##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D. C. 20549
 FORM 10-K
 þ
    
    Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the fiscal year ended December 31, 2010
 or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 Commission file number: 000-52380
 MISCOR GROUP, LTD.
  Indiana
    
    20-0995245(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 800 Nave Road, SE
Massillon, Ohio 44646
 330)-830-3500
 None
 Common Stock, no par value
 o þ
 o þ
 þ o
 o o
 þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
(Do not check if a smaller reporting company)
    
    Smaller reporting company þ
 o þ
  As of March 24, 2011, there were 11,785,826 shares outstanding of the registrants Common Stock,
without par value.
 DOCUMENTS INCORPORATED BY REFERENCE




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##### 



PART I
    
    
    1ITEM 1. BUSINESS
    
    
    1Overview
    
    
    1Business Strategy
    
    
    2Segment Information
    
    
    2Industrial Services Segment (Continuing Operations)
    
    
    3Principal Products, Services, Markets and Distribution
    
    
    3Marketing and Customers
    
    
    4Business Strategy
    
    
    4Raw Materials
    
    
    4Competition
    
    
    4Foreign Sales
    
    
    5Backlog
    
    
    5Working Capital
    
    
    5Seasonality and Quarterly Fluctuations
    
    
    5Construction and Engineering Services Segment (Discontinued Operations)
    
    
    5Principal Products, Services, Markets and Distribution
    
    
    6Business Strategy
    
    
    5Marketing and Customers
    
    
    6Raw Materials
    
    
    6Competition
    
    
    7Backlog
    
    
    7Working Capital
    
    
    7Seasonality and Quarterly Fluctuations
    
    
    7Rail Services Segment (Discontinued Operations)
    
    
    7Business Strategy
    
    
    7Principal Products Services, Markets and Distribution
    
    
    8Marketing and Customers
    
    
    8Raw Materials
    
    
    8Competition
    
    
    9Foreign Sales
    
    
    9Backlog
    
    
    9Working Capital
    
    
    9Seasonality and Quarterly Fluctuations
    
    
    9ITEM 1.A RISK FACTORS
    
    
    10ITEM 1B. UNRESOLVED STAFF COMMENTS
    
    
    10ITEM 2. PROPERTIES
    
    
    10ITEM 3. LEGAL PROCEEDINGS
    
    
    10ITEM 4. (REMOVED AND RESERVED)
    
    
    11PART II
    
    
    11ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
    
    
    11Market Information and Holders
    
    
    11EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1
  i




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##### Table of Contents



Dividends
    
    
    11Securities Authorized for Issuance Under Equity Compensation Plans
    
    
    122005 Stock Option Plan
    
    
    12Restricted Stock Purchase Plan
    
    
    12ITEM 6. SELECTED FINANCIAL DATA
    
    
    13ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    
    
    13ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    23ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
    
    
    23Report of Independent Registered Public Accounting Firm
    
    
    24Consolidated Balance Sheets as of December 31, 2010 and 2009
    
    
    25Consolidated Statements of Operations for the Years Ended December 31, 2010 and 2009
    
    
    26Consolidated Statements of Stockholders Equity for the Years Ended December 31, 2010 and 2009
    
    
    27Consolidated Statements of Cash Flows for the Years Ended December 31, 2010 and 2009
    
    
    28Notes to Consolidated Financial Statements
    
    
    29ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
    
    
    59ITEM 9A. CONTROLS AND PROCEDURES
    
    
    59ITEM 9B. OTHER INFORMATION
    
    
    60PART III
    
    
    60ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
    
    
    60ITEM 11. EXECUTIVE COMPENSATION
    
    
    61ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
    
    
    61ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
    
    
    61ITEM 14. PRINCIPAL ACOCUNTING FEES AND SERVICES
    
    
    61PART IV
    
    
    61ITEM 15. EXHIBITS AND FINANCIAL STATEMENTS
    
    
    61SIGNATURES
    
    
    72
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PART I
 
 ITEM 1.
    
    BUSINESS
 
 Overview
    
    
    Industrial Services  Providing maintenance and repair services to several
industries including electric motor repair and rebuilding; maintenance and repair of
electro-mechanical components for the wind power industry; and the repairing,
manufacturing, and remanufacturing of industrial lifting magnets for the steel and
scrap industries. To supplement our service offerings, we also provide on-site
maintenance services and custom and standardized industrial maintenance training
programs.
    
    Rail Services  Manufacturing and rebuilding power assemblies, engine parts, and
other components related to large diesel engines, and providing locomotive
maintenance, remanufacturing, and repair services for the rail industry.
  1




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Business Strategy
  Employees
  
 Segment Information
   2




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2010
    
    
    2009Revenues:Industrial Services
    
    $
    33,068
    
    
    $
    31,554Construction and Engineering Services
    
    
    1,721
    
    
    
    32,931Rail Services
    
    
    8,426
    
    
    
    16,785Corporate
    
    
    
    
    
    
    Elimination
    
    
    (3
    )
    
    
    (266
    )Discontinued/held-for-sale operations
    
    
    (10,147
    )
    
    
    (49,614
    )Consolidated
    
    $
    33,065
    
    
    $
    31,390Gross Profit:Industrial Services
    
    
    5,718
    
    
    
    2,689Construction and Engineering Services
    
    
    35
    
    
    
    3,223Rail Services
    
    
    1,104
    
    
    
    717Corporate
    
    
    (8
    )
    
    
    Elimination
    
    
    
    
    
    
    Discontinued/held-for-sale operations
    
    
    (1,139
    )
    
    
    (3,940
    )Consolidated
    
    $
    5,710
    
    
    $
    2,689Net loss:Industrial Services
    
    $
    (9,574
    )
    
    $
    (5,331
    )Construction and Engineering Services
    
    
    (1,209
    )
    
    
    (316
    )Rail Services
    
    
    (395
    )
    
    
    (12,748
    )Corporate
    
    
    (711
    )
    
    
    (2,073
    )Elimination
    
    
    
    
    
    
    Consolidated
    
    $
    (11,889
    )
    
    $
    (20,468
    )
 As of December 31,2010
    
    
    2009Total assets:Industrial Services
    
    $
    22,653
    
    
    $
    31,723Construction and Engineering Services
    
    
    
    
    
    
    9,314Rail Services  Held-for-sale
    
    
    3,493
    
    
    
    6,600Corporate
    
    
    1,030
    
    
    
    533Consolidated
    
    $
    27,176
    
    
    $
    48,170
  
 Industrial Services Segment (Continuing Operations)
  
 Principal Products, Services, Markets and Distribution
  3




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Marketing and Customers
  
 Business Strategy
  
    
    Strengthen competitive position in the growing market for outsourcing industrial
services. We believe that participants in the steel, power generation and other
industries we serve, in an effort to remain competitive, will increasingly rely on
independent contractors to provide maintenance and repair services. We intend to expand
our capabilities to provide our customers an outsourcing solution.
    
    Expand our presence in industries with long term growth potential, including the wind
energy, utility, and heavy industry markets.
 
 Raw Materials
  
 Competition
   4




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Foreign Sales
  
 Backlog
  
 Working Capital
  
 Seasonality and Quarterly Fluctuations
  
 Construction and Engineering Services Segment (Discontinued Operations)
 
 Business Strategy
  5




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Principal Products, Services, Markets and Distribution
   
 Marketing and Customers
  
 Raw Materials
  6




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Competition
  
 Backlog
  
 Working Capital
  
 Seasonality and Quarterly Fluctuations
  
 Rail Services Segment (Discontinued Operations)
 
 Business Strategy
    7




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Principal Products, Services, Markets and Distribution
   
 Marketing and Customers
  
 Raw Materials
  8




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Competition
   
 Foreign Sales
  
 Backlog
  
 Working Capital
  
 Seasonality and Quarterly Fluctuations
  9




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ITEM 1A.
    
    RISK FACTORS
  
 ITEM 1B.
    
    UNRESOLVED STAFF COMMENTS
  
 ITEM 2.
    
    PROPERTIES
     
 ITEM 3.
    
    LEGAL PROCEEDINGS
  10




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ITEM 4.
    
    (REMOVED AND RESERVED)
 
 PART II
 
 ITEM 5.
    
    MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
AND ISSUER PURCHASES OF EQUITY SECURITIES
 
 Market Information and Holders
 Reverse Stock Split
 Fiscal Year 2010
    
    High
    
    
    Low1st quarter ended 4/4/10
    
    $
    0.48
    
    
    $
    0.312nd quarter ended 7/4/10
    
    $
    0.44
    
    
    $
    0.303rd quarter ended 10/3/10
    
    $
    0.45
    
    
    $
    0.244th quarter ended 12/31/10
    
    $
    0.35
    
    
    $
    0.14
 Fiscal Year 2009
    
    High
    
    
    Low1st quarter ended 4/5/09
    
    $
    3.50
    
    
    $
    1.202nd quarter ended 7/5/09
    
    $
    2.55
    
    
    $
    0.723rd quarter ended 10/4/09
    
    $
    1.56
    
    
    $
    0.454th quarter ended 12/31/09
    
    $
    1.04
    
    
    $
    0.35
  
    
    warrants to acquire up to 308,197 shares of our common stock at fixed exercise
prices ranging from $0.0025 to $8.50 per share;
    
    options issued under our 2005 Stock Option Plan to acquire 13,900 shares of our
common stock at exercise prices ranging from $0.38 to $11.45 per share.
  
 Dividends
  11




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Securities Authorized for Issuance Under Equity Compensation Plans
 
 2005 Stock Option Plan
     
 Restricted Stock Purchase Plan
  12




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ITEM 6.
    
    SELECTED FINANCIAL DATA
  
 ITEM 7.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
  Overview
   
    
    Industrial Services  Providing maintenance and repair services to several
industries including electric motor repair and rebuilding; maintenance and repair of
electro-mechanical components for the wind power industry; and the repairing,
manufacturing, and
remanufacturing of industrial lifting magnets for the steel and scrap industries. To
supplement our service offerings, we also provide on-site maintenance services and
custom and standardized industrial maintenance training programs.
 13




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
    
    Rail Services  Manufacturing and rebuilding power assemblies, engine parts, and
other components related to large diesel engines, and providing locomotive
maintenance, remanufacturing, and repair services for the rail industry.
    
    
    Consented to our planned sale of our business;
    
    Revised the definition of Borrowing Base, resulting in lower available
borrowings;
    
    Required additional weekly principal payments of $10,000 on the real estate term
note; and
    
    Extended until January 27, 2010, and reduced to $1 million the previously agreed
upon requirement for the Company to raise $2 million additional capital through
subordinated debt, asset sales, or additional cash equity.
     14




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
    
    Revised the terms of Wells Fargos consent to the sale of our CES business; and
    
    Extended until February 19, 2010 and reduced to $1 million the previously agreed
upon requirement for the Company to raise $2 million additional capital through
subordinated debt, asset sales, or additional cash equity.
   
    
    Waived the Companys noncompliance with the minimum book net worth and maximum
capital expenditures from working capital covenants for the year ended December 31,
2009;
    
    Adjusted the minimum book net worth covenant to $21.5 million as of December 31,
2009
    
    Adjusted the allowable capital expenditures for the year ended December 31, 2010
to a maximum of $500,000;
    
    Incorporated a monthly minimum EBITDA covenant commencing in April, 2010; and
    
    Eliminated the previously agreed upon requirement for the Company to raise $1
million additional capital through subordinated debt, asset sales, or additional
cash equity.
   
    
    amortization of the term loan remained at $21,000 per month through January 31,
2011, when it increased to $52,000 per month;
    
    the term loan is to be paid in full upon the earlier of the sale of the Companys
HKEC business or upon maturity;
    
    the real estate loan was to be paid in full by December 31, 2011, using revolver
availability;
    
    accounts receivable between 91  120 days cease to be eligible collateral on the
earlier of a sale of the Companys HKEC business or May 31, 2011, having been
subjected to a cap gradually decreasing from $275,000 in monthly increments of
$50,000 through May 31, 2011;
    
    the percentage of ineligibility test for accounts owed by an account debtor was
to reduce from 35% of the total due from an account debtor to 25%, no later than
January 31, 2011;
    
    a stop loss covenant of ($400,000) measured monthly on a year-to-date basis
commenced January 1, 2011; and
    
    Capital expenditures during 2011 are limited to $200,000.
   15




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Critical Accounting Policies and Estimates
  Principles of consolidation
 Use of estimates
 Accounts receivable and allowance for doubtful accounts
 Discontinued operations and assets and liabilities held-for-sale
  Inventory
 16




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Goodwill
and other intangible assets   Intangibles  Goodwill and Other .
  Long-lived
assets 
 Revenue recognition 
  17




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Construction-type and Production-type Contracts
 Warranty
costs 
 Income taxes Income Taxes
  Stock based compensation Compensation  Stock Compensation (ASC 718).
 New Accounting Standards
   18




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Recent Developments
 Liquidity Issues.
  Response to Liquidity Issues.
 
    
    Downsized workforce and furloughs.
    
    Moved our corporate offices to Massillon, Ohio, and closed the South Bend,
Indiana facility.
    
    Suspended pay increases and bonuses.
    
    Initiated working capital initiatives with respect to accounts receivable and
inventory.
    
    Consolidated operations in certain groups where customer service would not be
affected.
    
    Initiated the effort to sell certain non-strategic assets resulting in the sale
of AMP Canada, our CES segment, and the remaining assets of AMP.
    
    Continue the effort to divest HK Engine Components.
  Operating Results
 Year Ended December 31, 2010 Compared to Year Ended December 31, 2009
 Revenues
 Gross Profit.
 19




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Selling, General and Administrative Expenses
 Goodwill impairment.
 Loss from Operations.
 Interest Expense and Other Income
 Loss from Continuing Operations.
 Provision for Income Taxes
 Loss from Discontinued Operations.
 Net Loss.
 Liquidity and Capital Resources for the Years Ended December 31, 2010 and 2009
  20




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21




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Off-Balance Sheet Transactions
  Forward-Looking Statements
  22




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ITEM 7A.
    
    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  
 ITEM 8.
    
    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 23




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Report of Independent Registered Public Accounting Firm
 
    Determining Whether an
Instrument (or embedded feature) is Indexed to an Entitys Own Stock
  /s/ BDO USA, LLP
 
 24




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MISCOR GROUP, LTD. AND SUBSIDIARIES
 
 CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data)
 December 31
    
    
    December 31,2010
    
    
    2009ASSETSCURRENT ASSETSAccounts
receivable, net of allowance for doubtful accounts of $226 and $766, respectively
    
    $
    6,006
    
    
    $
    4,083Inventories
    
    
    4,359
    
    
    
    5,349Assets held-for-sale
    
    
    3,493
    
    
    
    15,914Other current assets
    
    
    603
    
    
    
    261Total current assets
    
    
    14,461
    
    
    
    25,607PROPERTY AND EQUIPMENT, net
    
    
    5,521
    
    
    
    7,050OTHER ASSETSGoodwill
    
    
    
    
    
    
    7,831Customer relationships, net
    
    
    6,537
    
    
    
    6,922Other intangible assets, net
    
    
    598
    
    
    
    643Deposits and other assets
    
    
    59
    
    
    
    117Total other assets
    
    
    7,194
    
    
    
    15,513Total assets
    
    $
    27,176
    
    
    $
    48,170LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIESRevolving credit line, net of discount of $0 and $100, respectively
    
    $
    3,263
    
    
    $
    3,207Current portion of long-term debt
    
    
    385
    
    
    
    430Current portion of long-term debt, officers and affiliates
    
    
    4,105
    
    
    
    4,600Accounts payable
    
    
    3,742
    
    
    
    2,549Liabilities of held-for-sale operations
    
    
    1,076
    
    
    
    9,581Accrued expenses and other current liabilities
    
    
    1,855
    
    
    
    1,636Total current liabilities
    
    
    14,426
    
    
    
    22,003LONG-TERM LIABILITIESLong-term debt
    
    
    947
    
    
    
    2,003Long-term debt, officers and affiliates
    
    
    1,974
    
    
    
    2,418Total long-term liabilities
    
    
    2,921
    
    
    
    4,421Total liabilities
    
    
    17,347
    
    
    
    26,424Commitments and contingenciesSTOCKHOLDERS EQUITYPreferred stock, no par value; 800,000 shares authorized; no shares
issued and outstanding
    
    
    
    
    
    
    Common stock, no par value; 30,000,000 shares authorized;
11,785,826 and 11,801,326 shares issued and outstanding, respectively
    
    
    59,344
    
    
    
    59,372Accumulated deficit
    
    
    (49,515
    )
    
    
    (37,626
    )Total stockholders equity
    
    
    9,829
    
    
    
    21,746Total liabilities and stockholders equity
    
    $
    27,176
    
    
    $
    48,170
  25




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MISCOR GROUP, LTD. AND SUBSIDIARIES  
 CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except share and per share data)
 Year ended December 31,2010
    
    
    2009REVENUESProduct sales
    
    $
    4,774
    
    
    $
    3,972Service revenue
    
    
    28,291
    
    
    
    27,418Total Revenues
    
    
    33,065
    
    
    
    31,390COST OF REVENUESCost of product sales
    
    
    3,509
    
    
    
    3,326Cost of service revenue
    
    
    23,847
    
    
    
    25,375Total Cost of Revenues
    
    
    27,356
    
    
    
    28,701GROSS PROFIT
    
    
    5,709
    
    
    
    2,689SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
    
    
    16,418
    
    
    
    10,991LOSS FROM OPERATIONS
    
    
    (10,709
    )
    
    
    (8,302
    )OTHER (INCOME) EXPENSEInterest expense
    
    
    891
    
    
    
    1,018Other (income) expense
    
    
    188
    
    
    
    (610
    )1,079
    
    
    
    408LOSS FROM CONTINUING OPERATIONS
    
    
    (11,788
    )
    
    
    (8,710
    )LOSS FROM DISCONTINUED OPERATIONS
    
    
    (101
    )
    
    
    (11,758
    )(See Note C, Discontinued and Held-for-Sale Operations)NET LOSS
    
    $
    (11,889
    )
    
    $
    (20,468
    )BASIC AND DILUTED LOSS PER COMMON SHAREFrom Continuing Operations
    
    $
    (0.99
    )
    
    $
    (0.74
    )From Discontinued Operations
    
    
    (0.01
    )
    
    
    (1.00
    )BASIC AND DILUTED LOSS PER COMMON SHARE
    
    $
    (1.01
    )
    
    $
    (1.74
    )WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
    
    
    11,788,185
    
    
    
    11,775,245
  26




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MISCOR GROUP, LTD. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
(Amounts in thousands, except share data)
 Common
    
    
    AccumulatedShares
    
    
    Stock
    
    
    Defcit
    
    
    TotalBalances, December 31, 2008
    
    
    11,748,448
    
    
    $
    59,915
    
    
    $
    (17,158
    )
    
    $
    42,757Effect of adopting new
accounting gudeline
    
    
    
    
    
    
    (638
    )
    
    
    
    
    
    
    (638
    )Issuance of MISCOR common stock
in connection with 2005
Restricted Stock Plan
    
    
    2,500
    
    
    
    
    
    
    
    
    
    
    
    Issuance of MISCOR common stock
in connection with 2005
Employee Stock Purchase Plan
    
    
    53,680
    
    
    
    66
    
    
    
    
    
    
    
    66Stock based compensation
    
    
    
    
    
    
    34
    
    
    
    
    
    
    
    34Stock Re-purchase
    
    
    (3,302
    )
    
    
    (5
    )
    
    
    
    
    
    
    (5
    )Loss  2009
    
    
    
    
    
    
    
    
    
    
    (20,468
    )
    
    
    (20,468
    )Balances, December 31, 2009
    
    
    11,801,326
    
    
    
    59,372
    
    
    
    (37,626
    )
    
    
    21,746Stock based compensation, net
of forfietures
    
    
    (15,500
    )
    
    
    (27
    )
    
    
    
    
    
    
    (27
    )Loss  2010
    
    
    
    
    
    
    
    
    
    
    (11,889
    )
    
    
    (11,889
    )Balances, December 31, 2010
    
    
    11,785,826
    
    
    $
    59,344
    
    
    $
    (49,515
    )
    
    $
    9,829
  27




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MISCOR GROUP, LTD. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands, except share and per share data)
 Year Ended December 31,2010
    
    
    2009OPERATING ACTIVITIESNet loss
    
    $
    (11,889
    )
    
    $
    (20,468
    )Adjustments to reconcile net loss to net cash provided by operating activities:Depreciation and amortization
    
    
    1,881
    
    
    
    2,988Goodwill impairment
    
    
    7,831
    
    
    
    5,135Long lived assets impairment
    
    
    
    
    
    
    4,845Write off of note related to sale of business
    
    
    (379
    )
    
    
    Bad debt provision
    
    
    87
    
    
    
    319Inventory cost adjustments
    
    
    97
    
    
    
    74Loss on sale of equipment
    
    
    25
    
    
    
    Gain (loss) on disposal of discontinued operations
    
    
    (314
    )
    
    
    329Stock-based compensation, net of forfietures
    
    
    (25
    )
    
    
    34Amortization of debt issuance costs and debt discount
    
    
    100
    
    
    
    192Unrealized gain on conversion option
    
    
    (18
    )
    
    
    (620
    )Changes in:Accounts receivable
    
    
    (893
    )
    
    
    10,648Inventories
    
    
    1,415
    
    
    
    4,343Other current assets
    
    
    111
    
    
    
    (668
    )Deposits and other non-current assets
    
    
    596
    
    
    
    195Accounts payable
    
    
    1,481
    
    
    
    (2,222
    )Accrued expenses and other current liabilities
    
    
    241
    
    
    
    (1,299
    )Net cash provided by operating activities
    
    
    347
    
    
    
    3,825INVESTING ACTIVITIESProceeds from disposal of discontinued operations
    
    
    735
    
    
    
    1,083Acquisition of property and equipment
    
    
    (134
    )
    
    
    (433
    )Proceeds from disposal of property and equipment
    
    
    176
    
    
    
    303Net cash provided by investing activities
    
    
    777
    
    
    
    953FINANCING ACTIVITIESPayments on capital lease obligations
    
    
    (59
    )
    
    
    (117
    )Short-term debt repayments, net
    
    
    (3
    )
    
    
    (4,153
    )Borrowings of long-term debt
    
    
    26
    
    
    
    223Repayments of long-term debt
    
    
    (1,086
    )
    
    
    (691
    )Proceeds from the issuance of shares
    
    
    
    
    
    
    66Cash repurchase of restricted stock
    
    
    (2
    )
    
    
    (5
    )Debt issuance costs paid
    
    
    
    
    
    
    (177
    )Net cash utilized by financing activities
    
    
    (1,124
    )
    
    
    (4,854
    )DECREASE IN CASH
    
    
    
    
    
    
    (76
    )Cash, beginning of period
    
    
    
    
    
    
    76Cash, end of period
    
    $
    
    
    
    $
    SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:Cash paid during the period for:Interest
    
    $
    901
    
    
    $
    942
  28




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MISCOR GROUP, LTD. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
 (Amounts in thousands, except share and per share data)
 NOTE A  BUSINESS OVERVIEW
          NOTE B  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Principles of consolidation
  29




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
  Reclassifications
  Cash equivalents
  Concentration of credit risk
  Accounts receivable and allowance for doubtful accounts
   2010
    
    
    2009Balance at beginning of year
    
    $
    (766
    )
    
    $
    (639
    )Charges to expense
    
    
    (83
    )
    
    
    (213
    )Deductions
    
    
    623
    
    
    
    86Balance at end of year
    
    $
    (226
    )
    
    $
    (766
    )
 Discontinued operations and assets and liabilities held-for-sale
   30




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
  Inventory
  Property and equipment
  Buildings
    
    30 yearsLeasehold improvements
    
    Shorter of lease term or useful lifeMachinery and equipment
    
    5 to 10 yearsVehicles
    
    3 to 5 yearsOffice and computer equipment
    
    3 to 10 years
  Debt issue costs
   Goodwill and other intangible assets
 Intangibles  Goodwill and Other .
 31




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
   Revenue recognition
   Advertising costs
  Warranty costs
  32




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
   2010
    
    
    2009Balance at the beginning of year
    
    
    244
    
    
    
    417Warranty claims paid
    
    
    (79
    )
    
    
    (257
    )Warranty expense
    
    
    52
    
    
    
    84Balance at end of year
    
    
    217
    
    
    
    244
 Income taxes
    Stock based compensation
  Earnings per share
  33




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
    Use of estimates
  Variable Interest Entities
  New Accounting Standards
   34




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 NOTE C  DISCONTINUED AND HELD-FOR-SALE OPERATIONS
 AMP Rail Services Canada, ULC
   Twleve Months EndedDecember 31, 2009Revenue from discontinued operations
    
    $
    3,863Pretax loss from discountinued operations
    
    
    (1,091
    )Pretax loss on disposal of discontinued operations
    
    
    (329
    )
 Construction and Engineering Services Business
    35




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
   Year ended December 31,2010
    
    
    2009Revenue from discontinued operations
    
    $
    1,721
    
    
    $
    32,831Pretax income (loss) from discontinued operations
    
    
    (171
    )
    
    
    242Pretax gain on disposal of discontinued operations
    
    
    136
    
    
    
    
  February 3, 2010
    
    
    December 31, 2009ASSETSAccounts receivable, net of allowance for doubtful accounts
of $210 and $209, respectively
    
    $
    5,116
    
    
    $
    6,317Inventories
    
    
    171
    
    
    
    172Other current assets
    
    
    2,208
    
    
    
    2,325Total current assets
    
    
    7,495
    
    
    
    8,814PROPERTY AND EQUIPMENT, net
    
    
    500
    
    
    
    500Total assets
    
    $
    7,995
    
    
    $
    9,314LIABLITIESAccounts payable
    
    $
    5,252
    
    
    $
    5,174Accrued expense and other liabilities
    
    
    1,033
    
    
    
    1,279Total liabilities
    
    
    6,285
    
    
    
    6,453Net assets
    
    $
    1,710
    
    
    $
    2,861
 American Motive Power
   December 31, 2010
    
    
    December 31, 2009Revenue from discontinued operations
    
    $
    709
    
    
    $
    4,435Pretax loss from discontinued operations
    
    
    (241
    )
    
    
    (11,523
    )Pretax gain on disposal of discontinued operations
    
    
    178
    
    
    
    
 36




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
  March 8, 2010
    
    
    December 31, 2009ASSETSAccounts receivable, net of allowance for doubtful accounts
of $56 and $55, respectively
    
    $
    564
    
    
    $
    490Inventories
    
    
    1,153
    
    
    
    1,152Other current assets
    
    
    479
    
    
    
    723Total current assets
    
    
    2,196
    
    
    
    2,365Other assets
    
    
    
    
    
    
    262Total assets
    
    $
    2,196
    
    
    $
    2,627LIABLITIESAccounts payable
    
    $
    683
    
    
    $
    643Accrued expense and other liabilities
    
    
    1,691
    
    
    
    1,576Total liabilities
    
    
    2,374
    
    
    
    2,219Net assets
    
    $
    (178
    )
    
    $
    408
 HK Engine Components
   Year ended December 31,2010
    
    
    2009Revenue from discontinued operations
    
    $
    7,717
    
    
    $
    8,505Pretax income from discontinued operations
    
    
    311
    
    
    
    614
  37




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 December 31, 2010
    
    
    December 31, 2009ASSETSAccounts receivable, net of allowance for doubtful accounts
of $81 and $142, respectively
    
    $
    602
    
    
    $
    592Inventories
    
    
    1,571
    
    
    
    2,094Other current assets
    
    
    66
    
    
    
    30Total current assets
    
    
    2,239
    
    
    
    2,716PROPERTY AND EQUIPMENT, net
    
    
    1,254
    
    
    
    1,233Other assets
    
    
    
    
    
    
    24Total assets
    
    $
    3,493
    
    
    $
    3,973LIABLITIESAccounts payable
    
    $
    819
    
    
    $
    601Accrued expense and other liabilities
    
    
    258
    
    
    
    308Total liabilities
    
    
    1,077
    
    
    
    909Net assets
    
    $
    2,416
    
    
    $
    3,064
 NOTE D  INVENTORY
  December 31, 2010
    
    
    December 31, 2009Raw materials
    
    $
    2,196
    
    
    $
    2,393Work-in-progress
    
    
    1,633
    
    
    
    2,200Finished goods
    
    
    530
    
    
    
    756$
    4,359
    
    
    $
    5,349
  NOTE E  PROPERTY AND EQUIPMENT
  2010
    
    
    2009Land and Buildings
    
    $
    1,600
    
    
    $
    1,600Leasehold Improvements
    
    
    348
    
    
    
    378Machinery and Equipment
    
    
    6,866
    
    
    
    8,063Construction in Progress
    
    
    3
    
    
    
    Vehicles
    
    
    923
    
    
    
    978Office and Computer Equipment
    
    
    2,472
    
    
    
    1,46012,212
    
    
    
    12,479Less: Accumulated Depreciation
    
    
    (6,691
    )
    
    
    (5,429
    )$
    5,521
    
    
    $
    7,050
   38




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
  NOTE F  GOODWILL AND OTHER INTANGIBLE ASSETS
 Goodwill
  Magnetech
    
    
    American MotiveIndustrial Services
    
    
    Power
    
    
    Ideal Consolidated
    
    
    TotalBalances as of January 1, 2009
    
    $
    7,831
    
    
    $
    4,490
    
    
    $
    645
    
    
    $
    12,966Impairment Charge
    
    
    
    
    
    
    (4,490
    )
    
    
    (645
    )
    
    
    (5,135
    )Balances as of December 31, 2009
    
    $
    7,831
    
    
    $
    
    
    
    $
    
    
    
    $
    7,831Impairment Charge
    
    
    (7,831
    )
    
    
    
    
    
    
    
    
    
    
    (7,831
    )Balances as of December 31, 2010
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
  Goodwill impairment  AMP
   39




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
  Goodwill impairment  Ideal
  Other intangible assets
  Estimated
    
    
    December 31, 2010
    
    
    December 31, 2009Useful Lives
    
    
    Gross Carrying
    
    
    Accululated
    
    
    
    
    
    
    Gross Carrying
    
    
    Accululated(in Years)
    
    
    Amount
    
    
    Amortization
    
    
    Net
    
    
    Amount
    
    
    Amortization
    
    
    Impairment
    
    
    NetPatents and Trademarks
    
    
    10
    
    
    $
    4
    
    
    $
    (4
    )
    
    $
    
    
    
    $
    4
    
    
    $
    (3
    )
    
    $
    
    
    
    $
    1Technical Library
    
    
    20
    
    
    
    700
    
    
    
    (108
    )
    
    
    592
    
    
    
    700
    
    
    
    (73
    )
    
    
    
    
    
    
    627Customer Relationships
    
    
    15-20
    
    
    
    7,722
    
    
    
    (1,187
    )
    
    
    6,537
    
    
    
    9,592
    
    
    
    (1,044
    )
    
    
    (1,626
    )
    
    
    6,922Non-Compete Agreements
    
    
    3
    
    
    
    17
    
    
    
    
    
    
    
    6
    
    
    
    807
    
    
    
    (518
    )
    
    
    (274
    )
    
    
    15Total
    
    
    
    
    
    $
    8,443
    
    
    $
    (1,299
    )
    
    $
    7,135
    
    
    $
    11,103
    
    
    $
    (1,638
    )
    
    $
    (1,900
    )
    
    $
    7,565
   Year Ended December 31 2011
    
    $
    4282012
    
    
    4212013
    
    
    4212014
    
    
    4212015
    
    
    421Thereafter
    
    
    5,023Total
    
    $
    7,135
 40




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 NOTE G  ASSET IMPAIRMENT
     NOTE H  SENIOR CREDIT FACILITY
 Senior credit facility with Wells Fargo
   41




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
     Default and Waiver Agreements
  
    
    Consented to the planned sale of the CES business;
    
    Revised the definition of Borrowing Base, resulting in lower available
borrowings;
    
    Required additional weekly principal payments of $10,000 on the real estate term
note; and
    
    Extended until January 27, 2010, and reduced to $1,000 the previously agreed upon
requirement for the Company to raise $2,000 additional capital through subordinated
debt, asset sales, or additional cash equity.
  
    
    Revised the terms of Wells Fargos consent to the sale of our CES business; and
    
    Extended until February 19, 2010 the requirement for the Company to raise $1,000
additional capital through subordinated debt, asset sales, or additional cash equity.
  
    
    Waived the Companys noncompliance with the minimum book net worth and maximum
capital expenditures from working capital covenants for the year ended December 31,
2009;
    
    Adjusted the minimum book net worth covenant to $21,500 as of December 31, 2009
 42




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 
    
    Adjusted the allowable capital expenditures for the year ended December 31, 2010
to a maximum of $500;
    
    Incorporated a monthly minimum EBITDA covenant commencing in April, 2010; and
    
    Eliminated the previously agreed upon requirement for the Company to raise $1,000
additional capital through subordinated debt, asset sales, or additional cash
equity.
   
    
    amortization of the term loan remained at $21 per month through January 31, 2011,
when it increased to $52 per month;
    
    the term loan is to be paid in full upon the earlier of the sale of the Companys
HKEC business or upon maturity;
    
    the real estate loan was to be paid in full by December 31, 2011, using revolver
availability;
    
    accounts receivable between 91  120 days cease to be eligible collateral on the
earlier of a sale of the Companys HKEC business or May 31, 2011, having been
subjected to a cap gradually decreasing from $275 in monthly increments of $50
through May 31, 2011;
    
    the percentage of ineligibility test for accounts owed by an account debtor was
to reduce from 35% of the total due from an account debtor to 25%, no later than
January 31, 2011;
    
    a stop loss covenant of ($400) measured monthly on a year-to-date basis commenced
January 1, 2011; and
    
    Capital expenditures during 2011 are limited to $200.
   NOTE I  LONG-TERM DEBT
  43




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 December 31,
    
    
    December 31,2010
    
    
    2009Note payable to
Chairman, payable in
monthly installments of
$5 beginning April 1,
2010, with outstanding
balance payable at
maturity date of
February 28, 2012, plus
interest at the greater
of 5% or the prime rate
(3.25% at December 31,
2010 and December 31,
2009) plus 2%, secured
by a subordinated
interest in
substantially all assets
owned by the Company
    
    $
    2,079
    
    
    $
    Note payable to former
members of 3-D Service,
Ltd. (BDeWees, Inc.) due
November 30, 2011, plus
interest at 12% at
December 31, 2010 and
prime rate (3.25% at
December 31, 2009)
secured by a
subordinated interest in
machinery and equipment
of 3-D Services, Ltd.
    
    
    2,000
    
    
    
    2,000Note payable to former
members of 3-D Service,
Ltd. (XGen III, Ltd.)
due November 30, 2011,
plus interest at 12% at
December 31, 2010 and
prime rate (3.25% at
December 31, 2009)
secured by a
subordinated interest in
machinery and equipment
and inventory of 3-D
Services, Ltd.
    
    
    2,000
    
    
    
    2,000Note payable to bank in
monthly installments of
$21 through May 2012,
plus interest currently
at Daily Three Month
LIBOR plus 5.25%
beginning April 14,
2009, increased to Daily
Three Month LIBOR (0.30%
at December 31, 2010)
plus 8.25% beginning
June 1, 2009, secured by
inventory and
substantially all
machinery and equipment
(see Note G, Senior
Credit Facility)
    
    
    322
    
    
    
    580Note payable to bank in
monthly installments of
$3 through November 16,
2014, plus interest at
8% secured by a security
interest in certain
equipment
    
    
    123
    
    
    
    147Convertible note payable
to officer , converted
into the note payable to
Chairman in accordance
with CES sales agreement
    
    
    
    
    
    
    3,000Notes paid off in 2010
    
    
    
    
    
    
    827Notes payable in monthly
installments of $1
through April 2014,
without interest,
secured by certain
equipment.
    
    
    
    
    
    
    136Capital lease obligations
    
    
    1,009
    
    
    
    1,0447,533
    
    
    
    9,734Less: current portion
    
    
    4,490
    
    
    
    5,030$
    3,043
    
    
    $
    4,704
  44




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 Capital lease obligations
  December 31,
    
    
    December 31,2010
    
    
    2009Machinery and equipment
    
    $
    746
    
    
    $
    746Vehicles and trailers
    
    
    84
    
    
    
    84Computer equipment and
software
    
    
    240
    
    
    
    240Furniture and office equipment
    
    
    91
    
    
    
    91Less accumulated depreciation
    
    
    (397
    )
    
    
    (249
    )$
    764
    
    
    $
    912
  Minimum future lease payments:2011
    
    $
    1782012
    
    
    1782013
    
    
    1,0561,412Less imputed interest
    
    
    (403
    )Present value of net minimum lease payments
    
    $
    1,009
 Maturities of long term debt
  Years Ending December 31,
    
    Amount2011
    
    $
    4,4902012
    
    
    2,0722013
    
    
    9142014
    
    
    57$
    7,533
  45




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 Years ended December 31,2010
    
    
    2009Interest expense on principal
    
    $
    772
    
    
    $
    976Amortization of debt issue costs
    
    
    14
    
    
    
    40Amortization of debt discount -
revolving notes payable
    
    
    115
    
    
    
    194$
    901
    
    
    $
    1,210
  Warrants associated with debt
  Number of
    
    
    Weighted-AverageWarrant Shares
    
    
    Exercise PriceOutstanding at January 1, 2009
    
    
    310,254
    
    
    $
    8.23Granted
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Forfieted
    
    
    
    
    
    
    Outstanding at December 31, 2009
    
    
    310,254
    
    
    $
    8.23Granted
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Forfieted
    
    
    (2,057
    )
    
    $
    0.01Outstanding at December 31, 2010
    
    
    308,197
    
    
    $
    8.28
  Weighted-AverageNumber of Warrant
    
    Remaining ContractualExercise Price
    
    Shares
    
    Life (Years)0.25
    
    8,079
    
    2.428.50
    
    300,118
    
    1.65
 NOTE J  STOCK BASED COMPENSATION
 2005 Stock Option Plan
  46




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
     2010
    
    
    2009Expected Volatility
    
    
    47.94
    %
    
    
    47.41
    %Risk free interest rate
    
    
    1.63
    %
    
    
    1.55
    %Expected term
    
    3.75 years
    
    
    3.75 yearsVesting period
    
    4 years
    
    
    4 yearsContractual term
    
    5 years
    
    
    5 yearsWeighted average fair value
    
    $
    0.14
    
    
    $
    1.83
   47




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 2009Weighted AverageNumber
    
    
    Weighted Average
    
    
    Remaining
    
    
    Aggregateof Shares
    
    
    Exercise Price
    
    
    Contractual Term
    
    
    Intrinsic ValueOutstanding at beginning of year
    
    
    76,600
    
    
    $
    7.37Granted
    
    
    8,000
    
    
    $
    3.30Exercised
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    Forfeited
    
    
    (46,600
    )
    
    $
    6.62Outstanding at December 31, 2009
    
    
    38,000
    
    
    $
    7.43
    
    
    
    2.41
    
    
    $
    Vested and Exercisable at
December 31, 2009
    
    
    20,100
    
    
    $
    6.84
    
    
    
    1.84
    
    
    $
    
 2010Weighted AverageNumber of
    
    
    Weighted Average
    
    
    Remaining
    
    
    AggregateShares
    
    
    Exercise Price
    
    
    Contractual Term
    
    
    Intrinsic ValueOutstanding at beginning of year
    
    
    38,000
    
    
    $
    7.43Granted
    
    
    66,000
    
    
    $
    0.38Exercised
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    Forfeited
    
    
    (31,800
    )
    
    $
    1.15Outstanding at December 31, 2010
    
    
    72,200
    
    
    $
    2.19
    
    
    
    3.42
    
    
    $
    Vested and Exercisable at
December 31, 2010
    
    
    13,900
    
    
    $
    6.34
    
    
    
    0.58
    
    
    $
    
 2005 Restricted Stock Purchase Plan
   2010
    
    
    2009Weighted
    
    
    
    
    
    
    WeightedAverage Grant
    
    
    
    
    
    
    Average GrantDate Fair
    
    
    
    
    
    
    Date FairShares
    
    
    Value
    
    
    Shares
    
    
    ValueNon-vested at Beginning of Year
    
    
    9,000
    
    
    $
    8.71
    
    
    
    21,200
    
    
    $
    8.45Granted
    
    
    10,000
    
    
    
    0.35
    
    
    
    1,500
    
    
    
    3.30Vested
    
    
    
    
    
    
    
    
    
    
    (1,000
    )
    
    
    6.23Forfeited
    
    
    (7,000
    )
    
    
    8.98
    
    
    
    (12,700
    )
    
    
    7.88Non-vested at End of Year
    
    
    12,000
    
    
    
    1.33
    
    
    
    9,000
    
    
    
    8.71
  48




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
  Employee Stock Purchase Plan
   2009Expected volatility
    
    
    47.55
    %Risk-free interest rate
    
    
    0.17
    %Expected term
    
    0.25 yearsDividend yield
    
    
    0
    %
 NOTE K  INCOME TAXES
  49




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 December 31,2010
    
    
    2009Deferred Tax Assets:Tax Credit Carryforwards
    
    $
    14,629
    
    
    $
    12,092Accounts Receivable
    
    
    104
    
    
    
    413Inventory
    
    
    288
    
    
    
    527Warranty Reserve
    
    
    87
    
    
    
    165Accrued Expenses and Other
    
    
    2
    
    
    
    21Total Gross Deferred Tax Assets
    
    
    15,110
    
    
    
    13,218Valuation Allowance
    
    
    (13,563
    )
    
    
    (12,576
    )1,547
    
    
    
    642Deferred Tax Liabilities:Property, Equipment, and
Intangibles
    
    
    (1,547
    )
    
    
    (642
    )Net Deferred Tax Assets
    
    $
    
    
    
    $
    
  December 31,2010
    
    
    2009Statuatory U.S. federal income tax rate
    
    
    34.0
    %
    
    
    34.0
    %State taxes, net of federal benefit
    
    
    5.6
    %
    
    
    5.6
    %Permanent differences
    
    
    -0.4
    %
    
    
    -0.8
    %Valuation allowance
    
    
    -39.2
    %
    
    
    -38.8
    %Effective tax rate
    
    
    0.0
    %
    
    
    0.0
    %
    NOTE L  LEASE COMMITMENTS
  50




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
    Years Ending December 31,2011
    
    $
    1,2662012
    
    
    6632013
    
    
    5702014
    
    
    5442015
    
    
    541Thereafter
    
    
    1,035$
    4,619
 NOTE M  RELATED PARTY TRANSACTIONS
 Long term debt, officers
   51




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
   Affiliated Leases
    NOTE N  DERIVATIVE INSTRUMENTS
   52




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 NOTE O  FAIR VALUE MEASUREMENTS
  
    
    Level 1Unadjusted quoted prices in active markets that are accessible at the
measurement date for identical, unrestricted assets or liabilities.
 
    
    Level 2Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly or indirectly, including quoted
prices for similar assets or liabilities in active markets; quoted prices for
identical or similar assets or liabilities in markets that are not active; inputs
other than quoted prices that are observable for the asset or liability (e.g.,
interest rates); and inputs that are derived principally from or corroborated by
observable market data by correlation or other means.
 
    
    Level 3Inputs that are both significant to the fair value measurement and
unobservable.
 Assets measured at fair value
  Fair Value Measurements at December 31, 2010, using:Total Carrying
    
    
    
    
    
    
    Significant
    
    
    SignificantValue at
    
    
    Quoted Prices in
    
    
    Observable
    
    
    UnobservableDecember 31,
    
    
    Active Markets
    
    
    Other Inputs
    
    
    Other Inputs
    
    
    Total Gains2010
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    (Losses)Goodwill (See Note F, Goodwill and Other
Intangible Assets)
    
    $
    
    
    
    
    
    
    
    
    
    
    
    $
    
    
    
    $
    (7,831
    )Long lived assets held for sale (See Note C,
Discontinued and Held-for-Sale
Operations and Note F, Goodwill and
Other Intangible Assets)
    
    $
    1,254
    
    
    $
    
    
    
    $
    
    
    
    $
    1,254
    
    
    $
    
 Fair Value Measurements at December 31, 2009, using:Total Carrying
    
    
    
    
    
    
    Significant
    
    
    SignificantValue at
    
    
    Quoted Prices in
    
    
    Observable
    
    
    UnobservableDecember 31,
    
    
    Active Markets
    
    
    Other Inputs
    
    
    Other Inputs
    
    
    Total Gains2009
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    (Losses)Note payable conversion option (See Note N)
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    18
    
    
    
    620Goodwill (See Note F, Goodwill and Other
Intangible Assets)
    
    $
    7,831
    
    
    
    
    
    
    
    
    
    
    $
    7,831
    
    
    $
    (5,135
    )Long lived assets held for sale (See Note C,
Discontinued and Held-for-Sale
Operations and Note F, Goodwill and
Other Intangible Assets)
    
    $
    1,733
    
    
    $
    
    
    
    $
    
    
    
    $
    1,733
    
    
    $
    4,845
  53




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 Note PayableConversion
    
    
    
    
    
    
    Long lived assetsOption
    
    
    Goodwill
    
    
    held-for-saleBalance at December 31, 2009
    
    $
    (18
    )
    
    
    7,831
    
    
    
    1,733Net realized gain on the fair value of the conversion option
included in earnings
    
    
    18
    
    
    
    
    
    
    
    Goodwill impairment included in earnings
    
    
    
    
    
    
    (7,831
    )
    
    
    Capital expenditures
    
    
    
    
    
    
    
    
    
    
    21CES assets disposed and included in gain calculation at Note C
    
    
    
    
    
    
    
    
    
    
    (500
    )Balance at December 31, 2010
    
    $
    
    
    
    $
    
    
    
    $
    1,254
 Cash, accounts receivable, accounts payable and accrued expenses
  Debt
  NOTE P  RETIREMENT PLANS
    NOTE Q  CONCENTRATIONS OF CREDIT RISK
  54




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
  NOTE R  COMMITMENTS AND CONTINGENCIES
 Collective bargaining agreements
  Potential lawsuits
  Employment agreements
   NOTE S  SEGMENT INFORMATION
   55




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
  Construction &
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Discontinued/
    
    
    December 31,Industrial
    
    
    Engineering
    
    
    Rail
    
    
    
    
    
    
    Intersegment
    
    
    Held -for-Sale
    
    
    20102010
    
    Services
    
    
    Services
    
    
    Services
    
    
    Corporate
    
    
    Eliminations
    
    
    Operations
    
    
    ConsolidatedExternal revenue:Product sales
    
    $
    4,774
    
    
    $
    
    
    
    $
    7,717
    
    
    $
    
    
    
    $
    
    
    
    $
    (7,717
    )
    
    $
    4,774Service revenue
    
    
    28,291
    
    
    
    1,721
    
    
    
    709
    
    
    
    
    
    
    
    
    
    
    
    (2,430
    )
    
    
    28,291Intersegment revenue:Product sales
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Service revenue
    
    
    3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3
    )
    
    
    
    
    
    
    Deprecation included in the cost
of revenues
    
    
    1,242
    
    
    
    8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8
    )
    
    
    1,242Gross profit
    
    
    5,718
    
    
    
    35
    
    
    
    1,104
    
    
    
    (8
    )
    
    
    
    
    
    
    (1,139
    )
    
    
    5,710Other depreciation & amortization
    
    
    483
    
    
    
    2
    
    
    
    11
    
    
    
    
    
    
    
    
    
    
    
    (13
    )
    
    
    483Goodwill impairment charges
    
    
    7,831
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,831Interest expense
    
    
    291
    
    
    
    
    
    
    
    10
    
    
    
    600
    
    
    
    
    
    
    
    (10
    )
    
    
    891Net income (loss)
    
    
    (9,574
    )
    
    
    (1,209
    )
    
    
    (395
    )
    
    
    (711
    )
    
    
    
    
    
    
    
    
    
    
    (11,889
    )Total assets
    
    
    22,654
    
    
    
    
    
    
    
    3,493
    
    
    
    1,028
    
    
    
    
    
    
    
    
    
    
    
    27,175Capital expenditures
    
    
    176
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    176
 Construction &
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Discontinued/
    
    
    December 31,Industrial
    
    
    Engineering
    
    
    Rail
    
    
    
    
    
    
    Intersegment
    
    
    Held -for-Sale
    
    
    20092009
    
    Services
    
    
    Services
    
    
    Services
    
    
    Corporate
    
    
    Eliminations
    
    
    Operations
    
    
    ConsolidatedExternal revenue:Product sales
    
    $
    3,972
    
    
    $
    
    
    
    $
    8,505
    
    
    $
    
    
    
    $
    
    
    
    $
    (8,505
    )
    
    $
    3,972Service revenue
    
    
    27,418
    
    
    
    32,831
    
    
    
    8,278
    
    
    
    
    
    
    
    
    
    
    
    (41,109
    )
    
    
    27,418Intersegment revenue:Product sales
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Service revenue
    
    
    164
    
    
    
    100
    
    
    
    2
    
    
    
    
    
    
    
    (266
    )
    
    
    
    
    
    
    Deprecation included in the cost
of revenues
    
    
    1,246
    
    
    
    101
    
    
    
    564
    
    
    
    
    
    
    
    
    
    
    
    (665
    )
    
    
    1,246Gross profit
    
    
    2,689
    
    
    
    3,223
    
    
    
    717
    
    
    
    
    
    
    
    
    
    
    
    (3,940
    )
    
    
    2,689Other depreciation & amortization
    
    
    445
    
    
    
    28
    
    
    
    2,443
    
    
    
    150
    
    
    
    
    
    
    
    (2,471
    )
    
    
    595Asset impairment charges
    
    
    
    
    
    
    
    
    
    
    4,845
    
    
    
    
    
    
    
    
    
    
    
    (4,845
    )
    
    
    Goodwill impairment charges
    
    
    
    
    
    
    645
    
    
    
    4,490
    
    
    
    
    
    
    
    
    
    
    
    (5,135
    )
    
    
    Interest expense
    
    
    287
    
    
    
    1
    
    
    
    24
    
    
    
    898
    
    
    
    
    
    
    
    (192
    )
    
    
    1,018Net income (loss)
    
    
    (5,331
    )
    
    
    (316
    )
    
    
    (12,748
    )
    
    
    (2,073
    )
    
    
    
    
    
    
    
    
    
    
    (20,468
    )Total assets
    
    
    31,723
    
    
    
    9,314
    
    
    
    6,600
    
    
    
    533
    
    
    
    
    
    
    
    
    
    
    
    48,170Capital expenditures
    
    
    288
    
    
    
    288
    
    
    
    476
    
    
    
    15
    
    
    
    
    
    
    
    (764
    )
    
    
    303
 NOTE T  SUPPLEMENTAL DISCLOSURES OF NON-CASH FINANCING ACTIVITIES
 Year Ended December 31,2010
    
    
    2009Issuance of restricted stock
    
    $
    
    
    
    $
    5Reduction of note payable in conjunction with
sale of CES business
    
    $
    1,096
    
    
    $
    Expiration of conversion option
    
    $
    18
    
    
    $
    620Equipment acquired through capital lease obligation
    
    $
    
    
    
    $
    79
 NOTE U  LIQUIDITY AND MANAGEMENT PLANS
  56




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
     57




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MISCOR GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
TWO YEARS IN THE PERIOD ENDED DECEMBER 31, 2010
(Amounts in thousands, except share and per share data)
 NOTE V  SUBSEQUENT EVENTS
 Officer Resignations
  Officer Appointments
  Financing Efforts
  NOTE W  SUMMARIZED QUARTERLY DATA (UNAUDITED)
  QuarterFirst
    
    
    Second
    
    
    Third
    
    
    FourthYear Ended December 31, 2010Sales
    
    $
    8,031
    
    
    $
    9,105
    
    
    $
    7,963
    
    
    $
    7,966Gross profit
    
    
    1,205
    
    
    
    1,696
    
    
    
    1,253
    
    
    
    1,556Cost and expenses
    
    
    2,139
    
    
    
    2,334
    
    
    
    2,289
    
    
    
    10,736Loss from continuing opperations
    
    
    (934
    )
    
    
    (638
    )
    
    
    (1,036
    )
    
    
    (9,180
    )Loss from discontinued operations
    
    
    (111
    )
    
    
    (143
    )
    
    
    34
    
    
    
    119Net loss
    
    $
    (1,045
    )
    
    $
    (781
    )
    
    $
    (1,002
    )
    
    $
    (9,061
    )Basic and diluted loss per common shareFrom continuing operations
    
    $
    (0.08
    )
    
    $
    (0.07
    )
    
    $
    (0.08
    )
    
    $
    (0.77
    )From discontinued operations
    
    
    (0.01
    )
    
    
    (0.00
    )
    
    
    0.00
    
    
    
    0.00Basic and diluted loss per common share
    
    $
    (0.09
    )
    
    $
    (0.07
    )
    
    $
    (0.08
    )
    
    $
    (0.77
    )Year Ended December 31, 2009Sales
    
    $
    10,259
    
    
    $
    6,951
    
    
    $
    7,552
    
    
    $
    6,628Gross profit
    
    
    677
    
    
    
    665
    
    
    
    631
    
    
    
    716Cost and expenses
    
    
    3,465
    
    
    
    2,681
    
    
    
    2,684
    
    
    
    2,569Loss from continuing opperations
    
    
    (2,788
    )
    
    
    (2,016
    )
    
    
    (2,053
    )
    
    
    (1,853
    )Loss from discontinued operations
    
    
    (542
    )
    
    
    (620
    )
    
    
    (2,424
    )
    
    
    (8,172
    )Net loss
    
    $
    (3,330
    )
    
    $
    (2,636
    )
    
    $
    (4,477
    )
    
    $
    (10,025
    )Basic and diluted loss per common shareFrom continuing operations
    
    $
    (0.24
    )
    
    $
    (0.17
    )
    
    $
    (0.18
    )
    
    $
    (0.15
    )From discontinued operations
    
    
    (0.04
    )
    
    
    (0.05
    )
    
    
    (0.20
    )
    
    
    (0.71
    )Basic and diluted loss per common share
    
    $
    (0.28
    )
    
    $
    (0.22
    )
    
    $
    (0.38
    )
    
    $
    (0.86
    )
 58




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##### Table of Contents



ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 9A. CONTROLS AND PROCEDURES
 Evaluation of Effectiveness of Disclosure Controls and Procedures
   Internal Control Over Financial Reporting
 Managements Annual Report on Internal Control Over Financial Reporting
    59




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Internal Control 
Integrated Framework
  Changes in Internal Control Over Financial Reporting
  
 ITEM 9B. OTHER INFORMATION
  
 PART III
 
 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
 Directors and Executive Officers
 Proxy Statement
 Code of Ethics
  Audit Committee Information
  60




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ITEM 11. EXECUTIVE COMPENSATION
  
 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
  
 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
  
 ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES
  
 PART IV
 
 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 Financial Statements
  Financial Statement Schedules
  Exhibits
  Exhibit Number
    
    Description2.1*
    
    
    AMP Stock Purchase Agreement dated January 16, 2008, among
MISCOR Group, Ltd., Lawrence Mehlenbacher, Joseph Fearon,
Thomas Coll, Richard Rizzieri, and Gary Walsh (incorporated
by reference to Exhibit 2.1 to the registrants Current
Report on Form 8-K filed by the registrant on January 23,
2008)
 61




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##### Table of Contents



Exhibit Number
    
    Description2.2*
    
    
    3-D Membership Interest Purchase Agreement dated November
30, 2007, by and among Magnetech Industrial Services, Inc.,
BDeWees, Inc., and XGen III, Ltd. (incorporated by
reference to Exhibit 2.1 to the registrants Current Report
on Form 8-K filed by the registrant on December 5, 2007)2.3*
    
    
    Stock Purchase Agreement dated October 19, 2007, by and
among MISCOR Group, Ltd., and Darrell L. Graf, Mary A.
LaPlace and Kenneth D. Wiegand (incorporated by reference
to Exhibit 2.1 to the registrants Current Report on Form
8-K filed by the registrant on October 22, 2007)2.4*
    
    
    Asset Purchase Agreement dated May 31, 2006 among Magnetech
Industrial Services of Alabama, LLC, Magnetech Industrial
Services, Inc., E. T. Smith Services of Alabama, Inc. and
Smith Services, Inc. (incorporated by reference to Exhibit
2.1 to the registrants Current Report on Form 8-K filed by
the registrant on June 1, 2006)2.5
    
    
    Asset Purchase Agreement dated as of March 4, 2005 among HK
Machined Parts, LLC, HK Weston Properties, LLC and Hatch &
Kirk, Inc. (incorporated by reference to Exhibit 10.31 to
the registrants Registration Statement on Form S-1 (Reg.
No. 333-129354))2.6
    
    
    Asset Purchase Agreement dated as of March 4, 2005 between
HK Cast Products, LLC f/k/a HK Engineered Castings, LLC and
HK Castings, Inc. (incorporated by reference to Exhibit
10.32 to the registrants Registration Statement on Form
S-1 (Reg. No. 333-129354))3.1a
    
    
    Amended and Restated Articles of Incorporation of the
registrant (incorporated by reference to Exhibit 3.1 to the
registrants Registration Statement on Form S-1 (Reg No.
333-129354))3.1b
    
    
    Articles of Amendment to the registrants Amended and
Restated Articles of Incorporation, effective January 14,
2008 (incorporated by reference to Exhibit 3.1 to the
registrants Current Report on Form 8-K filed by the
registrant on January 14, 2008)3.1c
    
    
    Articles of Amendment to the registrants Amended and
Restated Articles of Incorporation, effective February 8,
2008 (incorporated by reference to Exhibit 3.1 to the
registrants Current Report on Form 8-K filed by the
registrant on February 13, 2008)3.2
    
    
    Amended and Restated Code of By-Laws of the registrant
(incorporated by reference to Exhibit 3.1 to the
registrants Current Report on Form 8-K filed by the
registrant on November 21, 2007)3.3
    
    
    Amended and Restated Code of By-laws of MISCOR Group, Ltd.
(amended as of July 22, 2009) (incorporated by reference to
Exhibit 3.1 to the registrants Current Report on Form 8-K
filed on July 28, 2009)4.1
    
    
    Specimen certificate of common stock 2004 (incorporated by
reference to Exhibit 4.2.1 to the registrants Form 10-K
filed March 31, 2004)4.2
    
    
    Warrant Agreement, form of Joinder Agreement and form of
common stock purchase warrant issued to designees of
Strasbourger Pearson Tulcin Wolff Incorporated pursuant to
Placement Agency Agreement dated April 26, 2004
(incorporated by reference to Exhibit 4.2 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))4.3
    
    
    Form of common stock purchase warrant issued to designees
of Strasbourger Pearson Tulcin Wolff Incorporated pursuant
to Placement Agency Agreement dated January 25, 2005
(incorporated by reference to Exhibit 4.3 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))4.4
    
    
    Form of common stock purchase warrant issued to purchasers
of the registrants subordinated convertible debentures
pursuant to Convertible Debenture Purchase Agreements with
the registrant (incorporated by reference to Exhibit 4.4 to
the registrants Registration Statement on Form S-1 (Reg.
No. 333-129354))4.5
    
    
    Common Stock Purchase Warrant dated August 24, 2005 issued
to Laurus Master Fund, Ltd. (incorporated by reference to
Exhibit 4.5 to the registrants Registration Statement on
Form S-1 (Reg. No. 333-129354))4.6
    
    
    Form of common stock purchase warrant issued to persons
designated by Vertical Capital Partners, Inc. (incorporated
by reference to Exhibit 4.6 to the registrants
Registration Statement on Form S-1 (Reg. No. 333-129354))4.7a
    
    
    Form of subordinated convertible debenture issued to
purchasers pursuant to Convertible
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##### Table of Contents



Exhibit Number
    
    DescriptionDebenture Purchase Agreements with the registrant (incorporated by reference
to Exhibit 4.7a to the registrants Registration Statement
on Form S-1 (Reg. No. 333-129354))4.7b
    
    
    Letter Agreement dated April 16, 2006, to extend maturity
date of subordinated convertible debentures (incorporated
by reference to Exhibit 4.7b to the registrants
Registration Statement on Form S-1 (Reg. No. 333-129354))4.8
    
    
    Secured Revolving Note dated August 24, 2005 issued to
Laurus Master Fund, Ltd. (incorporated by reference to
Exhibit 4.8 to the registrants Registration Statement on
Form S-1 (Reg. No. 333-129354))4.9
    
    
    Secured Convertible Minimum Borrowing Note dated August 24,
2005 issued to Laurus Master Fund, Ltd. (incorporated by
reference to Exhibit 4.9 to the registrants Registration
Statement on Form S-1 (Reg. No. 333-129354))4.10
    
    
    Secured Convertible Term Note dated August 24, 2005 issued
to Laurus Master Fund, Ltd. (incorporated by reference to
Exhibit 4.10 to the registrants Registration Statement on
Form S-1 (Reg. No. 333-129354))4.11
    
    
    Promissory Note dated January 1, 2004 issued by Magnetech
Industrial Services, Inc. to John A. Martell (incorporated
by reference to Exhibit 4.11 to the registrants
Registration Statement on Form S-1 (Reg. No. 333-129354))4.11a
    
    
    Amendment to Promissory Note dated April 14, 2009 issued by
the registrant (assignee of Magnetech Industrial Services,
Inc.) to John A. Martell (incorporated by reference to
Exhibit 4.11a of the registrants Annual Report on Form
10-K filed on April 15, 2009)4.11b
    
    
    Secured Promissory Note dated February 3, 2010, among John
A. Martell and the registrant (incorporated by reference to
Exhibit 10.3 to the registrants Current Report on Form 8-K
filed on February 9, 2010)4.12
    
    
    Conversion Option dated September 12, 2005 among John A.
Martell, Magnetech Industrial Services, Inc. and the
registrant (incorporated by reference to Exhibit 4.12 to
the registrants Registration Statement on Form S-1 (Reg.
No. 333-129354))4.13
    
    
    Amendment to Conversion Option dated November 28, 2007, by
and among MISCOR Group, Ltd., Magnetech Industrial
Services, Inc., and John A. Martell (incorporated by
reference to Exhibit 4.1 to the registrants Current Report
on Form 8-K filed by the registrant on December 5, 2007)4.14
    
    
    Form of Registration Rights Agreement between the
registrant and the purchasers scheduled therein, made
pursuant to Stock Purchase Agreement with the registrant
(incorporated by reference to Exhibit 4.13 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))4.15
    
    
    Form of Registration Rights Agreement between the
registrant and the purchasers scheduled therein, made
pursuant to Subordinated Convertible Debenture Purchase
Agreements (incorporated by reference to Exhibit 4.14 to
the registrants Registration Statement on Form S-1 (Reg.
No. 333-129354))4.16
    
    
    Registration Rights Agreement dated August 24, 2005 between
the registrant and Laurus Master Fund, Ltd. (incorporated
by reference to Exhibit 4.15 to the registrants
Registration Statement on Form S-1 (Reg. No. 333-129354))4.17
    
    
    Common Stock Purchase Warrant dated May 31, 2006 issued by
registrant to Laurus Master Fund, Ltd. (incorporated by
reference to Exhibit 4.1 to the registrants Current Report
on Form 8-K filed by the registrant on June 6, 2006)4.18
    
    
    Secured Non-convertible Revolving Note dated May 31, 2006
issued by Magnetech Industrial Services of Alabama, LLC to
Laurus Master Fund, Ltd. (incorporated by reference to
Exhibit 4.2 to the registrants Current Report on Form 8-K
filed by the registrant on June 6, 2006)4.19
    
    
    Secured Term Note dated May 31, 2006 issued by Magnetech
Industrial Services of Alabama, LLC to Laurus Master Fund,
Ltd. (incorporated by reference to Exhibit 4.3 to the
registrants Current Report on Form 8-K filed by the
registrant on June 6, 2006)4.20a
    
    
    Registration Rights Agreement dated May 31, 2006 between
the registrant and Laurus Master Fund, Ltd. (incorporated
by reference to Exhibit 4.4 to the registrants Current
Report on Form 8-K filed by the registrant on June 6, 2006)4.20b
    
    
    Amendment dated July 31, 2006, to Registration Rights
Agreement dated May 31, 2006, between the registrant and
Laurus Master Fund, Ltd. (incorporated by reference to
Exhibit 10.1 to the registrants Current Report on Form 8-K
filed by the registrant on August 4, 2006)4.20c
    
    
    Amendment dated August 30, 2006, to Registration Rights
Agreement dated May 31, 2006, between the registrant and
Laurus Master Fund, Ltd. (incorporated by reference to
Exhibit 10.1 to the registrants Current Report on Form 8-K
filed by the registrant on August 31, 2006)4.21*
    
    
    Securities Purchase Agreement, dated January 18, 2007, by
and among MISCOR Group, Ltd.,
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Exhibit Number
    
    DescriptionTontine Capital Partners, L.P. and Tontine Capital Overseas Master Fund, L.P.
(incorporated by reference to Exhibit 10.1 to the
registrants Current Report on Form 8-K filed by the
registrant on January 22, 2007)4.22
    
    
    Registration Rights Agreement, dated January 18, 2007, by
and among MISCOR Group, Ltd., Tontine Capital Partners,
L.P. and Tontine Capital Overseas Master Fund, L.P.
(incorporated by reference to Exhibit 10.2 to the
registrants Current Report on Form 8-K filed by the
registrant on January 22, 2007)4.23
    
    
    Irrevocable Proxy of John Martell (incorporated by
reference to Exhibit 99.1 to the registrants Current
Report on Form 8-K filed by the registrant on January 22,
2007)4.24
    
    
    Restated Irrevocable Proxy of John A. Martell (incorporated
by reference to Exhibit 99.2 to the registrants Current
Report on Form 8-K filed by the registrant on December 5,
2007)10.1
    
    
    Placement Agency Agreement, dated April 26, 2004 between
Magnetech Industrial Services, Inc. and Strasbourger
Pearson Tulcin Wolff Incorporated (incorporated by
reference to Exhibit 10.1 to the registrants Registration
Statement on Form S-1 (Reg. No. 333-129354))10.2
    
    
    Placement Agency Agreement dated January 25, 2005 between
the registrant and Strasbourger Pearson Tulcin Wolff
Incorporated (incorporated by reference to Exhibit 10.2 to
the registrants Registration Statement on Form S-1 (Reg.
No. 333-129354))10.3
    
    
    Form of Convertible Redeemable Preferred Stock Purchase
Agreement between Magnetech Industrial Services, Inc. and
the purchasers scheduled therein (incorporated by reference
to Exhibit 10.3 to the registrants Registration Statement
on Form S-1 (Reg. No. 333-129354))10.4
    
    
    Form of Stock Purchase Agreement between the registrant and
the purchasers scheduled therein (incorporated by reference
to Exhibit 10.4 to the registrants Registration Statement
on Form S-1 (Reg. No. 333-129354))10.5
    
    
    Form of Subordinated Convertible Debenture Purchase
Agreement among the registrant, Strasbourger Pearson Tulcin
Wolff, Inc. and the purchasers scheduled therein
(incorporated by reference to Exhibit 10.5 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.6
    
    
    Escrow Agreement dated April 26, 2004 among the registrant,
Wilmington Trust Company and Strasbourger Pearson Tulcin
Wolff Incorporated (incorporated by reference to Exhibit
10.6 to the registrants Registration Statement on Form S-1
(Reg. No. 333-129354))10.7a
    
    
    Funds Escrow Agreement dated August 24, 2005 among the
registrant, Loeb & Loeb LLP and Laurus Master Fund, Ltd.
(incorporated by reference to Exhibit 10.7a to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.7b
    
    
    Funds Escrow Disbursement Letter/Joint Instructions dated
August 24, 2005 (incorporated by reference to Exhibit 10.7b
to the registrants Registration Statement on Form S-1
(Reg. No. 333-129354))10.8
    
    
    Security Agreement dated as of March 3, 2005 between the
registrant and Strasbourger Pearson Tulcin Wolff
Incorporated, as agent for purchasers of subordinated
convertible debentures (incorporated by reference to
Exhibit 10.8 to the registrants Registration Statement on
Form S-1 (Reg. No. 333-129354))10.9a
    
    
    Security and Purchase Agreement dated August 24, 2005 among
Laurus Master Fund, Ltd., the registrant and subsidiaries
of the registrant identified therein (incorporated by
reference to Exhibit 10.9a to the registrants Registration
Statement on Form S-1 (Reg. No. 333-129354))10.9b
    
    
    Amendment to Security and Purchase Agreement, dated October
19, 2005 among Laurus Master Fund, Ltd., the registrant and
subsidiaries of the registrant identified therein
(incorporated by reference to Exhibit 10.9b to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.9c
    
    
    Amendment to Security and Purchase Agreement, dated January
31, 2006 among Laurus Master Fund, Ltd., the registrant and
subsidiaries of the registrant identified therein
(incorporated by reference to Exhibit 10.9c to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))
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##### Table of Contents



Exhibit Number
    
    Description10.9d
    
    
    Amendment to Security and Purchase Agreement dated July 14,
2006 among Laurus Master Fund, Ltd., the registrant and
subsidiaries of the registrant identified therein, amending
the Security and Purchase Agreement and related agreements
and instruments (incorporated by reference to Exhibit 10.1
to the registrants Current Report on Form 8-K filed by the
registrant on July 20, 2006)10.10
    
    
    Pledge Agreement dated August 24, 2005 among Laurus Master
Fund, Ltd., the registrant and certain subsidiaries of the
registrant identified therein (incorporated by reference to
Exhibit 10.10 to the registrants Registration Statement on
Form S-1 (Reg. No. 333-129354))10.11
    
    
    Guaranty dated August 24, 2005 made by certain subsidiaries
of the registrant identified therein in favor of Laurus
Master Fund, Ltd. (incorporated by reference to Exhibit
10.11 to the registrants Registration Statement on Form
S-1 (Reg. No. 333-129354))10.12
    
    
    Form of Subordination Agreement made among John Martell,
Patricia Minehardt and Strasbourger Pearson Tulcin Wolff,
Inc., as agent for the holders of subordinated convertible
debentures, in favor of Laurus Master Fund, Ltd.
(incorporated by reference to Exhibit 10.13 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.13
    
    
    Lease, commencing August 3, 2001, between JAM Summer
Properties, LLC and Magnetech Industrial Services, Inc.
(incorporated by reference to Exhibit 10.14 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.14
    
    
    Lease, commencing May 5, 2003, between JAM Bev Properties,
LLC and Magnetech Industrial Services, Inc. (incorporated
by reference to Exhibit 10.15 to the registrants
Registration Statement on Form S-1 (Reg. No. 333-129354))10.15
    
    
    Lease, commencing May 5, 2003, between JAM Walnut
Properties, LLC and Magnetech Industrial Services, Inc.
(incorporated by reference to Exhibit 10.16 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.16
    
    
    Lease, commencing March 1, 2002, between JAM Hutson
Properties, LLC and Magnetech Industrial Services, Inc.
(incorporated by reference to Exhibit 10.17 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.17@
    
    
    2005 Stock Option Plan of the registrant (incorporated by
reference to Exhibit 10.18 to the registrants Registration
Statement on Form S-1 (Reg. No. 333-129354))10.18@
    
    
    Form of Stock Option Agreement under 2005 Stock Option Plan
(incorporated by reference to Exhibit 10.19 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.19a@
    
    
    2005 Restricted Stock Purchase Plan of the registrant
(incorporated by reference to Exhibit 10.20 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.19b@
    
    
    Amendment to the MISCOR 2005 Restricted Stock Purchase
Plan, effective February 7, 2008 (incorporated by reference
to Exhibit 10.1 to the registrants Current Report on Form
8-K filed by the registrant on February 13, 2008)10.20@
    
    
    MISCOR Group, Ltd. Employee Stock Purchase Plan
(incorporated by reference to Exhibit 4.1 to the
registrants Registration Statement on Form S-8 (Reg. No.
333-141537))10.21@
    
    
    Employment Agreement dated September 30, 2005 between the
registrant and John A. Martell (incorporated by reference
to Exhibit 10.21 to the registrants Registration Statement
on Form S-1 (Reg. No. 333-129354))10.22@
    
    
    Employment Agreement dated September 30, 2005 between the
registrant and James M. Lewis (incorporated by reference to
Exhibit 10.22 to the registrants Registration Statement on
Form S-1 (Reg. No. 333-129354))10.23@
    
    
    Employment Agreement dated September 30, 2005 between the
registrant and Richard J. Mullin (incorporated by reference
to Exhibit 10.23 to the registrants Registration Statement
on Form S-1 (Reg. No. 333-129354))
 65




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##### Table of Contents



Exhibit Number
    
    Description10.24@
    
    
    Employment Agreement dated September 30, 2005 between
Magnetech Industrial Services, Inc. and William Wisniewski
(incorporated by reference to Exhibit 10.24 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.25@
    
    
    Employment Agreement dated September 30, 2005 between
Martell Electric, LLC and Anthony Nicholson (incorporated
by reference to Exhibit 10.25 to the registrants
Registration Statement on Form S-1 (Reg. No. 333-129354))10.26
    
    
    Asset Purchase Agreement dated August 9, 2000 between
Magnetech Industrial Services, Inc., Trans Tech Electric,
Inc. and Delta Star Electric, Inc. (incorporated by
reference to Exhibit 10.28 to the registrants Registration
Statement on Form S-1 (Reg. No. 333-129354))10.27
    
    
    Asset Purchase Agreement dated as of November 26, 2004
between Martell Electric, LLC and Thompson, Inc.
(incorporated by reference to Exhibit 10.30 to the
registrants Registration Statement on Form S-1 (Reg. No.
333-129354))10.28
    
    
    Security and Purchase Agreement dated May 31, 2006 among
Laurus Master Fund, Ltd. and Magnetech Industrial Services
of Alabama, LLC (incorporated by reference to Exhibit 10.1
to the registrants Current Report on Form 8-K filed by the
registrant on June 6, 2006)10.29
    
    
    Stock Pledge Agreement dated May 31, 2006 among Laurus
Master Fund, Ltd., the registrant and certain subsidiaries
of the registrant identified therein (incorporated by
reference to Exhibit 10.2 to the registrants Current
Report on Form 8-K filed by the registrant on June 6, 2006)10.30
    
    
    Master Security Agreement among Laurus Master Fund, Ltd.,
the registrant and certain subsidiaries of the registrant
identified therein (incorporated by reference to Exhibit
10.3 to the registrants Current Report on Form 8-K filed
by the registrant on June 6, 2006)10.31
    
    
    Mortgage granted by Magnetech Industrial Services of
Alabama, LLC in favor of Laurus Master Fund, Ltd.
(incorporated by reference to Exhibit 10.4 to the
registrants Current Report on Form 8-K filed by the
registrant on June 6, 2006)10.32
    
    
    Guaranty dated May 31, 2006 made by the registrant and
certain subsidiaries of the registrant identified therein
in favor of Laurus Master Fund, Ltd. (incorporated by
reference to Exhibit 10.5 to the registrants Current
Report on Form 8-K filed by the registrant on June 6, 2006)10.33
    
    
    Amended and Restated Subordination Agreement dated May 31,
2006 made among John Martell and Strasbourger Pearson
Tulcin Wolff, Inc., as agent for the holders of
subordinated convertible debentures, in favor of Laurus
Master Fund, Ltd. (incorporated by reference to Exhibit
10.6 to the registrants Current Report on Form 8-K filed
by the registrant on June 6, 2006)10.34
    
    
    Overadvance Side Letter Agreement dated May 31, 2006
between Magnetech Industrial Services of Alabama, LLC and
Laurus Master Fund, Ltd. (incorporated by reference to
Exhibit 10.7 to the registrants Current Report on Form 8-K
filed by the registrant on June 6, 2006)10.35
    
    
    Funds Escrow Agreement dated May 31, 2006 among the
registrant, Loeb & Loeb LLP and Laurus Master Fund, Ltd.
(incorporated by reference to Exhibit 10.8 to the
registrants Current Report on Form 8-K filed by the
registrant on June 6, 2006)10.36
    
    
    Funds Escrow Disbursement Letter/Joint Instructions dated
May 31, 2006 (incorporated by reference to Exhibit 10.9 to
the registrants Current Report on Form 8-K filed by the
registrant on June 6, 2006)10.37
    
    
    Commercial Lease effective January 1, 2007, between Martell
Electric, LLC and Martell Properties LLC (incorporated by
reference to Exhibit 10.37 to the registrants Registration
Statement on Form S-1 (Reg. No. 333-137940))10.38
    
    
    Line of Credit Agreement, dated March 9, 2007, by and among
MISCOR Group, Ltd., HK Engine Components, LLC, Magnetech
Industrial Services, Inc., Magnetech Power Services, LLC,
Martell Electric LLC and MFB Financial (incorporated by
reference to
 66




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##### Table of Contents



Exhibit Number
    
    DescriptionExhibit 10.1 to the registrants Current Report on Form 8-K filed by the registrant on March 15, 2007)10.39
    
    
    Promissory Note dated March 9, 2007, made by MISCOR Group,
Ltd., HK Engine Components, LLC, Magnetech Industrial
Services, Inc., Magnetech Power Services, LLC and Martell
Electric LLC for MFB Financial (incorporated by reference
to Exhibit 10.2 to the registrants Current Report on Form
8-K filed by the registrant on March 15, 2007)10.40
    
    
    Form of Commercial Security Agreement dated March 9, 2007,
entered into between each of MISCOR Group, Ltd., HK Engine
Components, LLC, Magnetech Industrial Services, Inc.,
Magnetech Power Services, LLC, and Martell Electric LLC, on
the one hand, and MFB Financial, on the other hand
(incorporated by reference to Exhibit 10.3 to the
registrants Current Report on Form 8-K filed by the
registrant on March 15, 2007)10.41
    
    
    Form of Guaranty dated March 9, 2007, entered into between
each of MISCOR Group, Ltd., HK Engine Components, LLC,
Magnetech Industrial Services, Inc., Magnetech Power
Services, LLC, and Martell Electric LLC, on the one hand,
and MFB Financial, on the other hand (incorporated by
reference to Exhibit 10.4 to the registrants Current
Report on Form 8-K filed by the registrant on March 15,
2007)10.42
    
    
    Insider Subordination Agreement dated March 9, 2007, by and
among MISCOR Group, Ltd., HK Engine Components, LLC, MFB
Financial and John A. Martell (incorporated by reference to
Exhibit 10.5 to the registrants Current Report on Form 8-K
filed by the registrant on March 15, 2007)10.43
    
    
    Subordination Agreement dated March 9, 2007, by and among
MISCOR Group, Ltd., MFB Financial, and the holders of
certain subordinated secured convertible debentures
(incorporated by reference to Exhibit 10.6 to the
registrants Current Report on Form 8-K filed by the
registrant on March 15, 2007)10.44
    
    
    Promissory Note dated November 30, 2007, issued by
Magnetech Industrial Services, Inc., to BDeWees, Inc.
(incorporated by reference to Exhibit 10.1 to the
registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.45
    
    
    Promissory Note dated November 30, 2007, issued by
Magnetech Industrial Services, Inc., to XGen III, Ltd.
(incorporated by reference to Exhibit 10.2 to the
registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.46
    
    
    Lease between 3-D3E Ltd., Landlord, and 3-D Service, Ltd.,
Tenant, and Guaranty of MISCOR Group, Ltd., dated November
30, 2007 (incorporated by reference to Exhibit 10.3 to the
registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.47*
    
    
    Securities Purchase Agreement dated November 30, 2007, by
and among Tontine Capital Partners, L.P., Tontine Capital
overseas Master Fund, L.P., and MISCOR Group, Ltd.
(incorporated by reference to Exhibit 10.4 to the
registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.48
    
    
    Amended and Restated Registration Rights Agreement dated
November 30, 2007, by and between MISCOR Group, Ltd.,
Tontine Capital Partners, L.P., and Tontine Capital
Overseas Master Fund, L.P. (incorporated by reference to
Exhibit 10.5 to the registrants Current Report on Form 8-K
filed by the registrant on December 5, 2007)10.49
    
    
    Commercial Security Agreement dated November 30, 2007,
between 3-D Service, Ltd., and BDeWees, Inc. (incorporated
by reference to Exhibit 10.6 to the registrants Current
Report on Form 8-K filed by the registrant on December 5,
2007)10.50
    
    
    Commercial Security Agreement dated November 30, 2007,
between 3-D Service, Ltd., and XGen III, Ltd. (incorporated
by reference to Exhibit 10.7 to the registrants Current
Report on Form 8-K filed by the registrant on December 5,
2007)10.51@
    
    
    Employment Agreement dated November 30, 2007, between
Magnetech Industrial Services, Inc., and Bernard L. DeWees
(incorporated by reference to Exhibit 10.8 to the
registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.52
    
    
    Guaranty of Thomas J. Embrescia dated November 30, 2007
(incorporated by reference
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Exhibit Number
    
    Descriptionto Exhibit 10.9 to the registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.53
    
    
    Guaranty of Bernard L. DeWees dated November 30, 2007
(incorporated by reference to Exhibit 10.10 to the
registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.54
    
    
    Non-Compete Agreement dated November 30, 2007, between
Magnetech Industrial Services, Inc., and Bernard L. DeWees
(incorporated by reference to Exhibit 10.11 to the
registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.55
    
    
    Non-Compete Agreement dated November 30, 2007, between
Magnetech Industrial Services, Inc., and Thomas J.
Embrescia (incorporated by reference to Exhibit 10.12 to
the registrants Current Report on Form 8-K filed by the
registrant on December 5, 2007)10.56*
    
    
    Credit and Security Agreement dated January 14, 2008, among
Wells Fargo Bank, the registrant and certain subsidiaries
of the registrant identified therein (incorporated by
reference to Exhibit 10.1 to the registrants Current
Report on Form 8-K filed by the registrant on January 18,
2008)10.56a
    
    
    Second Amendment to Credit and Security Agreement dated
August 28, 2008, among Wells Fargo Bank, the registrant and
certain subsidiaries of the registrant identified therein
(incorporated by reference to Exhibit 10.56a to the
registrants Registration Statement on Form S-1 (Reg. No.
333-154649))10.56b
    
    
    Fourth Amendment to Credit and Security Agreement and
Limited Waiver of Defaults dated April 14, 2009, among
Wells Fargo Bank, the registrant and certain subsidiaries
of the registrant (incorporated by reference to Exhibit
10.56b of the registrants Annual Report on Form 10-K filed
on April 15, 2009)10.56c
    
    
    Fourth Amendment to Credit and Security Agreement dated
July 22, 2009, among Wells Fargo Bank, the registrant and
certain subsidiaries of the registrant (incorporated by
reference to Exhibit 10.1 of the registrants Current
Report or Form 8-K filed July 28, 2009)10.56d
    
    
    Fifth Amendment to Credit and Security Agreement dated
September 16, 2009, among Wells Fargo Bank, the registrant
and certain subsidiaries of the registrant (incorporated by
reference to Exhibit 10.2 to the registrants Current
Report on Form 8-K filed on September 21, 2009)10.56e
    
    
    Sixth Amendment to Credit and Security Agreement dated
January 14, 2010, among Wells Fargo Bank, the registrant
and certain subsidiaries of the registrant (incorporated by
reference to Exhibit 10.1 of the registrants Current
Report or Form 8-K filed January 21, 2010)10.56f
    
    
    Letter Agreement dated September 8, 2009, among Wells Fargo
Bank, the registrant and certain subsidiaries of the
registrant, acknowledged and agreed to by the registrant
and such subsidiaries on September 16, 2009 (incorporated
by reference to Exhibit 10.1 to the registrants Current
Report on Form 8-K filed on September 21, 2009)10.56g
    
    
    Consent and release by Wells Fargo Bank, National
Association, dated March 15, 2010 (incorporated by
reference to Exhibit 10.10 to the registrants Current
Report on form 8-K filed on March 15, 2010)10.56h
    
    
    Letter Agreement dated February 9, 2010, among Wells Fargo
Bank, the registrant and certain subsidiaries of the
registrant (incorporated by reference to Exhibit 10.1 to
the registrants Current Report on Form 8-K filed on
February 9, 2010)10.56i
    
    
    Seventh Amendment to Credit and Security Agreement and
Limited Waiver of Defaults dated April 15, 2010, among
Wells Fargo Bank, the registrant and certain subsidiaries
of the registrant.10.57
    
    
    Revolving Note dated January 14, 2008, among Wells Fargo
Bank, the registrant and certain subsidiaries of the
registrant identified therein (incorporated by reference to
Exhibit 10.2 to the registrants Current Report on Form 8-K
filed by the registrant on January 18, 2008)
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Exhibit Number
    
    Description10.58
    
    
    Real Estate Note dated January 14, 2008, among Wells Fargo
Bank, the registrant and certain subsidiaries of the
registrant identified therein (incorporated by reference to
Exhibit 10.3 to the registrants Current Report on Form 8-K
filed by the registrant on January 18, 2008)10.59
    
    
    Real Estate Mortgage, Security Agreement and Assignment of
Rents and Leases dated January 14, 2008, between Wells
Fargo Bank and Magnetech Industrial Services, Inc.
(incorporated by reference to Exhibit 10.4 to the
registrants Current Report on Form 8-K filed by the
registrant on January 18, 2008)10.61
    
    
    Patent and Trademark Security Agreement dated January 14,
2008, between Wells Fargo Bank and 3-D Service, Ltd.
(incorporated by reference to Exhibit 10.6 to the
registrants Current Report on Form 8-K filed by the
registrant on January 18, 2008)10.62
    
    
    Patent and Trademark Security Agreement dated January 14,
2008, between Wells Fargo Bank and Magnetech Industrial
Services, Inc. (incorporated by reference to Exhibit 10.7
to the registrants Current Report on Form 8-K filed by the
registrant on January 18, 2008)10.63
    
    
    Standby Letter of Credit Agreement dated January 14, 2008,
among Wells Fargo Bank, the registrant and certain
subsidiaries of the registrant identified therein
(incorporated by reference to Exhibit 10.8 to the
registrants Current Report on Form 8-K filed by the
registrant on January 18, 2008)10.64
    
    
    Subordination Agreement between Wells Fargo Bank and John
A. Martell (incorporated by reference to Exhibit 10.9 to
the registrants Current Report on Form 8-K filed by the
registrant on January 18, 2008)10.65
    
    
    Subordination Agreement between Wells Fargo Bank and
Strasbourger, Pearson, Tulcin, Wolffe, Inc. (incorporated
by reference to Exhibit 10.10 to the registrants Current
Report on Form 8-K filed by the registrant on January 18,
2008)10.66
    
    
    Subordination Agreement among Wells Fargo Bank, BDeWees,
Inc., and XGen III, Ltd. (incorporated by reference to
Exhibit 10.11 to the registrants Current Report on Form
8-K filed by the registrant on January 18, 2008)10.67
    
    
    Lease Agreement dated January 16, 2008, between Dansville
Properties, LLC and American Motive Power, Inc.
(incorporated by reference to Exhibit 10.1 to the
registrants Current Report on Form 8-K filed by the
registrant on January 23, 2008)10.68
    
    
    Non-Compete Agreement dated January 16, 2008, between
American Motive Power, Inc., and Lawrence Mehlenbacher
(incorporated by reference to Exhibit 10.2 to the
registrants Current Report on Form 8-K filed by the
registrant on January 23, 2008)10.69
    
    
    Non-Compete Agreement dated January 16, 2008, between
American Motive Power, Inc., and Richard Rizzieri
(incorporated by reference to Exhibit 10.3 to the
registrants Current Report on Form 8-K filed by the
registrant on January 23, 2008)10.70
    
    
    Non-Compete Agreement dated January 16, 2008, between
American Motive Power, Inc., and Thomas Coll (incorporated
by reference to Exhibit 10.4 to the registrants Current
Report on Form 8-K filed by the registrant on January 23,
2008)10.71
    
    
    Non-Compete Agreement dated January 16, 2008, between
American Motive Power, Inc., and Gary Walsh (incorporated
by reference to Exhibit 10.5 to the registrants Current
Report on Form 8-K filed by the registrant on January 23,
2008)10.72
    
    
    Non-Compete Agreement dated January 16, 2008, between
American Motive Power, Inc., and Joseph Fearon
(incorporated by reference to Exhibit 10.6 to the
registrants Current Report on Form 8-K filed by the
registrant on January 23, 2008)10.73
    
    
    Mutual Services Agreement dated January 16, 2008, among
American Motive Power, Inc., LMC Power Systems, Inc., LMC
Industrial Contractors, Inc., and Dansville Properties, LLC
(incorporated by reference to Exhibit 10.7 to the
registrants Current Report on Form 8-K filed by the
registrant on January 23, 2008)10.74
    
    
    Prior Contract Termination Agreement dated January 16,
2008, among Lawrence Mehlenbacher, Joseph Fearon, Thomas
Coll, Richard Rizzieri, Gary Walsh, LMC
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##### Table of Contents



Exhibit Number
    
    DescriptionIndustrial Contractors, Inc., LMC Power Systems, Inc., Dansville
Properties, LLC and American Motive Power, Inc.
(incorporated by reference to Exhibit 10.8 to the
registrants Current Report on Form 8-K filed by the
registrant on January 23, 2008)10.76
    
    
    Purchase Agreement dated February 3, 2010, among John A.
Martell and Bonnie Martell and the registrant (incorporated
by reference to Exhibit 2.1 to the registrants Current
Report on Form 8-K filed on February 9, 2010)10.77
    
    
    Lenders Receipt and Acknowledgement dated February 3,
2010, among John A. Martell and the registrant
(incorporated by reference to Exhibit 10.2 to the
registrants Current Report on Form 8-K filed on February
9, 2010)10.78
    
    
    Security Agreement dated February 3, 2010, among Magnetech
Industrial Services, Inc. and the registrant (incorporated
by reference to Exhibit 10.4 to the registrants Current
Report on Form 8-K filed on February 9, 2010)10.79
    
    
    Indemnification Agreement dated February 3, 2010, among
John A. Martell and Bonnie Martell and the
registrant(incorporated by reference to Exhibit 10.5 to the
registrants Current Report on Form 8-K filed on February
9, 2010)10.80
    
    
    Amendment No. 1 to Employment Agreement dated February 3,
2010, among John A. Martell and the registrant
(incorporated by reference to Exhibit 10.6 to the
registrants Current Report on Form 8-K filed on February
9, 2010)10.81
    
    
    AMP Stock Purchase Agreement dated March 8, 2010, between
LMC Transport, LLC, and the registrant (incorporated by
reference to Exhibit 2.1 to the registrants Current Report
on form 8-K filed on March 15, 2010)10.82
    
    
    Release of Tenant Guaranty made by Dansville Properties,
LLC, in favor of the registrant and certain of its
affiliates (incorporated by reference to Exhibit 10.1 to
the registrants Current Report on form 8-K filed on March
15, 2010)10.83
    
    
    Release of Landlord Guaranty made by American Motive Power,
Inc. in favor of Lawrence Mehlenbacher (incorporated by
reference to Exhibit 10.2 to the registrants Current
Report on form 8-K filed on March 15, 2010)10.84
    
    
    Lease Agreement dated January 16, 2008, between Dansville
Properties, LLC, and American Motive Power, Inc.
(incorporated by reference to Exhibit 10.1 to the
registrants Current Report on Form 8-K filed by the
registrant on January 16, 2008).10.85
    
    
    Mutual Release of January 2008 Obligations among the
registrant, American Motive Power, Inc., and certain
affiliates of LMC Transport, LLC (incorporated by reference
to Exhibit 10.4 to the registrants Current Report on form
8-K filed on March 15, 2010)10.86
    
    
    AMP Stock Purchase Agreement dated January 16, 2008, among
Lawrence Mehlenbacher, Joseph Fearon, Thomas Coll, Richard
Rizzieri, Gary Walsh and the registrant (incorporated by
reference to Exhibit 2.1 to the registrants Current Report
on Form 8-K filed by the registrant on January 16, 2008).10.87
    
    
    Non-Compete Agreement dated January 16, 2008, between
Lawrence Mehlenbacher and the registrant (incorporated by
reference to Exhibit 10.2 to the registrants Current
Report on Form 8-K filed by the registrant on January 16,
2008).10.88
    
    
    Non-Compete Agreement dated January 16, 2008, between
Richard Rizzieri and the registrant (incorporated by
reference to Exhibit 10.3 to the registrants Current
Report on Form 8-K filed by the registrant on January 16,
2008).10.89
    
    
    Non-Compete Agreement dated January 16, 2008, between
Thomas Coll and the registrant (incorporated by reference
to Exhibit 10.4 to the registrants Current Report on Form
8-K filed by the registrant on January 16, 2008).10.90
    
    
    Mutual Services Agreement dated January 16, 2008, among
American Motive Power, Inc., LMC Power Systems, Inc., LMC
Industrial Contractors, Inc., and Dansville Properties, LLC
(incorporated by reference to Exhibit 10.7 to the
registrants Current Report on Form 8-K filed by the
registrant on January 16, 2008).14.1
    
    
    Code of Business Conduct and Ethics (incorporated by
reference to Exhibit 14 to the registrants Registration
Statement on Form S-1 (Reg. No. 333-129354)).
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##### Table of Contents



Exhibit Number
    
    Description21.1
    
    
    Subsidiaries of the registrant23.1
    
    
    Consent of BDO USA LLP31.1
    
    
    Certification by Chief Executive Officer required by Rule
13a-14(a) or 15d-14(a) of the Exchange Act31.2
    
    
    Certification by Chief Accounting Officer required by Rule
13a-14(a) or 15d-14(a) of the Exchange Act32.1
    
    
    Section 1350 Certifications
 
 *
    
    MISCOR has omitted schedules and similar attachments to the subject
agreement pursuant to Item 601(b) of Regulation S-K. MISCOR will
furnish a copy of any omitted schedule or similar attachment to the
Commission upon request.@
    
    Denotes a management contract or compensatory plan. 71




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##### Table of Contents



SIGNATURES
  MISCOR GROUP, LTD.April 14, 2011
    By:
    /s/ Michael P. MooreMichael P. Moore, President andChief Executive OfficerApril 14, 2011
    By:
    /s/ Marc ValentinMarc Valentin, CPA, Chief Accounting Officer  Signature
    
    Title
    
    Date/s/ JOHN A. MARTELL
    
    Chairman of the Board
    
    April 14, 2011John A. Martell/s/ MICHAEL D. TOPA
    
    Director
    
    April 14, 2011Michael D. Topa/s/ WILLIAM J. SCHMUHL, JR.
    
    Director
    
    April 14, 2011William J. Schmuhl, Jr.
 72