**UNITED STATESSECURITIES AND EXCHANGE COMMISSION**

## **Washington, D.C.20549**

## ** **

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**FORM 10-Q**

 

**ý**** QUARTERLY REPORT PURSUANTTO SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934**

 

**For the Quarterly Period Ended June 27,2004**

 

**or**

 

**o**** TRANSITION REPORT PURSUANTTO SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934**

 

**Commission file number 333-72343**

 

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**TRUE TEMPER SPORTS, INC.**

(Exact name of registrant asspecified in its charter)

 

| **Delaware**                                                    | ** ** | **3949**                                                  | ** ** | **52-2112620**                           |
|-----------------------------------------------------------------|------------|-----------------------------------------------------------|------------|------------------------------------------|
| (State of other jurisdiction of  incorporation or organization) |       | (Primary Standard Industrial  Classification Code Number) |       | (I.R.S. Employer  Identification Number) |
|                                                            |       |

 

**8275 Tournament Drive**

**Suite 200**

**Memphis, Tennessee 38125**

**Telephone: (901) 746-2000**

(Address, including zip code, andtelephone number, including area code, of registrant’s principal executiveoffices)

 

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Indicate by check mark whether the registrant (1) has filed allreports required to be filed by Section 13 or 15(d) of the SecuritiesExchange Act of 1934 during the preceding 12 months (or for such shorterperiod that the registrant was required to file such reports), and (2) hasbeen subject to such filing requirements for the past 90 days.  Yes ý   No o.

 

Indicate by check mark whether the registrant is an accelerated filer(as defined in Rule 12b-2 of the Act) Yes ý   No o.

 

As of August 11, 2004 the Registrant had 100 shares of CommonStock, $0.01 par value per share, outstanding.

 

 

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**TRUE TEMPER SPORTS, INC.**

 

**INDEX**

 
|          |                  | **Page**                                                                                    |
|---------------|-----------------------|---------------------------------------------------------------------------------------------|
| PART I.  | FINANCIAL INFORMATION |                                                                                        |
|          |                  |                                                                                        |
|          | Item 1.          | Financial Statements                                                                        |   |
|          |                  |                                                                                        |   |
|          |                  | Condensed Consolidated Statements of  Operations (Unaudited)                                | 1 |
|          |                  |                                                                                        |   |
|          |                  | Condensed  Consolidated Balance Sheets (Unaudited)                                          | 2 |
|          |                  |                                                                                        |   |
|          |                  | Condensed Consolidated Statements of Cash  Flows (Unaudited)                                | 3 |
|          |                  |                                                                                        |   |
|          |                  | Notes to Condensed Consolidated Financial  Statements (Unaudited)                           | 4 |
|          |                  |                                                                                        |   |
|          | Item 2.          | Management’s Discussion and Analysis of  Financial Condition and Results of Operations | 9 |
|          |                  |                                                                                        |   |
|          | Item 3.          | Quantitative and Qualitative Disclosures  About Market Risk                                 | 17 |
|          |                  |                                                                                        |   |
|          | Item 4.               | Controls and Procedures                                                                     | 17 |
|          |                  |                                                                                        |   |
| PART II. | OTHER INFORMATION     |                                                                                        |
|          |                  |                                                                                        |   |
|          | Item 1.          | Legal Proceedings                                                                           | 18 |
|          |                  |                                                                                        |   |
|          | Item 2.          | Changes in Securities and Use of Proceeds                                                   | 18 |
|          |                  |                                                                                        |   |
|          | Item 3.          | Defaults Upon Senior Securities                                                             | 18 |
|          |                  |                                                                                        |   |
|          | Item 4.          | Submission of Matters to a Vote of Security  Holders                                        | 18 |
|          |                  |                                                                                        |   |
|          | Item 5.          | Other Information                                                                           | 18 |
|          |                  |                                                                                        |   |
|          | Item 6.          | Exhibits and Reports on Form 8-K                                                       | 18 |
|          |                  |                                                                                        |   |
| Signatures    | 20                    |

 

----

 

### **PART I**       FINANCIAL INFORMATION

 

**Item 1.****           *Financial Statements***

 

**TRUE TEMPER SPORTS, INC.**

**(A wholly-owned subsidiary of True TemperCorporation)**

 

**CONDENSED CONSOLIDATED STATEMENTS OFOPERATIONS**

**(Unaudited)**

**(Dollars in thousands)**

 
| ** **                                       | ** ** | **Quarterly**                                          | ** ** | **Year – To – Date** | ** **                                             |
|--------------------------------------------------|------------|--------------------------------------------------------|------------|--------------------------------|--------------------------------------------------------|
| ** **                                       | ** ** | **Successor  Company**                                 | ** ** | ** **                     | **Predecessor  Company**                               | ** ** | **Successor  Company** | ** ** | ** ** | **Predecessor Company** | ** ** |
| ** **                                       | ** ** | **Period from  March 29 to  June 27,  2004** | ** ** | ** **                     | **Period from  March 31 to  June 29,  2003** | ** ** | **Period from  March 15 to  June 27,  2004** | ** ** | ** ** | **Period from  January 1 to  March 14,  2004** | ** ** | **Period from  January 1 to  June 29,  2003** | ** ** |
| ** **                                       | ** ** | ** **                                             | ** ** | ** **                     | ** **                                             | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
| **NET SALES**                                    | ** ** | **$**                                                  | **25,333** | ** **                     | ** **                                             | **$** | **32,491** | ** ** | **$** | **35,297** | ** ** | ** ** | **$** | **20,247** | ** ** | **$** | **64,092** | ** ** |
| Cost of sales                                    |       | 15,123                                                 |       |                           | 19,199                                                 |   | 21,111 |   |   | 11,871 |   | 38,952 |   |
| **GROSS PROFIT**                                 | ** ** | **10,210**                                             | ** ** | ** **                     | **13,292**                                             | ** ** | **14,186** | ** ** | ** ** | **8,376** | ** ** | **25,140** | ** ** |
|                                             |       |                                                   |       |                           |                                                   |   |   |   |   |   |   |   |   |
| Selling, general and administrative  expenses    |       | 3,339                                                  |       |                           | 3,605                                                  |   | 3,903 |   |   | 3,635 |   | 7,679 |   |
| Business development and start-up costs          |       | 99                                                     |       |                           | 159                                                    |   | 182 |   |   | 100 |   | 284 |   |
| Transaction and reorganization expenses          |       | —                                                 |       |                           | —                                                 |   | — |   |   | 5,381 |   | — |   |
| Loss on early extinguishment of long- term  debt |       | —                                                 |       |                           | —                                                 |   | — |   |   | 9,217 |   | — |   |
| **OPERATING INCOME  (LOSS)**                     | ** ** | **6,772**                                              | ** ** | ** **                     | **9,528**                                              | ** ** | **10,101** | ** ** | ** ** | **(9,957** | **)** | **17,177** | ** ** |
|                                             |       |                                                   |       |                           |                                                   |   |   |   |   |   |   |   |   |
| Interest expense, net of interest income         |       | 3,994                                                  |       |                           | 3,323                                                  |   | 4,679 |   |   | 2,498 |   | 6,651 |   |
| Other expenses (income), net                     |       | 12                                                     |       |                           | 41                                                     |   | 14 |   |   | (2 | ) | 46 |   |
| **INCOME (LOSS)  BEFORE INCOME TAXES**           | ** ** | **2,766**                                              | ** ** | ** **                     | **6,164**                                              | ** ** | **5,408** | ** ** | ** ** | **(12,453** | **)** | **10,480** | ** ** |
|                                             |       |                                                   |       |                           |                                                   |   |   |   |   |   |   |   |   |
| Income taxes                                     |       | 1,053                                                  |       |                           | 2,413                                                  |   | 2,098 |   |   | (2,845 | ) | 4,145 |   |
| **NET INCOME (LOSS)**                            | ** ** | **$**                                                  | **1,713**  | ** **                     | ** **                                             | **$** | **3,751** | ** ** | **$** | **3,310** | ** ** | ** ** | **$** | **(9,608** | **)** | **$** | **6,335** | ** ** |

 

See accompanying notes to condensedconsolidated financial statements

 

1

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**TRUE TEMPER SPORTS, INC.**

**(A wholly-owned subsidiary of True TemperCorporation)**

 

**CONDENSED CONSOLIDATED BALANCE SHEETS**

**(Unaudited)**

**(Dollars in thousands)**

 
| ** **                                                                                                 | ** ** | **Successor  Company  June 27,  2004** | ** **  | ** ** | **Predecessor  Company  December 31,  2003** | ** ** |
|------------------------------------------------------------------------------------------------------------|------------|---------------------------------------------|-------------|------------|---------------------------------------------------|------------|
| ** **                                                                                                 | ** ** | ** **                                  | ** **  | ** ** | ** **                                        | ** ** |
| **ASSETS**                                                                                                 |       |                                        |        |       |                                              |       |
| **CURRENT ASSETS**                                                                                         |       |                                        |        |       |                                              |       |
| Cash and cash equivalents                                                                                  |       | $                                           | 5,529       |       |                                              | $          | 8,389 |   |
| Receivables, net                                                                                           |       | 16,517                                      |        |       | 15,612                                            |       |
| Inventories                                                                                                |       | 20,334                                      |        |       | 15,656                                            |       |
| Prepaid expenses and other current assets                                                                  |       | 3,414                                       |        |       | 2,271                                             |       |
| **Total current  assets**                                                                                  | ** ** | **45,794**                                  | ** **  | ** ** | **41,928**                                        | ** ** |
|                                                                                                       |       |                                        |        |       |                                              |       |
| Property, plant and equipment, net                                                                         |       | 14,466                                      |        |       | 15,026                                            |       |
| Goodwill, net                                                                                              |       | 256,028                                     |        |       | 71,506                                            |       |
| Deferred tax assets                                                                                        |       | 49,847                                      |        |       | 47,902                                            |       |
| Other assets                                                                                               |       | 7,442                                       |        |       | 3,254                                             |       |
| **Total assets**                                                                                           | ** ** | **$**                                       | **373,577** | ** ** | ** **                                        | **$**      | **179,616** | ** ** |
|                                                                                                       |       |                                        |        |       |                                              |       |
| **LIABILITIES & STOCKHOLDER’S EQUITY**                                                            |       |                                        |        |       |                                              |       |
| **CURRENT LIABILITIES**                                                                                    |       |                                        |        |       |                                              |       |
| Current portion of long-term debt                                                                          |       | $                                           | 1,100       |       |                                              | $          | 4,500 |   |
| Accounts payable                                                                                           |       | 5,178                                       |        |       | 4,992                                             |       |
| Accrued expenses and other current  liabilities                                                            |       | 11,054                                      |        |       | 8,675                                             |       |
| **Total current  liabilities**                                                                             | ** ** | **17,332**                                  | ** **  | ** ** | **18,167**                                        | ** ** |
|                                                                                                       |       |                                        |        |       |                                              |       |
| Long-term debt, net of current portion                                                                     |       | 233,900                                     |        |       | 109,230                                           |       |
| Other liabilities                                                                                          |       | 6,265                                       |        |       | 3,426                                             |       |
| **Total liabilities**                                                                                      | ** ** | **257,497**                                 | ** **  | ** ** | **130,823**                                       | ** ** |
|                                                                                                       |       |                                        |        |       |                                              |       |
| **STOCKHOLDER’S  EQUITY **                                                                       | ** ** | ** **                                  | ** **  | ** ** | ** **                                        | ** ** |
| Common stock — par value $0.01 per share;  authorized 1,000 shares; issued and outstanding 100 shares |       | —                                      |        |       | —                                            |       |
| Additional paid-in capital                                                                                 |       | 112,715                                     |        |       | 40,326                                            |       |
| Retained earnings                                                                                          |       | 3,310                                       |        |       | 8,796                                             |       |
| Accumulated other comprehensive income  (loss), net of taxes                                               |       | 55                                          |        |       | (329                                              | )          |
| **Total stockholder’s  equity**                                                                       | ** ** | **116,080**                                 | ** **  | ** ** | **48,793**                                        | ** ** |
| **Total liabilities  and stockholder’s equity**                                                       | ** ** | **$**                                       | **373,577** | ** ** | ** **                                        | **$**      | **179,616** | ** ** |

 

See accompanying notes to condensedconsolidated financial statements

 

2

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**TRUE TEMPER SPORTS, INC.**

**(A wholly-owned subsidiary of True TemperCorporation)**

 

**CONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWS**

**(Unaudited)**

**(Dollars in thousands)**

 
| ** **                                                                                       | ** ** | **Successor  Company**                                 | ** ** | ** ** | **Predecessor Company**                                   | ** ** |
|--------------------------------------------------------------------------------------------------|------------|--------------------------------------------------------|------------|------------|-----------------------------------------------------------|------------|
| ** **                                                                                       | ** ** | **Period from  March 15 to  June 27,  2004** | ** ** | ** ** | **Period from   January 1 to  March 14,  2004** | ** ** | **Period from   January 1 to   June 29,  2003** | ** ** |
| **OPERATING  ACTIVITIES**                                                                        | ** ** | ** **                                             | ** ** | ** ** | ** **                                                | ** ** | ** ** | ** ** |
| Net income (loss)                                                                                |       | $                                                      | 3,310      |       |                                                      | $          | (9,608 | ) | $ | 6,335 |   |
| Adjustments to reconcile net income  (loss)  to net cash provided by  operating activities: |       |                                                   |       |       |                                                      |       |   |   |
| Depreciation and amortization                                                                    |       | 836                                                    |       |       | 671                                                       |       | 1,463 |   |
| Amortization of deferred financing costs                                                         |       | 309                                                    |       |       | 109                                                       |       | 445 |   |
| Loss on disposal of property, plant and  equipment                                               |       | —                                                 |       |       | —                                                    |       | 28 |   |
| Transaction and reorganization expenses                                                          |       | —                                                 |       |       | 5,381                                                     |       | — |   |
| Loss on early extinguishment of long-term  debt                                                  |       | —                                                 |       |       | 9,217                                                     |       | — |   |
| Deferred taxes                                                                                   |       | 2,069                                                  |       |       | (3,015                                                    | )          | 4,073 |   |
| Changes in operating assets and  liabilities, net                                                |       | (748                                                   | )          |       | 227                                                       |       | (339 | ) |
| **Net cash provided  by operating activities**                                                   | ** ** | **5,776**                                              | ** ** | ** ** | **2,982**                                                 | ** ** | **12,005** | ** ** |
|                                                                                             |       |                                                   |       |       |                                                      |       |   |   |
| INVESTING ACTIVITIES                                                                             |       |                                                   |       |       |                                                      |       |   |   |
| Purchase of property, plant and equipment                                                        |       | (617                                                   | )          |       | (330                                                      | )          | (1,354 | ) |
| **Net cash used in  investing activities**                                                       | ** ** | **(617**                                               | **)**      | ** ** | **(330**                                                  | **)**      | **(1,354** | **)** |
|                                                                                             |       |                                                   |       |       |                                                      |       |   |   |
| FINANCING ACTIVITIES                                                                             |       |                                                   |       |       |                                                      |       |   |   |
| Proceeds from issuance of bank debt                                                              |       | 110,000                                                |       |       | —                                                    |       | — |   |
| Proceeds from issuance of Senior  Subordinated Notes                                             |       | 125,000                                                |       |       | —                                                    |       | — |   |
| Principal payments on bank debt                                                                  |       | —                                                 |       |       | (7,700                                                    | )          | (2,000 | ) |
| Repay bank debt, including accrued interest                                                      |       | (6,335                                                 | )          |       | —                                                    |       | — |   |
| Call Senior Subordinated Notes, including  accrued interest and call premium                     |       | (109,160                                               | )          |       | —                                                    |       | — |   |
| Payment of debt issuance costs                                                                   |       | (8,673                                                 | )          |       | —                                                    |       | (273 | ) |
| Dividends paid                                                                                   |       | (102,518                                               | )          |       | —                                                    |       | (676 | ) |
| Transaction and reorganization expenses,  including cash payments for direct acquisition costs   |       | (10,780                                                | )          |       | (463                                                      | )          | — |   |
| Other financing activity                                                                         |       | —                                                 |       |       | (42                                                       | )          | (85 | ) |
| **Net cash used in  financing activities**                                                       | ** ** | **(2,466**                                             | **)**      | ** ** | **(8,205**                                                | **)**      | **(3,034** | **)** |
|                                                                                             |       |                                                   |       |       |                                                      |       |   |   |
| Net increase (decrease) in cash                                                                  |       | 2,693                                                  |       |       | (5,553                                                    | )          | 7,617 |   |
| Cash at beginning of period                                                                      |       | 2,836                                                  |       |       | 8,389                                                     |       | 7,070 |   |
| **Cash at end of  period**                                                                       | ** ** | **$**                                                  | **5,529**  | ** ** | ** **                                                | **$**      | **2,836** | ** ** | **$** | **14,687** | ** ** |

 

See accompanying notes to condensedconsolidated financial statements

 

3

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**TRUE TEMPER SPORTS, INC.**

**(A wholly-owned subsidiary of True TemperCorporation)**

 

**NOTES To CONDENSED CONSOLIDATED FINANCIALSTATEMENTS**

**(Unaudited)**

**(Dollars in thousands unless otherwiseindicated)**

 

**1)  Basis of Presentation**

 

The accompanying unaudited financial statements of True Temper Sports,Inc. (“True Temper” or the “Company”) have been prepared in accordance with therules and regulations of the Securities and Exchange Commission (“SEC”) forquarterly reports on Form 10-Q and consequently do not include all thedisclosures required by accounting principles generally accepted in the UnitedStates of America. It is suggested that these financial statements be read inconjunction with the audited financial statements and the notes thereto for theyear ended December 31, 2003. In the opinion of management, the financialstatements include all adjustments which are necessary for the fair presentationof results for interim periods.

 

The Company’s fiscal year begins on January 1 and ends onDecember 31 of each year. During the course of the year the Company closesits books on a monthly and quarterly basis following a 4,4,5 week closingcalendar. Since the Company uses Sunday as the last day of each period (withthe exception of December) the number of days in the first and fourth quartersof any given year can vary depending on which day of the week January 1stfalls on.

 

On January 30, 2004, TTS Holdings LLC, a new company formed byGilbert Global Equity Partners, L.P. and its affiliated funds (“GilbertGlobal”), entered into a stock purchase agreement with our direct parentcompany, True Temper Corporation, pursuant to which TTS Holdings LLC and certainof the Company’s senior management purchased all of the outstanding shares ofTrue Temper Corporation.  In connectionwith this acquisition, and effective on March 15, 2004, the Company repaidall of its outstanding 2002 senior credit facility, redeemed all of its 10 7/8%senior subordinated notes due 2008, and made certain dividends to True TemperCorporation.  These payments werefinanced with the net proceeds of a new senior credit facility and new 8 3/8%senior subordinated notes due 2011.

 

This transaction was accounted for by our parent company using thepurchase method of accounting.  As theCompany is a wholly owned subsidiary of True Temper Corporation, we have“pushed down” the effect of the purchase method of accounting to thesefinancial statements.  Accordingly, thesefinancial statements and accompanying notes present the historical cost basisresults of the Company as “predecessor company” through March 14, 2004,and the results of the Company as “successor company” from March 15, 2004through June 27, 2004.  Thefinancial statements have also been separated by a vertical dashed line intopredecessor company and successor company results.

 

**2)  Inventories**

 
| ** **      | ** ** | **Successor  Company  June 27,  2004** | ** ** | ** ** | **Predecessor  Company  December 31,  2003** | ** ** |
|-----------------|------------|---------------------------------------------|------------|------------|---------------------------------------------------|------------|
| Raw materials   |       | $                                           | 4,009      |       |                                              | $          | 2,287 |   |
| Work in process |       | 2,023                                       |       |       | 2,067                                             |       |
| Finished goods  |       | 14,302                                      |       |       | 11,302                                            |       |
| Total           |       | $                                           | 20,334     |       |                                              | $          | 15,656 |   |

 

**3)  Segment Reporting**

 

The Company operates in two reportable business segments: golf shaftsand performance sports. The Company’s reportable segments are based on the typeof product manufactured and the application of that product in the marketplace.The golf shaft segment manufactures and sells steel, composite, andmulti-material golf club shafts for use exclusively in the golf industry. Theperformance sports segment manufactures and sells high

 

4

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strength, tight tolerance tubular components for bicycle, hockey andother recreational sport markets. The Company evaluates the performance ofthese segments based on segment sales and gross profit. The Company has nointer-segment sales.

 
| ** **         | ** ** | **Quarterly**                                          | ** ** | **Year – To – Date** | ** **                                             |
|--------------------|------------|--------------------------------------------------------|------------|--------------------------------|--------------------------------------------------------|
| ** **         | ** ** | **Successor  Company**                                 | ** ** | ** **                     | **Predecessor  Company**                               | ** ** | **Successor  Company** | ** ** | ** ** | **Predecessor Company** | ** ** |
| ** **         | ** ** | **Period from  March 29 to  June 27,  2004** | ** ** | ** **                     | **Period from  March 31 to  June 29,  2003** | ** ** | **Period from  March 15 to  June 27,  2004** | ** ** | ** ** | **Period from  January 1 to  March 14,  2004** | ** ** | **Period from  January 1 to  June 29,  2003** | ** ** |
| Net sales:         |       |                                                   |       |                           |                                                   |   |   |   |   |   |   |   |   |
| Golf shafts        |       | $                                                      | 23,981     |                           |                                                   | $ | 30,636 |   | $ | 33,360 |   |   | $ | 19,067 |   | $ | 60,866 |   |
| Performance sports |       | 1,352                                                  |       |                           | 1,855                                                  |   | 1,937 |   |   | 1,180 |   | 3,226 |   |
| Total              |       | $                                                      | 25,333     |                           |                                                   | $ | 32,491 |   | $ | 35,297 |   |   | $ | 20,247 |   | $ | 64,092 |   |
| Gross profit:      |       |                                                   |       |                           |                                                   |   |   |   |   |   |   |   |   |
| Golf shafts        |       | $                                                      | 9,936      |                           |                                                   | $ | 12,805 |   | $ | 13,736 |   |   | $ | 8,080 |   | $ | 24,252 |   |
| Performance sports |       | 274                                                    |       |                           | 487                                                    |   | 450 |   |   | 296 |   | 888 |   |
| Total              |       | $                                                      | 10,210     |                           |                                                   | $ | 13,292 |   | $ | 14,186 |   |   | $ | 8,376 |   | $ | 25,140 |   |

 

Following is a reconciliation of total reportable segment gross profitto total Company income (loss) before income taxes:

 
| ** **                                       | ** ** | **Quarterly**                                          | ** ** | **Year – To – Date** | ** **                                             |
|--------------------------------------------------|------------|--------------------------------------------------------|------------|--------------------------------|--------------------------------------------------------|
| ** **                                       | ** ** | **Successor  Company**                                 | ** ** | ** **                     | **Predecessor  Company**                               | ** ** | **Successor  Company** | ** ** | ** ** | **Predecessor Company** | ** ** |
| ** **                                       | ** ** | **Period from  March 29 to  June 27,  2004** | ** ** | ** **                     | **Period from  March 31 to  June 29,  2003** | ** ** | **Period from  March 15 to  June 27,  2004** | ** ** | ** ** | **Period from  January 1 to  March 14,  2004** | ** ** | **Period from  January 1 to  June 29,  2003** | ** ** |
| Total reportable segment gross profit            |       | $                                                      | 10,210     |                           |                                                   | $ | 13,292 |   | $ | 14,186 |   |   | $ | 8,376 |   | $ | 25,140 |   |
| Less:                                            |       |                                                   |       |                           |                                                   |   |   |   |   |   |   |   |   |
| Selling, general and administrative  expenses    |       | 3,339                                                  |       |                           | 3,605                                                  |   | 3,903 |   |   | 3,635 |   | 7,679 |   |
| Business development and  start-up costs    |       | 99                                                     |       |                           | 159                                                    |   | 182 |   |   | 100 |   | 284 |   |
| Transaction and reorganization expenses          |       | —                                                 |       |                           | —                                                 |   | — |   |   | 5,381 |   | — |   |
| Loss on early extinguishment of long-term  debt  |       | —                                                 |       |                           | —                                                 |   | — |   |   | 9,217 |   | — |   |
| Interest expense, net of  interest income   |       | 3,994                                                  |       |                           | 3,323                                                  |   | 4,679 |   |   | 2,498 |   | 6,651 |   |
| Other expense (income), net                      |       | 12                                                     |       |                           | 41                                                     |   | 14 |   |   | (2 | ) | 46 |   |
| Total Company income (loss) before income  taxes |       | $                                                      | 2,766      |                           |                                                   | $ | 6,164 |   | $ | 5,408 |   |   | $ | (12,453 | ) | $ | 10,480 |   |

 

5

----

 

**4)  Comprehensive Income**

 

Total comprehensive income and its components for the periods coveredby this report are as follows:

 
| ** **                                                                                           | ** ** | **Quarterly**                                          | ** ** | **Year – To – Date** | ** **                                             |
|------------------------------------------------------------------------------------------------------|------------|--------------------------------------------------------|------------|--------------------------------|--------------------------------------------------------|
| ** **                                                                                           | ** ** | **Successor  Company**                                 | ** ** | ** **                     | **Predecessor  Company**                          | ** ** | **Successor  Company** | ** ** | ** ** | **Predecessor Company** | ** ** |
| ** **                                                                                           | ** ** | **Period from  March 29 to  June 27,  2004** | ** ** | ** **                     | **Period from  March 31 to  June 29,  2003** | ** ** | **Period from  March 15 to  June 27,  2004** | ** ** | ** ** | **Period from  January 1 to  March 14,  2004** | ** ** | **Period from  January 1 to  June 29,  2003** | ** ** |
| Net income (loss)                                                                                    |       | $                                                      | 1,713      |                           |                                                   | $ | 3,751 |   | $ | 3,310 |   |   | $ | (9,608 | ) | $ | 6,335 |   |
| Mark to market adjustment  on foreign currency  derivative instruments,  net of taxes |       | (20                                                    | )          |                           | 81                                                     |   | 55 |   |   | (121 | ) | 31 |   |
| Total comprehensive income (loss)                                                                    |       | $                                                      | 1,693      |                           |                                                   | $ | 3,832 |   | $ | 3,365 |   |   | $ | (9,729 | ) | $ | 6,366 |   |
|                                                                                                      |            |                                                        |            |                                |                                                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

**5)  Transaction andReorganization**

 

On March 15, 2004 TTS Holdings LLC, along with certain of theCompany’s senior management, acquired all of the outstanding common stock ofthe Company’s parent, True Temper Corporation, for $123.0 million in cash andexisting common stock.  In addition, the Companyborrowed $110.0 million under a term loan and issued $125.0 million in seniorsubordinated notes due 2011.  These debtinstruments are further described in Note 6 below.

 

The purchase price as stipulated in the January 30, 2004 stockpurchase agreement totaled $342.0 million, plus direct acquisition costs andcertain working capital adjustments of $18.4 million.  The Company is in the process of evaluatingthe fair value of tangible and intangible assets acquired and liabilitiesassumed as of March 15, 2004.  Thefollowing preliminary allocation of total consideration is, therefore, subjectto change as the Company completes this evaluation.

 

| Current assets                |   | $       | 38,542  |   |
|-------------------------------|--------|---------|---------|--------|
| Property, plant and equipment |   | 14,684  |    |
| Deferred tax assets           |   | 62,218  |    |
| Deferred financing costs      |   | 7,366   |    |
| Goodwill                      |   | 256,028 |    |
| Other assets                  |   | 197     |    |
| Current liabilities           |   | (12,475 | )       |
| Other liabilities             |   | (6,130  | )       |
| Total                         |   | $       | 360,430 |   |

 

This transaction was accounted for by the Company’s parent companyusing the purchase method of accounting. As the Company is a wholly owned subsidiary of True Temper Corporation,we have “pushed down” the effect of the purchase method of accounting to thesefinancial statements.

 

In conjunction with the transaction and reorganization, the predecessorcompany recorded certain transaction related expenses totaling $5.4million.  These expenses consistprimarily of investment banking merger and acquisition fees, legal fees andother incidental costs and expenses typically incurred in an acquisition ofthis nature.

 

6

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In addition, as a direct result of the early extinguishment of thepredecessor company’s long term debt, expenses totaling $9.2 million wereincurred consisting primarily of the write-off of the remaining deferredfinancing costs related to the 10 7/8% seniorsubordinated notes due 2008 and the 2002 senior credit facility, and the earlyextinguishment call premium and related interest incurred when the Companyredeemed the 10 7/8% senior subordinated notes onMarch 15, 2004.

 

The following unaudited pro forma financial information is presented asif the aforementioned transaction had occurred as of the beginning of eachperiod presented.  The pro forma amountsinclude certain adjustments, including, (i) an adjustment to interest expenseto reflect the extinguishment of the 10 7/8% SeniorSubordinated Notes due 2008 and the 2002 senior credit facility, and theissuance of the 8 3/8% Senior Subordinated Notes due 2011and 2004 senior credit facility, (ii) the elimination of transaction andreorganization expenses and the loss on early extinguishment of long term debt,which are non-recurring, and (iii) the related tax effect of the adjustmentsdescribed above.

 
| ** **                 | ** ** | **Quarterly**                                           | ** ** | **Year – To – Date**                         | ** ** |
|----------------------------|------------|---------------------------------------------------------|------------|--------------------------------------------------------|------------|
| ** **                 | ** ** | **Period from  March 29 to   June 27,  2004** | ** ** | **Period from  March 31 to  June 29,  2003** | ** ** | **Period from  January 1 to  June 27,  2004** | ** ** | **Period from  January 1 to  June 29,  2003** | ** ** |
| Net sales                  |       | $                                                       | 25,333     |                                                   | $          | 32,491 |   | $ | 55,544 |   | $ | 64,092 |   |
| Income before income taxes |       | $                                                       | 2,766      |                                                   | $          | 5,485 |   | $ | 6,734 |   | $ | 9,127 |   |
| Net income                 |       | $                                                       | 1,713      |                                                   | $          | 3,330 |   | $ | 4,081 |   | $ | 5,496 |   |

 

**6)  Borrowings**

 

(a)  Long Term Debt

 

Long term debt at June 27, 2004 and December 31, 2003consisted of the following:

 
| ** **                                       | ** ** | **Successor  Company  June 27,  2004** | ** ** | ** ** | **Predecessor  Company  December 31,  2003** | ** ** |
|--------------------------------------------------|------------|---------------------------------------------|------------|------------|---------------------------------------------------|------------|
| 10 7/8%  Senior Subordinated Notes due 2008 |       | $                                           | —     |       |                                              | $          | 99,730 |   |
| 2002 senior credit facility                      |       | —                                      |       |       | 14,000                                            |       |
| 8 3/8% Senior  Subordinated Notes due 2011       |       | 125,000                                     |       |       | —                                            |       |
| 2004 senior credit facility                      |       | 110,000                                     |       |       | —                                            |       |
| Total debt                                       |       | 235,000                                     |       |       | 113,730                                           |       |
| Less current maturities                          |       | 1,100                                       |       |       | 4,500                                             |       |
| Long-term debt                                   |       | $                                           | 233,900    |       |                                              | $          | 109,230 |   |

 

The 8 3/8% Senior Subordinated Notes due 2011(the “Notes”) provide for semi-annual interest payments, in arrears, due onMarch 15 and September 15.  Atthe option of the Company, up to 35% of the Notes are redeemable prior toMarch 15, 2007, at 108.375%, with the net cash proceeds of one or morepublic equity offerings.  In addition, atany time prior to March 15, 2008, the Company may also redeem all or apart of the Notes upon the occurrence of a change of control.  On or after March 15, 2008 the Notes maybe redeemed, at the option of the Company, in whole or in part, at a redemptionprice of 104.188% beginning March 15, 2008 and declining ratablythereafter to 100.0% on March 15, 2010.

 

7

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The 2004 senior credit facility provides for interest on the term loan,at the Company’s option, at (i) the base rate of the bank acting asadministrative agent plus a margin adder of 1.50%, or (ii) under a LIBOR optionwith a borrowing spread of LIBOR plus 2.50%. The rate at June 27, 2004 was 3.76%.

 

The loans under the 2004 senior credit facility are senior to theNotes, and are secured by substantially all of the Company’s assets.

 

The 2004 senior credit facility and the Notes contain provisions which,among other things, limit the Company’s ability to (i) incur additionalindebtedness, (ii) make acquisitions and capital expenditures, (iii) sellassets, (iv) create liens or other encumbrances, (v) make certain payments anddividends, or (vi) merge or consolidate. In addition, both the senior credit facility and the Notes containcustomary change of control provisions that could, under certain circumstances,cause accelerated debt repayment.  The2004 senior credit facility also requires the Company to maintain certainspecified financial ratios and tests including minimum interest coverage andfixed charge coverage ratios, and maximum leverage ratios.  At June 27, 2004 the Company was incompliance with all of the covenants in both the 2004 senior credit facilityand the Notes.

 

The terms of the extinguished debt were substantially similar to the2004 senior credit facility and Notes.

 

At June 27, 2004, future minimum principal payments on long termdebt were as follows:

 
| 2004       |   | 825     |    |
|------------|--------|---------|---------|
| 2005       |   | 1,100   |    |
| 2006       |   | 1,100   |    |
| 2007       |   | 1,100   |    |
| 2008       |   | 1,100   |    |
| Thereafter |   | 229,775 |    |
| Total      |   | $       | 235,000 |   |
|            |        |         |         |  |

 

(b)  Line of Credit

 

The Company may borrow, through March 15, 2009, up to $20,000under a revolving credit agreement included in the 2004 senior creditfacility.  Borrowings under the agreementare subject to the same provisions described in the long term debtsection of this note.  The Companyhad no outstanding borrowings under this line of credit as of June 27,2004.

 

8

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**Item 2.****           *Management’s Discussion and Analysis of Financial Condition and Resultsof Operations***

 

The following discussion should be read in conjunction with the moredetailed information in our 2003****AnnualFinancial Statements, including the notes thereto, appearing most recently inour 2003 Annual Report on Form 10-K, filed with the SEC on March 12,2004 and also disclosed in our Form S-4 Registration Statement filed with theSEC on April 13, 2004.

 

**Company Overview**

 

True Temper Sports, Inc. (“True Temper” or the “Company”), a whollyowned subsidiary of True Temper Corporation (“TTC”), is a leading designer,manufacturer and marketer of steel, composite, and multi-material golf clubshafts for original equipment manufacturers (“OEM’s”) and distributors in thegolf equipment industry. In addition, True Temper produces and sells a varietyof performance sports products that offer high strength and tight tolerancetubular components to the bicycle, hockey and other recreational sportsmarkets. In calendar 2003, golf shaft sales represented 94% of total revenues,and performance sports sales represented 6%. This sales split has remainedrelatively consistent during the first six months of 2004.

 

**Purchase Agreement for True Temper Corporation**

 

On January 30, 2004, TTS Holdings LLC, a new company formed byGilbert Global Equity Partners, L.P. and its affiliated funds (“GilbertGlobal”), entered into a stock purchase agreement with our direct parent company,True Temper Corporation, pursuant to which TTS Holdings LLC and certain of theCompany’s senior management purchased all of the outstanding shares of TrueTemper Corporation.  In connection withthis acquisition, and effective on March 15, 2004, the Company repaid allof its outstanding 2002 senior credit facility, redeemed all of its 10 7/8%senior subordinated notes due 2008, and made certain dividends to True TemperCorporation.  These payments werefinanced with the net proceeds of a new senior credit facility and new 8 3/8%senior subordinated notes due 2011.

 

This transaction was accounted for by our parent company using thepurchase method of accounting.  As theCompany is a wholly owned subsidiary of True Temper Corporation, we have“pushed down” the effect of the purchase method of accounting to thesefinancial statements.  Accordingly, ourfinancial statements and accompanying notes present the historical cost basisresults of the Company as “predecessor” through March 14, 2004, and theresults of the Company as “successor” from March 15, 2004 throughJune 27, 2004.

 

For purposes of the following discussion regarding the Company’sresults of operations and cash flow, the Company has combined the results ofthe predecessor and successor companies in order to compare the quarterly andyear to date results to the prior year. Material variances caused by the different basis of accounting have beendisclosed where applicable.

 

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**Results of Operations**

 

The following tables set forth the components of net income as apercentage of net sales for the periods indicated:

 
| ** **                                    | ** ** | **Quarterly**                                          | ** ** |
|-----------------------------------------------|------------|--------------------------------------------------------|------------|
| ** **                                    | ** ** | **Successor  Company**                                 | ** ** | **Predecessor  Company** | ** ** |
| ** **                                    | ** ** | **Period from  March 29 to  June 27,  2004** | ** ** | **Period from  March 31 to  June 29,  2003** | ** ** |
| Net sales                                     |       | 100.0                                                  | %          | 100.0 | % |
| Cost of sales                                 |       | 59.7                                                   |       | 59.1 |   |
| Gross profit                                  |       | 40.3                                                   |       | 40.9 |   |
| Selling, general and administrative  expenses |       | 13.2                                                   |       | 11.1 |   |
| Business development and start-up costs       |       | 0.4                                                    |       | 0.5 |   |
|                                          |       |                                                   |       |   |   |
| Operating income                              |       | 26.7                                                   |       | 29.3 |   |
| Interest expenses, net of interest income     |       | 15.8                                                   |       | 10.2 |   |
| Other expenses, net                           |       | —                                                 |       | 0.1 |   |
| Earnings before income taxes                  |       | 10.9                                                   |       | 19.0 |   |
| Income taxes                                  |       | 4.2                                                    |       | 7.4 |   |
| Net income                                    |       | 6.8                                                    | %          | 11.5 | % |

 
| ** **                                    | ** ** | **Year – To – Date**                           | ** ** |
|-----------------------------------------------|------------|----------------------------------------------------------|------------|
| ** **                                    | ** ** | **Predecessor  Company**                                 | ** ** | **Successor  Company** | ** ** | **Combined  Company** | ** ** | **Predecessor  Company** | ** ** |
| ** **                                    | ** ** | **Period from  January 1 to  March 14,  2004** | ** ** | **Period from  March 15 to  June 27,  2004** | ** ** | **Period from  January 1 to  June 27,  2004** | ** ** | **Period from  January 1 to   June 29,  2003** | ** ** |
| Net sales                                     |       | 100.0                                                    | %          | 100.0 | % | 100.0 | % | 100.0 | % |
| Cost of sales                                 |       | 58.6                                                     |       | 59.8 |   | 59.4 |   | 60.8 |   |
| Gross profit                                  |       | 41.4                                                     |       | 40.2 |   | 40.6 |   | 39.2 |   |
| Selling, general and administrative  expenses |       | 18.0                                                     |       | 11.1 |   | 13.6 |   | 12.0 |   |
| Business development and start-up costs       |       | 0.5                                                      |       | 0.5 |   | 0.5 |   | 0.4 |   |
| Transaction and reorganization expenses       |       | 26.6                                                     |       | — |   | 9.7 |   | — |   |
| Loss on early extinguishment of debt          |       | 45.5                                                     |       | — |   | 16.6 |   | — |   |
| Operating income (loss)                       |       | (49.2                                                    | )          | 28.6 |   | 0.3 |   | 26.8 |   |
| Interest expense, net of interest income      |       | 12.3                                                     |       | 13.3 |   | 12.9 |   | 10.4 |   |
| Other expenses, net                           |       | —                                                   |       | — |   | — |   | 0.1 |   |
| Income (loss) before income taxes             |       | (61.5                                                    | )          | 15.3 |   | (12.7 | ) | 16.4 |   |
| Income taxes                                  |       | (14.1                                                    | )          | 5.9 |   | (1.3 | ) | 6.5 |   |
| Net income (loss)                             |       | (47.5                                                    | )%         | 9.4 | % | (11.3 | )% | 9.9 | % |

 

***Second Quarter Ended June 27, 2004Compared to the Second Quarter Ended June 29, 2003***

 

***Net Sales*** forthe second quarter of 2004 decreased $7.2 million, or 22.0%, to $25.3 millionfrom $32.5 million in the second quarter of 2003.

 

Golf shaft sales decreased $6.7 million, or 21.7%, to $24.0 millioncompared to the $30.6 million in the second quarter of 2003.  This decrease was caused by a number offactors.  While retail golf equipmentsales appear to be somewhat stable in units, there are indications thatshipments of certain products into the retail market have declined, and discountingappears to be occurring in order to clear the current inventory levels ofexisting products through the distribution channel.  We believe this decline of shipments intoretail is indicative of an overall shortage of major new club introductions duringthe first half of 2004, as many of the new iron and wood introductions thatwould normally occur during the spring golf season have been scheduled for late2004 and early

 

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2005.  These market factorscontributed to a decline in our overall steel shaft unit volume during thesecond quarter of 2004.  In addition, weexperienced, what we believe to be, a temporary shift in product mix within ourpremium steel shaft category which caused a slight decrease in our average unitselling price.  Finally, while ourGrafalloy Blue and Grafalloy ProLaunch graphite shafts continue to sell well,our overall graphite unit sales have declined as some of our major OEM partnersexperienced weaker demand in the wood category of the retail market.

 

Performance sports sales decreased $0.5 million, or 27.1%, to $1.3million in the second quarter of 2004 from $1.8 million in the second quarterof 2003.   This decline was driven mainlyby a shift in the timing of customer ordering patterns for hockey sticks, offsetsomewhat by a continued increase in sales of our growing bike componentsegment.

 

Net sales to international customers decreased $0.7million, or 7.3%, to $8.3 million in the second quarter of 2004 from $9.0million in the second quarter of 2003. This decrease was driven primarily by a decline in the unit sales volumein the United Kingdom as they experience similar market factors as describedabove for our overall golf sales, offset somewhat by improved foreign currencyexchange rates in the United Kingdom, Japan and Australia.

 

***Gross Profit*** forthe second quarter of 2004 decreased $3.1 million, or 23.2%, to $10.2 millionfrom $13.3 million in the second quarter of 2003. Gross profit as a percentageof net sales decreased to 40.3% in the second quarter of 2004 from 40.9% in thesecond quarter of 2003.  Our gross profitmargin decreased as a result of several factors, including (i) an increase inthe cost of raw materials for both steel and graphite golf shafts, (ii)continued escalation in the cost of employee healthcare benefits, and (iii) theunfavorable impact of certain fixed costs in our manufacturing facilitiesspread over a reduced unit volume.  Thesefactors were somewhat offset by the favorable impact of (i) improved foreigncurrency exchange rates, (ii) increased selling prices on branded and otherproducts, (iii) favorable operating improvements from productivity programs atour manufacturing facilities, and (iv) the impact of cost control actionsinitiated during the quarter in response to the softness on the revenue line.

 

In the second quarter of 2003 we paid a ratification bonus to thehourly employees represented by the United Steelworkers of America related to anew four year collective bargaining agreement effective July 1, 2003.  Excluding the impact of this ratificationbonus, gross profit as a percentage of net sales would have decreased to 40.3%in the second quarter of 2004 from 43.0% in the second quarter of 2003.

 

***Selling, General and Administrative Expenses***(“SG&A”) for the second quarter of 2004 decreased $0.3 million, or 7.4%, to$3.3 million from $3.6 million in the second quarter of 2003.  The decrease in total SG&A spendingduring the second quarter resulted primarily from cost control actionsinitiated earlier in 2004 in response to the softness on the revenue line.

 

***Business Development and Start-Up Costs***for the second quarter of 2004 decreased slightly from $0.2 million in thesecond quarter of 2003.  In 2003 and 2004these costs represent various start-up business expenses related to the openingof our composite manufacturing operation in southern China.

 

***Operating Income***forthe second quarter of 2004 decreased $2.8 million, or 28.9%, to $6.8 millionfrom $9.5 million in the second quarter of 2003.  Operating income as a percentage of net salesdecreased to 26.7% in the second quarter of 2004 from 29.3% in the secondquarter of 2003.  This decrease reflectsthe profit impact of the items described above.

 

Excluding the impact of the 2003 ratification bonus, operating incomewould have decreased $3.4 million, or 33.7%, to $6.8 million from $10.2 millionin the second quarter of 2003.  Operatingincome as a percentage of net sales would have decreased to 26.7% in the secondquarter of 2004 from 31.4% in the second quarter of 2003.

 

***Interest Expense***for the second quarter of 2004 increased to $4.0 million from $3.3 million inthe second quarter of 2003.  Thisincrease was driven primarily by the increase in outstanding principal amountsof variable

 

11

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rate bank debt and fixed rate bonds, offset somewhat by a decrease ininterest rates on both the variable and fixed rate debt between periods.

 

***Income Taxes*** inthe second quarter of 2004 decreased to $1.1 million from $2.4 million in thesecond quarter of 2003. The effective tax rate during these periods differsfrom a federal statutory rate of 34% due primarily to the incremental tax ratefor state and foreign income tax purposes.

 

***Net Income***forthe second quarter of 2004 decreased by approximately $2.0 million to $1.7million from $3.8 million in the second quarter of 2003.  This decrease reflects the profit impact ofthe items described above.

 

Excluding the impact of the 2003 ratification bonus, net income wouldhave decreased by $2.5 million to $1.7 million from $4.2 million in the secondquarter of 2003.

 

***Six Month Period Ended June 27, 2004Compared to the Six Month Period Ended June 29, 2003***

 

***Net Sales*** forthe first six months of 2004 decreased $8.5 million, or 13.3%, to $55.5 millionfrom $64.1 million in the first six months of 2003.

 

Golf shaft sales decreased $8.4 million, or 13.9%, to $52.4 million inthe first six months of 2004 from $60.9 million in the first six months of2003.  This decrease was caused by anumber of factors.  While retail golfequipment sales appear to be somewhat stable in units, there are indicationsthat shipments of certain products into the retail market have declined, anddiscounting appears to be occurring in order to clear the current inventory levelsof existing products through the distribution channel.  We believe this decline of shipments intoretail is indicative of an overall shortage of major new club introductionsduring the first half of 2004, as many of the new iron and wood introductionsthat would normally occur during the spring golf season have been scheduled forlate 2004 and early 2005.  These marketfactors contributed to a decline in our overall steel shaft unit volume duringthe first six months of 2004.  Inaddition, we experienced, what we believe to be, a temporary shift in productmix within our premium steel shaft category which caused a slight decrease inour average unit selling price.  Finally,while our Grafalloy Blue and Grafalloy ProLaunch graphite shafts continue tosell well, our overall graphite unit sales have declined as some of our majorOEM partners experienced weaker demand in the wood category of the retailmarket.

 

Performance sports sales decreased $0.1 million, or 3.4%, to $3.1million in the first six months of 2004 from $3.2 million in the first sixmonths of 2003.  This decline was drivenmainly by a shift in the timing of customer ordering patterns for hockeysticks, offset somewhat by a continued increase in sales of our growing bikecomponent product line.

 

Net sales to international customers increased $1.1million, or 5.7%, to $19.3 million in the first six months of 2004 from $18.3million in the first six months of 2003. This increase was driven primarily by improved foreign currency exchangerates in the United Kingdom, Japan and Australia but was offset slightly by adecline in the unit sales volume in the United Kingdom as they experiencesimilar market factors as described above for our overall golf sales.

 

***Gross Profit*** forthe first six months of 2004 decreased $2.6 million, or 10.3%, to $22.6 millionfrom $25.1 million in the first six months of 2003. Gross profit as apercentage of net sales increased to 40.6% in the first six months of 2004 from39.2% in the first six months of 2003. Our gross profit margin increased as a result of several factors,including (i) improved foreign currency exchange rates, (ii) increased sellingprices on branded and other products, (iii) favorable operating improvementsfrom productivity programs at our manufacturing facilities, and (iv) the impactof cost control actions initiated during the first six months of 2004 inresponse to the softness on the revenue line. These factors were somewhat offset by the unfavorable impact of (i) anincrease in the cost of raw materials for both steel and graphite golf shafts,(ii) continued escalation in the cost of employee healthcare benefits, and(iii) the unfavorable impact of certain fixed costs in our manufacturingfacilities spread over a reduced unit volume.

 

In the second quarter of 2003 we paid a ratification bonus to thehourly employees represented by the United Steelworkers of America related to anew four year collective bargaining agreement effective July 1, 2003.

 

12

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Excluding the impact of this ratification bonus, gross profit as apercentage of net sales would have increased to 40.6% in the first six monthsof 2004 from 40.3% in the first six months of 2003.

 

***Selling, General and Administrative Expenses***(“SG&A”) for the first six months of 2004 decreased $0.1 million, or 1.8%,to $7.5 million from $7.7 million in the first six months of 2003.  The decrease in total SG&A spendingduring the first six months of 2004 resulted primarily from cost controlactions initiated in response to the softness on the revenue line.

 

***Business Development and Start-Up Costs***for the first six months of 2004 totaled $0.3 million and remained flat to thefirst six months of 2003.  In 2003 and2004 these costs represent various start-up business expenses related to theopening of our composite manufacturing operation in southern China.

 

***Transaction and Reorganization Expenses***for the first six months of 2004 were $5.4 million and were incurred inconjunction with the sale and purchase agreement for TTC which closed onMarch 15, 2004.  These transactionrelated expenses include (i) investment banking merger and acquisition fees;(ii) legal fees; and (iii) other incidental costs and expenses related to thesale of TTC.  No such transaction andreorganization expenses were incurred during the first six months of 2003.

 

***Loss on the Early Extinguishment of Long-TermDebt*** for the first six months of 2004 was $9.2million.  The costs recorded as loss onthe early extinguishment of long term debt include (i) the write-off of theremaining deferred financing costs related to our 10 7/8% senior subordinatednotes and our 2002 senior credit facility, and (ii) the early extinguishmentcall premium and related interest we incurred when we redeemed the 10 7/8%senior subordinated notes on March 15, 2004.  No long term debt was extinguished during thefirst six months of 2003.

 

***Operating Income***for the first six months of 2004 decreased by $17.0 million, or 99.2%, to $0.1million from $17.2 million in the first six months of 2003. Operating income asa percentage of net sales decreased to 0.3% in the first six months of 2004from 26.8% in the first six months of 2003. This decrease reflects the profitimpact of the items described above.

 

Excluding the impact of transaction and reorganization expenses and theloss on early extinguishment of long-term debt in 2004 as well as the 2003ratification bonus, operating income would have decreased approximately $3.1million, or 17.5%, to $14.7 million from $17.9 million in the first six monthsof 2003.  Operating income as apercentage of net sales would have decreased to 26.5% in the first six monthsof 2004 from 27.9% in the first six months of 2003.

 

***Interest Expense***for the first six months of 2004 increased by $0.5 million to $7.2 million from$6.7 million in the first six months of 2003. This increase was driven primarily by the increase in outstandingprincipal amounts of variable rate bank debt and fixed rate bonds, offsetsomewhat by a decrease in interest rates on both the variable and fixed ratedebt between periods.

 

***Income Taxes*** forthe first six months of 2004 decreased to an income tax benefit of $0.7 millioncompared to an income tax expense of $4.1 million in the first six months of2003. This decrease was driven primarily by the pretax expenses recorded as aresult of the transaction and reorganization on March 15, 2004.  The effective tax rate during these periodsdiffers from a federal statutory rate of 34% due primarily to the incrementaltax rate for state and foreign income tax purposes.  For the period from January 1, 2004through March 14, 2004 the effective tax rate also differs due to thenondeductible nature of a portion of transaction and reorganization expenses.

 

Excluding the impact of transaction and reorganization expenses and theloss on early extinguishment of long-term debt in 2004 as well as the 2003ratification bonus, the financial results of the company in the first sixmonths of 2004 would have generated an income tax expense of $3.0 millioncompared to $4.4 million in the first six months 2003.

 

13

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***Net income*** forthe first six months of 2004 decreased by $12.6 million to a $6.3 million lossfrom $6.3 million in income in the first six months of 2003.  This decrease reflects the profit impact fromthe items described above.

 

Excluding the impact of transaction and reorganization expenses and theloss on early extinguishment of long-term debt in 2004 as well as the 2003ratification bonus, net income in the first six months of 2004 would havedecreased by $2.2 million to $4.6 million from $6.8 million in the first sixmonths of 2003.

 

**Liquidity and Capital Resources**

 

***General***

 

At the beginning of 2003 the Company had a senior credit facility (the“2002 senior credit facility”) which included a $15.0 million non-amortizingrevolving credit facility and a $25.0 million term loan. Amounts under therevolving credit facility were available on a revolving basis throughDecember 31, 2007.  The term loanrequired quarterly cash interest and principal payments beginning inMarch 2003 and continuing through December 2007.

 

In addition, the Company had $99.7 million in 10 7/8%Senior Subordinated Notes Due 2008 (the “10 7/8% Notes”).The 10 7/8% Notes required cash interest payments eachJune 1 and December 1, beginning June 1, 1999. The 10 7/8%Notes were redeemable at the Company’s option, under certain circumstances andat certain redemption prices, beginning December 1, 2003.

 

On March 15, 2004, TTC, True Temper’s parent company, waspurchased by TTS Holdings LLC, an affiliate of Gilbert Global Equity Partners,L. P.  As part of the transaction theCompany entered into a new senior credit facility (the “2004 senior creditfacility”) which includes a $20.0 million non-amortizing revolving creditfacility and a $110.0 million Term B loan. The term loan requires cash interest payments and quarterly principalpayments beginning June 30, 2004 and continuing through March 15,2011.

 

Also in conjunction with the transaction the Company issued new 8 3/8%Senior Subordinated Notes due 2011 (the “8 3/8%Notes”).  The 8 3/8%Notes require cash interest payments each March 15th andSeptember 15th commencing on September 15, 2004.  The 8 3/8% Notes areredeemable at the Company’s option, under certain circumstances and at certainredemption prices, beginning March 15, 2008.

 

The Company used the proceeds from the 2004 senior credit facility andthe 8 3/8% Notes to pay off the existing debt that wasoutstanding at closing on March 15, 2004. Also, a portion of the proceeds were used to pay a dividend to TTC inorder that TTC could repay the outstanding balance on its senior discount noteswhich carried a 13.25% PIK interest rate or a 12.25% cash interest rate.

 

Both the 2004 senior credit facility and the 8 3/8%Notes contain covenants and events of default, including substantialrestrictions and provisions which, among other things, limit our ability toincur additional indebtedness, make acquisitions and capital expenditures, sellassets, create liens or other encumbrances, make certain payments anddividends, or merge or consolidate. The 2004 senior credit facility alsorequires the Company to maintain certain specified financial ratios and testsincluding minimum interest coverage and fixed charge coverage ratios, andmaximum leverage ratios. At June 27, 2004 the Company was in compliancewith all of the covenants in both the 2004 senior credit facility and the 8 3/8%Notes. Furthermore, the 2004 senior credit facility requires certain mandatoryprepayments including payments from the net proceeds of certain asset sales anda portion of our excess cash flow as defined within the credit agreement.

 

***Six Months Ended June 27, 2004 Comparedto the Six Months Ended June 29, 2003***

 

Net cash provided by operating activities declined $3.2 million betweenperiods, as net income declined due to the lower net sales during 2004.  In addition, the Company built inventory tofacilitate the transition of graphite golf shaft production from its El Cajon,California facility to its newly established plant in Guangzhou, China, as wellas in anticipation of an increase in retail activity.

 

14

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We used $0.9 million of cash to invest in property, plant and equipmentin the first six months of 2004, compared to the $1.4 million spent in thefirst six months of 2003.

 

The Company used $10.7 million of net cash for financing activities inthe first six months of 2004 as compared to $3.0 million in 2003.  The 2004 activity included the proceeds fromissuing the 2004 senior credit facility and the proceeds from issuing the 8 3/8%Notes.   These proceeds, plus cashgenerated from operations during the first quarter, and cash on hand at thebeginning of 2004 were used to (i) repay the outstanding principal and intereston the Company’s 2002 senior credit facility, (ii) to redeem and repay the 10 7/8%Notes including their accrued and unpaid interest and early redemption callpremium, (iii) to pay for debt issuance costs on the 2004 senior creditfacility and the 8 3/8% Notes, (iv) to pay fortransaction and reorganization expenses, and (v) to issue a dividend to ourparent company, TTC.

 

***Existing Contractual Cash Obligations***

 

The following table reflects the Company’s contractual cash obligationsfor long-term debt and capital and operating leases as of June 27, 2004(dollars in millions):

 
| ** **               | ** ** | **Total** | ** ** | **2004** | ** ** | **2005  through  2006** | ** ** | **2007  through  2008** | ** ** | **Thereafter** | ** ** |
|--------------------------|------------|-----------|------------|----------|------------|-------------------------|------------|-------------------------|------------|----------------|------------|
| Long-Term Debt(1)        |       | $         | 235.0      |     | $          | 0.8                     |       | $                       | 2.2        |           | $          | 2.2 |   | $ | 229.8 |   |
| Operating Leases         |       | 3.3       |       | 0.5      |       | 1.7                     |       | 1.1                     |       | —         |       |
| Purchase Commitments (2) |       | 0.1       |       | 0.1      |       | —                  |       | —                  |       | —         |       |
| Total(3)                 |       | $         | 238.4      |     | $          | 1.4                     |       | $                       | 3.9        |           | $          | 3.3 |   | $ | 229.8 |   |

 

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(1)          Our long-term debt agreements containcustomary change of control provisions that could, under certain circumstances,cause accelerated debt repayment.

 

(2)          Amount represents the purchase commitments fornatural gas used in the manufacture of steel golf shafts at our Amory,Mississippi facility.

 

(3)          This table does not include our futureobligations related to our funding of our pension benefits.

 

***Future Cash Generation and Use***

 

Currently our intention is to use existing cash and cash provided fromfuture operations, if any, as allowed within the covenants of our 2004 seniorcredit facility and our 8 3/8% Notes, to:

 

•                  Repay theprincipal on our 2004 senior credit facility; and / or

 

•                  To makeadditional investments in the business for growth, which may include, amongother things, capital expenditures, business acquisitions, and/or expendituresfor business development and expansion in China.

 

In addition to the debt service obligations for principal and interestpayments, the Company’s liquidity needs largely relate to working capitalrequirements and capital expenditures for machinery and equipment.  The Company intends to fund our current andlong term working capital, capital expenditure and debt service requirementsthrough cash flow generated from operations. However, since there can be no assurance of future performance, as ofJune 27, 2004 the Company has the $20.0 million revolving credit facilityavailable for future cash requirements. The maximum amount the Company may use of the $20.0 million revolvingcredit facility is limited by the financial covenants contained within the 2004senior credit facility.

 

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In addition to the Company’s cash obligations for interest andprincipal payments related to its debt obligations, the Company also has amanagement services agreement with an affiliate of the principle common stockholder in its parent company, which requires the payment of an annual advisoryfee of $0.5 million.

 

Depending on the size, any future acquisitions, joint ventures, capitalexpenditures or similar transactions may require significant capital resourcesin excess of cash provided from operations, and potentially in excess of cashavailable under the revolving credit facility. There can be no assurance that the Company will be able to obtain thenecessary capital, under acceptable terms, from creditors or other sources thatwill be sufficient to execute any such business investment or capitalexpenditure.

 

**Impact of Recently Issued Accounting Standards**

 

In December 2003, the FASB issued FASB Interpretation No. 46(revised December 2003), *Consolidation of VariableInterest Entities*, which addresses how a business enterprise shouldevaluate whether it has a controlling financial interest in an entity throughmeans other than voting rights and accordingly should consolidate theentity.  This Interpretation replacesFASB Interpretation No. 46, *Consolidation of VariableInterest Entities*, which was issued in January 2003.  The Company will be required to apply FIN 46Rto variable interests in VIEs created after December 31, 2003.  For variable interests in VIEs created beforeJanuary 1, 2004, the Interpretation will be applied beginning onJanuary 1, 2005.  For any VIEs thatmust be consolidated under FIN 46R that were created before January 1,2004, the assets, liabilities and non-controlling interests of the VIEinitially would be measured at their carrying amounts with any differencebetween the net amount added to the balance sheet and any previously recognizedinterest being recognized as the cumulative effect of an accountingchange.  If determining the carryingamounts is not practicable, fair value at the date FIN 46R first applies willbe used to measure the assets, liabilities and non-controlling interest of theVIE.  The application of thisInterpretation did not have a material effect on the Company’s financialstatements.

 

In May 2003, the FASB issued Statement No. 150, *Accountingfor Certain Financial Instruments with Characteristics of both Liabilities andEquity*. This Statement establishes standards for the classificationand measurement of certain financial instruments with characteristics of bothliabilities and equity.  The Statementalso includes required disclosures for financial instruments within its scope.  For the Company, the Statement was effectivefor instruments entered into or modified after May 31, 2003 and otherwise waseffective as of January 1, 2004, except for mandatorily redeemablefinancial instruments.  For certainmandatorily redeemable financial instruments, the Statement will be effectivefor the Company on January 1, 2005. The effective date has been deferred indefinitely for certain othertypes of mandatorily redeemable financial instruments.  The Company currently does not have anyfinancial instruments that are within the scope of this Statement.

 

**Forward-Looking Statements**

 

The Private Securities Litigation Act of 1995 (the “Act”) provides asafe harbor for forward-looking statements made by our Company. This documentcontains forward-looking statements, including but not limited to Item 2“Management’s Discussion and Analysis of Financial Condition and Results ofOperations”. All statements which address future operating or financialperformance, events or developments that we expect, plan, believe, hope, wish,forecast, predict, intend, or anticipate will occur in the future, and othersimilar meanings or phrases, are forward-looking statements within the meaningof the Act.

 

The forward-looking statements are based on management’s current viewsand assumptions regarding future events and operating performance. However,there are many risk factors, including but not limited to, the Company’ssubstantial leverage, the Company’s ability to service its debt, the generalstate of the economy, the Company’s ability to execute its plans, fluctuationsin the price and availability of energy, fluctuations in the price andavailability of raw materials, potentially significant increases to employeehealth and welfare costs, competitive factors, and other risks that could causethe actual results to differ materially from the estimates or predictionscontained in our Company’s forward-looking statements. Additional informationconcerning the Company’s risk factors is contained from time to time in theCompany’s public filings with the SEC; and most recently in the Business Riskssection of Item 1 to Part 1 of our 2003 Annual Report onForm 10-K filed with the

 

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SEC on March 12, 2004 and also disclosed in our Form S-4Registration Statement filed with the SEC on April 13, 2004.

 

The Company’s views, estimates, plans and outlook as described withinthis document may change subsequent to the release of this statement.  The Company is under no obligation to modifyor update any or all of the statements it has made herein despite anysubsequent changes the Company may make in its views, estimates, plans oroutlook for the future.

 

**Item 3.****           *Quantitative and Qualitative Disclosures About Market Risk***

 

**Interest Rate Sensitivity**

 

The table below provides information about the Company’s debtobligations as of June 27, 2004 that are sensitive to changes in interestrates. The table presents cash flows and related weighted average interestrates by expected maturity dates (dollars in millions).

 
| ** **                             | ** ** | **Expected Maturity Date** | ** ** | **Total**  | ** ** | **Fair   Value** | ** ** |
|----------------------------------------|------------|----------------------------|------------|------------|------------|------------------|------------|
| ** **                             | ** ** | ** **                 | ** ** | **There-** | ** ** | ** **       | ** ** |
| ** **                             | ** ** | **2004**                   | ** ** | **2005**   | ** ** | **2006**         | ** ** | **2007** | ** ** | **2008** | ** ** | **after** | ** ** | ** ** | ** ** |
| LONG TERM DEBT                         | ** ** | ** **                 | ** ** | ** ** | ** ** | ** **       | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
| Fixed Rate 8 3/8%  Senior Subordinated |       |                       |       |       |       |             |       |   |   |   |   |   |   |   |   |   |   |
| Notes                                  |       | $                          | —     |       | $          | —           |       | $ | — |   | $ | — |   | $ | — |   | $ | 125.0 |   | $ | 125.0 |   | $ | 125.0 |   |
| Average Interest Rate                  |       |                       |       |       |       |             |       |   |   |   |   | 8.375 | % | 8.375 | % |   |   |
| Variable Rate Senior Credit Facility   |       | $                          | 0.8        |       | $          | 1.1              |       | $ | 1.1 |   | $ | 1.1 |   | $ | 1.1 |   | $ | 104.8 |   | $ | 110.0 |   | $ | 110.0 |   |
| Average Interest Rate (a)              |       |                       |       |       |       |             |       |   |   |   |   | 3.759 | % | 3.759 | % |   |   |
|                                        |            |                            |            |            |            |                  |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

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(a)            Variable rate long-term debt is comprised ofterm loans under the 2004 senior credit facility. The 2004 senior creditfacility provides for interest at the Company’s option, at (1) the base rate ofthe bank acting as administrative agent plus a margin adder of 1.50%, or (2)under a LIBOR option with a borrowing spread of LIBOR plus 2.50%.

 

Information concerning the Company’s market risks related to foreignexchange rates and commodities is contained in the “Management’s Discussion andAnalysis of Financial Condition and Results of Operations” section of our2003 Annual Report on Form 10-K, as filed with the SEC on March 12, 2004.

 

This information has been omitted from this report as there have beenno material changes to the Company’s risks related to foreign exchange ratesand commodities as of June 27, 2004.

 

**Item 4.****           *Controls and Procedures***

 

**Evaluation of Disclosure Controls and Procedures**

 

Evaluations required by Rule 13a-15 of the Securities Exchange Act of1934 of the effectiveness of the Company’s disclosure controls and procedures(as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as ofthe end of the period covered by this Report have been carried out under thesupervision and with the participation of the Company’s management, includingits Chief Executive Officer and Chief Financial Officer. Based upon suchevaluations, the Chief Executive Officer and Chief Financial Officer concludedthat the Company’s disclosure controls and procedures were effective. Therehave been no changes in the Company’s internal controls over financialreporting during the period covered by this Report that were identified inconnection with the evaluation referred to above that have materially affected,or are reasonably likely to materially affect, the Company’s internal controlsover financial reporting.

 

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**PARTII.  OTHER INFORMATION**

 

**Item 1.****           *Legal Proceedings***

 

Various claims and legal proceedingsgenerally incidental to the normal course of business are pending or threatenedagainst us. While we cannot predict the outcome of these matters, in theopinion of management, any liability arising from these matters will not have amaterial adverse effect on our business, financial condition or results ofoperations.

 

**Item 2.****           *Changes in Securities and Use of Proceeds***

 

—Not applicable—

 

**Item 3.****           *Defaults Upon Senior Securities***

 

—None—

 

**Item 4.****           *Submission of Matters to a Vote of Security Holders***

 

There were no matters submitted to a vote of security holders duringthe quarter ended June 27, 2004.

 

**Item 5.****           *Other Information***

 

—Not Applicable—

 

**Item 6.****           *Exhibits and Reports on Form 8-K***

 

a.               Exhibits

 
| 1.1    |   | Purchase Agreement, dated as of March 3, 2004, among True  Temper Sports, Inc., Credit Suisse First Boston LLC and Goldman, Sachs &  Co. (filed as Exhibit 1.1 to True Temper Sports, Inc.’s Registration  Statement on Form S-4, as filed with the Securities and Exchange Commission  on April 13, 2004).*                                                                                                        |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.1    |   | Indenture, dated as of March 15, 2004, among True Temper  Sports, Inc., the Guarantors identified therein, and The Bank of New  York (filed as Exhibit 4.1 to True Temper Sports, Inc.’s Registration  Statement on Form S-4, as filed with the Securities and Exchange Commission  on April 13, 2004).*                                                                                                           |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.2    |   | Form of Senior Subordinated Note due 2011 (filed as  Exhibit 4.2 to True Temper Sports, Inc.’s Registration Statement on Form  S-4, as filed with the Securities and Exchange Commission on April 13,  2004).*                                                                                                                                                                                                               |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 4.3    |   | Registration Rights Agreement, dated as of March 15,  2004, among True Temper Sports, Inc., El Cajon Equipment Corporation,  True Temper Sports-PRC Holdings, Inc., Credit Suisse First Boston LLC  and Goldman, Sachs & Co (filed as Exhibit 4.3 to True  Temper Sports, Inc.’s Registration Statement on Form S-4, as filed with the  Securities and Exchange Commission on April 13, 2004).* |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 10.1   |   | Management Services Agreement, dated as of March 15,  2004, between GGEP Management, L.L.C., GGEP Management (Bermuda) Ltd.,  and True Temper Sports, Inc. (filed as Exhibit 10.1 to True Temper  Sports, Inc.’s Registration Statement on Form S-4, as filed with the  Securities and Exchange Commission on April 13, 2004).*                                                                                    |

 

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| 10.2   |   | Shareholders Agreement, dated as of March 15, 2004, by  and among True Temper Corporation, TTS Holdings LLC and the Other Investors  identified therein (filed as Exhibit 10.2 to True Temper Sports, Inc.’s  Registration Statement on Form S-4, as filed with the Securities and Exchange  Commission on April 13, 2004).*                                                                                                                          |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.3   |   | True Temper Corporation 2004 Equity Incentive Plan, dated as  of March 15, 2004 (filed as Exhibit 10.3 to True Temper Sports,  Inc.’s Registration Statement on Form S-4, as filed with the Securities and  Exchange Commission on April 13, 2004).*                                                                                                                                                                                                  |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.4   |   | Credit Agreement, dated as of March 15, 2004, by and  among True Temper Corporation, True Temper Sports, Inc, the Lenders  identified therein, Credit Suisse First Boston, Antares Capital Corporation,  Goldman Sachs Credit Partners L.P. and Merrill Lynch Capital (filed as  Exhibit 10.4 to True Temper Sports, Inc.’s Registration Statement on  Form S-4, as filed with the Securities and Exchange Commission on  April 13, 2004).* |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.5   |   | Tax Sharing and Administrative Services Agreement, dated as of  March 15, 2004, by and among True Temper Corporation, True Temper  Sports, Inc., El Cajon Equipment Corporation and True Temper Sports-PRC  Holdings, Inc. (filed as Exhibit 10.5 to True Temper Sports, Inc.’s  Registration Statement on Form S-4, as filed with the Securities and Exchange  Commission on April 13, 2004).*                                             |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 10.6   |   | Employment Agreement, dated as of January 30, 2004, by  and between True Temper Sports, Inc. and Scott C. Hennessy (filed  as Exhibit 10.6 to True Temper Sports, Inc.’s Registration Statement on  Form S-4, as filed with the Securities and Exchange Commission on  April 13, 2004).*                                                                                                                                                    |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 31.1   |   | Certification pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002**                                                                                                                                                                                                                                                                                                                                                                                           |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 31.2   |   | Certification pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002**                                                                                                                                                                                                                                                                                                                                                                                           |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 31.3   |   | Certification pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002 (filed as Exhibit 31.1 to True Temper Sports,  Inc.’s 2003 Annual Report on Form 10-K, as filed with the Securities and  Exchange Commission on March 12, 2004).*                                                                                                                                                                                                       |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 31.4   |   | Certification pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002 (filed as Exhibit 31.2 to True Temper Sports,  Inc.’s 2003 Annual Report on Form 10-K, as filed with the Securities and  Exchange Commission on March 12, 2004).*                                                                                                                                                                                                       |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 32.1   |   | Certification pursuant to Section 906 of  the Sarbanes-Oxley Act of 2002.**                                                                                                                                                                                                                                                                                                                                                                                     |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 32.2   |   | Certification pursuant to Section 906 of  the Sarbanes-Oxley Act of 2002.**                                                                                                                                                                                                                                                                                                                                                                                     |

 

b.              Reportson Form 8-K

 

No reports or Form 8-K were filed during the quarter endedJune 27, 2004.

 

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*                                         Incorporatedby reference

**                                  Filedherewith

 

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**SIGNATURES**

 

Pursuant to the requirements of the Securities Exchange Act of 1934,the registrant has duly caused this report to be signed on its behalf by theundersigned, thereunto duly authorized, in the City of Memphis, State ofTennessee, on August 11, 2004.

 
|   | True Temper Sports, Inc. |
|--------|--------------------------|
|   |                     |
|   |                     |
|   | By:                      | /s/SCOTT C. HENNESSY |   |
|   |                     |   |   |
|   | Name: Scott C. Hennessy  |
|   | Title:                   | President and Chief Executive Officer |
|   |                     |   |
|   |                     |   |
|   | By:                      | /s/FRED H. GEYER |   |
|   |                     |
|   | Name: Fred H. Geyer      |
|   | Title:                   | Senior Vice President, |
|   |                     | Chief Financial Officer and Treasurer |
|        |                          |  |  |  |

 

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