Use these links to rapidly review the documentTRUE TEMPER SPORTS, INC. ANNUAL REPORT ON FORM 10-K For the Fiscal Year Ended December 31, 2007 INDEX Item 8. Consolidated Financial Statements and Supplementary Data



UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-K

|ý                                           | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934    
|------------------------------------------- | ----------------------------------------------------------------------------------------
|For the fiscal year ended December 31, 2007
|OR                                         
|o                                           | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|Commission file number 333-72343           

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TRUE TEMPER SPORTS, INC.(Exact name of registrant as specified in its charter)

|Delaware(State or other jurisdiction of
incorporation or organization)                     |  | 52-2112620(I.R.S. Employer
Identification Number)
|------------------------------------------------------------------------------------------ |  | -------------------------------------------------
|                                                                                           |  |                                                  
|8275 Tournament Drive Suite 200
Memphis, Tennessee(Address of Principal Executive Offices) |  | 38125(Zip Code)                                  

Telephone: (901) 746-2000(Registrant's telephone number, including area code)

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Securities
registered pursuant to section 12(b) of the Act:None

Securities
registered pursuant to section 12(g) of the Act:None

Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
o Yes    ý No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
ý Yes    o No

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment
to this Form 10-K.    ý

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See definitions of "large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large
accelerated filer o        Accelerated filer o        Non-accelerated
filer ý        Smaller reporting company o (Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
o Yes    ý No

As of June 29, 2007 the Registrant had 100 shares of Common Stock, $0.01 par value per share, outstanding. All of the Registrant's outstanding shares were
held by True Temper Corporation, the Registrant's parent company, as of June 29, 2007.

Documents Incorporated by Reference

None.



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TRUE TEMPER SPORTS, INC.        ANNUAL REPORT ON FORM 10-K        For the Fiscal Year Ended December 31, 2007        INDEX



|                  |         |    |                                                                                                              | Page
|----------------- | ------- | -- | ------------------------------------------------------------------------------------------------------------ | ----
|                  |         |    |                                                                                                              |     
|PART I            |         |    |                                                                                                              |     
|                  | Item 1  |    | Business                                                                                                     |     
|                  | Item 1A |    | Risk Factors                                                                                                 |     
|                  | Item 1B |    | Unresolved Staff Comments                                                                                    |     
|                  | Item 2  |    | Properties                                                                                                   |     
|                  | Item 3  |    | Legal Proceedings                                                                                            |     
|                  | Item 4  |    | Submission of Matters to a Vote of Security Holders                                                          |     
|PART II           |         |    |                                                                                                              |     
|                  | Item 5  |    | Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |     
|                  | Item 6  |    | Selected Financial Data                                                                                      |     
|                  | Item 7  |    | Management's Discussion and Analysis of Financial Condition and Results of Operations                        |     
|                  | Item 7A |    | Quantitative and Qualitative Disclosures About Market Risk                                                   |     
|                  | Item 8  |    | Financial Statements and Supplementary Data                                                                  |     
|                  | Item 9  |    | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure                         |     
|                  | Item 9A |    | Controls and Procedures                                                                                      |     
|                  | Item 9B |    | Other Information                                                                                            |     
|PART III          |         |    |                                                                                                              |     
|                  | Item 10 |    | Directors, Executive Officers and Corporate Governance                                                       |     
|                  | Item 11 |    | Executive Compensation                                                                                       |     
|                  | Item 12 |    | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters               |     
|                  | Item 13 |    | Certain Relationships and Related Transactions and Director Independence                                     |     
|                  | Item 14 |    | Principal Accountants Fees and Services                                                                      |     
|PART IV           |         |    |                                                                                                              |     
|                  | Item 15 |    | Exhibits and Financial Statements Schedule                                                                   |     
|SIGNATURES        |         | 81
|INDEX TO EXHIBITS |         | 83

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PART I

Item 1.Business

Purchase Agreement for True Temper Corporation

On January 30, 2004, TTS Holdings LLC, a new company formed by Gilbert Global Equity Partners, L.P. and its affiliated funds ("Gilbert
Global"), entered into a stock purchase agreement with True Temper Sports, Inc.'s ("True Temper" or the "Company") direct parent company, True Temper Corporation ("TTC"), pursuant to which TTS
Holdings LLC and certain of the Company's senior management purchased all of the outstanding shares of TTC ("Gilbert Global Acquisition"). The Gilbert Global Acquisition was finalized and
closed on March 15, 2004.

General

We are the world's leading designer, manufacturer and marketer of golf shafts. Since the 1930s, we have manufactured golf shafts under the widely recognized True
Temperbrand. In 2007, approximately 70% of our revenue was generated through the sale of steel golf shafts. We believe that our share of the
worldwide steel golf shaft market was approximately 70% to 80% in 2007 and that our share is several times greater than that of the next largest market participant. We are a leading supplier of
premium steel shafts to the top golf club original equipment manufacturers and distributors, including Adams, Callaway, Cleveland, Golfsmith, Golf Works, Mizuno, Nike, Ping, TaylorMade, Titleist and
Wilson. From 1988 to 2007, our steel shafts were played by all of the winners of the PGA's 80 major
championships. We are also one of the world's largest manufacturers of premium graphite (carbon fiber based composites) golf shafts, with an estimated share of approximately 10% of this highly
fragmented market. In addition to golf shafts, through our Performance Sports business, we also design, manufacture and market products such as steel and titanium alloy bicycle frames, composite
bicycle components, such as forks and handlebars, and graphite hockey sticks.

Our
golf shaft products include numerous proprietary models (with our customers' brand name, label or trademark affixed to the shaft) as well as a number of branded models (with the True Temper, Royal PrecisionorGrafalloybrand name, label or trademark affixed to the shaft),
including a full range of premium and commercial grade steel and graphite shafts. We design, manufacture and market a number of steel shaft product lines, including:



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We
also design, manufacture and market several lines of premium graphite shafts under theGrafalloybrand name. Our graphite shafts have a
strong presence at the professional level and have been played by winners on each of the professional tours, including the PGA, EPGA, LPGA, Champions and Nationwide Tours. Our most popular
graphite shaft brands include:



We
believe that we are the only golf shaft company in the world which is capable, within its own facilities, of manufacturing both steel and graphite golf shafts in large volumes. This
unique competitive advantage allowed us to design, develop, manufacture and sell the first commercially viable multi-material golf shaft combining both steel and graphite into one shaft. Our BiMatrx RXiandBiMatrx Rocketshafts utilize a patented multi-material technology to combine the
torsional stability and consistent performance benefits of steel with the light-weight flexible benefits of graphite into one shaft.

In
addition, this expertise in various materials was instrumental in our ability to develop the next generation of golf shafts using patented Nanofuse® material. The first
brand launch using this revolutionary material is theGrafalloy Epicshaft which has been proven to not only improve distance but also to significantly
reduce dispersion.

Through
our Performance Sports business, we have utilized the capabilities developed in our golf shaft business to pursue other branded recreational sports equipment markets that have
similar competitive dynamics, manufacturing requirements, and raw material applications. We focus on the premium segment of the bicycle market where innovation, quality and branding are highly valued
by the consumer, and products are often customized to suit the individual consumer's specific requirements. Our value-added premium bicycle component products generally have higher margins than
component parts made for bicycles sold in mass channel retail stores. In the hockey components market, we focus on composite shafts and full sticks used in a variety of original equipment
manufacturers' one-piece and composite sticks.

The Golf Club Shaft Industry

The golf market for hard goods is estimated to be a $5.0 to $7.0 billion industry, with golf clubs making up the largest portion at over 50%. Spending in
the golf equipment industry is highly

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concentrated
among avid golfers (golfers that play more than 25 rounds of golf per year) who account for nearly 60% of the total spending on golf equipment despite only accounting for approximately
one quarter of the golfing population.

There
are three basic components needed to manufacture a golf club: the shaft, the club head and the grip. The shaft is critical to the performance of a golf club as it is vital in
controlling the consistency and distance of a golf shot. While branded premium shafts are important to the performance and marketing of golf clubs, these shafts represent a relatively small portion of
the overall cost of a golf club, typically under 10% of the retail sales price.

The
golf shaft market is comprised primarily of steel and graphite shafts. We believe that in 2007 the two largest participants in the worldwide steel shaft market comprised an aggregate
market share of approximately 90%. We believe that this concentration in the steel shaft market is due to the high barriers to entry created by the technical expertise and capital investment necessary
to participate in the market as well as the customized manufacturing process required for the production of premium steel shafts. The production of graphite shafts is less capital intensive and
requires less investment than steel shaft manufacturing. Although recently there has been some consolidation among graphite shaft manufacturers, the graphite shaft industry is fragmented, with the top
six market participants representing approximately 75% of the worldwide market in 2007. We believe that the relatively lower barriers to entry account for this fragmentation.

We
believe that from 1991 to 1995, graphite shafts gained share in the overall shaft market due to the light-weight, vibration-damping characteristics of graphite shafts, particularly
for longer-shafted, larger-headed woods. Since 1995, however, the development of vibration damping materials for steel shafts such as ourSensiCoreinsert, along with the introduction of lighter weight steel alloys in products such as ourDynamic Gold SLand GS75shafts, have resulted in steel shafts
that have the vibration damping and light-weight characteristics of graphite shafts together with the
consistent performance and distance control qualities of steel shafts. We believe that these design improvements contributed to the growth in share of steel shafts in the overall shaft market from
approximately 50% in 1995 to approximately 55% to 60% in 2007.

Products

We design, manufacture and market steel and graphite golf shafts, as well as a variety of high strength, tight tolerance components for the hockey, bicycle and
other recreational sports markets. Our proprietary golf shafts, which accounted for approximately 25% of our net sales in 2007, are custom designed, and frequently co-branded in
partnership with our customers, to accommodate specific golf club head designs. As an example, our proprietary models include co-branded products such as Callaway's Uniflex, Nike'sSpeedstepand Ping'sAWT. Our branded
products with theTrue Temper, Royal PrecisionorGrafalloynames and designs are typically sold to golf
club original equipment manufacturers, distributors and various custom club assemblers, and are used to either assemble new clubs or to replace the shafts in existing clubs.

Steel Golf Shafts.We manufacture a wide range of steel golf shaft lines with unique design features
and performance characteristics. Our steel golf shafts can be divided into the following two major product categories:



Premium
steel shafts, such as ourDynamic Gold, Rifle, Project X, Black Gold, Dynamic Gold SLand GS75product lines, are high performance products with tighter
design tolerances and quality

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specifications
that sell for higher average selling prices and generate higher profit margins than commercial grade steel shafts. Our commercial grade steel shafts are manufactured to a different
specification and sell for a lower average selling price to original equipment manufacturers who produce and sell opening price point golf club sets, typically to entry-level players who purchase
their products through mass channel retail stores.

Graphite Golf Shafts.We manufacture a wide range of graphite golf shaft lines, which are offered in
a variety of weights, torques and flexes. Our graphite golf shafts are currently being played by numerous touring professionals on the PGA, EPGA, LPGA, Champions and Nationwide Tours. Our
graphite shafts are sold under theGrafalloybrand name. Similar to steel, graphite shafts can be placed in several categories of performance, quality
and price. Historically, most of the graphite golf shafts that we produced were higher quality and higher priced premium grade shafts that are sold to golf
equipment distributors, and to original equipment manufacturers for their custom product offerings. Beginning in 2004, with the establishment of our lower cost China manufacturing facility, we also
began producing and selling certain lower price point graphite shafts. These products are currently used primarily as stock offerings in original equipment manufacturer iron programs.

Golf Shafts with Combined Materials.During the last several years, we have developed golf shafts
that combine multiple materials such as steel and graphite into one shaft. Late in 2000, we introduced a proprietary custom iron product for a customer that combines a steel shaft with a graphite tip
section to produce a shaft that provides a new feel for irons.

We
used similar patented technology to introduce theTrue Temperbranded product known as BiMatrxin January 2001. TheBiMatrxshaft consists of a graphite shaft with a steel tip section that
was designed for use in driver and fairway wood applications.

Golf Shafts with New Materials.In early 2007, we introduced driver and fairway wood shafts
constructed of patented Nanofuse® material, which utilizes today's most advanced nanotechnology to produce a stronger, lighter shaft which incorporates the benefits of both graphite and
steel.

Performance Sports Products.We also manufacture and sell a wide variety of high performance
components for the bicycle, hockey and other recreational sports markets. In 2007, we sold our performance sports products to a broad range of original equipment manufacturers and distributors.

Customers

We maintain long-standing relationships with a highly diversified customer base. We are a leading supplier of shafts to the top golf club original
equipment manufacturers and distributors, including Adams, Callaway, Cleveland, Golfsmith, Golf Works, Mizuno, Nike, Ping, TaylorMade, Titleist and Wilson. In addition, we are partnered with several
of the leading component suppliers in the hockey market, such as Reebok and Sherwood. In 2007, we had in excess of 600 customers, including approximately 540 manufacturers/retailers and approximately
80 distributors.

For
many years, we have maintained a broad and diversified customer base in the golf equipment market. In 2007, our top ten customers represented approximately 70% of our net sales, and
our top customer accounted for approximately 15% of our net sales.

We
believe that our close customer relationships and responsive service have been significant elements to our success and that our engineering and manufacturing expertise provide us with
a strong
competitive advantage in truly partnering with our customer base. We have developed and co-branded many proprietary shafts with our customers. As an example, we produce proprietary
customized steel shafts for Callaway, under theUniflexbrand; for Ping, under theAWTbrand; and for
Nike, using theSpeedstepbrand.

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Competition

We operate in a highly competitive environment. We believe that we compete principally on the basis of:



We
believe that our share of the worldwide steel golf shaft market was approximately 70% to 80% in 2007 and that our share is several times greater than the share of the next largest
market participant. We believe that we compete primarily with three other steel golf shaft manufacturers: Far East Machinery Co., Ltd., located in Taiwan which produces primarily
commercial grade golf shafts, Nippon Shaft Co., Ltd., a Japanese manufacturer of primarily premium golf shafts, and Summit Sports World Wide Co., Ltd. which produces
limited volumes of commercial grade golf shafts.

Unlike
steel, the graphite shaft manufacturing industry is highly fragmented with a large number of suppliers selling to only a few customers. We believe there are approximately 50
graphite shaft manufacturers worldwide. A few of these companies reside in North America and many are located in Asia. We do not believe that there are any graphite suppliers currently with a market
share in graphite that is comparable to the market share we have in steel. We believe we are one of the six largest producers of branded premium grade graphite shafts in the world and we estimate that
our market share is approximately 10%. Our major competitors in the premium grade branded graphite shaft market include Aldila, Inc., United Sports Technologies, Inc., Graphite Design
International, Fujikura Composites and Mitsubishi.

We
believe that we are the only golf shaft company in the world which is capable, within its own facilities, of manufacturing both steel and graphite golf shafts in large volumes.

Design & Development

We design and develop products for both proprietary/co-branded market applications and for theTrue
Temper,Royal PrecisionandGrafalloybranded product range.

The
larger golf club manufacturers often request exclusively designed proprietary or co-branded steel and graphite golf shafts for their club systems, which require golf
shafts, heads and grips engineered to work together. We are committed to serving this market by maintaining our role as a leader in innovative shaft designs for both steel and graphite materials
technology. Shaft designs and modifications are frequently the direct result of our efforts combined with those of our customers to develop an exclusive shaft specifically designed for that customer's
clubs. We use a computer aided design analysis system to evaluate a new shaft's design with respect to weight, torque, flex point, tip and butt flexibility, swing weight and other critical shaft
design criteria.

In
addition to our proprietary/co-branded products, we are very active in designing and developing new products under our various brand names that meet the performance needs
of golfers of all ages and skill levels. We develop these branded products based upon our internal research and evaluation of consumer needs and preferences.

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The
materials typically used in production of our designs include several different high strength steel alloys, advanced composites of graphite and glass fibers with thermosetting epoxy
resin systems, and today's most advanced nano materials.

Using
state of the art technology, we generate a design which is then analyzed by computer for stiffness and strength properties. Our research and development efforts focus on innovative
technology and new materials as an essential precursor to successful new product development. Our design research focuses on improvements in shaft aesthetics since cosmetic appearance has become
increasingly important to customers. To supplement our design and development we employ extensive testing that includes laboratory durability tests, robotic performance testing involving extensive
ball flight/trajectory analysis and individual player evaluation.

In
2003, we opened a 14 acre test facility that enables us to better evaluate our products. We have our own private driving range where we perform qualitative player testing and
quantitative mechanical testing with a Miya 5 swing robot. Our facility utilizes the newest, state of the art, TrackMan doppler radar system to track all aspects of ball flight and trajectory. We
believe that we are the only shaft manufacturer with our own driving range that is capable of this type of product testing.

In
addition, our pursuit of strategic vendor alliances complement our abilities and needs, an approach which allows us to exploit technical capabilities beyond our own while minimizing
the risk and investment required to enter the market with new products.

Research
and development costs for the years ended December 31, 2007, 2006 and 2005 were $1.8 million, $1.9 million and $1.8 million, respectively.

Manufacturing

We believe that our manufacturing expertise and production capabilities enable us to respond quickly to customers' orders and provide sufficient quantities on a
timely basis. We believe that our investment in capital equipment and personnel training has helped us to establish a reputation as one of the leading manufacturers of steel and graphite shafts.

Steel Shaft Manufacturing Process.The process of manufacturing a steel golf shaft has many distinct phases. Generally, a
large steel coil is unrolled and then formed lengthwise, welded and cut into cylinders. The tubing is then treated and fitted over a metal rod or "mandrel" that is used to determine the precise inside
diameter of the cylinder as it is drawn. The tubing is stretched, cut into sections, and then weighed and balanced. Later, through a process that we pioneered, the sections are tapered to give each
shaft model a particular flex and frequency. The shafts are cleaned, straightened, heat-treated and tempered. Some of the shafts are straightened by machines designed
and built by us. The shafts are plated with layers of nickel to prevent corrosion and then covered with a fine layer of chrome. Finally, shafts are dried, polished and inspected for cosmetic flaws
before our name and logo is affixed to the shaft.

Graphite Shaft Manufacturing Process.There are two processes which are used to manufacture a graphite shaft:
flag-wrapping and filament-winding. Most of our graphite shafts are produced using the flag-wrapping technique. The flag-wrapping method uses graphite fiber
materials or "prepreg" in sheet form, which requires refrigeration until use. Each new roll of prepreg is allowed to reach room temperature before the material is cut into pennant-shaped patterns
called flags for each particular shaft design. Layer by layer, various combinations of prepreg flags are wrapped around mandrels specified for each particular shaft design. The layered materials are
then encased in thin layers of clear tape for compaction and heated at high temperatures to harden the material. At the end of the process, the shafts are painted and stylized using a variety of
colors, patterns and designs. The filament-winding process, on the other hand, begins with a spool, rather than a sheet, of graphite fiber, which is fed onto the reel of a machine which then wraps the

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fiber
around a mandrel by turning the mandrel and simultaneously moving the graphite fiber from one end of the mandrel to the other. Once the mandrel is wrapped, the process uses the same encasing and
heating techniques as the flag wrapping process.

Raw Materials.We use several raw materials to produce steel golf shafts, including several steel alloys sourced from a
number of vendors, nickel crowns and plating chemicals, Sensicore inserts and various sundry supplies, boxes and labels. Graphite shafts are produced with a variety of graphite fiber materials that we
source from several different vendors. In addition, graphite shafts are finished with a wide variety of paints, inks and heat transfer labels. We believe that there are adequate alternative suppliers
of these materials and, therefore, we do not believe that we are dependent on any one supplier.

In
addition to the raw materials discussed above, we also use a substantial amount of natural gas and electricity in our manufacturing processes. Suppliers for these types of energy
sources are limited, and prices are subject to general market and industry conditions.

Marketing and Promotion

Our marketing strategy is designed around new product development and targeted advertising and promotion programs. Through our ability to anticipate and address
consumer trends in the golf equipment market, as well as the performance demands of professional golfers, we are able to successfully market our products to golf club manufacturers while strengthening
brand awareness. During the last several years, our marketing efforts, through the utilization of a wide variety of promotional channels, including mass media advertising, print and television,
sponsorship of
golf-related events, equipment endorsements from original equipment manufacturers and product demonstrations, have increased our overall exposure in the golf industry.

For
example, we have maintained a strong presence among PGA Tour players, particularly since 1981, when we began sending our PGA Tour van to all major PGA events. The tour van functions
as a golf club custom shop on wheels, visiting numerous professional tour events during 2007. Typically, the van is located near the practice tee and lends technical support to the tour professionals
while simultaneously promoting theTrue Temper, Royal PrecisionandGrafalloybrands to representatives
of original equipment manufacturers. In addition, we provide technical support to the players on the Champions, Nationwide and LPGA Tours as well as the European and Japanese PGA Tours.

Although
we do not pay any professional golfer to endorse or play our shafts, we believe that the use of our products by professional golfers enhances our reputation for quality and
performance while also promoting the use of our shafts. Due to our strong reputation and service, we estimate that over 90% of professional golfers around the world use our product in
competition. We clearly recognize the influence that a professional golfer, or very low handicap golfer, can have on consumer preferences, so we also engage in special promotional efforts with local
club and teaching professionals, and we contribute shafts to college athletic programs, to encourage the use of our product so they provide positive feedback on theTrue
Temper, Royal PrecisionandGrafalloybrands to their constituents.

Much
of our advertising and promotional spending is dedicated to print and television advertising, including cooperative advertising with our customers. Additional advertising and
promotional spending is allocated to promotional events such as trade shows, consumer golf shows, PGA Tour activities and retail golf shop advertising displays.

Advertising
and promotional costs for the years ended December 31, 2007, 2006 and 2005 were $3.2 million, $3.7 million and $3.5 million, respectively.

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Distribution & Sales

We primarily sell our shafts to original equipment manufacturers, retailers and distributors. Typically, distributors resell our products to custom club
assemblers, pro shops and individuals. Sales to golf club manufacturers/retailers accounted for approximately 87% of our net golf shaft sales in 2007, and sales to distributors represented
approximately 13% of our 2007 net golf shaft sales.

We
believe that we have one of the most experienced and respected sales staffs in the industry. Our sales and marketing department includes domestic sales managers, international sales
managers, a customer service/logistics group and a team of design professionals that provides field support to our sales representatives. We believe that our international market presence, which
comprised approximately 36% of our total 2007 net sales, provides an opportunity for future growth. We market our products in Japan, Europe, and Asia and maintain a distribution operation in each
region. Financial information by geographic segment is contained in Note 14 to the consolidated financial statements located elsewhere in this annual report.

Employees

As of December 31, 2007, we had 807 full-time employees, including 17 in sales and marketing, 40 in research, development and
manufacturing engineering, approximately 700 in production and the balance in administrative and support roles. In addition, we had approximately 300 manufacturing workers contracted through
temporary service firms.

The
hourly employees at our steel plant in Amory, Mississippi are represented by the United Steel Workers of America. In August 2007, the United Steel Workers union at our Amory,
Mississippi facility voted to accept a new collective bargaining agreement that covers a four-year period beginning in August 2007 and expiring on June 30, 2011. We believe that our
relationships with the union and our employees are good.

Intellectual Property

As of December 31, 2007, we held 54 patents worldwide relating to various products and proprietary technologies, including the SensiCoretechnology, and had three patent applications pending. We also hold numerous trademarks related to, among other things, our True Temper, Grafalloy, Royal PrecisionandAlpha Qbranded products. We do not believe that our
competitive position is dependent solely on patent or trademark protection, or that our operations are dependent on any individual patent or trademark.

Environmental, Health And Safety Matters

We are subject to federal, state and local environmental and workplace health and safety laws and regulations, including requirements governing discharges to the
air and water, the handling and disposal of solid and hazardous wastes, and the remediation of contamination associated with releases of hazardous substances. In December 2003, a review was conducted
by independent environmental consultants and, based upon such report, we believe that we are currently in material compliance with environmental and workplace health and safety laws and regulations.
Nevertheless, our manufacturing operations involve the use of hazardous substances and, as is the case with manufacturers in general, if a release of hazardous substances occurs or has occurred on or
from our facilities, we may be held liable and may be required to pay the cost of remedying the condition. The amount of any such liability could be material.

We
devote significant resources to maintaining compliance with, and believe we are currently in material compliance with, our environmental obligations. Despite such efforts, the
possibility exists that instances of noncompliance could occur or be identified, the penalties or corrective action costs associated with which could be material.

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Like
any manufacturer, we are subject to the possibility that we may receive notices of potential liability, pursuant to Comprehensive Environmental Response, Compensation and Liability
Act ("CERCLA"), commonly known as Superfund, or analogous state laws, for cleanup costs associated with onsite or offsite waste recycling or disposal facilities at which waste associated with our
operations have allegedly come to be located. Liability under CERCLA is strict, retroactive and joint and several. To our knowledge, no notices involving any material liability are currently pending.

We
have made, and will continue to make, capital expenditures to comply with current and future environmental obligations. Because environmental requirements are becoming increasingly
stringent, our expenditures for environmental compliance may increase in the future.

Item 1A.Risk Factors

Our substantial indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations.

Our substantial indebtedness could adversely affect the financial health of our company. For example, it could:



To service our indebtedness, we will require a significant amount of cash. Our ability to generate cash depends on many factors beyond our control.

We may not be able to generate the cash we need to service our indebtedness. Our ability to make payments on and to refinance our indebtedness, and to fund
planned capital expenditures and research and development efforts will depend on our ability to generate cash in the future. This, to a certain extent, is subject to general economic, financial,
competitive, legislative, regulatory and other factors that are beyond our control. We believe our cash flow from operations, available cash and available borrowings under our senior bank facilities
will be adequate to meet our future liquidity needs.

Our
business may not generate sufficient cash flow from operations, and future borrowings may not be available to us under our senior bank facilities in an amount sufficient to enable us
to pay our indebtedness, or to fund our other liquidity needs. We may need to refinance all or a portion of our indebtedness on or before maturity. We might not be able to refinance any of our
indebtedness on commercially reasonable terms or at all.

Our success depends on the continued popularity of golf and the growth of the market for golf clubs.

We generate a substantial portion of our net revenues from the sale of golf shafts. The demand for our golf shafts is directly related to the popularity of golf,
the number of golf participants and the number of rounds of golf being played by these participants. If golf participation decreases, sales of our products would be adversely affected. In addition,
the popularity of golf organizations, such as the

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PGA,
also affects the sales of our golf shafts. We depend on the exposure of our brands to increase brand recognition and reinforce the quality of our products. Any significant reduction in television
coverage of PGA or other golf tournaments, or any other significant decreases in either attendance at golf tournaments or viewership of golf tournaments, will reduce the visibility of our brand and
could adversely affect our sales.

A reduction in discretionary consumer spending could reduce sales of our products.

Sales of golf clubs are dependent on discretionary consumer spending which may be affected by general economic conditions and could result in a decrease in
consumer spending on golf equipment. In addition, our future results of operations could be affected adversely by a number of other factors that influence discretionary consumer spending, including
consumer concerns over international and military conflicts around the world, unseasonal weather patterns, demand for our existing and future products, new product introductions by our competitors, an
overall decline in participation in golf activities, shifting consumer preferences between graphite and steel golf shafts or other materials that we currently do not produce, and competitive pressures
that otherwise result in lower than expected average selling prices. Any one or more of these factors could result in our failure to achieve our expectations as to future sales or earnings. Because
most operating expenses are relatively fixed in the short-term, we may be unable to adjust spending to compensate for any unexpected sales shortfall, which could adversely affect our
results of operations.

Our new product development efforts may not be successful.

We may not be able to continue to develop competitive products, develop or use technology on a timely or competitive basis, or otherwise respond to emerging
market trends. Because the introduction of new golf shafts using steel, graphite or other composite and combined materials is critical to our future success, our continued growth will depend, in large
part, on our ability to successfully develop and introduce new products in the marketplace. Should golf consumers prefer to use golf clubs made from materials other than steel or graphite, there could
be a material adverse effect on the results of our operations. In addition, the design of new golf clubs is also greatly influenced by the rules and interpretations of the U.S. Golf Association, or
USGA, and the Royal and Ancient Golf Club of St. Andrews, or R&A. Although the golf equipment standards established by the USGA and R&A generally apply to competitive events sanctioned by those
organizations, we believe that it is critical for our future success that our new shafts comply with USGA and R&A standards. New products that we introduce may not receive USGA or R&A approval. In
addition, existing USGA and R&A standards may be changed in ways that adversely affect the sales of our current or future products.

We are subject to work stoppages at our steel manufacturing facility, which could impact the overall profitability of our business.

If any labor disruption or work stoppages affect our employees, the results of our operation could be adversely affected. At December 31, 2007, we employed
807 full-time individuals. Of these, 397 hourly employees at our Amory, Mississippi facility are represented by the United Steel Workers of America. Our collective bargaining
agreement with the United Steel Workers of America will expire on June 30, 2011. We may not be able to reach an agreement on a new collective bargaining
agreement. If a work stoppage or other labor disruption were to occur, our results of operations may be materially adversely affected.

We face intense competition with other golf shaft designers and manufacturers, and our inability to compete effectively for any reason could adversely affect our business.

We operate in a highly competitive environment and compete against a number of established golf shaft designers, manufacturers and distributors. Unlike the steel
shaft industry, the graphite shaft industry is highly fragmented. As a result, we compete with many competitors involved in the design

12

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and
manufacture of graphite shafts. While we have had long-established relationships with most of our customers, we are not the exclusive supplier to most of them, and consistent with the
industry practice, generally do not have long-term, multi-year contracts with our customers. Although we believe that our relationships with our customers are good, the loss of a
significant customer or a substantial decrease in sales to a significant customer could have a material adverse affect on our business and operating results. See "BusinessCompetition" for
a description of the bases on which we compete and the number of competitors in our industry. These factors, as well as demographic trends and economic conditions, could result in increased
competition and could have a material adverse effect on our results of operations.

Our profitability would be adversely affected if the operation of our Amory manufacturing plant were interrupted or shut down.

We operate a majority of our manufacturing processes at our facility in Amory, Mississippi. Any natural disaster or other serious disruption to this facility due
to fire, tornado, flood or any other cause would substantially disrupt our sales and would damage a portion of our inventory, impairing our ability to adequately supply our customers. In addition, we
could incur significantly higher costs and longer lead times associated with fulfilling our direct-to-consumer orders and distributing our products to our customers during the
time it takes for us to reopen or replace our Amory facility. As a result, disruption at our Amory facility would adversely affect our profitability.

Risks related to our operating facility in China could adversely affect our business.

In 2003, we opened a graphite manufacturing facility in Guangzhou, China in order to be able to produce our graphite shafts at a lower cost. We have since
transitioned the majority of our composite manufacturing capacity from the United States to China. In addition, in 2007 we acquired CN
Precision, a start-up steel golf shaft manufacturing plant in Suzhou, China in order to produce a portion of our steel golf shafts overseas. As a result, we will be subject to potential political
instability in China and trade conflict between the United States and China.

Consolidation of our customer base could adversely affect our business.

If the industry and customer base continues to consolidate, then it is possible a consolidation of several of our existing customers into one company could
represent a significant portion of our annual revenues. If this was to occur, and this customer selected an alternative shaft supplier, it could have a material adverse effect on our results of
operations. If this consolidated company were to remain our customer it could represent an increased credit risk due to its size in relation to our total accounts receivable.

Fluctuations in the cost and availability of raw materials could adversely affect our business.

Since we are dependent upon certain suppliers for steel, nickel, composite graphite material and other materials, we are subject to price increases and delays in
receiving such materials. Although we have several sources for most of the key raw materials we purchase, and we attempt to establish purchase price commitments for one-year periods, we
are subject to price increases for raw materials used in the manufacture of golf shafts and to delays in receiving these materials. As key components to the manufacture of golf shafts, a substantial
price increase to one or more of these raw materials or any extended delay in their delivery could result in a material adverse effect on our results of operations.

Fluctuations in the cost and availability of energy sources could adversely affect our business.

Our graphite shaft manufacturing operations in the United States and China are dependent upon a consistent and affordable supply of electricity. If there is a
prolonged shortage of electrical supply to these facilities and/or a significant increase in the cost of electrical power, we may need to temporarily

13

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or
permanently close our graphite shaft operations, which could materially adversely affect our results of operations. In addition, our steel shaft manufacturing plant located in Mississippi relies
upon a consistent and affordable supply of natural gas in order to conduct normal operations. If our Mississippi facility should experience a shortage in supply or a significant increase in cost for
natural gas, it could have a material adverse affect on our results of operations.

Fluctuations in the availability of energy sources to our customers could adversely affect our business.

There are a significant number of golf equipment original equipment manufacturers and assemblers that are headquartered and conduct manufacturing operations in
Southern California and Southern China. In the aggregate, these companies account for a significant share of the golf equipment market and also account for a considerable portion of our sales revenue.
With the disruption of electrical power to these areas in recent years there is a risk that our customers' manufacturing operations may be adversely affected by power shortages. If this were to occur
they may reduce their purchases of shafts from us causing a significant adverse impact to our revenues and results of operations.

Fluctuations in cost of health insurance could adversely affect our business.

Health insurance coverage is a valuable benefit in retaining and attracting employees and has been subject to significant price increases by health industry
providers. Since we plan to continue to provide health benefits to our employees, the rising costs could have a material adverse affect on the results of our operations. We currently have contractual
caps on the maximum increase in premium cost for our U.S. healthcare coverage that extend into 2010; however, beyond this date we are subject to overall market forces that drive healthcare expenses.

If we are unable to protect our intellectual property rights, our business and prospects may be harmed.

The patents we hold relating to certain of our products and technologies may not offer complete protection against infringement of our proprietary rights by
others. As of December 31, 2007, we held 54 patents worldwide relating to various products and proprietary technologies, and had three patent applications pending. Patents may not be issued for
the pending patent applications. Moreover, these patents may have limited commercial value or may not adequately protect our products. Additionally, the U.S. patents that we hold do not preclude
competitors from developing or marketing products similar to our products in international markets. We may infringe on others' intellectual property rights. One or more adverse judgments with respect
to these intellectual property rights could negatively impact our ability to compete and could adversely affect our business.

We are subject to various environmental, health and safety laws and regulations that govern, and impose liability, for our activities and operations. If we do not comply with
these laws and regulations, our business could be materially and adversely affected.

We are subject to federal, state, and local environmental and workplace health and safety laws, regulations and requirements in both the United States and China,
which, if contravened, could result in significant costs to us. Our manufacturing operations involve the use of hazardous substances and should there be a release of such substances from our
facilities, we may be held liable. The penalties or corrective action costs associated with noncompliance could be material. In addition, we may receive notices of potential liability for cleanup
costs associated with waste recycling or disposal facilities at which wastes associated with our operations have allegedly come to be located.

Fluctuations in certain general economic conditions could increase our minimum pension liability under our defined benefit pension plan.

We maintain an employer sponsored defined benefit pension plan for the hourly employees at our Amory, Mississippi steel golf shaft plant. We are subject to
Financial Accounting Standards Board

14

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guidelines
and subject to ERISA regulations with regard to our cash funding of the plan. As a result, certain U.S. economic conditions involving weak equity market performance and low general interest
rates can both reduce the total value of the assets of the plan as well as increase our benefit obligation under the plan. If these economic conditions are severe enough they could have a significant
adverse effect on the funding status of our plan and our overall results of operations.

In
addition, as new pension laws are enacted they can have an adverse effect on our pension liability and/or cash funding requirements, and as a result our overall business.

If we do not retain our key personnel and attract and retain other highly skilled employees our business will suffer.

If we fail to recruit and retain the necessary personnel, our business and our ability to obtain new customers, develop new products and provide acceptable levels
of customer service could suffer. The success of our business is heavily dependent on the leadership of our key management personnel. If any of these persons were to leave our company it could be
difficult to replace them, and our business would be harmed. See "Management."

We are subject to risks relating to our international operations.

We are subject to risks customarily associated with foreign operations, including:



These
risks could have a material adverse effect on our business, prospects, results of operations and financial condition.

We are subject to product liability claims and other litigation.

From time to time, we are subject to product liability claims involving personal injuries allegedly relating to our products. While we carry product liability
insurance, currently pending claims and any future claims are subject to the general uncertainties related to litigation, and the ultimate outcome of any such proceedings or claims cannot be
predicted.

We may not be able to identify suitable acquisition candidates, and even if we do, we may not be able to acquire those candidates or successfully integrate their operations
with ours.

We continuously review acquisition prospects that would complement our current product offerings, increase our size and geographic scope of operations or
otherwise offer growth and operating efficiency opportunities. Any future acquisition may not be successfully completed or, if completed, any such acquisition may not be effectively integrated into
our business. Acquisitions may entail numerous risks and impose costs on us, including, among others, difficulties associated with assimilating acquired manufacturing operations or products, diversion
of management's attention and adverse effects on existing business relationships with suppliers and customers. In addition, any future acquisitions could result in the incurrence of debt or contingent
liabilities, which could have a material adverse effect on our business, financial condition or results of operations.

15

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We may not be able to achieve necessary output, efficiency and productivity levels in our manufacturing facilities.

During 2006 and 2007, due to a number of factors including the acquisition of new products and manufacturing processes from Royal Precision, the efficiency and
productivity in our Amory, Mississippi steel product manufacturing facility deteriorated. We expect to regain these efficiencies in the future, but if we are not able to do so, or if efficiencies
deteriorate further, it could have a material adverse effect on our business.

We may not be able to adequately ramp up production in our new steel golf shaft facility in Suzhou, China, or the start-up process may be delayed or require more
investments than we originally anticipated.

In 2007, we acquired a start-up steel golf shaft manufacturing facility in Suzhou, China. We have made investments in this facility in the form of
buildings, equipment, and personnel, and we plan to produce a portion of our products in this facility beginning in 2008. Any delay in the start-up of this facility, or any increased
investment requirements above those originally budgeted, could have an adverse effect on our overall business.

Terrorist attacks, such as the attacks that occurred on September 11, 2001, and other acts of violence or war, including the military action in Iraq, could negatively
impact the U.S. and foreign economies, the financial markets, the industries in which we operate, our operations and our profitability.

Terrorist attacks may negatively affect our operations. There can be no assurance that there will not be further terrorist attacks worldwide. These attacks have
contributed to economic instability in the United States and elsewhere, and further acts of terrorism, violence or war could further affect the industries in which we operate, our business and our
results of operations. In addition, terrorist attacks or hostilities may directly impact our physical facilities or those of our suppliers or customers and could impact our sales, our supply chain,
our production capability and our ability to deliver our products and services to our customers. The consequences of any terrorist attacks or hostilities are unpredictable, and we may not be able to
foresee events that could have an adverse effect on our operations.

Risks Associated with Forward Looking Statements

The Private Securities Litigation Act of 1995 (the "Act") provides a safe harbor for forward-looking statements made by our Company. This document contains
forward-looking statements, including but not limited to, Item 1 of Part I "Business" and Item 7 of Part II "Management's Discussion and Analysis of Financial Condition and
Results of Operations". All statements which address operating performance, events or developments that we expect, plan, believe, hope, wish, forecast, predict, intend, or anticipate will occur in the
future are forward looking statements within the meaning of the Act.

The
forward-looking statements are based on management's current views and assumptions regarding future events and operating performance. However there are many risk factors, including
but not limited to, the general state of the economy, the Company's ability to execute its plans, competitive factors, and other risks that could cause the actual results to differ materially from the
estimates or predictions contained in our Company's forward-looking statements. Additional information concerning
the Company's risk factors is contained from time to time in the Company's public filings with the SEC; and most recently in Item 1A of Part I of this Annual Report on
Form 10-K.

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

16

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Item 1B.Unresolved Staff Comments

None.

Item 2.Properties

Our administrative offices and manufacturing facilities currently occupy approximately 560,000 square feet. Our shafts are manufactured at separate
facilities, including steel shaft facilities located in Amory, Mississippi and Suzhou, China, and a composite graphite shaft facility located in Guangzhou, China. Our executive offices are located in
a leased facility in Memphis, Tennessee. The following table sets forth certain information regarding significant facilities operated by us as of December 31, 2007:

Facility

Location

Approx.
Sq. Ft.

Owned/
Leased

Lease
Expiration
DateCorporate Offices

Memphis, Tennessee

15,241

Leased

June 2011Steel Shaft/Tubing Mfg.

Amory, Mississippi

335,000

Leased

January 2063(1)Composite Shaft Mfg.

Guangzhou, China

99,298

Leased

March 2008(3)Steel Shaft Mfg

Suzhou, China

83,000

OwnedComposite R&D, Distribution

San Diego, California

17,885

Leased

December 2011Steel R&D

Olive Branch, Mississippi

5,000

Leased

MonthlyTest Facility

Robinsonville, Mississippi

1,000
(2)
Leased

March 2008(3)


---

In
addition, we promote our products in international markets through sales and distribution offices in Japan and the United Kingdom, and we also distribute our product
in Southeast Asia from our distribution warehouse in Hong Kong. To the extent that any such properties are leased, we expect to be able to renew such leases or to lease comparable facilities on terms
commercially acceptable to us.

Item 3.Legal Proceedings

Various claims and legal proceedings, generally incidental to the normal course of business, are pending or threatened against us. While we cannot predict the
outcome of these matters, in the opinion of management, any liability arising from these matters will not have a material adverse effect on our business, financial condition or results of operations.

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

There were no matters submitted to a vote of security holders during 2007.

17

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PART II

Item 5.Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity  Securities

There is no public market for the Company's equity securities. All of the Company's capital stock is owned by True Temper Corporation.

The
Company paid no dividends on its shares of common stock in 2006 or 2007.

The
Company's various debt instruments impose restrictions on the payment of dividends by means of covenants. The Company was in compliance with all debt covenants as of
December 31, 2007.

There
were no purchases of the Company's equity securities by or on behalf of the Company or any affiliated purchaser during the fourth quarter of 2007.

18

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Item 6.Selected Financial Data

Set forth below are our selected historical financial data for the five fiscal years ended December 31, 2007. The historical financial data were derived
from our audited consolidated financial statements and the notes thereto (except the ratio of earnings to fixed charges data), for which the December 31, 2007, 2006 and 2005 financial
statements are included herein. As more fully described in note 4 of this table, the Company went through a business combination on March 15, 2004. Accordingly, the following selected
financial data is presented for both the predecessor and successor companies.

Successor CompanyPredecessor CompanyYears EndedPeriod from
March 15 to
December 31,
2004



Period from
January 1 to
March 14,
2004December 31,
2007

December 31,
2006

December 31,
2005



Year Ended
December 31,
2003(Dollars in thousands)STATEMENT OF OPERATIONS DATA:Net sales

$
116,273

$
108,005

$
117,594

$
78,120



$
20,247

$
116,206Gross profit


33,906


34,811


47,232


18,016




8,376


46,736Selling, general and administrative expenses


14,725


14,226


14,660


9,520




3,635


14,747Amortization of intangible assets(1)


14,941


14,343


13,840


10,984







Business development, start-up and transition costs(2)


2,012


2,688


208


738




100


869Impairment charge on long-lived assets(3)








357










Transaction and reorganization expenses(4)











25




5,381


Loss on early extinguishment of debt(5)


755













9,217


Operating income (loss)


1,473


3,554


18,167


(3,251
)



(9,957
)

31,120Interest expense, net


24,921


20,525


18,631


13,491




2,498


13,017Income tax (benefit) expense(6)


9,991


(6,279
)

33


(6,350
)



(2,845
)

7,113Net income (loss)


(33,471
)

(10,767
)

(466
)

(10,464
)



(9,608
)

10,858BALANCE SHEET DATA (AT END OF PERIOD):Working capital(7)

$
31,630

$
26,281

$
27,403

$
25,324



$
14,551

$
15,372Total assets


359,850


353,699


349,836


360,825




178,057


179,616Total debt(8)


260,720


240,406


220,725


232,725




106,030


113,730Total stockholder's equity


58,001


90,282


99,764


101,330




39,064


48,793OTHER FINANCIAL DATA:Cash provided by (used in) operating activities

$
(9,939
)
$
941

$
15,936

$
6,702



$
2,982

$
21,402Cash used in investing activities


(12,780
)

(20,464
)

(2,031
)

(1,182
)



(330
)

(3,460
)Cash provided by (used in) financing activities


24,386


17,845


(12,509
)

(5,019
)



(8,205
)

(16,623
)Depreciation


3,028


2,616


2,725


2,420




671


2,906Capital expenditures(9)


3,170


4,888


2,612


1,232




330


3,460Ratio of earnings to fixed charges(10)



















2.3x


---

19

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20

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Item 7.Management's Discussion and Analysis of Financial Condition and Results of Operations

THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH THE MORE DETAILED INFORMATION IN THE AUDITED FINANCIAL STATEMENTS, INCLUDING THE RELATED NOTES, APPEARING ELSEWHERE
IN THIS ANNUAL REPORT ON FORM 10-K.

Company Overview

True Temper Sports, Inc. (the "Company") is a wholly owned subsidiary of True Temper Corporation ("TTC") and a leading designer, manufacturer and marketer
of both steel and composite graphite golf shafts for original equipment manufacturers and distributors in the golf equipment industry. In addition, the Company produces and sells a variety of
performance sports products that offer high strength and tight tolerance components produced with steel alloys and composite carbon fiber graphite materials for the bicycle, hockey and other
recreational sports markets. In 2007, golf shaft net sales represented 88% of total net sales, and performance sports net sales represented 12%.

Purchase Agreement for True Temper Corporation

On January 30, 2004, TTS Holdings LLC, a new company formed by Gilbert Global Equity Partners, L.P. and its affiliated funds ("Gilbert
Global"), entered into a stock purchase agreement with the Company's direct parent company, TTC, pursuant to which TTS Holdings LLC and certain of the Company's senior management purchased all
of the outstanding shares of TTC ("Gilbert Global Acquisition"). The Gilbert Global Acquisition was finalized and closed on March 15, 2004.

Year in Review2007

The past year was marked by a combination of both significant achievements and considerable challenges. The golf industry provided a reasonably stable backdrop,
and the combination of a full year of Royal Precision product sales along with the significant momentum generated in the performance sports category, enabled the Company to deliver 7.7% overall
revenue growth.

Unfortunately,
the commodity inflation that began in late 2006 continued into 2007, as nickel prices hit all time highs over $20.00 per pound. When combined with the continuing
operational inefficiencies surrounding the Company's primary steel facility in Mississippi, and the escalating costs of healthcare benefits for its U.S. employees, these factors put significant
pressure on overall profitability.

A
number of initiatives were enacted during 2007 to mitigate the cost pressures, and as a result, the fourth quarter saw significant improvement in profitability, as compared to the
fourth quarter of 2006.

The
Company also took a significant step forward in its global manufacturing and distribution strategy during 2007, with the acquisition of a start-up steel golf shaft
facility in Suzhou, China. The new facility will provide manufacturing flexibility for the Company, and should become operational during 2008.

Outlook2008

During 2008, the Company intends to further enhance its leadership position in steel golf shafts through the launch of new branded products such as Dynamic Gold
High Launch, and further enhancing its line of lightweight steel golf shafts offerings. In addition, the Company will also focus on
expanding its marketshare in graphite golf shafts through strategic partnerships with key original equipment manufacturers, and by extending its successful ProLaunchline of golf shafts into graphite
iron and wood applications, as well as other new graphite product initiatives.

21

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In
addition, the Company expects to continue its rapid expansion in performance sports categories such as hockey and cycling, and to deliver revenue growth in these categories. Further
developing partnerships with industry leaders in these sporting goods categories, as well as technologically
advanced product offerings, are intended to help drive continued momentum in this diverse, yet focused business segment.

The
Company expects profitability to improve based on these revenue growth factors. Over and above volume growth, however, it is also anticipated that the initiatives implemented during
2007 will enable the Company to deliver higher gross profit percentages during 2008. Price increases on the Company's products, its new and more affordable healthcare plan, and the operational
improvements in its Mississippi steel facility that are expected to continue throughout 2007 are all factors that should contribute to improved profitability in the year to come.

Lastly,
the Company also expects to begin ramping up production output from its new steel golf shaft facility in Suzhou, China during 2008. While capacity will not be fully utilized
during 2008, a portion of total steel shaft output will be shifted to this new facility, providing lower cost, manufacturing flexibility and improved delivery times for customers in Asia.

Although
the Company expects that these internal and external factors will favorably benefit its business, such outcomes are subject to uncertainties and unforeseeable factors relating
to internal operations and the overall business environment, all of which are difficult to predict and many of which are beyond the Company's control. Actual future results may vary materially as a
result of various risks and uncertainties, including but not limited to, a reduction in discretionary consumer spending or a general downturn in the economy. See Item 1A "Risk Factors" for a
complete discussion of these and other risk factors.

Results of Operations

The following table sets forth the components of net loss as a percentage of net sales for the periods indicated:

|                                                    |  | Year Ended
December 31,
2007 |    | Year Ended
December 31,
2006 |    | Year Ended
December 31,
2005 |   
|--------------------------------------------------- |  | ---------------------------- | -- | ---------------------------- | -- | ---------------------------- | --
|Net sales                                           |  | 100.0                        | %  | 100.0                        | %  | 100.0                        | % 
|Cost of sales                                       |  | 70.8                         |    | 67.8                         |    | 59.8                         |   
|                                                    |  |                              |    |                              |    |                              |   
|Gross profit                                        |  | 29.2                         |    | 32.2                         |    | 40.2                         |   
|Selling, general and administrative expenses        |  | 12.7                         |    | 13.2                         |    | 12.5                         |   
|Amortization of intangible assets                   |  | 12.8                         |    | 13.3                         |    | 11.8                         |   
|Business development, start-up and transition costs |  | 1.7                          |    | 2.5                          |    | 0.2                          |   
|Impairment charge on long-lived assets              |  |                             |    |                             |    | 0.3                          |   
|Loss on early extinguishment of debt                |  | 0.6                          |    |                             |    |                             |   
|                                                    |  |                              |    |                              |    |                              |   
|Operating income                                    |  | 1.3                          |    | 3.3                          |    | 15.4                         |   
|Interest expense, net                               |  | 21.4                         |    | 19.0                         |    | 15.8                         |   
|Other expenses, net                                 |  |                             |    | 0.1                          |    |                             |   
|                                                    |  |                              |    |                              |    |                              |   
|Loss before income taxes                            |  | (20.2                        | )  | (15.8                        | )  | (0.4                         | ) 
|Income tax (benefit) expense                        |  | 8.6                          |    | (5.8                         | )  | 0.0                          |   
|                                                    |  |                              |    |                              |    |                              |   
|Net loss                                            |  | (28.8                        | )% | (10.0                        | )% | (0.4                         | )%
|                                                    |  |                              |    |                              |    |                              |   

Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006

Net Salesfor 2007 increased approximately $8.3 million, or 7.7%, to $116.3 million from
$108.0 million in 2006. Golf shaft sales increased approximately $3.8 million, or 3.8%, to $102.9 million compared to the $99.1 million realized in 2006. This improvement
related primarily to an increase in premium steel golf shaft sales resulting from the 2006 acquisition of certain assets from Royal Precision, including brands, patents and trademarks; and was offset
by a small decrease in graphite golf

22

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shaft
sales related primarily to a decline in the unit sales of stock original equipment manufacturer ("OEM") graphite shafts associated with the timing of certain OEM iron launches using the
Company's proprietary graphite iron shafts. This decline in graphite golf shaft sales was heavily weighted toward the first half of 2007, and during the second half of 2007, graphite golf shaft sales
improved by a double digit percentage compared to the second half of 2006, as the Company was selected to be the stock graphite shaft supplier for a number of new OEM product launches.

Performance
sports sales increased approximately $4.5 million, or 50.7%, to $13.4 million from $8.9 million in 2006. Revenue momentum in the performance sports
category continued to improve as 2007 progressed. Sales improvement in the first half of 2007 was 34.0%, compared to the first half of 2006, while second half sales were up 66.3% compared to the
second half of 2006. This increase was the direct result of the Company's diversification strategy into the cycling and hockey markets, and relates primarily to new products launched in 2007, as well
as new customer relationships developed in these same areas as the Company continues to gain marketshare and execute on its performance sports growth strategy.

Net
sales to international customers increased approximately $2.9 million, or 7.6%, to $41.2 million in 2007 from $38.3 million in 2006. This increase relates
primarily to revenue growth in the Japanese golf market, which is a targeted growth region for the Company, as well as the routine shifting of product assembly into China by the major golf OEMs.

Gross Profitfor 2007 decreased $0.9 million, or 2.6%, to $33.9 million from $34.8 million in 2006. Gross profit as a
percentage of net sales decreased to 29.2% in 2007 from 32.2% in 2006. The decrease in gross profit as a percentage of net sales was driven by several factors, including (i) an increase in the
cost of nickel, which is a raw material used in the manufacture of steel golf shafts, (ii) an increase in the cost of medical benefits provided to employees, and (iii) certain
inefficiencies experienced in the
Company's Amory, Mississippi production facility related to, among other things, its continued integration of Royal Precision production processes. These unfavorable factors were partially offset by
an increase in profit margins due to the mix of products sold being more heavily weighted toward premium steel golf shafts, and price increases on the Company's products that went into effect at
various times during 2007.

During
the second half of 2007, the Company implemented several key initiatives to counteract the negative impact of the cost factors described above. These initiatives included, among
other things, (i) a global price increase effective October 1, 2007, (ii) a significant modification to the Company's medical plan to reduce costs, and (iii) programs
designed to stabilize and improve the operational efficiency of the Amory, Mississippi facility. During the fourth quarter of 2007, these initiatives provided the catalyst for improvement in gross
profit as a percentage of net sales to 31.8%, as compared to 23.2% in the fourth quarter of 2006 and 28.3% in the first nine months of 2007.

Selling, General and Administrative Expenses ("SG&A")for 2007 increased approximately $0.5 million, or 3.5%, to
$14.7 million from $14.2 million in 2006. SG&A as a percentage of net sales decreased to 12.7% from 13.2% in 2006. There was a reduction in SG&A expenses related primarily to a variety
of cost containment programs implemented in response to the gross profit pressures described above. These cost controls encompass a variety of functional areas within the organization, and are
representative of both permanent cost savings as well as the delay of certain non-essential business activities. The cost reduction actions were offset by (i) additional sales and
marketing efforts intended to improve the Company's net sales during 2007, (ii) an increase of $0.2 million related to the Company's initial Sarbanes-Oxley compliance program, and
(iii) the recognition of approximately $0.5 million in expenses related to the elimination of certain operational positions, including the position of chief operating officer.

Amortization of Intangible Assetsincreased during 2007 to $14.9 million from the $14.3 million recorded during 2006.
Intangible assets were acquired in connection with (i) the Gilbert Global

23

---



Acquisition
in 2004, (ii) the acquisition of certain assets from Royal Precision in 2006, and (iii) the acquisition of CN Precision in 2007. Intangible assets with definitive lives are
being amortized using a straight-line method over periods from 2 to 59 years.

Business Development, Start-Up and Transition Costsfor 2007 decreased to $2.0 million from $2.7 million in
2006. The costs incurred during 2006 relate primarily to the acquisition of certain assets from a former competitor in the steel golf shaft industry, Royal Precision. These costs include acquisition
related fees and expenses, as well as transportation and integration expenses associated with the transfer of production equipment and inventory to True Temper facilities. The costs incurred during
2007 relate primarily to expenses associated with the acquisition of CN Precision, a steel golf shaft manufacturing facility located in Suzhou, China. These costs include certain start-up
related costs to begin the commissioning of this new facility and the related production equipment. The Company expects to ramp-up production of steel golf shafts in this new facility
during
2008. See Note 3 to the consolidated financial statements included elsewhere in this annual report for a further discussion of this acquisition.

Loss On Early Extinguishment of Debtfor 2007 totaled $0.8 million. As a result of paying down $24.7 million of the
borrowings under the 2006 Restated Credit Facility, the Company recognized a loss on early extinguishment of long-term debt, comprised of the write-off of certain deferred financing costs
related to the 2006 Restated Credit Facility and third party costs incurred in conjunction with the Second Amendment to the same facility. No such loss on early extinguishment of long-term
debt was recognized in 2006.

Operating Incomefor 2007 decreased approximately $2.1 million, to $1.5 million from $3.6 million in 2006. This
decrease reflects the impact from gross profit, SG&A, business development, start-up and transition costs, and loss on early extinguishment of long-term debt described above.

Interest Expense, Netfor 2007 increased approximately $4.4 million, or 21.4%, to $24.9 million from $20.5 million in
2006. This increase was due primarily to (i) an increase in short-term interest rates experienced in the overall economy, (ii) an increase in the outstanding principal
balance of variable rate debt due to the issuance of the $45.0 million second lien credit facility, and (iii) an increase in the weighted average interest rate for the Company's variable
rate debt resulting from the higher LIBOR margin adder on the Second Lien credit facility.

Income Tax Expense (Benefit)increased in 2007 to an income tax expense of $10.0 million compared to an income tax benefit of
$6.3 million in 2006. This increase was due primarily to a charge establishing a valuation allowance against deferred tax assets. See Note 9 to the consolidated financial statements included
elsewhere in this annual report for a further discussion of this charge. The effective tax rate during these periods differs from a federal statutory rate of 34% due primarily to the incremental tax
rate for state and foreign income tax purposes and the provision of the valuation allowance referred to above.

Net Lossfor 2007 decreased to a net loss of $33.5 million as compared to a net loss of $10.8 million in 2006. This decrease
reflects the impact from gross profit, SG&A, business development, start-up and transition costs, loss on early extinguishment of long-term debt, interest expense, and income
tax expense (benefit) described above.

Year Ended December 31, 2006 Compared to the Year Ended December 31, 2005

Net Salesfor 2006 decreased approximately $9.6 million, or 8.2%, to $108.0 million from
$117.6 million in 2005.

Golf
shaft sales decreased approximately $11.7 million, or 10.6%, to $99.1 million from $110.8 million in 2005. This decline in net sales resulted primarily from a
reduction in unit sales of two product types; (i) premium steel golf shafts for irons, wedges and putters, and (ii) stock original

24

---



equipment
manufacturer ("OEM") graphite golf shafts for irons. The unit sales reduction in premium steel shafts was driven by several factors, but was predominantly impacted by the lack of exciting
new product introductions in the iron, wedge and putter categories from the leading golf equipment companies. The decline in unit sales of stock OEM graphite shafts relates primarily to the timing of
certain OEM iron launches using the Company's proprietary graphite iron shafts.

Performance
sports sales increased approximately $2.1 million, or 31.2%, to $8.9 million in 2006 from $6.8 million in 2005. This increase in revenue was driven
primarily by continued sales growth in the Company's bike and hockey categories, which remain the strategic focus for the performance sports segment, and comprise the majority of the segment's new
products initiatives.

Net
sales to international customers decreased approximately $4.1 million, or 9.7%, to $38.3 million in 2006 from $42.4 million in 2005. This decrease resulted
primarily from the same overall golf industry factors and Company specific issues described above.

Gross Profitfor 2006 decreased approximately $12.4 million, or 26.3%, to $34.8 million from $47.2 million in 2005.
Gross profit as a percentage of net sales decreased to 32.2% in 2006 from 40.2% in 2005. The decrease in gross profit as a percentage of net sales was driven primarily by four key factors:
(i) an increase in the cost of raw materials and energy sources, (ii) unfavorable fluctuations in foreign currency exchange rates, (iii) the unfavorable impact of certain fixed
costs in the Company's manufacturing facilities spread over reduced unit volume, and (iv) the expected decline in profit margins due to the mix of products sold being more heavily weighted
toward graphite golf and performance sports. These factors were partially offset by increased selling prices to the Company's customers in January 2006 on steel and graphite golf products, as well as
select performance sports product offerings.

Selling, General and Administrative ("SG&A") Expensesfor 2006 decreased approximately $0.5 million, or 3.0%, to
$14.2 million from $14.7 million in 2005. SG&A as a percentage of net sales increased to 13.2% in 2006 from 12.5% in 2005. This increase in SG&A as a percentage of net sales was due
primarily to the decrease in sales between periods. The decrease in SG&A spending between periods was in response to the softness on the gross profit line, as the Company put specific expense controls
in place to ensure the best possible read-through to operating profit. These cost controls encompass a variety of functional areas within the organization, and are representative of both
permanent cost savings as well as the delay in certain non-essential business activities.

During
2006 the Company spent approximately $0.1 million on its initial compliance project related to Section 404 of the Sarbanes-Oxley Act of 2002 ("SOX"). In 2005, the
Company spent approximately $0.2 million on SOX initial compliance.

Amortization of Intangible Assetsfor 2006 was $14.3 million. The majority of intangible assets were acquired in connection with
the Gilbert Global Acquisition. Intangible assets with definitive lives are being amortized using a straight-line method over periods from 2 to 59 years. Amortization of intangible
assets in 2005 was $13.8 million.

Business Development, Start-Up and Transition Costsfor 2006 increased approximately $2.5 million, to
$2.7 million, from $0.2 million in 2005. The increase in these costs relates primarily to expenses associated with the acquisition of assets from a former competitor in the steel golf
shaft industry, Royal Precision. Costs include acquisition related fees and expenses, as well as transportation and integration expenses associated with the transfer of production equipment and
inventory to True Temper facilities.

Impairment Charge On Long-Lived Assetsfor 2005 was $0.4 million and was incurred in conjunction with the
write-down, and subsequent disposal, of certain manufacturing equipment originally obtained through the acquisition of substantially all of the tangible, personal property of Apollo Sports
in 2000. Apollo Sports was a steel golf shaft competitor in England that went out of business in 2000. A significant portion of the assets acquired were subsequently transferred to the Company's
Amory,

25

---



Mississippi
facility. This write-off represents the remainder of the assets located in the United Kingdom that were deemed unusable. No such charges were incurred during 2006.

Operating Incomefor 2006 decreased approximately $14.6 million to $3.6 million from $18.2 million in 2005. Operating
income as a percentage of net sales decreased to 3.3% in 2006 from 15.4% in 2005. This decrease reflects the profit impact of the items described above.

Interest Expense, netfor 2006 increased approximately $1.8 million to $20.5 million from $18.7 million in 2005. This
increase was driven primarily by the increase in outstanding principal amounts of variable rate bank debt associated with the financing required for the acquisition of assets from Royal Precision, as
well as an increase in the variable interest rate on the Company's bank debt as reflected by the rise in short term borrowing rates in the overall economy.

Income Tax Expense (Benefit)for 2006 changed to a benefit of approximately $6.3 million from an income tax expense of
approximately $0.0 in 2005. The effective tax rate during these periods differs
from the U.S. federal statutory rate of 34% due primarily to the incremental tax rate for state and foreign income tax purposes.

Net Lossfor 2006 decreased approximately $10.3 million to a net loss of $10.8 million from a net loss of
$0.5 million in 2005. This decrease reflects the profit impact from the items described above.

Liquidity and Capital Resources

The following table shows cash flow activity by source. Discussion of cash flow activity is noted below.

2007

2006Net cash provided by (used in) operating activities

$
(9,939
)
$
941Net cash used in investing activities

$
(12,780
)
$
(20,464
)Net cash provided by financing activities

$
24,386

$
17,845


General

On March 15, 2004, as part of the Gilbert Global Acquisition, the Company entered into a new senior credit facility (the "2004 Senior Credit Facility")
which includes a $20.0 million non-amortizing revolving credit facility and a $110.0 million Term B loan (as amended from time to time). The term loan requires cash interest
payments and quarterly principal payments beginning June 30, 2004 and continuing through March 15, 2011.

Also
in conjunction with the Gilbert Global Acquisition, the Company issued new 83/8% Senior Subordinated Notes due 2011 (the "83/8% Notes"). The
83/8% Notes require cash interest payments each March 15th and September 15th commencing on September 15, 2004. The 83/8% Notes are
redeemable at the Company's option, under certain circumstances and at certain redemption prices, beginning March 15, 2008.

The
Company used the proceeds from the 2004 Senior Credit Facility and the 83/8% Notes to pay off the existing debt that was outstanding at closing on March 15,
2004, and to make a distribution of the net remaining equity to the selling shareholders.

On
March 27, 2006, the Company amended and restated its 2004 Senior Credit Facility (the "2006 Restated Credit Facility"). The 2006 Restated Credit Facility included additional
term loans under the Company's existing Senior Secured Credit Facilities of approximately $18.0 million, amendments that enable the Company to pursue future acquisitions, and the flexibility to
enable the Company to execute on its global strategic and operational initiatives.

26

---



On January 22, 2007, the Company executed an amendment to its 2006 Restated Credit Facility (the "Second Amendment"). The Second Amendment was made effective as of
December 20, 2006. The Second Amendment was executed in conjunction with a second lien financing effort, described more fully below, and related acquisition, both described more fully in
Notes 3 and 8 to the consolidated financial statements located elsewhere in this annual report. In addition to allowing the flexibility for such second lien financing, the Second Amendment also
provided adjustments to certain specified financial ratios and tests included in the 2006 Restated Credit Facility. As part of the Second Amendment, the margin adder on LIBOR based loans was increased
to between 3.00% and 3.25%, depending on financial ratios, beginning January 22, 2007.

On
January 22, 2007, the Company executed a Second Lien Credit Agreement (the "Second Lien"). The Second Lien includes additional term loans of approximately $45.0 million,
with $24.7 million of the proceeds being used to pay down the debt under the 2006 Restated Credit Facility. The margin adder under the Second Lien is 4.5% or 5.5%, depending on the type of
borrowing. The maturity date of the Second Lien is June 30, 2011. The Second Lien does not amortize.

As
a result of paying down $24.7 million of the borrowings under the 2006 Restated Credit Facility, the Company recognized a loss on early extinguishment of debt of
$0.8 million. This loss is comprised of the write off of certain deferred financing costs related to the 2006 Restated Credit Facility and third party costs incurred in conjunction with the
Second Amendment.

The
2006 Restated Credit Facility, the Second Lien, and the 83/8% Notes contain covenants and events of default, including substantial restrictions and provisions which,
among other things, limit the Company's ability to incur additional indebtedness, make acquisitions and capital expenditures, sell assets, create liens or other encumbrances, make certain payments and
dividends, or merge or consolidate. The 2006 Restated Credit Facility and the Second Lien also require the Company to maintain certain specified financial ratios and tests including minimum interest
coverage and fixed charge coverage ratios, and maximum leverage ratios. Furthermore, the 2006 Restated Credit Facility and the Second Lien require certain mandatory prepayments including payments from
the net proceeds of certain asset sales and a portion of the Company's excess cash flows as defined within each credit agreement.

On
August 14, 2007, TTS Holdings LLC made a capital investment in the Company's parent, True Temper Corporation, of $1.7 million. These funds were then contributed
by True Temper Corporation to the Company in order to maintain full compliance with the second quarter 2007 financial covenants in the Company's 2006 Restated Credit Facility and the Second Lien
Credit Agreement.

On
September 14, 2007, TTS Holdings LLC made a capital investment in the Company's parent, True Temper Corporation, of $5.0 million. These funds were then
contributed by True Temper Corporation to the Company in order to maintain full compliance with the third quarter 2007 financial covenants in the Company's 2006 Restated Credit Facility and the Second
Lien Credit Agreement.

As
of December 31, 2007, with the contributions noted above, the Company was in compliance with all of the covenants in the 2006 Restated Credit Facility, the Second Lien, and the
83/8% Notes.

Discussion of Cash Flows for Years Ended December 31, 2007 and 2006

Cash Flows from Operating Activities

Cash flows from operating activities were a use of cash totaling $9.9 million during 2007, and a source of cash totaling $0.9 million during 2006.

The
use of cash in operating activities of $9.9 million in 2007 was primarily the result of $3.4 million in cash used by normal operations as well as a use of cash to
invest in working capital of $6.6 million. The use of cash in normal operations was driven primarily by cash interest expense of

27

---



$22.4 million
during 2007. The change in working capital consisted primarily of (1) an increase in accounts receivable of $4.4 million, which was an expected increase related to
the higher net sales in the fourth quarter of 2007 compared to the fourth quarter of 2006, and (2) an increase in inventory of $5.2 million, which relates to several factors, including
(i) an increase in the cost of nickel, a raw material used in the manufacture of steel golf shafts, (ii) an increase in the number of inventory build programs with key global golf OEMs,
and (iii) an increase in the Company's finished goods levels in anticipation of continued revenue gains in future periods.

The
source of cash from operating activities of $0.9 million during 2006 was primarily the result of $1.1 million in cash generated from normal operations offset by a
slight use of cash in working capital.

Cash Flows from Investing Activities

Cash flows from investing activities were a use of cash totaling $12.8 million during 2007, and a use of cash totaling $20.5 million during 2006.
The cash used in investing activities during 2007 relates primarily to the acquisition of CN Precision, as described more fully in Note 3 to the consolidated financial statements located
elsewhere in this annual report. The cash used in investing activities during 2006 relates primarily to the acquisition of certain assets from Royal Precision, as described more fully in Note 3
to the consolidated financial statements located elsewhere in this annual report.

Cash Flows from Financing Activities

Cash flows from financing activities were a source of cash totaling $24.4 million during 2007, and a source of cash totaling $17.8 million in 2006.

The
cash provided by financing activities in 2007 relates primarily to the events surrounding the acquisition of CN Precision, as well as a general refinancing of term debt, and includes
(i) new borrowings of second lien term debt totaling $45.0 million, (ii) the repayment of $24.7 million in first lien term debt, and (iii) the payment of
$2.4 million in debt issuance costs related to the additional 2007 borrowings.

The
cash provided by financing activities in 2006 relates primarily to the events surrounding the acquisition of certain assets from Royal Precision, and includes (i) new
borrowings of first lien term debt totaling $18.0 million, (ii) the repayment of $3.3 million in first lien term debt, and (iii) the payment of $1.3 million in debt
issuance costs related to the additional 2006 borrowings.

In
addition, as described above, during the third quarter of 2007, TTC made equity investments in True Temper Sports, Inc. totaling $6.7 million. The equity investments
were from the proceeds of Series A Senior Preferred Shares ("Senior Preferred Shares") issued by the Company's parent. While the Senior Preferred Shares contain customary redemption features
that are binding on the Company's parent, the Company has no legal obligation to redeem the Senior Preferred Shares in the future, nor has the Company guaranteed or pledged its assets in regard to
them. TTC is a holding company whose primary operations are through its investment in the Company.

28

---



Existing Contractual Cash Obligations

The following table reflects the Company's contractual cash obligations for principal payments on long-term debt and operating leases as of
December 31, 2007 (dollars in millions):

Total

2008

2009
through
2010

2011
through
2012

ThereafterLong-Term Debt(1)

$
260.7

$
1.0

$
77.1

$
182.6

$
Operating Leases


2.9


0.9


1.4


0.6


Purchase Commitments(2)


0.7


0.7








Total(3)

$
264.3

$
2.6

$
78.5

$
183.2

$



---

Future Cash Generation and Use

Currently the Company's intention is to use existing cash and cash provided from future operations, if any, as allowed within the covenants of the 2006 Restated
Credit Facility, the Second Lien and the 83/8% Notes, to:



In
addition to the debt service obligations for principal and interest payments, the Company's liquidity needs largely relate to working capital requirements and capital expenditures for
machinery and equipment. The Company intends to fund its current and long-term working capital, capital expenditure and debt service requirements through cash flow generated from
operations. However, since there can be no assurance of future performance, as of December 31, 2007 the Company has the $20.0 million revolving credit facility available for future cash
requirements (as reduced by any outstanding draws, of which there were $5.0 million as of December 31, 2007). The maximum amount the Company may use of the $20.0 million revolving
credit facility is limited by the financial covenants contained within the 2006 Restated Credit Facility and is reduced by any outstanding letters of credit (which totaled $2.6 million as of
December 31, 2007). As of December 31, 2007, the Company believes that cash flow generated from operations, in addition to other financing sources, will be sufficient to meet its cash
obligations for at least the ensuing 12-month period.

In
addition to the Company's cash obligations for interest and principal payments related to its debt obligations, the Company also has a management services agreement with an affiliate
of Gilbert Global, which requires the payment of an annual management services fee of $0.5 million, as well as a transaction based advisory fee associated with any significant merger,
acquisition or financing transaction entered into by the Company. A fee of $0.6 million was paid associated with the 2007 CN Precision acquisition and related financing activities and a fee of
$0.8 million was paid associated with

29

---



the
2006 acquisition of certain assets from Royal Precision and the related financing activities, both as more fully explained in Notes 3 and 8 to the consolidated financial statements located
elsewhere in this annual report.

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

Discussion of Cash Flows for Years Ended December 31, 2006 and 2005

Net cash provided by operating activities decreased approximately $15.0 million between periods, which relates primarily to the decrease in earnings during
2006 and the additional costs for the acquisition
and integration of assets from Royal Precision. Overall working capital requirements were relatively flat during 2006, with an increase in inventory, due in part to additional graphite raw material
purchases secured in a tight market, being effectively offset by a related increase in accounts payable and a decrease in accounts receivable due to improved collection efforts and overall lower sales
revenue.

Net
cash used in investing activities increased $18.4 million during 2006, primarily as a result of the acquisition of certain assets from Royal Precision. Assets acquired include
production equipment, inventory and intellectual property.

Net
cash provided by financing activities totaled $17.8 million during 2006, as compared to the $12.5 million used in financing activities during 2005. This increase in
cash provided by financing activities relates primarily to (i) additional borrowings of term debt totaling $18.0 million during 2006, used primarily to finance the acquisition of certain
assets from Royal Precision, (ii) additional borrowings under the revolving credit agreement for working capital and general corporate purposes which totaled $5.0 million, (iii) a
net decline in repayments of term debt between periods of $8.7 million, and (iv) the payment of $1.3 million of debt issuance costs during 2006 related to the additional
borrowings.

Seasonality

In general, the component supplier sales to golf equipment companies and distributors are seasonal, and tend to precede the warm weather golf season. However,
there are exceptions, especially for those suppliers that sell to the high volume opening price point golf club manufacturers who sell their products through mass channel retail stores and generate
strong volumes during the holiday gift-giving season in the fourth quarter. Our business does experience some seasonal fluctuations, based on a five year average, approximately 56% of our
net sales are generated in the first half of the year, and the remaining 44% of our net sales are generated in the second half.

Inflation

With the exception of natural gas, steel, nickel, carbon fiber composite graphite material, and medical costs, the Company's historical financial results have not
been significantly impacted by inflationary pressures. The key cost elements outlined above have impacted financial results, or are expected to impact future results, and are described in more detail
below.

During
2005, the Company experienced an increase in costs for natural gas used in its steel product manufacturing plant in Amory, Mississippi. During 2006, overall natural gas prices
were relatively stable. During 2007, the Company experienced slight deflation in the cost for natural gas. Based upon current market conditions for natural gas, the Company expects overall natural gas
costs to

30

---



be
higher during 2008. The Company believes its natural gas price inflation has been and will continue to be consistent with that experienced by others using this same energy source.

During
2005, 2006 and 2007, the Company experienced routine annual price increases for steel. Based upon current market conditions and steel contracts for 2008, the Company expects
overall steel costs to increase at a much faster rate during 2008 than in the previous three-year period.

During
2005, 2006 and 2007, the Company experienced an increase in costs for nickel, which is used in the manufacture of steel golf shafts. Based upon current market conditions and
nickel contracts for 2008, the Company expects overall nickel costs to be materially lower during 2008. The Company believes its nickel price inflation has been and will continue to be consistent with
that experienced by others using this same raw material.

During
2005 and 2006, the Company experienced an increase in costs for carbon fiber prepreg material which is used in the manufacture of graphite golf shafts, hockey sticks and bicycle
components. During 2007, the Company experienced relatively stable costs for carbon fiber prepreg material. Based upon current market conditions and purchase price agreements for 2008, the Company
expects overall carbon fiber prepreg costs to be down slightly during 2008. The Company believes its carbon fiber prepreg price inflation has been and will continue to be consistent with that
experienced by others using this same raw material.

During
2005, 2006 and 2007, the Company experienced an increase in costs for the medical benefits provided to employees in the United States. Based upon current market conditions and
projected medical inflation trends, as well as the Company's new fully insured medical benefit plan that became effective October 1, 2007, the Company expects overall medical costs to be lower
in 2008 than experienced in 2007. The Company believes its medical cost inflation has been and will continue to be consistent with that experienced by other U.S. based companies providing employer
sponsored medical benefits to their employees.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("GAAP") requires the appropriate application of certain
accounting policies, many of which
require Company management to make estimates and assumptions about future events and their impact on amounts reported in the consolidated financial statements and accompanying notes. Since future
events and their impact cannot be determined with absolute certainty, the actual results will inevitably differ from management's estimates. Such differences may be material to the consolidated
financial statements.

The
Company believes that its application of accounting policies, and the estimates inherently required therein, are reasonable under the circumstances. These accounting policies and
estimates are constantly reevaluated, and adjustments are made when facts and circumstances dictate a change. Historically, the Company has found its application of accounting policies to be
appropriate, and actual results have not differed materially from those determined using necessary estimates.

The
Company's accounting policies are more fully described in Note 2 to its consolidated financial statements located elsewhere in this annual report. Certain critical accounting
policies and estimates are described below.

Revenue Recognition.The Company derives substantially all of its revenue from the sales of golf
shafts and performance sports products. Revenue is recognized when all of the following conditions exist: (i) persuasive evidence of an arrangement between the Company and its customer,
(ii) delivery has occurred, (iii) the revenue amount is determinable and (iv) collection is reasonably assured. Valuation allowances are established for estimated returns,
allowances, and discounts at the time revenue is recognized.

31

---



Pension and Other Postretirement Obligations.Pension and other postretirement benefits costs and
obligations are dependent on assumptions used in calculating such amounts. These assumptions include discount rates, expected return on plan assets, rates of salary increase, health care cost trend
rates, mortality rates, retirement rates, and other factors. These assumptions are updated on an annual basis, and where appropriate, the Company consults with its actuaries to provide input and
guidance for certain estimates and assumptions. The Company considers current market conditions, including interest rates, in making these assumptions. The Company develops the discount rates by
considering the yields available on high-quality fixed income investments with maturities corresponding to the related benefit obligation. The Company's discount rate for both its defined
benefit pension plan and its unfunded post-retirement health plan was 6.45% and 6.00% at December 31, 2007 and 2006, respectively. As discussed further in Note 10 to the
consolidated financial statements, located elsewhere in this annual report, the Company develops the expected return on pension plan assets by considering various factors, which include its targeted
asset allocation percentages, historic returns, and expected future returns. The Company's expected long-term rate of return assumption for assets in its defined benefit plan was 8.00% and
8.50% for 2007 and 2006, respectively. The Company estimated its long-term healthcare cost trend rate to be 8.5% currently, decreasing gradually to 5.0% by 2014 and remaining at that level thereafter.

The
Company believes that the assumptions used are appropriate; however, differences in actual experience or changes in the assumptions may materially affect the Company's financial
position or results of operations. In accordance with GAAP, actual results that differ from the actuarial assumptions are accumulated and, if in excess of a specified corridor, amortized over future
periods and, therefore, generally affect recognized expense and the recorded obligation in future periods. Also, gains and losses resulting from changes in assumptions are amortized over the expected
remaining service period of active plan participants or, for retired participants, the average remaining life expectancy, to the extent that such amounts exceed 10% of the greater of the
market-related value of plan assets or the projected benefit obligation at the beginning of the year. The Company expects that its pension and other postretirement benefit costs in 2008 will be
relatively consistent with those recognized in 2007.

In
September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 158,Employers' Accounting for
Defined Benefit Pension and Other Postretirement Plansan Amendment of FASB Statements No. 87, 88, 106, and 132(R)("SFAS 158"). SFAS 158,
which was applicable for the Company beginning on January 1, 2007, requires the recognition of the overfunded or underfunded status of a defined benefit postretirement plan as an asset or a
liability in the balance sheet, with changes in the funded status recorded through other comprehensive income in the year in which those changes occur. The impact of the Company's adoption of
SFAS 158 is more fully described in Note 10 to the consolidated financial statements located elsewhere in this annual report.

Impairment of Long-Lived Assets, Including Goodwill.The Company accounts for
long-lived assets in accordance with the provisions of Statement No. 144,Accounting for the Impairment or Disposal of Long-Lived
Assets(Statement 144) and evaluates goodwill for impairment under Statement No. 142,Goodwill and Other Intangible
Assets(Statement 142). The Company evaluates goodwill for impairment on an annual basis, and periodically evaluates long-lived assets, including goodwill, for
indicators that would suggest that the carrying amount of the assets may not be recoverable. The judgments regarding the existence of such indicators are based on factors such as operating
performance, market conditions, and legal factors. The valuation of long-lived assets, including goodwill, requires the use of judgment in evaluating these indicators.

32

---



In accordance with SFAS No. 144, long-lived assets, such as property, plant, and equipment, and purchased intangibles subject to amortization, are reviewed for
impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of
the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an
impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Assets to be disposed of would be separately presented in the balance sheet
and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated. The assets and liabilities of a disposal group classified as held for sale would be
presented separately in the appropriate asset and liability sections of the balance sheet.

Goodwill
and intangible assets not subject to amortization are tested annually for impairment, and are tested for impairment more frequently if events and circumstances indicate that the
asset might be impaired. An impairment loss is recognized to the extent that the carrying amount exceeds the asset's fair value.

Inventory Valuation.Inventories are stated at the lower of cost or market, cost being determined on
the first-in, first-out method. The Company assesses the valuation of its inventories and reduces the carrying value of those inventories that are obsolete, or in excess of the
Company's forecasted usage, to their estimated net realizable value. The Company estimates the net realizable value of such inventories based on analyses and assumptions including, but not limited to,
historical usage, future demand and market requirements. Reductions to the carrying value of inventories are recorded in cost of goods sold. If the future demand for the Company's products is less
favorable than the Company's forecasts, then the value of the inventories may be required to be reduced, which could result in material additional expense to the Company and have a material adverse
impact on the Company's consolidated financial statements.

Valuation for Deferred Income Taxes.The Company's consolidated financial statements include an
estimate of income taxes assessed in each legal jurisdiction in which it operates. These income taxes include both a current amount, as well as a deferred portion which results from a variety of
temporary book versus tax treatment differences, including tax-basis net operating loss carryforwards. These differences result in deferred tax assets and liabilities, which are included
in the consolidated balance sheet. Once established, any deferred tax asset must be evaluated to determine the likelihood that the Company will generate sufficient future taxable income to utilize the
full amount. When facts and circumstances warrant, as they did during the third quarter of 2007, the Company will establish, increase or reduce valuation allowances associated with deferred tax assets
in
order to reflect which assets meet the more likely than not realizability test. The valuation allowance is more fully described in Note 9 to the consolidated financial statements.

Impact of Recently Issued Accounting Standards

Information regarding recent accounting pronouncements is contained in Note 2 to the consolidated financial statements, which is incorporated herein by
this reference.

33

---



Item 7A.    Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Sensitivity

The table below provides information about our debt obligations as of December 31, 2007 that are sensitive to changes in interest rates. The table presents
cash flows and related weighted average interest rates by expected maturity dates (dollars in millions).

|                                           |                          | Expected Maturity Date |     |  |   |     | 
|------------------------------------------ | ------------------------ | ---------------------- | --- |  | - | --- | 
|
|
|Fixed Rate 83/8% Senior Subordinated Notes |                          | $                      |    |  | $ |    | 
|                                           | Average Interest Rate    |                        |     |  |   |     | 
|2006 Restated Credit Facility              |                          |                        | 1.0 |  |   | 6.0 | 
|                                           | Average Interest Rate(a) |                        |     |  |   |     | 
|Second Lien                                |                          |                        |    |  |   |    | 
|                                           | Average Interest Rate(b) |                        |     |  |   |     | 

---

Exchange Rate Sensitivity

We use forward foreign exchange contracts ("Instruments" or "Derivative Instruments") in our management of foreign currency exchange rate exposures. Instruments
used as hedges must be effective at reducing the risks associated with the underlying exposure and must be designated as a hedge at the inception of the contract. Accordingly, changes in the market
value of the Instruments must have a high degree of inverse correlation with changes in the market value or cash flows of the underlying hedged item.

We
use Derivative Instruments to hedge several components of our revenue and cash collection stream, including, (i) anticipated foreign currency sales, (ii) accounts
receivable denominated in foreign currencies, and (iii) cash balances maintained in foreign currencies.

The
changes in the market value of Derivative Instruments hedging anticipated foreign currency sales are recognized in the consolidated balance sheets as a component of accumulated other
comprehensive income (loss) in stockholder's equity. To the extent an instrument is no longer effective as a hedge due to a change in the underlying exposure, gains and losses are recognized currently
in the consolidated statements of operations as a component of cost of sales.

The
changes in the market value of Derivative Instruments hedging accounts receivable or cash denominated in foreign currency are recognized as a component of operating income during the
period of the change, as they are marked to market on a monthly basis.

At
December 31, 2007, the Company had outstanding forward foreign currency contracts designated as hedging instruments which totaled $8.3 million.

Assuming
a hypothetical 10% adverse change in all foreign currencies, with the resulting functional currency gains and losses translated into U.S. dollars at the spot rate, the loss in
fair value of exchange contracts held on December 31, 2007, would be $1.0 million. Those losses would be offset, in part, by

34

---



gains
on the underlying receivables and cash being hedged. See Note 2(h) to our consolidated financial statements located elsewhere in this annual report for further discussion of foreign
currencies.

Commodity Risk

We have some exposure to risks associated with fluctuations in prices for commodities such as nickel and natural gas which are used to manufacture our products.
Nickel is used in the plating of steel golf shafts, and natural gas is used as an energy source primarily in our steel manufacturing operations. In some cases we will purchase contracts to lock in
prices for both nickel and natural gas to be delivered anywhere from one to twenty-four months from the date the contract is consummated. As of December 31, 2007, we held either
under contract or have purchased approximately 25% of our expected 2008 usage of nickel, and had no contracts for the purchase of natural gas.

35

---





Item 8.Consolidated Financial Statements and Supplementary Data

INDEX



|Financial Statements                                                                                                                       |                                                                                                                                              | Page(s)
|------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------- | -------
|                                                                                                                                           |                                                                                                                                              |        
|The following consolidated financial statements of True Temper Sports, Inc. and subsidiaries
are submitted in response to Part II, Item 8: |                                                                                                                                              |        
|                                                                                                                                           | Report of Independent Registered Public Accounting Firm                                                                                      |        
|                                                                                                                                           | Consolidated Statements of Operationsfor each of the years ended December 31, 2007, 2006 and 2005                                           |        
|                                                                                                                                           | Consolidated Balance SheetsDecember 31, 2007 and 2006                                                                                       |        
|                                                                                                                                           | Consolidated Statements of Stockholder's Equity and Comprehensive Income (Loss)for each of the years ended December 31, 2007, 2006 and 2005 |        
|                                                                                                                                           | Consolidated Statements of Cash Flowsfor each of the years ended December 31, 2007, 2006 and 2005                                           |        
|                                                                                                                                           | Notes to Consolidated Financial Statements                                                                                                   |        

36

---





Report of Independent Registered Public Accounting Firm

The
Board of Directors
True Temper Sports, Inc.:

We
have audited the accompanying consolidated balance sheets of True Temper Sports, Inc. and subsidiaries (the Company) as of December 31, 2007 and 2006, and the related
consolidated statements of operations, stockholder's equity and comprehensive income (loss), and cash flows for each of the years in the three-year period ended December 31, 2007.
In connection with our audits of the consolidated financial statements, we also have audited the financial statement schedule, Schedule IIValuation and Qualifying Accounts. These
consolidated financial statements and financial statement schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial
statements and financial statement schedule based on our audits.

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

In
our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of True Temper Sports, Inc. and
subsidiaries as of December 31, 2007 and 2006, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31,
2007, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the related financial statement schedule, when considered in relation to the basic consolidated financial
statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

As
discussed in Note 2 to the consolidated financial statements, effective January 1, 2007, the Company adopted FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxesan Interpretation of FASB
Statement No. 109.Also, as discussed in Notes 2 and 10
to the consolidated financial statements, the Company adopted the recognition and disclosure provisions of Statement of Financial Accounting Standards No. 158, Employers' Accounting for Defined Benefit Pension and Other
Postretirement Plansan amendment of FASB Statements No. 87, 88, 106, and
132(R), as of December 31, 2007.

As
discussed in Note 2 to the consolidated financial statements, effective January 1, 2006, the Company adopted the fair value method of accounting for stock-based
compensation as required by Statement of Financial Accounting Standards No. 123(R),Share-Based Payment.

/s/
KPMG LLP

|Memphis, Tennessee
March 21, 2008 |  | 
|--------------------------------- |  | 

37

---





TRUE TEMPER SPORTS, INC. AND SUBSIDIARIES  (A wholly-owned subsidiary of True Temper Corporation)        CONSOLIDATED STATEMENTS OF OPERATIONS        (Dollars in thousands)

|                                                    |  | Years ended |        
|--------------------------------------------------- |  | ----------- | -------
|
|NET SALES                                           |  | $           | 116,273
|Cost of sales                                       |  |             | 82,367 
|                                                    |  |             |        
|GROSS PROFIT                                        |  |             | 33,906 
|Selling, general and administrative expenses        |  |             | 14,725 
|Amortization of intangible assets                   |  |             | 14,941 
|Business development, start-up and transition costs |  |             | 2,012  
|Impairment charge on long-lived assets              |  |             |       
|Loss on early extinguishment of debt                |  |             | 755    
|                                                    |  |             |        
|OPERATING INCOME                                    |  |             | 1,473  
|Interest expense, net                               |  |             | 24,921 
|Other expenses (income), net                        |  |             | 32     
|                                                    |  |             |        
|LOSS BEFORE INCOME TAXES                            |  |             | (23,480
|Income tax expense (benefit)                        |  |             | 9,991  
|                                                    |  |             |        
|NET LOSS                                            |  | $           | (33,471
|                                                    |  |             |        

See
accompanying notes to consolidated financial statements.

38

---





TRUE TEMPER SPORTS, INC. AND SUBSIDIARIES  (A wholly-owned subsidiary of True Temper Corporation)        CONSOLIDATED BALANCE SHEETS        (Dollars in thousands)

|                                                                                                   |                                                | December 31,
2007                          |         | December 31,
2006 |        
|-------------------------------------------------------------------------------------------------- | ---------------------------------------------- | ------------------------------------------ | ------- | ----------------- | -------
|ASSETS                                                                                             |                                                |                                            |         |                   |        
|CURRENT ASSETS                                                                                     |                                                |                                            |         |                   |        
|                                                                                                   | Cash                                           |                                            | $       | 4,722             |        
|                                                                                                   | Receivables, net                               |                                            |         | 21,185            |        
|                                                                                                   | Inventories                                    |                                            |         | 28,418            |        
|                                                                                                   | Prepaid expenses and other current assets      |                                            |         | 1,803             |        
|                                                                                                   | Deferred tax assets                            |                                            |         | 1,242             |        
|                                                                                                   |                                                |                                            |         |                   |        
|                                                                                                   |                                                | Total current assets                       |         |                   | 57,370 
|Property, plant and equipment, net                                                                 |                                                |                                            | 18,902  |                   |        
|Goodwill                                                                                           |                                                |                                            | 156,070 |                   |        
|Intangible assets, net                                                                             |                                                |                                            | 119,396 |                   |        
|Deferred financing costs                                                                           |                                                |                                            | 6,360   |                   |        
|Other assets                                                                                       |                                                |                                            | 1,752   |                   |        
|                                                                                                   |                                                |                                            |         |                   |        
|                                                                                                   |                                                | Total assets                               |         | $                 | 359,850
|                                                                                                   |                                                |                                            |         |                   |        
|LIABILITIES AND STOCKHOLDER'S EQUITY                                                               |                                                |                                            |         |                   |        
|CURRENT LIABILITIES                                                                                |                                                |                                            |         |                   |        
|                                                                                                   | Current portion of long-term debt              |                                            | $       | 987               |        
|                                                                                                   | Accounts payable                               |                                            |         | 7,979             |        
|                                                                                                   | Accrued expenses and other current liabilities |                                            |         | 12,052            |        
|                                                                                                   |                                                |                                            |         |                   |        
|                                                                                                   |                                                | Total current liabilities                  |         |                   | 21,018 
|Deferred tax liabilities                                                                           |                                                |                                            | 10,139  |                   |        
|Long-term debt, net of current portion                                                             |                                                |                                            | 259,733 |                   |        
|Pension and post-retirement obligations                                                            |                                                |                                            | 10,959  |                   |        
|                                                                                                   |                                                |                                            |         |                   |        
|                                                                                                   |                                                | Total liabilities                          |         |                   | 301,849
|STOCKHOLDER'S EQUITY                                                                               |                                                |                                            |         |                   |        
|Common stockpar value $0.01 per share; authorized 1,000 shares; issued and outstanding 100 shares |                                                |                                            |        |                   |        
|Additional paid-in capital                                                                         |                                                |                                            | 118,648 |                   |        
|Accumulated deficit                                                                                |                                                |                                            | (55,168 | )                 |        
|Accumulated other comprehensive income (loss)                                                      |                                                |                                            | (5,479  | )                 |        
|                                                                                                   |                                                |                                            |         |                   |        
|                                                                                                   |                                                | Total stockholder's equity                 |         |                   | 58,001 
|Commitments and contingent liabilities (See Note 12)                                               |                                                |                                            |        |                   |        
|                                                                                                   |                                                |                                            |         |                   |        
|                                                                                                   |                                                | Total liabilities and stockholder's equity |         | $                 | 359,850
|                                                                                                   |                                                |                                            |         |                   |        

See
accompanying notes to consolidated financial statements.

39

---





TRUE TEMPER SPORTS, INC. AND SUBSIDIARIES        (A wholly-owned subsidiary of True Temper Corporation)        CONSOLIDATED STATEMENTS OF  STOCKHOLDER'S EQUITY AND COMPREHENSIVE INCOME
(LOSS)        (Dollars in thousands)

|                             |                                                                   | Common Stock |   |   |   |   |   | Accumulated
Other
Comprehensive
Income (Loss) |       |   |        
|---------------------------- | ----------------------------------------------------------------- | ------------ | - | - | - | - | - | --------------------------------------------- | ----- | - | -------
|
|
|Balance at December 31, 2004 |                                                                   | 100          |   | $ |  |   | $ | 111,943                                       |       | $ | (10,464
|                             | Net loss                                                          |              |  |   |   |  |   |                                               |      |   |        
|                             | Minimum pension liability, net of taxes                           |              |  |   |   |  |   |                                               |      |   |        
|                             | Mark to market adjustment on derivative instruments, net of taxes |              |  |   |   |  |   |                                               |      |   |        
|                             |                                                                   |              |   |   |   |   |   |                                               |       |   |        
|                             | Comprehensive loss, net of taxes                                  |              |   |   |   |   |   |                                               |       |   |        
|                             |                                                                   |              |   |   |   |   |   |                                               |       |   |        
|Balance at December 31, 2005 |                                                                   | 100          |   |   |  |   |   | 111,943                                       |       |   | (10,930
|                             | Net loss                                                          |              |  |   |   |  |   |                                               |      |   |        
|                             | Minimum pension liability, net of taxes                           |              |  |   |   |  |   |                                               |      |   |        
|                             | Mark to market adjustment on derivative instruments, net of taxes |              |  |   |   |  |   |                                               |      |   |        
|                             |                                                                   |              |   |   |   |   |   |                                               |       |   |        
|                             | Comprehensive loss, net of taxes                                  |              |   |   |   |   |   |                                               |       |   |        
|                             |                                                                   |              |   |   |   |   |   |                                               |       |   |        
|Balance at December 31, 2006 |                                                                   | 100          |   |   |  |   |   | 111,943                                       |       |   | (21,697
|                             | Net loss                                                          |              |  |   |   |  |   |                                               |      |   |        
|                             | Minimum pension liability, net of taxes                           |              |  |   |   |  |   |                                               |      |   |        
|                             | Mark to market adjustment on derivative instruments, net of taxes |              |  |   |   |  |   |                                               |      |   |        
|                             |                                                                   |              |   |   |   |   |   |                                               |       |   |        
|                             | Comprehensive loss, net of taxes                                  |              |   |   |   |   |   |                                               |       |   |        
|                             | Adoption of FASB Statement No. 158                                |              |  |   |   |  |   |                                               |      |   |        
|                             | Capital contribution from True Temper Corporation                 |              |  |   |   |  |   |                                               | 6,705 |   |        
|                             |                                                                   |              |   |   |   |   |   |                                               |       |   |        
|Balance at December 31, 2007 |                                                                   | 100          |   | $ |  |   | $ | 118,648                                       |       | $ | (55,168
|                             |                                                                   |              |   |   |   |   |   |                                               |       |   |        

See
accompanying notes to consolidated financial statements.

40

---





TRUE TEMPER SPORTS, INC. AND SUBSIDIARIES  (A wholly-owned subsidiary of True Temper Corporation)        CONSOLIDATED STATEMENTS OF CASH FLOWS        (Dollars in thousands)

|                                |                                                                                           | Years ended December 31,                                          |                                                    
|------------------------------- | ----------------------------------------------------------------------------------------- | ----------------------------------------------------------------- | ---------------------------------------------------
|
|OPERATING ACTIVITIES            |                                                                                           |                                                                   |                                                    
|                                | Net loss                                                                                  |                                                                   | $                                                  
|                                | Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |                                                                   |                                                    
|                                |                                                                                           | Depreciation                                                      |                                                    
|                                |                                                                                           | Amortization of deferred financing costs                          |                                                    
|                                |                                                                                           | Amortization of intangible assets                                 |                                                    
|                                |                                                                                           | Loss on disposal of property, plant and equipment                 |                                                    
|                                |                                                                                           | Loss on early extinguishment of long-term debt                    |                                                    
|                                |                                                                                           | Deferred income taxes                                             |                                                    
|                                |                                                                                           | Changes in operating assets and liabilities, net of acquisitions: |                                                    
|                                |                                                                                           |                                                                   | Receivables, net                                   
|                                |                                                                                           |                                                                   | Inventories                                        
|                                |                                                                                           |                                                                   | Prepaid expenses and other assets                  
|                                |                                                                                           |                                                                   | Accounts payable                                   
|                                |                                                                                           |                                                                   | Accrued expenses and other current liabilities     
|                                |                                                                                           |                                                                   | Other assets and liabilities                       
|                                |                                                                                           |                                                                   |                                                    
|                                |                                                                                           |                                                                   | Net cash provided by (used in) operating activities
|INVESTING ACTIVITIES            |                                                                                           |                                                                   |                                                    
|                                | Purchases of property, plant and equipment                                                |                                                                   |                                                    
|                                | Proceeds from sales of property, plant and equipment                                      |                                                                   |                                                    
|                                | Acquisition of business, net of cash acquired                                             |                                                                   |                                                    
|                                | Purchase of other assets                                                                  |                                                                   |                                                    
|                                | Other investing activity                                                                  |                                                                   |                                                    
|                                |                                                                                           |                                                                   |                                                    
|                                |                                                                                           |                                                                   | Net cash used in investing activities              
|FINANCING ACTIVITIES            |                                                                                           |                                                                   |                                                    
|                                | Proceeds from issuance of bank debt                                                       |                                                                   |                                                    
|                                | Capital contributions from True Temper Corporation                                        |                                                                   |                                                    
|                                | Principal payments on bank debt                                                           |                                                                   |                                                    
|                                | Payment of debt issuance costs                                                            |                                                                   |                                                    
|                                | Other financing activity                                                                  |                                                                   |                                                    
|                                |                                                                                           |                                                                   |                                                    
|                                |                                                                                           |                                                                   | Net cash provided by (used in) financing activities
|Net increase (decrease) in cash |                                                                                           |                                                                   | 1,667                                              
|Cash at beginning of year       |                                                                                           |                                                                   | 3,055                                              
|                                |                                                                                           |                                                                   |                                                    
|Cash at end of year             |                                                                                           | $                                                                 | 4,722                                              
|                                |                                                                                           |                                                                   |                                                    

See accompanying notes to consolidated financial statements.

41

---





TRUE TEMPER SPORTS, INC. AND SUBSIDIARIES  (A wholly-owned subsidiary of True Temper Corporation)    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS    (Dollars in thousands unless otherwise
indicated)

(1)   DESCRIPTION OF BUSINESS

True Temper Sports, Inc. and subsidiaries ("True Temper" or the "Company") is primarily engaged in the design, manufacture and sale of steel and composite
golf shafts as well as a variety of other high strength, tight tolerance tubular components for the bicycle, hockey and other recreational sports markets. True Temper's manufacturing plants and
related facilities are located in Memphis, Tennessee; Amory and Olive Branch, Mississippi; San Diego, California; and Suzhou and Guangzhou, China. The majority of True Temper's sales are to golf club
manufacturers and distributors primarily located in the United States, Europe, Japan, Australia and Southeast Asia. True Temper operates as a wholly-owned operating subsidiary of True Temper
Corporation ("TTC").

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

On
January 30, 2004, TTS Holdings LLC, a new company formed by Gilbert Global Equity Partners, L.P. and its affiliated funds ("Gilbert Global"), entered into a stock
purchase agreement with the Company's direct parent company, True Temper Corporation, pursuant to which TTS Holdings LLC and certain of the Company's senior management purchased all of the
outstanding shares of TTC ("Gilbert Global Acquisition"). The Gilbert Global Acquisition was finalized and closed on March 15, 2004.

(2)   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



42

---





Asset Category

LifeBuildings

15-40 yearsFurniture and office equipment

10-15 yearsMachinery and equipment

8-15 yearsComputers and capitalized software

2-4 yearsLeasehold improvements

6-15 years




43

---





2007

2006Pound Sterling

$
7,059

$
5,521Yen


2,849


1,277Australian dollar





284Total

$
9,908

$
7,082




44

---





45

---





Prior To
Application of
SFAS 158

SFAS 158
Adjustments

After
Application of
SFAS 158Accrued expenses and other current liabilities

$
11,659

$
393

$
12,052Total current liabilities


20,625


393


21,018Pension and post-retirement obligations


7,187


3,772


10,959Total liabilities


297,784


4,165


301,849Accumulated other comprehensive loss


(1,314
)

(4,165
)

(5,479
)Total stockholder's equity


62,166


(4,165
)

58,001




46

---





47

---





48

---





Years Ended
December 31,2007

2006

2005Income taxes

$
135

$
213

$
147Interest


22,355


19,391


17,330




Pension and Post-
Retirement ObligationsDerivative Instruments Mark to Market Adjustment



Accumulated
Other
Comprehensive
Income (Loss)Minimum Pension Liability Adjustments

Prior
Service Cost

Accumulated
LossDecember 31, 2005

$


$
(1,249
)
$


$


$
(1,249
)Period change


74


1,211








1,285December 31, 2006


74


(38
)







36Period change


(64
)

(1,286
)







(1,350
)Adoption of SFAS 158





1,324


(785
)

(4,704
)

(4,165
)December 31, 2007

$
10

$


$
(785
)
$
(4,704
)
$
(5,479
)




49

---







(3)   ACQUISITIONS



On
June 8, 2006, the Company acquired certain business assets of the former golf shaft manufacturer Royal Precision, Inc. ("Royal Precision") for approximately
$17.9 million. The assets acquired included intangible assets of $14.9 million comprised of patents, trademarks, brand names and design technologies and other intangible assets including
customer relationships, $0.6 million in inventory, and $2.4 million in certain steel golf shaft manufacturing equipment.

The
Company has completed the integration of the machinery and equipment into its existing steel golf shaft facility in Amory, Mississippi, and is currently producing and distributing
the branded products formerly sold by Royal Precision.

Machinery
and equipment acquired are being depreciated over their estimated remaining useful lives, between five and ten years. Intangible assets acquired with determinable useful lives
are being amortized over periods ranging from eight to ten years.

Certain
expenses were incurred to acquire the assets and transition them to the Company's existing manufacturing sites. Of these costs approximately $2.1 million for the year
ended December 31, 2006 were recorded in the Company's consolidated statement of operations as business development, start-up and transition costs. These costs include
acquisition-related fees and expenses, as well as transportation and integration expenses associated with the transfer of production equipment and inventory to the Company's facilities.



On February 25, 2007, the Company acquired 100% of the shares of Supertop Enterprises Limited, the sole shareholder of CN Precision Co., Ltd ("CN
Precision"), a wholly foreign-owned enterprise in Suzhou, China for approximately $9.5 million. Approximately $0.7 million of the purchase price was contingent upon the successful
completion of certain contractual obligations by the seller. As of September 30, 2007, all of the contractual obligations had been fulfilled by the seller, and the entire $0.7 million
contingent purchase price had been paid.

CN
Precision is a startup steel golf shaft manufacturing facility. The Company is in the process of commissioning all of the machinery and equipment necessary to begin production of
steel golf shafts at CN Precision, and expects to ramp up production of steel golf shaft manufacturing in this facility during 2008.

50

---



The
purchase price as stipulated in the February 25, 2007 purchase agreement totaled $9.5 million, plus direct acquisition costs and certain working capital adjustments of
$0.2 million. Following is the allocation of the total consideration paid:

|Cash                           |       | $ | 150   |      
|------------------------------ | ----- | - | ----- | -----
|Current assets                 |       |   | 30    |      
|Identifiable intangible assets |       |   | 987   |      
|Property, plant and equipment  |       |   | 4,276 |      
|Goodwill                       |       |   | 5,187 |      
|Current liabilities            |       |   | (585  | )    
|Deferred tax liability         |       |   | (382  | )    
|                               |       |   |      
|                               | Total |   | $     | 9,663
|                               |       |   |      

This
transaction was accounted for using the purchase method of accounting. In connection with the acquisition, the Company conducted an assessment and valuation of all
tangible and intangible assets acquired. The results of this exercise are reflected in the allocation table above.

The
establishment of the intangible assets results in certain non-cash amortization expense beginning in 2007, as these intangible assets are amortized over their expected
economic life of 50 years.

The
financial position of CN Precision as of December 31, 2007 and the results of operations of CN Precision from February 25, 2007 through December 31, 2007 have
been included in these consolidated financial statements. Because CN Precision is a start-up operation, and was not operational as of December 31, 2007, the Company's consolidated
results of operations would not have been significantly different than reported results had the acquisition occurred at the beginning of 2007 or 2006.

(4)   INTANGIBLE ASSETS

The following table sets forth the gross value and accumulated amortization for intangible assets at December 31, 2007 and 2006.

|                                   |  |        |  | December 31, 2007 |         | December 31, 2006
|---------------------------------- |  | ------ |  | ----------------- | ------- | -----------------
|
|
|Trade name                         |  |       |  | $                 | 22,430  |                  
|Patented technology                |  | 8 yrs  |  |                   | 13,011  |                  
|Customer-related intangible assets |  | 10 yrs |  |                   | 132,478 |                  
|Lease contract                     |  | 59 yrs |  |                   | 4,323   |                  
|Land use rights                    |  | 50 yrs |  |                   | 987     |                  
|Other                              |  | 2 yrs  |  |                   | 275     |                  
|                                   |  |        |  |                   |         |                  
|Total intangible assets            |  |        |  | $                 | 173,504 |                  
|                                   |  |        |  |                   |         |                  

The
following table sets forth the estimated aggregate future amortization expense for these intangible assets at December 31, 2007:

2008

$
14,9612009


14,9592010


14,9582011


14,9582012


13,800


51

---



(5)   INVENTORIES

Inventories, as of December 31 of the year indicated, consist of the following:

2007

2006Raw materials

$
5,017

$
5,168Work in process


4,156


3,553Finished goods


19,245


14,487Total

$
28,418

$
23,208


(6)   PROPERTY, PLANT AND EQUIPMENT

Major classes of property, plant and equipment, as of December 31 of the year indicated, are summarized as follows:

2007

2006Land improvements

$
121

$
121Buildings


5,440


2,914Furniture and office equipment


1,017


626Machinery and equipment


19,501


15,034Computer equipment and capitalized software


950


540Leasehold improvements


2,149


1,458Construction in progress


984


1,78830,162


22,481Less accumulated depreciation


11,260


7,999Net property, plant and equipment

$
18,902

$
14,482


(7)   ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities, as of December 31 of the year indicated, consist of the following:

2007

2006Accrued compensation, benefits and related payroll taxes

$
3,926

$
3,721Accrued interest


4,871


3,697Other


3,255


2,742Total

$
12,052

$
10,160


(8)   BORROWINGS



2007

200683/8% Senior Subordinated Notes due 2011

$
125,000

$
125,0002004 Senior Credit Facility/2006 Restated Credit Facility


90,720


115,406Second Lien


45,000


Total debt


260,720


240,406Less current portion


987


1,257Long-term debt, net of current portion

$
259,733

$
239,149


52

---







53

---





2008

$
9872009


5,9872010


71,1272011


182,619Total

$
260,720




The Company may borrow, through March 15, 2009, up to $20.0 million under a revolving credit agreement included in the 2004 Senior Credit Facility.
The Company pays an annual commitment fee of 0.05% on the unused portion of the revolving credit agreement. Borrowings under the agreement are subject to the same provisions described in the
long-term debt section of this Note. The Company had $5.0 million in outstanding borrowings under this line of credit as of December 31, 2007, which is included in the
preceding table in this Note.

(9)   INCOME TAXES

Total income taxes for the periods indicated were allocated as follows:

Years EndedDecember 31, 2007

December 31, 2006

December 31 2005Income (loss) from continuing operations

$
9,991

$
(6,279
)
$
33Stockholder's equity:Minimum pension liability





741


(665
)Mark to market adjustment on derivative instruments





45


(9
)Total income taxes

$
9,991

$
(5,493
)
$
(641
)


54

---



The
income tax expense (benefit) attributable to loss from continuing operations, for the periods indicated, is as follows:

Years EndedDecember 31, 2007

December 31, 2006

December 31, 2005Current:Federal

$


$


$
State





40


40Foreign


262


173


194Total current


262


213


234Deferred:Federal


8,714


(5,473
)

(169
)State


1,015


(1,019
)

(32
)Total deferred


9,729


(6,492
)

(201
)Total

$
9,991

$
(6,279
)
$
33


The
actual income tax expense (benefit) attributable to loss from continuing operations differs from the amounts computed by applying the U.S. federal tax rate of 34% to
the pretax loss as a result of the following:

Years EndedDecember 31, 2007

December 31, 2006

December 31, 2005Computed "expected" tax benefit

$
(7,983
)
$
(5,796
)
$
(147
)State tax, net of federal benefit


(930
)

(646
)

5Foreign taxes


262


173


194Valuation allowance


18,588





Other


54


(10
)

(19
)Actual income tax expense (benefit)

$
9,991

$
(6,279
)
$
33


The
components of deferred tax assets and liabilities at December 31, 2007 and 2006 are as follows:

2007

2006Deferred tax assets:Goodwill

$
27,693

$
32,510Accrued liabilities


802


642Asset impairment


445


445Net operating loss carryforwards


19,974


12,207Facility start-up costs


454


168Pension and post-retirement benefit obligations


3,868


1,609Inventory


1,018


802Deferred financing costs


222


Other





11Gross deferred tax assets

$
54,476

$
48,394Valuation allowance


(20,765
)

Net deferred tax assets


33,711


48,394Deferred tax liabilities:Identifiable intangible assets

$
(40,247
)
$
(44,912
)Property, plant and equipment


(2,126
)

(1,999
)Other


(235
)

(308
)Net deferred tax asset (liability)

$
(8,897
)
$
1,175


55

---



At
December 31, 2007, the Company had net operating loss carryforwards for federal and state income tax purposes of approximately $52,600 which expire between 2019
and 2027.

During
2007, the Company recorded income tax expense of approximately $10,000, primarily related to providing a valuation allowance against its deferred tax assets which were, at
December 31, 2007, in excess of its deferred tax liabilities amortizing or reversing over similar time periods. The remaining net deferred tax liability of $8,900 on the Company's consolidated
balance sheet as of December 31, 2007 related entirely to intangible assets with indefinite lives or in different tax jurisdictions.

In
accordance with SFAS No. 109,Accounting for Income Taxes("SFAS 109"), the Company evaluates its deferred income taxes
to determine if a valuation allowance is required. SFAS 109 requires that companies assess whether valuation allowances should be established against their deferred tax assets based on the
consideration of all available evidence using a "more likely than not" standard. In making such judgments, companies must give more weight to evidence that can be objectively verified, and less weight
to evidence that is more subjective in nature. Accordingly, when the Company evaluates the need for a valuation allowance it normally relies more heavily on recent financial performance than on
projections of future taxable income.

The
Company believes that a valuation allowance is now required due to the Company's recent financial performance through 2007. In conducting the analysis in 2007, the Company utilized a
consistent approach which relies heavily on reviewing the three year cumulative pretax income or loss
for financial reporting purposes, as adjusted for any items that are unusual or infrequent in nature. In addition, all available positive and negative evidence was assessed, including future expected
taxable income. In concluding that a full valuation allowance was required, the Company determined that the historical cumulative loss information outweighed other positive evidence available.

(10)    EMPLOYEE BENEFIT PLANS

True Temper has a qualified pension plan for the hourly unionized employees at its Amory, Mississippi plant. The following tables provide a reconciliation of the
changes in the plan's benefit obligation, fair value of plan assets and a statement of the plan's funded status for the years ended December 31, 2007 and 2006. During 2007, the Company adopted
SFAS 158, as more fully described in Note 2(m). The Company's measurement date for its pension plan is December 31. The following tables present information about the plan in
accordance with the recognition provisions of SFAS 158.

Years Ended December 31,2007

2006Reconciliation of benefit obligation:Benefit obligation at beginning of period

$
18,037

$
19,015Service cost


547


571Interest cost


1,155


1,001Amendments


817


Actuarial (gains) losses


870


(2,060
)Benefit payments


(669
)

(490
)Benefit obligation at end of period

$
20,757

$
18,037Reconciliation of fair value of plan assets:Fair value of plan assets at beginning of period

$
13,760

$
13,044Actual return on plan assets


709


956Employer contributions


316


250Benefit payments


(669
)

(490
)Fair value of plan assets at end of year

$
14,116

$
13,760Funded Status:Benefit obligation in excess of plan assets

$
(6,641
)
$
(4,277
)Unrecognized net actuarial loss





396Net amount recognized in the consolidated balance sheets

$
(6,641
)
$
(3,881
)


56

---



Amounts recognized in the consolidated balance sheets consist of:Noncurrent liabilities

$
(6,641
)
$
(3,944
)Accumulated other comprehensive income (loss)





63Net amount recognized in the consolidated balance sheets

$
(6,641
)
$
(3,881
)Amount not yet reflected in net periodic benefit cost and included in accumulated other comprehensive income (loss):Prior service cost

$
(785
)
$
Accumulated loss


(1,637
)

Accumulated other comprehensive income (loss):

$
(2,422
)
$



The estimated amount that will be amortized from AOCI into net periodic pension expense in 2008 is $78, and represents prior service cost.

The
Company expects to make total contributions of $3,095 to the pension plan in 2008. The following table sets forth the estimated benefit payments, which reflect expected future
service, as appropriate, expected to be paid in the periods indicated.

2008

$
7402009

$
8092010

$
8652011

$
9952012

$
1,05420132017

$
6,358


The
following table provides the components of net periodic pension expense for the defined benefit pension plan for the years ended December 31, 2007, 2006 and 2005:

|                                   |                              | 2007                           |        | 2006 |      | 2005   |    
|---------------------------------- | ---------------------------- | ------------------------------ | ------ | ---- | ---- | ------ | ---
|Service cost                       |                              | $                              | 547    |      | $    | 571    |    
|Interest cost                      |                              |                                | 1,155  |      |      | 1,001  |    
|Expected return on plan assets     |                              |                                | (1,080 | )    |      | (1,092 | )  
|Amortization of prior service cost |                              |                                | 32     |      |      |       |    
|                                   |                              |                                |        |      |      |        |    
|                                   | Net periodic pension expense |                                | $      | 654  |      | $      | 480
|                                   |                              |                                |        |      |      |        |    
|Weighted average assumptions:      |                              |                                |        |      |      |        |    
|                                   |                              | Discount rate                  |        |      | 6.45 | %      |    
|                                   |                              | Expected return on plan assets |        |      | 8.00 | %      |    
|                                   |                              | Rate of compensation increase  |        |      | 3.00 | %      |    

57

---



The following table provides information related to the Company's pension plan in which the accumulated benefit obligation exceeded the fair value of plan assets as of the applicable
year end:

December 31,2007

2006Projected benefit obligation

$
20,757

$
18,037Accumulated benefit obligation

$
20,444

$
17,704Fair value of assets

$
14,116

$
13,760


Assets
of the pension plan consist primarily of investments in equity securities, debt securities, and cash equivalents. The weighted-average asset allocations as of December 31,
2007 and 2006 are as follows:

December 31,2007

2006

TargetEquity securities

66.0
%
66.0
%
50-70
%Debt securities

30.0

33.0

30-50Cash equivalents

4.0

1.0

0Total

100.0
%
100.0
%
100.0
%


Certain
actuarial assumptions, such as the assumed discount rate and long-term rate of return on plan assets, have an effect on the amounts reported for net periodic pension expense as
well as the respective benefit obligation amounts. The assumed discount rates represent long-term high quality corporate bond rates reasonably commensurate with liability durations of the pension
plan. The estimated long-term rate of return on plan assets used by the Company takes into account historical investment experience over a multi-year period, as well as a number of other factors,
including the mix of plan asset investment types, current market conditions, investment practices of the pension plan's fiduciaries within the Company, and advice from its investment professionals and
actuaries.

In
addition to the pension plan, the Company also maintains a defined contribution plan which covers substantially all United States based employees. Expenses for defined contribution
plans amounted to $745, $695 and $635 for the years ended December 31, 2007, 2006 and 2005.

The
Company also participates in certain unfunded health care plans that provide post-retirement medical, dental, and life insurance benefits to hourly union employees at its
Amory, Mississippi plant and to salaried employees hired prior to January 1, 2000. The post-retirement plans are contributory, and include certain cost-sharing features,
such as deductibles and co-payments.

The
following tables set forth the benefit obligation and funded status of the unfunded post-retirement health plans for the years ended December 31, 2007 and 2006.
During 2007 the Company adopted SFAS 158, as more fully described in Note 2(m). The Company's measurement date

58

---



for
its post-retirement plan is December 31. The following tables present information about the plans in accordance with the recognition provisions of SFAS 158.

Years Ended
December 31,2007

2006Reconciliation of benefit obligation:Benefit obligation at beginning of year

$
4,593

$
3,869Service cost


127


136Interest cost


282


256Participant contributions


249


208Actuarial loss


920


1,620Benefits paid


(1,480
)

(1,496
)Benefit obligation at end of year

$
4,691

$
4,593Unrecognized net actuarial loss





(2,333
)Accrued benefit obligation

$
4,691

$
2,260Amounts recognized in the consolidated balance sheets consist of:Current liabilities

$
(393
)
$
Noncurrent liabilities


(4,298
)

(2,260
)Net amount recognized in the consolidated balance sheets

$
(4,691
)
$
(2,260
)Amount not yet reflected in net periodic benefit cost and included in accumulated other comprehensive income (loss):Accumulated loss

$
(3,067
)
$
Accumulated other comprehensive income (loss) (AOCI)

$
(3,067
)
$



The
estimated amount that will be amortized from AOCI into net periodic post-retirement expense in 2008 is $228, and represents accumulated loss.

The
following table provides the components of net periodic expense for the unfunded post- retirement health plans for the years ended December 31, 2007, 2006 and
2005:

2007

2006

2005Service cost

$
127

$
136

$
91Interest cost


282


256


220Recognized net losses


183


94


Net periodic post-retirement expense

$
592

$
486

$
311Discount rate


6.45
%

6.00
%

5.75
%


The
healthcare cost trend rate used to determine the post-retirement benefit obligation was 8.50% for 2007. This rate decreases gradually to an ultimate rate
of 5.00% in 2014, and remains at that level thereafter. While the trend rate can be a significant factor in determining the amounts reported, for the year ended December 31, 2007 a
one-percentage-point increase or decrease in the trend rate will have only minimal impact due to the claims costs being close to the employer imposed cap.

59

---



The
following table sets forth the estimated health care benefit payments expected to be paid in the periods indicated.

2008

$
3932009

$
4262010

$
4552011

$
4592012

$
49220132017

$
2,491


Certain
actuarial assumptions, such as the assumed discount rate and the health care cost trend rates have an effect on the amounts reported for net periodic
post-retirement expense as well as the respective benefit obligation amounts. The assumed discount rates represent long-term high quality corporate bond rates reasonably commensurate with liability
durations of the post-retirement healthcare plan. The Company reviews external data provided by its healthcare benefit providers and actuaries, and its own historical trends for health care costs, to
determine the healthcare cost trend rates for the post-retirement medical benefit plan.

(11) STOCK OPTIONS

In 2004, the Company's parent, True Temper Corporation adopted an equity incentive plan (the "2004 Plan") pursuant to which TTC's board of directors may grant
equity incentive awards to officers and key employees of the Company. The 2004 Plan authorizes grants of options to purchase and grants of restricted shares, in total, up to 1,008,051 shares of
authorized but unissued common stock. Stock options are granted with an exercise price equal to the stock's fair market value at the date of grant. All stock options have 10 year terms and vest
and become fully exercisable at differing time periods up to four years from the date of grant.

On
August 10, 2005, TTC issued, to certain employees in return for service, a total of 525,400 stock options and stock appreciation rights ("Equity Incentive Awards") to purchase
common stock of TTC
for $13.56 per share. The Equity Incentive Awards have a term of ten years, and vest and become exercisable at various times and under various conditions through August 10, 2012; with certain
acceleration features based on performance criteria.

At
December 31, 2007, there were 251,051 shares available for grant under the 2004 Plan. There were no grants of equity incentive awards during 2006 or 2007. The per share
weighted average fair value of stock options granted during 2005 was $2.41, on the date of grant using the Black Scholes option-pricing model (excluding a volatility assumption) with the following
weighted average assumptions:

Expected dividend yield

0.0
%Risk free rate of return

4.21
%Expected life (years)

4.7


60

---



Stock
option activity during 2005, 2006 and 2007 is as follows:

Number of Shares

Wtd. Avg. Exercise PriceGranted on August 10, 2005

525,400

$
13.56Exercised




Forfeited




Balance at December 31, 2005

525,400

$
13.56Granted




Exercised




Forfeited




Balance at December 31, 2006

525,400

$
13.56Granted




Exercised




Forfeited

122,400


13.56Balance at December 31, 2007

403,000

$
13.56


At
December 31, 2007, the weighted average remaining contractual life of outstanding options was 7.6 years. At December 31, 2007, there were 124,800
options exercisable.

In
addition, TTC has 354,000 equity awards, issued on March 15, 2004, which vest only upon a sale of TTC and achivement of certain other terms as described in the awards. As of
December 31, 2007, the events required for vesting of these awards are not expected to occur in the near term.

(12) COMMITMENTS AND CONTINGENCIES



Operating
Leases2008

$
9012009


7282010


6782011


5272012


57Thereafter


Total minimum lease payments

$
2,891




61

---





December 31, 2004

$
153Liabilities accrued for warranties issued during the year


959Warranty claims paid during the year


(803
)December 31, 2005

$
309Liabilities accrued for warranties issued during the year


1,033Warranty claims paid during the year


(1,016
)December 31, 2006

$
326Liabilities accrued for warranties issued during the year


1,691Warranty claims paid during the year


(1,570
)December 31, 2007

$
447




The Company has certain contingent liabilities resulting from litigation and claims incidental to the ordinary course of business. Management believes that the
probable resolution of such contingencies will not materially affect the consolidated financial position or results of operations of the Company.

(13) RELATED PARTY TRANSACTIONS

On March 15, 2004, True Temper entered into a management services agreement with an entity affiliated with Gilbert Global, which is a related party through
its indirect management and ownership interest in True Temper Corporation.

In
accordance with this agreement, Gilbert Global has agreed to provide:



62

---







In exchange for such services, Gilbert Global or its nominee receives:



The
management services agreement has an initial term of five years, subject to automatic one-year extensions unless the Company or Gilbert Global provides written notice of
termination. The annual advisory fee of $0.5 million is an obligation of the Company and is also contractually subordinated to the Notes and the bank credit facilities.

During
2007 and 2006, in addition to annual advisory fees of $0.5 million, the Company paid $0.4 million and $1.0 million, respectively to Gilbert Global for fees
associated with financing and acquisition transactions.

(14) SEGMENT AND OTHER RELATED DISCLOSURES



Years Ended December 31,2007

2006

2005Net sales:Golf shafts

$
102,856

$
99,103

$
110,820Performance sports


13,417


8,902


6,774Total

$
116,273

$
108,005

$
117,594Gross profit:Golf shafts

$
31,220

$
33,958

$
45,804Performance sports


2,686


853


1,428Total

$
33,906

$
34,811

$
47,232Depreciation expense:Golf shafts

$
2,492

$
2,050

$
2,242Performance sports


536


566


483Total

$
3,028

$
2,616

$
2,725


63

---



Capital expenditures:Jointly used assets

$
310

$
125

$
143Golf shafts


2,523


4,264


1,686Performance sports


337


499


783Total

$
3,170

$
4,888

$
2,612Total assets:Jointly used assets

$
4,108

$
4,392

$
1,810Golf shafts


57,414


44,102


42,693Performance sports


5,624


4,560


4,210Total

$
67,146

$
53,054

$
48,713




2007

2006Total assets:Total from reportable segments

$
67,146

$
53,054General corporate and other unallocated assets


292,704


300,645Total

$
359,850

$
353,699


|
|

Years Ended December 31,2007

2006

2005Total reportable segment gross profit

$
33,906

$
34,811

$
47,232Less:Selling, general and administrative expenses


14,725


14,226


14,660Amortization of intangible assets


14,941


14,343


13,840Business development, start-up and transition costs


2,012


2,688


208Impairment charge on long lived assets








357Loss on early extinguishment of debt


755





Interest expense


24,921


20,525


18,631Other expense (income), net


32


75


(31
)Total Company loss before income taxes

$
(23,480
)
$
(17,046
)
$
(433
)


64

---





Years Ended December 31,2007

2006

2005U.S.

$
75,025

$
69,664

$
75,151International


41,248


38,341


42,443Total

$
116,273

$
108,005

$
117,594


Revenues
generated from sales into China accounted for approximately $22,400 or 19.3%, $19,300 or 17.9% and $20,900 or 17.8% of True Temper's total sales for the years
ended December 31, 2007, 2006 and 2005, respectively. The sales into China are due primarily to the Company's major U.S. based original equipment manufacturers shifting a portion of their
assembly operations to that region. Assets by location are not disclosed, as assets located outside the U.S. are immaterial.

(15) SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

The following is a summary of unaudited quarterly results of operations for the years ended December 31, 2007 and 2006.

First
Quarter

Second
Quarter

Third
Quarter

Fourth
Quarter2007Net sales

$
29,579

$
33,037

$
24,140

$
29,517Gross profit


10,017


10,428


4,067


9,394Net loss


(3,061
)

(2,301
)

(22,777
)

(5,332
)2006Net sales

$
31,659

$
30,674

$
21,491

$
24,181Gross profit


11,574


10,844


6,790


5,603Net loss


(230
)

(1,745
)

(4,146
)

(4,646
)


(16) SUBSEQUENT EVENTS

During the first quarter of 2008 the Company paid a dividend to its parent company, True Temper Corporation, of approximately $0.5 million. True Temper
Corporation used the proceeds of this dividend to repurchase certain shares of its common stock.

Item 9.Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

None.

Item 9A.Controls and Procedures

Not applicable.

Item 9A(T).Controls and Procedures



Evaluations
required by Rule 13a-15 of the Securities Exchange Act of 1934 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 of the end of the period covered by this Report have been carried out under the supervision and with the participation
of the Company's management, including its Chief Executive Officer and Chief Financial Officer. Based upon such evaluations, the Chief Executive Officer and

65

---



Chief
Financial Officer concluded that the Company's disclosure controls and procedures were effective.



Management
is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f). Our internal
control system is designed to provide reasonable assurance that externally published financial statements can be relied upon and have been prepared in accordance with U.S. generally accepted
accounting principles. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to
future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Under the
supervision and with the participation of management, including our principal executive officer and principal financial officer, we conducted an assessment of the effectiveness of our internal control
over financial reporting based on the framework inInternal Control  Integrated Frameworkissued by the Committee of Sponsoring
Organization of the Treadway Commission. Based on our assessment under the framework inInternal Control  Integrated Framework, management
concluded that our internal control over financial reporting was effective as of December 31, 2007.

This
annual report does not include an attestation report of the Company's registered public accounting firm regarding internal control over financial reporting. Management's report was
not subject to attestation by the Company's registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management's
report in this annual report.



There
have been no changes in the Company's internal control over financial reporting during the period covered by this Report that were identified in connection with the assessment
referred to above that have materially affected, or are reasonably likely to materially affect, the Company's internal controls over financial reporting.

Item 9B.Other Information

None.

66

---





PART III

Item 10.Directors, Executive Officers and Corporate Governance

The directors and executive officers of True Temper as of December 31, 2007 are as follows:

|Name                    |  | Age |  | Position                                                         
|----------------------- |  | --- |  | -----------------------------------------------------------------
|Scott C. Hennessy       |  | 49  |  | Chief Executive Officer, President and Director                  
|Adrian H. McCall        |  | 50  |  | Senior Vice President of Global Marketing and Product Development
|Stephen M. Brown        |  | 42  |  | Vice President of Human Resources                                
|Jeremy Erspamer         |  | 33  |  | Senior Director of Customer Planning and Supply Chain            
|Graeme Horwood          |  | 63  |  | Vice President Engineering, Research and Development             
|Jason A. Jenne          |  | 38  |  | Vice President, Chief Financial Officer and Treasurer            
|Raeford P. Lucas        |  | 42  |  | Vice President, Global Golf Sales                                
|Steven J. Gilbert       |  | 60  |  | Director and Co-Chairman                                         
|Steven Kotler           |  | 60  |  | Director and Co-Chairman                                         
|Richard W. Gaenzle, Jr. |  | 43  |  | Director                                                         
|Jeffery W. Johnson      |  | 39  |  | Director                                                         
|William P. Lauder       |  | 47  |  | Director                                                         

Scott C. Hennessyhas been the President since 1996, and the Chief Executive Officer and Director since October 1998. Mr. Hennessy
joined us in 1994 as Vice President-Sales and Marketing. From 1980 to 1994, Mr. Hennessy held various management positions at Black & Decker in sales, marketing and product development.
Mr. Hennessy sits on the Board of Governors of the National Golf Foundation. Mr. Hennessy graduated magna cum laude with a B.S. from the University of Delaware.

Adrian H. McCallhas been the Senior Vice President of Global Marketing and Product Development since November 2007. From August 2002 to
November 2007, Mr. McCall served as our Senior Vice President of Global Distribution and Sales. From March 1999 to July 2002, Mr. Mc Call served as our Vice President of International
Sales and Marketing since March 1999. From September 1995 to March 1999, Mr. McCall served as our Director of International Sales and Marketing. From May 1992 to September 1995,
Mr. McCall served as Director of International Operations of The Upper Deck Company, a manufacturer and distributor of baseball cards. Mr. McCall graduated cum laude with a B.S. from the
University of Hartford.

Stephen M. Brownhas been the Vice President of Human Resources since August 2002. From January 1998 to July 2002, Mr. Brown has
served as our Director of Human Resources. From September 1996 to December 1997, Mr. Brown served as the Manager-Human Resources. Prior to that, since 1992, Mr. Brown served in various
Human Resource management positions with Emerson Electric Company. Mr. Brown received a B.A. from the University of South Carolina.

Jeremy Erspamerhas been the Senior Director of Customer Planning and Supply Chain since November 2007. From September 2005 to October
2007, Mr. Erspamer served as our Director of Global Sales and Logistics. From April 2003 to August 2005, Mr. Erspamer served as the Senior ManagerGlobal Sales &
Logistics. From February 2000 to March 2003, Mr. Erspamer served in expanding roles within the supply chain and finance organizations. Prior to that Mr. Erspamer served in a Restructure
Analyst position with Thomas & Betts Corporation. Mr. Erspamer graduated summa cum laude with a B.S. from the University of Tennessee.

Graeme Horwoodhas been the Vice President of Engineering, Research and Development since June 2001. From April 2000 to May 2001,
Mr. Horwood served as our Senior Manager Technical Services. From 1986 to 2000, Mr. Horwood held various management positions at Apollo Sports Technologies. Mr. Horwood is a
Chartered Engineer as well as a member of the Institute of

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Mechanical
Engineers both in the United Kingdom. Mr. Horwood graduated first class honors with a B.S. from Coventry University.

Jason Jennehas been the Chief Financial Officer and Treasurer since January 2005 and Vice President since August 2003. From September
2002 to August 2003, Mr. Jenne served as the Director of Corporate Finance. From September 1998 to September 2002, Mr. Jenne served as the Corporate Controller. From 1993 to 1998,
Mr. Jenne served in various Finance and Accounting positions at Emerson Electric Company. Mr. Jenne graduated magna cum laude with a B.S. from Southern Illinois University.

Raeford P. Lucashas been the Vice President, Global Golf Sales since November 2007. From November 2006 to November 2007, Mr. Lucas
served as our Vice President of Sales. From June 2006 to October 2006, Mr. Lucas served as our Vice President and General Manager of Royal Precision and Precision Brands. From 2000 to June
2006, Mr. Lucas held various management positions at Royal Precision Inc., including Executive Vice President of Sales and Marketing. Prior to that, Mr. Lucas worked at Outdoor
Technologies Group as the General Manager of the Fenwick Golf division. Mr. Lucas received a B.S. from North Carolina State University.

Steven J. Gilbertbecame a member of and Co-Chairman of the board of directors upon consummation of the Gilbert Global
Acquisition. He is a founder and has served as Chairman of the Board of Gilbert Global Equity Partners, L.P. since 1997. From 1992 to 1997, he was the founder and Managing General Partner of
Soros Capital L.P., the principal venture capital and leveraged transaction entity of Quantum Group of Funds, and a principal Advisor to Quantum Industrial Holdings Ltd. From 1988
through 1992, he was the Managing Director of Commonwealth Capital Partners, L.P., a private equity investment firm. From 1984 to 1988, Mr. Gilbert was the Managing General Partner of
Chemical Venture Partners (now J.P. Morgan Partners), which he founded. Mr. Gilbert is a Director of CPM Holdings, Inc., the Asian Infrastructure Fund and J O Hambro Investment
Management, Ltd. Previously, Mr. Gilbert has been a director of numerous public and private companies. Mr Gilbert received a B.S.
from the Wharton School at the University of Pennsylvania, an M.B.A. from the Harvard Graduate School of Business Administration, and a J.D. from Harvard Law School.

Steven Kotlerbecame a member of and Co-Chairman of the board of directors upon consummation of the Gilbert Global
Acquisition. He has served as Vice Chairman of Gilbert Global Equity Partners, L.P. since 2000. Prior to joining Gilbert Global in 2000, Mr. Kotler, for 27 years, was with
Schroder & Co. and its predecessor firm, Wertheim & Co., where he served as its Chief Executive Officer and President. Mr. Kotler is a Director of CPM Holdings and
The Archstone Partnerships. Previously, Mr. Kotler has served as a Governor of the American Stock Exchange and a director of numerous public and private companies. Mr. Kotler is a
graduate of City College of New York.

Richard W. Gaenzle, Jr.became a member of the board of directors upon consummation of the Gilbert Global Acquisition. He is
a founder and has served as Managing Director of Gilbert Global Equity Partners, L.P. since 1997. From 1992 to 1997, he was a principal of Soros Capital L.P., the principal venture
capital and leveraged transaction entity of Quantum Group of Funds, and a principal Advisor to Quantum Industrial Holdings Ltd. Prior to joining Soros Capital, Mr. Gaenzle held various
positions in the investment banking industry. Mr. Gaenzle is a Director of CPM Holdings, Inc. Mr. Gaenzle received a B.A. from Hartwick College and an M.B.A. from Fordham
University.

Jeffrey W. Johnsonbecame a member of the board of directors upon consummation of the Gilbert Global Acquisition. He is a founder and has
served as Managing Director of Gilbert Global Equity Partners, L.P. since 1997. Mr. Johnson was previously with Goldman, Sachs & Co. in its mergers and acquisitions
department, Hallmark Cards, Inc. and Russell Investment Group. He is a director of CPM Holdings, Inc. Mr. Johnson received a B.A. from Claremont McKenna College and an M.B.A. from
the Harvard Graduate School of Business Administration.

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William P. Lauderbecame a member of the board of directors in 2004. In July 2004, Mr. Lauder was named the President and Chief
Executive Officer of Estee Lauder Companies, Inc. He joined Estee Lauder Companies in 1986 and held numerous positions of increasing responsibility. Mr. Lauder received a B.A. and an
M.B.A. from the Wharton School at the University of Pennsylvania.

Board of Directors and Committees

The Board of Directors held six meetings during 2007 and took action by written consent on one occasion. During 2007, a quorum was achieved at each of the
scheduled meetings of the Board of
Directors. The standing committees of the Board of Directors include the Audit Committee and the Compensation Committee.



Steven Kotler, Jeffrey W. Johnson and Richard W. Gaenzle, Jr. are members of the Audit Committee, and Mr. Kotler chairs this committee. The Audit Committee
is empowered to: (i) appoint, fix the compensation of, and oversee the work of the Company's independent registered public accounting firm (including the power to resolve any disagreements
between management and the independent registered public accounting firm), with the independent registered public accounting firm reporting directly to the Audit Committee;
(ii) pre-approve all audit services and permissible non-audit services; and (iii) engage and determine funding for independent counsel and other advisors as it
may relate to certain financial or administrative matters of the Company. The Compay is not a "listed company" under SEC rules and is therefore not required to have an audit committee comprised of
independent directors. The Board of Directors has determined that, with the exception of the independence requirement, Mr. Kotler would be an "audit committee financial expert" within the
meaning of the rules of the Securities and Exchange Commission.



Steven J. Gilbert, Steven Kotler and Jeffrey W. Johnson are members of the Compensation Committee, and Mr. Gilbert chairs this committee. The Compensation
Committee is responsible for monitoring the Company's adherence with its compensation philosophy, including ensuring that the compensation paid to its executive officers is fair, reasonable and
competitive. The Compensation Committee's responsibilities, as discussed further in the "Compensation Discussion and Analysis" in Item 11 of this Part III, include, among other duties,
the responsibility to establish the base salary, incentive compensation and any other compensation for the Company's Chief Executive Officer and review and approve the Chief Executive Officer's
recommendations for the compensation of certain executive officers reporting to him. The Compensation Committee also has the full power and authority to interpret the provisions and supervise the
administration of the True Temper Corporation 2004 Equity Incentive Plan, including the determination and/or approval of awards to be granted thereunder, and any and all other power and authority to
review, interpret and/or administer compensation and benefit programs as may be delegated by the Company's board of directors to the Compensation Committee from time to time.

Code of Ethics

The Audit Committee has adopted a Code of Ethics for the Chief Executive Officer, Chief Financial Officer, and other senior financial personnel. A copy of the
Code of Ethics is available on the Company's website at www.truetemper.com. The Company will disclose any amendments or waivers to the Code of Ethics on the same website.

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Item 11.Executive Compensation



The Compensation Committee of the Board of Directors of True Temper Corporation, the Company's parent company, has furnished the following report for inclusion in
this Annual Report on Form 10-K:



| |  | Respectfully submitted,
The Compensation Committee of the
Board of Directors
Steven J. Gilbert, Chairman
Steven Kotler
Jeffrey W. Johnson
| |  | -----------------------------------------------------------------------------------------------------------------------------------------

No
portion of this report shall be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or under the Securities Exchange Act of 1934, as
amended, (collectively, the "Acts") through any general statement incorporating by reference the Annual Report on Form 10-K in which this report appears in its entirety, except to
the extent that the company specifically incorporates this report or a portion of this report by reference. In addition, this report shall not otherwise be deemed to be "soliciting material" or to be
"filed" under either of such Acts.

Compensation Discussion and Analysis

Compensation Philosophy and Objectives.The Compensation Committee believes an effective compensation
program should be one that is designed to: attract and retain the best possible executive talent; tie annual and long-term cash and equity incentives to the achievement of measurable
corporate and individual performance objectives; and align executives' incentives with overall value creation within the organization. To achieve these objectives, the Compensation Committee
implements, maintains and monitors compensation plans which tie a portion of the Executives' overall compensation to the achievement of established objective goals, including profitability and the
efficient use of capital. When establishing these objectives and goals, the Compensation Committee considers those established by companies of similar size, while taking into account the strategic
goals and relative performance of True Temper Sports, Inc.

Role of Executive Officers in Compensation Decisions.The Compensation Committee makes all
compensation decisions for the Chief Executive Officer, and all decisions relating to equity based
compensation awards. The Compensation Committee, together with recommendations and input from the Chief Executive Officer, makes equity and non-equity compensation decisions with respect
to the other Executives.

On
at least an annual basis, the Compensation Committee reviews the performance of the Chief Executive Officer as compared with the achievement of the Company's objective goals and any
individual goals. The Compensation Committee, together with the Chief Executive Officer, annually

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reviews
the performance of each individual Executive as compared with the achievement of Company goals, as the case may be, together with each Executive's individual goals. The Compensation Committee
can then exercise its discretion in modifying any recommended adjustments or awards to the Executives.

Setting Executive Compensation.Based on the above objectives and philosophies, the Compensation
Committee has established annual and long-term cash and equity compensation components to motivate the Executives to achieve, and hopefully exceed, the business goals established by the
Company and to fairly reward such executives for achieving such goals. The Compensation Committee has not retained a compensation consultant to review its policies and procedures with respect to
executive compensation. The Compensation Committee periodically conducts an internal benchmark review of the aggregate level and mix of our Executive compensation against companies in our same
industry (both public and privately held).

2007 Executive Compensation Components

For the year ended December 31, 2007, the principal components of compensation for the Company's Executives are described below:

Base Salary.The Company provides Executives and other employees with base salary to compensate them
for services rendered during the fiscal year. Base salaries are set to recognize the experience, skills, knowledge and responsibilities required of the Executives in their respective roles. Base
salaries are reviewed annually, and will be adjusted from time to time to realign salaries with market levels after taking into account individual responsibilities, performance and experience. Base
salaries are established for a given position taking into consideration the factors discussed above together with available market or comparable salary data. In 2007, the Compensation Committee
approved salary increases for our named executive officers ranging from approximately 3% to 8%. The increases were based on each named executive officer's individual services rendered, level and scope
of responsibility and experience, comparisons to various market pay practices, and the operating performance of the Company during calendar year 2006. The increase range was 3% to 5% for all of the
Executives with the exception of two individuals who received 7% to 8% increases related to additional job responsibilities. The Compensation Committee determined that the overall increases were
warranted.

Performance-Based Executive Incentive Compensation Plan.The Company maintains a performance based
Executive incentive compensation plan (the "EICP"). The EICP establishes objectives for the calculation of annual cash bonuses for each Executive, subject to Compensation Committee oversight and
modification. The EICP provides for annual incentive bonuses which are intended to compensate Executives for achieving or exceeding Company financial goals and for achieving individual annual
performance goals. The EICP uses a sliding scale applied to financial performance targets with corresponding achievement levels. No bonus is earned unless a minimum target is achieved. Additional
bonus may be earned should the targets be exceeded. In 2007, the Company's operating performance fell below the minimum target established for payment of cash bonuses under the EICP, which was
$32.0 million in Adjusted EBITDA. Accordingly, no cash bonuses were paid to the Executives for calendar year 2007. For 2008, the EICP objectives will again be primarily based on profitability.

Incentives
under the EICP are paid in cash and are typically paid in a single installment in the first quarter following the completion of a given fiscal year. The Compensation Committee
has reserved the right under the EICP to also pay "discretionary" bonuses. Such discretionary bonuses are paid if the Compensation Committee determines that a particular Executive has exceeded the
objectives and/or goals established for such Executive or made a unique contribution to the Company during the year.

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Equity Program; Stock Options and Restricted Stock.Under the True Temper Corporation 2004 Equity
Incentive Plan (the "Plan"), the Compensation Committee may make various types of awards with respect to True Temper Corporation common stock. True Temper Corporation is a privately held company and
its common stock, including any stock issued or obtained pursuant to the Plan, has transfer restrictions. The maximum amount of common stock that can be issued (or in respect of which awards can be
issued) under the Plan is limited to approximately 1.0 million shares. Among other things, the Compensation Committee decides which of the Executives or senior managers shall receive awards
under the Plan and the type of award made. In the case of stock options granted under the Plan, the Compensation Committee determines strike price, vesting terms, and such other terms or conditions as
the Compensation Committee may determine, in their sole discretion, provided it is allowed under the Plan. The Plan has two types of options, service based options and performance based options.
Service based options vest on a pro-rata basis over a period less than five years, have a term of ten years from the date of grant, and expire if not exercised. Performance based options
vest upon the satisfactory achievement of certain specified profitability targets, have a term of ten years from the date of grant, and expire if not exercised. In the event of a change of control, as
defined in the Plan, all of the outstanding but unvested stock options become vested and exercisable.

The
Plan also has certain restricted shares available for grant. Restrictions are lifted in the event of a change of control, and provided that a certain specified stock price is
achieved during such transaction.

All
of the awards granted to management under the Plan were granted between March 15, 2004 and August 10, 2005. No such awards were granted for calendar year 2007.

There
is no program, plan or practice in place for selecting grant dates for awards under the Plan in coordination with the release of material non-public information. The
exercise price for the option awards is the fair market value of the stock of True Temper Corporation on the date of grant. The fair market value is determined by the Compensation Committee and the
Board of Directors of True Temper Corporation using a variety of analytical tools. The Compensation Committee is not prohibited from granting options at times when they are in possession of material
non-public information. However, no inside information was taken into account in determining the number of options previously awarded or the exercise price for those awards, and the
Compensation Committee did not "time" the release of any material non-public information to affect the value of those awards.

The
Compensation Committee believes that the granting of such awards promotes, on a short term and long term basis, an enhanced personal interest and alignment of those Executives
receiving equity
awards with the goals and strategies of the Company. The Compensation Committee also believes that the equity grants provide not only financial rewards to such Executives for achieving Company goals
but also provide additional incentives for Executives to remain with the Company.

401(k) Plan.The Company's Executives are eligible to participate in its company-wide
401k plan for salaried employees. The Company matches, at a 50% rate, the first 6% of the employee's contributions.

Perquisites and Other Personal Benefits.The Company provides the Executives, including other
employees generally, with perquisites and other personal benefits that the Company and the Compensation Committee believe are reasonable, competitive and which are consistent with the overall
compensation program to enable the Company to attract and retain qualified employees for key positions. The Compensation Committee periodically reviews the perquisites and other benefits provided to
the Executives, as well as the other employees.

Tax Treatment.The Company's Board of Directors considers the anticipated tax treatment of its
executive compensation program when setting levels and types of compensation. Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public companies for
compensation paid

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to
a company's chief executive officer or any of its other four most highly compensated executive officers in excess of $1 million in any year, with certain performance-based compensation being
specifically exempt from this deduction limit. Compensation received under the EICP is performance-based, and therefore qualifies for the exemption from the deduction limit. During 2007, none of the
Company's employees subject to this limit received Section 162(m) compensation in excess of $1 million. Consequently, the requirements of Section 162(m) should not affect the tax
deductions available to the Company in connection with its senior executive compensation program for 2007.

Conclusion.The Company's compensation policies are designed to reasonably and fairly motivate,
retain and reward its Executives for achieving the Company's objectives and goals.

Compensation Tables



The table below summarizes the total compensation paid or earned by each of the Named Executive Officers for the years ended December 31, 2007 and 2006.

|Name and Principal
Position                                                        |  | Fiscal
Year |  | Salary
$        |  | Bonus
$  |  | All Other
Compensation
$(1) |  | Total
$        
|---------------------------------------------------------------------------------- |  | ----------- |  | --------------- |  | -------- |  | --------------------------- |  | ---------------
|Scott C. Hennessy Chief Executive Officer, President and Director                  |  | 2007
2006   |  | 455,000
435,833 |  | 
      |  | 41,550
41,382               |  | 496,550
477,215
|Adrian H. McCall Senior Vice President of Global Marketing and Product Development |  | 2007
2006   |  | 202,500
192,915 |  | 
      |  | 28,261
29,224               |  | 230,761
222,139
|Jason A. Jenne Vice President, Chief Financial Officer and Treasurer               |  | 2007
2006   |  | 176,250
162,915 |  | 
      |  | 22,902
23,199               |  | 199,152
186,114
|Stephen M. Brown Vice President of Human Resources                                 |  | 2007
2006   |  | 152,500
143,133 |  | 25,000
 |  | 14,413
11,686               |  | 191,913
154,819
|Graeme Horwood Vice President Engineering, Research and Development                |  | 2007
2006   |  | 150,500
144,748 |  | 
      |  | 33,474
36,552               |  | 183,974
181,300
|Fred H. Geyer(2) Prior Senior Vice President, Chief Operating Officer              |  | 2007
2006   |  | 230,000
225,833 |  | 
      |  | 38,094
29,552               |  | 268,094
255,385

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Management Agreements with True Temper Sports, Inc.

Mr. Scott C. Hennessy, Chief Executive Officer, has an employment agreement with True Temper Sports, Inc.

Mr. Hennessy's Employment Agreement.Under his employment agreement, Mr. Hennessy serves as the Company's
president and chief executive officer. The initial term of the agreement was from March 15, 2004 through December 31, 2005, and is automatically renewed for successive
one-year

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periods
unless 60 days' prior notice is given by either party. In addition, Mr. Hennessy is a member of the Company's board of directors. He receives an annual base salary of at least
$400,000, and is eligible to receive an annual performance bonus of 100% of his base salary if the Company achieves specified performance objectives. In addition, under the employment agreement,
Mr. Hennessy is provided certain employee benefits consistent with other employees of the Company. Upon Mr. Hennessy's termination of employment by the Company without "cause" or by
Mr. Hennessy for "good reason" (each as defined in the employment agreement) or upon the Company's election not to renew his employment, Mr. Hennessy will be entitled to receive the
following severance payments and benefits: any accrued but unpaid salary as of the date of the termination, any annual bonus earned but unpaid for the most recently completed fiscal year,
reimbursement of any outstanding business expenses, and the continuation of his base salary for a period of 12 months. Additionally, Mr. Hennessy will be subject to certain restrictions
on his ability to compete with the Company or solicit any customers or employees for two years after his termination. Mr. Hennessy's employment agreement may also be terminated for "cause" (as
defined in the employment agreement).

Bonus Plan

See "Compensation Discussion and Analysis" for a discussion of the Company's EICP.

2004 Equity Incentive Plan

See "Compensation Discussion and Analysis" as well as Notes 2 and 11 to the Company's audited consolidated financial statements, located elsewhere in this
annual report, for a discussion of the 2004 Equity Incentive Plan.



|                  |  | Option Awards(1) |  | Stock Awards(1)
|----------------- |  | ---------------- |  | ---------------
|
|Scott C. Hennessy |  | 36,000           |  | 108,000        
|Adrian H. McCall  |  | 12,600           |  | 37,600         
|Jason A. Jenne    |  | 9,000            |  | 27,000         
|Stephen Brown     |  | 7,200            |  | 21,600         
|Graeme Horwood    |  | 7,200            |  | 21,600         
|Fred H. Geyer     |  | 24,000           |  |               

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Potential Payments Upon Termination or Change of Control

Other than those described above in the sections titled "Equity Program; Stock Options and Restricted Stock"and "Management Agreements with True Temper Sports, Inc.", the Company has no contractual payments associated with employment agreements that would
be required in the event of a

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termination
or change of control. The Company does maintain a severance policy which is used as a guideline in establishing severance benefits to any salaried employee that is terminated without cause
(the "Severance Policy"). The Severance Policy provides, primarily, for salary continuation for periods ranging from three to twelve months depending on length of service. Generally, one week of
severance pay is earned for each year of continuous service, with certain minimum amounts of severance provided for specific levels of management within the Company.

Following
is a discussion of the potential payments required for each Named Executive Officer; in the case of Mr. Hennessy, payments are governed by his employment agreement, and
in the case of all other Named Executive Officers, payments are governed by the Severance Policy.

Scott C. Hennessy.Under the terms of his employment agreement, Mr. Hennessy is entitled to receive the following
severance payments and benefits: any accrued but unpaid salary as of the date of the termination, any annual bonus earned but unpaid for the most recently completed fiscal year, reimbursement of any
outstanding business expenses, and the continuation of his base salary for a period of 12 months. As of December 31, 2007, the total amount of such payments would have been approximately
$460,000. In addition, in the event of a change of control, Mr. Hennessy would be entitled to accelerated vesting of all the option awards, and potentially all of the stock awards, identified
in the table above under the heading "Outstanding Equity Awards at Fiscal Year-End". The specific value of such awards would be determined based on the terms and conditions of such change
of control, including the per share price of common stock exchanged in the transaction.

Adrian H. McCall.Under the terms of the Company's Severance Policy, Mr. McCall is entitled to receive the following
severance payments and benefits: any accrued but unpaid salary as of the date of the termination, reimbursement of any outstanding business expenses, and the continuation of his base salary for a
period of at least six months. As of December 31, 2007, the total amount of such payments would have been approximately $103,000. In addition, in the event of a change of control,
Mr. McCall would be entitled to accelerated vesting of all the option awards, and potentially all of the stock awards, identified in the table above under the heading "Outstanding Equity Awards
at Fiscal Year-End". The specific value of such awards would be determined based on the terms and conditions of such change of control, including the per share price of common stock
exchanged in the transaction.

Jason A. Jenne.Under the terms of the Company's Severance Policy, Mr. Jenne is entitled to receive the following
severance payments and benefits: any accrued but unpaid salary as of the date of the termination, reimbursement of any outstanding business expenses, and the continuation of his base salary for a
period of at least six months. As of December 31, 2007, the total amount of such payments would have been approximately $90,000. In addition, in the event of a change of control,
Mr. Jenne would be entitled to accelerated vesting of all the option awards, and potentially all of the stock awards, identified in the table above under the heading "Outstanding Equity Awards
at Fiscal Year-End". The specific value of such awards would be determined based on the terms and conditions of such change of control, including the per share price of common stock
exchanged in the transaction.

Stephen M. Brown.Under the terms of the Company's Severance Policy, Mr. Brown is entitled to receive the following
severance payments and benefits: any accrued but unpaid salary as of the date of the termination, reimbursement of any outstanding business expenses, and the continuation of his base salary for a
period of at least six months. As of December 31, 2007, the total amount of such payments would have been approximately $78,000. In addition, in the event of a change of control,
Mr. Brown would be entitled to accelerated vesting of all the option awards, and potentially all of the stock awards, identified in the table above under the heading "Outstanding Equity Awards
at Fiscal Year-End". The specific value of such awards would be determined based on the terms and conditions of such change of control, including the per share price of common stock
exchanged in the transaction.

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Graeme Horwood.Under the terms of the Company's Severance Policy, Mr. Horwood is entitled to receive the following
severance payments and benefits: any accrued but unpaid salary as of the date of the termination, reimbursement of any outstanding business expenses, and the continuation of his base salary for a
period of at least six months. As of December 31, 2007, the total amount of such payments would have been approximately $76,000. In addition, in the event of a change of control,
Mr. Horwood would be entitled to accelerated vesting of all the option awards, and potentially all of the stock awards, identified in the table above under the heading "Outstanding Equity
Awards at Fiscal Year-End". The specific value of such awards would be determined based on the terms and conditions of such change of control, including the per share price of common stock
exchanged in the transaction.

Fred H. Geyer.Under the terms of the Company's Severance Policy, Mr. Geyer was entitled to receive the following
severance payments and benefits: any accrued but unpaid salary as of the date of the termination, reimbursement of any outstanding business expenses, and the continuation of his base salary for a
period of at least six months. On February 19, 2007, Mr. Geyer's employment with True Temper Sports, Inc. was terminated. He will receive total payments of approximately $230,000
during the severance period.

No
payments are made if an executive terminates his employment without "good reason" or we terminate his employment for "cause," or if, under a severance agreement, an executive leaves
for other than "good reason" or we terminate their employment for any reason other than without "cause" (including death or disability).

With
respect to the employment and severance agreements:



Director Compensation

The Company does not provide compensation to Directors for their service in such capacity.

Compensation Committee Interlocks and Insider Participation

There are no Compensation Committee interlocks (i.e., no executive officer of the Company or of True Temper
Corporation serves as a member of the board of directors or the compensation committee of another entity that has an executive officer serving on the Company's board of directors or True Temper
Corporation's board of directors).

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Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

All of the outstanding shares of our capital stock are owned by TTC. The following table sets forth information with respect to the beneficial ownership of TTC's
capital stock as of March 1, 2008 by:



Name of Beneficial Owner(1)

Number of
Common
Shares

Percentage of
Outstanding
Common
StockTTS Holdings LLC
c/o Gilbert Global Equity Capital, LLC.
320 Park Avenue
17th Floor
New York, New York 10022

8,778,919

96.8%Scott C. Hennessy

167,021

1.8%Adrian H. McCall

29,509

*Stephen Brown

7,377

*Jason A. Jenne

3,689

*Graeme Horwood

2,951

*All directors and executive officers as a group (5 persons)

210,547

2.3%




Item 13.Certain Relationships and Related Transactions and Director Independence

Stock Purchase Agreement

In accordance with the terms of the Purchase Agreement by and among TTS Holdings LLC, True Temper Corporation, and True Temper Sports, LLC and
others dated January 30, 2004 (the "Stock Purchase Agreement"), Sellers, as defined in the Stock Purchase Agreement, have indemnified TTS Holdings, LLC, the purchaser, against any and
all damages resulting from any misrepresentation or breach of warranty of Sellers contained in the Stock Purchase Agreement, for claims made within 18 months following the closing date, except
that claims involving environmental matters, tax matters, or employee benefit matters shall survive for a period of 36 months following the closing date. The indemnification obligations of the
Sellers under the Stock Purchase Agreement are generally subject to a $10.0 million basket amount and are limited to an aggregate payment of no more than the total amount held in escrow.

Stockholders Agreement

Upon the consummation of the Stock Purchase Agreement, TTC and all of its stockholders, including TTS Holdings, LLC, entered into a stockholders agreement.
The stockholders agreement:



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Management Services Agreement

In connection with the stock purchase agreement, True Temper entered into a management services agreement with Gilbert Global. In accordance with this agreement,
Gilbert Global has agreed to provide:



In
exchange for such services, Gilbert Global or its nominee receives:





During
2007 and 2006, in addition to annual advisory fees of $0.5 million, the Company paid $0.4 million and $1.0 million, respectively to Gilbert Global for fees
associated with financing and acquisition transactions.

Director Independence

As a debt-only filer, the Company is not required to have a majority of its Board consist of independent directors.

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Item 14.Principal Accountants Fees and Services

The following table represents aggregate fees billed to the Company for fiscal years ended December 31 by KPMG LLP, the Company's independent
registered public accounting firm.

Fiscal Years Ended2007

2006Audit fees

$
232,000

$
184,000Tax fees(1)


86,000


128,600Total fees(2)

$
318,000

$
312,600




The
Audit Committee has considered whether performance of services other than audit services is compatible with maintaining the independence of KPMG LLP.

Auditor Fees Pre-approval Policy

In 2003, the Audit Committee adopted a policy concerning approval of audit and non-audit services to be provided by the independent registered public
accounting firm to the Company. The policy requires that all services KPMG LLP, the Company's independent registered public accounting firm, may provide to the Company, including audit services
and permitted audit-related and non-audit services, excluding certain designated tax services, must be approved by the Audit Committee. The Committee approved all audit and
non-audit services provided by KPMG during 2007.

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PART IV

Item 15.Exhibits and Financial Statements Schedule



SCHEDULE IIVALUATION AND QUALIFYING ACCOUNTS

|                                |                              |  |   | Additions |  |     |  |  
|------------------------------- | ---------------------------- |  | - | --------- |  | --- |  | -
|
|
|ALLOWANCE FOR DOUBTFUL ACCOUNTS |                              |  |   |           |  |     |  |  
|                                | Year ended December 31, 2005 |  | $ | 915       |  | 165 |  | 
|                                | Year ended December 31, 2006 |  | $ | 411       |  | 100 |  | 
|                                | Year ended December 31, 2007 |  | $ | 477       |  | 65  |  | 

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All
other schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.



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SIGNATURES

Pursuant to the requirements of section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

| |  | TRUE TEMPER SPORTS, INC.
| |  | ------------------------
| |  | By:                     
| |  | Name:                   
| |  | Title:                  
| |  | Date:                   

Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on
the dates indicated.

| |  | By:    |  | /s/STEVEN J. GILBERT      
| |  | ------ |  | --------------------------
| |  | Name:  |  | Steven J. Gilbert         
| |  | Title: |  | Director and Co-Chairman  
| |  | Date:  |  | March 21, 2008            
| |  | By:    |  | /s/STEVEN KOTLER          
| |  | Name:  |  | Steven Kotler             
| |  | Title: |  | Director and Co-Chairman  
| |  | Date:  |  | March 21, 2008            
| |  | By:    |  | /s/RICHARD W. GAENZLE, JR.
| |  | Name:  |  | Richard W. Gaenzle, Jr.   
| |  | Title: |  | Director                  
| |  | Date:  |  | March 21, 2008            
| |  | By:    |  | /s/JEFFREY W. JOHNSON     
| |  | Name:  |  | Jeffrey W. Johnson        
| |  | Title: |  | Director                  
| |  | Date:  |  | March 21, 2008            
| |  | By:    |  | /s/WILLIAM P. LAUDER      
| |  | Name:  |  | William P. Lauder         
| |  | Title: |  | Director                  
| |  | Date:  |  | March 21, 2008            

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| |  | By:    |  | /s/SCOTT C. HENNESSY                                                    
| |  | ------ |  | ------------------------------------------------------------------------
| |  | Name:  |  | Scott C. Hennessy                                                       
| |  | Title: |  | President, Chief Executive Officer and Director                         
| |  | Date:  |  | March 21, 2008                                                          
| |  | By:    |  | /s/JASON A. JENNE                                                       
| |  | Name:  |  | Jason A. Jenne                                                          
| |  | Title: |  | Vice President, Chief Financial Officer and Principal Accounting Officer
| |  | Date:  |  | March 21, 2008                                                          

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INDEX TO 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).*                                                                                                          
|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).*                                                                                                                                                 

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|10.7  |  | First Amendment, dated as of September 24, 2004, to the 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 10.1 to True Temper Sports, Inc.'s report on Form 8-K, as filed with the Securities and Exchange Commission on September 30,
2004).*                                                                             
|----- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.8  |  | Amended and Restated Credit Agreement dated as of March 27, 2006, (amending and restating the 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 10.8 to True Temper Sports, Inc.'s report on Form 10-K, as filed with the Securities and Exchange
Commission on March 28, 2006).*                                          
|10.9  |  | First Amendment dated as of December 20, 2006 to the Amended and Restated Credit Agreement dated as of March 27, 2006 (amending and restating the Credit Agreement dated as of March 15, 2004, by and among True Temper Corporation, True
Temper Sports, Inc., the Lenders identified therein, Credit Suisse, Antares Capital Corporation, Goldman Sachs Credit Partners L.P. and Merrill Lynch Capital), (filed as Exhibit 10.2 to True Temper Sports, Inc.'s report on
Form 8-K, as filed with the Securities and Exchange Commission on January 26, 2007).*
|10.10 |  | Second Lien Credit Agreement dated as of January 22, 2007, by and among True Temper Corporation, True Temper Sports, Inc., the Lenders identified therein, and Credit Suisse, (filed as Exhibit 10.1 to True Temper Sports, Inc.'s
report on Form 8-K, as filed with the Securities and Exchange Commission on January 26, 2007).*                                                                                                                                                                                                                            
|10.11 |  | Summary of severance arrangement dated as of February 19, 2007 between True Temper Sports, Inc. and Fred H. Geyer.*                                                                                                                                                                                                                                                                                                                                                                                                                                           
|12.1  |  | Computation of Ratio of Earnings To Fixed Charges.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|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.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|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.**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

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