO  PROVIDE  SELECT
EXECUTIVES OR KEY  SHAREHOLDERS  WITH A PREMIUM  LEVEL OF SERVICE.  THIS SERVICE
INCLUDES  DELIVERY  OF  CERTIFICATES  AND  ELECTION/TRANSMITTAL   FORMS  TO  THE
ADMINISTRATOR  OR PROJECT  MANAGER;  A PERSONAL  CONTACT FOR SERVICE  INQUIRIES;
RECEIPT  OF  FUNDS  BY WIRE;  AND  CERTIFICATES  RUSHED  TO THE  SHAREHOLDER  BY
OVERNIGHT  COURIER.  IF THIS SERVICE IS NOT SELECTED,  OUR PRICING  CONTEMPLATES
THAT ALL  SHAREHOLDERS  WILL RETURN THEIR ITEMS IN ACCORDANCE  WITH THE STANDARD
PROCEDURE  OUTLINED IN THE SHAREHOLDER  MATERIALS AND ALL INQUIRIES WILL BE MADE
TO THE PUBLISHED TOLL FREE TELEPHONE LINE.  ADDITIONALLY,  WITHOUT THIS SERVICE,
ALL SHAREHOLDERS WILL RECEIVE FUNDS BY CHECK AND CERTIFICATES WILL BE MAILED AND
ALL PROCESSING WILL BE IN ACCORDANCE WITH OUR NORMAL TIMEFRAMES AND PROCEDURES.






                                    Exhibit 2

                                  [PROSPECTUS]







                                    Exhibit 3

               [INSTRUCTIONS FOR USE OF SUBSCRIPTION CERTIFICATES]






                                    Exhibit 4

                         [NOTICE OF GUARANTEED DELIVERY]







                                    Exhibit 5

                           [SUBSCRIPTION CERTIFICATE]






                                    Exhibit 6




         NAME                                    SPECIMEN SIGNATURE

John C. Ferrara

                                                 /S/JOHN C. FERRARA
                                                 -------------------------------
Eugene Hynes

                                                 /S/EUGENE HYNES
                                                 -------------------------------

EX-99.(J)

                                                                                                                       Exhibit 99(j)

                                                    LYNCH CORPORATION CERTIFICATE

                                                                    ----------------------------------------------------------------
                                                                    2                     SUBSTITUTE FORM W-9
                                                                    ----------------------------------------------------------------
THIS  LETTER  OF   TRANSMITTAL   INCLUDING   THE   ACCOMPANYING     PLEASE  CERTIFY YOUR TAXPAYER ID OR SOCIAL  SECURITY  NUMBER BY
INSTRUCTIONS,  SHOULD BE READ CAREFULLY  BEFORE THIS  LETTER OF     SIGNING BELOW.
TRANSMITTAL IS COMPLETED.

Lynch  Corporation is conducting a rights offering (the "Rights
Offering")  which entitles the holders of the Company's  common
shares (the  "Common  Shares"),  as of the close of business on
________ (the "Record Date") to receive one subscription  right
("Subscription  Right") for each Common Share held of record on
the Record Date. Holders of Subscription Rights are entitled to
subscribe  for and  purchase  one Common  Share for every three
Subscription Rights (the "Basic  Subscription  Privilege") at a
subscription  price of $xx.xx  per share.  Shareholders  on the     ----------------------------------------------------------------
Record Date who exercise their Basic Subscription  Privilege in     If  the   Taxpayer  ID  Number
full will be entitled to purchase  additional Common Shares pro     printed  above is INCORRECT OR    /__/__/__/__/__/__/__/__/__/
rata,  based on the number of Common Shares  purchased  through     if the space is BLANK write in
the Basic  Subscription  Privilege in  proportion  to the total     the CORRECT number here.
number   of   Common   Shares   that  the   holder   and  other     ----------------------------------------------------------------
oversubscribing    holders    purchased   through   the   Basic     Under penalties of perjury. I certify that:
Subscription Privilege (the "Oversubscrption  Privilege").  The     1.  The  number  shown  on  this  form is my  correct  taxpayer
maximum  number of Common  Shares  that a holder  may  purchase     identification  number  (or I am  waiting  for a  number  to be
under the Oversubscription  Privilege is equal to the number of     issued to me), AND
shares  such  holder  purchased  under the  Basic  Subscription     2. I am not  subject to backup  withholding  because:  (A) I am
Privilege.                                                          exempt from backup withholding, or (B) I have not been notified
                                                                    by the  Internal  Revenue  Service  (IRS)  that I am subject to
                                                                    backup  withholding  as a result  of a failure  to  report  all
For a more complete  description of the terms and conditions of     interest or dividends, or (C) the IRS has notified me that I am
the  Rights  Offering,  please  refer to the  Prospectus  dated     no longer subject to backup withholding, AND
_____, 2005 (the "Prospectus"), which is incorporated herein by     3. I am a U.S. person (including a U.S. resident alien).
reference.  Copies of the Prospectus are available upon request     CERTIFICATION INSTRUCTIONS.  You must cross out item 2 above if
from Mellon Investor Services LLC (toll free (866) 340-1578).       you  have  been  notified  by the IRS  that  you are  currently
                                                                    subject to backup withholding because you have failed to report
I hereby irrevocably  subscribe for the number of Common Shares     all interest and dividends on your tax return.
indicated on this  Subscription  Certificate upon the terms and
conditions   specified  in  the  Prospectus.   Receipt  of  the     Signature:________________________ Date:________________________
Prospectus is hereby acknowledged.                                  ----------------------------------------------------------------
                                                                    ----------------------------------------------------------------
PLEASE  COMPLETE  THE  BACK  IF  YOU  WOULD  LIKE  TO  TRANSFER                  SEE INSTRUCTIONS ON THE REVERSE SIDE
OWNERSHIP OR REQUEST SPECIAL MAILING.
                                                                    3 /__/ BASIC SHARES TO SUBSCRIBE   /__/__/__/__/__/__/__/__/
                                                                                                             WHOLE SHARES

                                                                    4 /_/  OVERSUBSCRIPTION FOR SHARES    /__/__/__/__/__/__/__/__/
                                                                                                               WHOLE SHARES
1.  SIGNATURE:  This  form  MUST be  signed  by the  registered
holder(s)   exactly   as   their   name(s)   appears   on   the
certificate(s) or by person(s)  authorized to sign on behalf of
the registered holder(s) by documents transmitted herewith.

X                         /           /
_________________________________________________________________
Signature of Shareholder    Date         Daytime Telephone #

X                         /           /
_________________________________________________________________
Signature of Shareholder    Date         Daytime Telephone #
                                                                    ENCLOSED IS MY PAYMENT FOR $ ______________________________
- -----------------------------------------------------------------   ----------------------------------------------------------------

- ------------------------------------------------------------------------------------------------------------------------------------
5


_____________________________________                                                            __________________________
   SUBSCRIPTION CERTIFICATE NUMBER                                                                    CUSIP NUMBER


_____________________________________                  ____________________                      ___________________________
     BASIC SHARES TO SUBSCRIBE                                RIGHTS                               RECORD DATE SHARES


                                                          LYNCH CORPORATION
                                                  SUBSCRIPTION FOR RIGHTS OFFERING
                                                            RECORD DATE

A.   Number of Common Shares subscribed for through the Basic Subscription Privilege (not to exceed one Common Share for every three
     Subscription Rights held):_________Common Shares

B.   Number of Common Shares subscribed for through the  Oversubscription  Privilege (not to exceed the number of shares subscribed
     for through the Basic Subscription Privilege):_________________ Common Shares

C.   Total Subscription Price (sum lines A and B multiplied by $__________): $ _______________

D.   Method of Payment

     Certified or Cashier's  check or money order payable to Mellon Investor Services LLC (acting on behalf of Mellon Bank, N.A.).


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

                                              HOW TO CONTACT MELLON INVESTOR SERVICES

                  By Telephone - 9 a.m. to 6 p.m. New York Time, Monday through Friday, except for bank holidays:

                                             From within the U.S., Canada or Puerto Rico
                                                     1-866-340-1578 (Toll Free)
                                                        From outside the U.S.
                                                      1-201-680-6579 (Collect)

                                         SUBSCRIPTION TO PURCHASE UNITS OF LYNCH CORPORATION
                                    RETURN TO: MELLON BANK, N.A. C/O MELLON INVESTOR SERVICES LLC

                                             WHERE TO FORWARD YOUR TRANSMITTAL MATERIALS


By Mail:                                            By Overnight Courier:                           By Hand

Mellon Bank, N.A.                                   Mellon Bank, N.A                                Mellon Bank, N.A
c/o Mellon Investor Services LLC                    c/o Mellon Investor Services LLC                c/o Mellon Investor Services LLC
Attn: Reorganization Dept.                          Attn: Reorganization Dept                       Attn: Reorganization Dept.
P.O. Box 3301                                       480 Washington Blvd.                            120 Broadway, 13th Floor
South Hackensack, NJ 07606                          Mail Drop-Reorg                                 New York, NY 10271
                                                    Jersey City, NJ 07310



THIS RIGHTS OFFERING EXPIRES AT 5:00 P.M., NEW YORK CITY TIME, ON  _____________XX,  2005 AND THIS SUBSCRIPTION  CERTIFICATE IS VOID
THEREAFTER.
- ------------------------------------------------------------------------------------------------------------------------------------



- ------------------------------------------------------------------------------------------------------------------------------------
                                        6                                                               7
                           Special Transfer Instructions                                  Special Mailing Instructions

If you want  your  LYNCH  CORPORATION  Common      Signature Guarantee Medallion  Fill in ONLY if mailing to someone other than
Shares and any  refund  check to be issued in                                     the  undersigned or to the  undersigned at an
ANOTHER  NAME,  fill in this section with the                                     address other than that shown on the front of
information for the NEW account name.                                             this card. Mail  certificate(s)  and check(s)
                                                                                  to:


_____________________________________________    ________________________________ _____________________________________________
Name (Please Print First, Middle &Last Name)     (Title of Officer Signing this  Name (Please Print First, Middle & Last Name)
                                                            Guarantee)


_____________________________________________    ________________________________ _____________________________________________
   Address            (Number and Street)              (Name of Guarantor -               Address     (Number and Street)
                                                           Please Print)


_____________________________________________    ________________________________ _____________________________________________
           (City, State & Zip Code)                 (Address of Guarantor Firm)



_____________________________________________    ________________________________ _____________________________________________
           (Tax Identification or                                                           (City, State & Zip Code)
           Social Security Number)



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


                            COMPLETE ALL APPLICABLE SECTIONS OF THIS FORM USING THE INSTRUCTIONS BELOW.

1    Sign and date Box 1 and include your daytime phone number.

2    PLEASE SIGN IN BOX 2 TO CERTIFY YOUR TAXPAYER ID OR SOCIAL  SECURITY NUMBER if you are a U.S.  Taxpayer.  If the Taxpayer ID or
     Social Security Number is incorrect or blank, write the corrected number in Box 2 and sign to certify.  Please note that Mellon
     Investor  Services may withhold 28% of your proceeds as required by the IRS if the Taxpayer ID or Social Security Number is not
     certified on our records. If you are a non - U.S. Taxpayer, please complete and return form W-8BEN.

3    Place an /X/ in the box and fill in the number of whole Common Shares you wish to subscribe for under your Basic Subscription

4    Place an /X/ in the box and fill in the number of whole Common Shares you wish to oversubscribe for under your Oversubscription
     Privilege (not to exceed the number of shares subscribed for through the Basic Subscription Privilege).

5    Rights card and calculation section for determining your Basic/Oversubscription Privileges.

6    If you want your LYNCH  CORPORATION  Common  Shares and any refund  check to be issued in another  name,  complete  the Special
     Transfer Instructions in Box 6. Signature(s) in Box 6 must be medallion guaranteed.

7    Fill in Box 7 if, mailing to someone other than the  undersigned  or to the  undersigned at an address other than that shown on
     the front of this card.







THIS RIGHTS  OFFERING HAS BEEN  QUALIFIED OR IS BELIEVED TO BE EXEMPT FROM  QUALIFICATION  ONLY UNDER THE FEDERAL LAWS OF THE UNITED
STATES AND THE LAWS OF THE STATES IN THE UNITED STATES.  RESIDENTS OR OTHER  JURISDICTIONS  MAY NOT PURCHASE THE SECURITIES  OFFERED
HEREBY UNLESS THEY CERTIFY THAT THEIR  PURCHASES OF SUCH  SECURITIES  ARE EFFECTED IN ACCORDANCE  WITH THE  APPLICABLE  LAWS OF SUCH
JURISDICTIONS.

THIS  RIGHTS  OFFERING  EXPIRES AT 5:00 P.M.,  NEW YORK CITY TIME,  ON _______ XX, 2005 AND THIS  SUBSCRIPTION  CERTIFICATE  IS VOID
THEREAFTER.

THIS AGREEMENT IS GOVERNED BY NEW YORK LAW.