exhibit10-12.htm


    _______________,
2010

     

     

     

     

     

     

     

     

     

    VISHAY PRECISION GROUP, INC.
(as
Issuer)

     

     

     

     

     

    
      	  
	FORM OF NOTE
      INSTRUMENT
	constituting
	up to $____________
	FLOATING
    RATE
	UNSECURED LOAN NOTES
      2102
	  
	   


    

     

     

     

     

     

     

     

     

     


    

    
    


    THIS
INSTRUMENT is made on the
____ day of ________ 2010 by VISHAY PRECISION GROUP, INC. a company
incorporated in the State of Delaware USA, (the Company).

     

    Whereas

     

    
      	(A)	
            	Vishay
      Intertechnology issued loan notes (the “Vishay Intertechnology Loan
      Notes”) pursuant to that certain Note Instrument dated as of
      December 13, 2002 (the “Vishay Intertechnology Note
      Instrument”); and
	 
	(B)	
            	Vishay
      Intertechnology, American Stock Transfer & Trust Co. and the holders
      of the Vishay Intertechnology Loan Notes entered into that certain Put and
      Call Agreement, dated as of December 13, 2002 (the “Vishay Intertechnology Put and Call
      Agreement”); and
	 
	(C)	
            	Pursuant to the Vishay Intertechnology Put and Call Agreement,
      Vishay Intertechnology agreed that in case it shall at any time pay a
      dividend or make a distribution to all holders of its common stock
      consisting of the capital stock of any class or series, or similar
      interests, of or relating to a subsidiary or other business entity of
      Vishay Intertechnology, then Vishay Intertechnology shall take such action
      and shall cause the subsidiary or other business entity whose capital
      stock was paid as a dividend or distributed by Vishay Intertechnology to
      take such action so that each of the loan notes issued pursuant to the
      Vishay Intertechnology Note Instrument shall be deemed exchanged as of the
      effective date of such transaction, for a combination of new floating rate
      unsecured Vishay Intertechnology loan notes and floating rate unsecured
      loan notes of the subsidiary or other business entity whose capital stock
      was paid as a dividend or distributed by Vishay Intertechnology;
      and
	 
	(D)	
            	Vishay
      Intertechnology and the Company entered into that certain Master
      Separation Agreement, dated as of _______, 2010 (the
      “Master Separation Agreement”),
      providing for the spin-off of the Company by Vishay Intertechnology in the
      form of a tax free dividend of the common stock of the Company to the
      holders of the common stock of Vishay Intertechnology and the class B
      common stock of the Company to the holders of class B common stock of
      Vishay Intertechnology; and
	 
	(E)	
            	The
      Company has agreed under the terms of the Master Separation Agreement to
      comply with the obligation under the Vishay Intertechnology Put and Call
      Agreement to issue floating rate unsecured loan notes to the holders of
      the Vishay Intertechnology Loan Notes; and
	 
	(F)	     	Accordingly, the Company has created up to $____________ Floating Rate Unsecured Loan Notes 2102
      and has determined to constitute the said Loan Notes as hereinafter
      provided.


    

     

    Now This Instrument Witnesses And The Company Hereby Declares as
follows:-

     

    1. In this Instrument and in the Schedules
hereto the following expressions shall, where the context permits, have the
following meanings:

     

    the Conditions means the conditions
to be endorsed on the Loan Notes in the form or substantially in the form set
out in Schedule 2 hereto as the same may from time to time be modified in
accordance with the provisions herein contained;

     

    

    
    


    Directors
means
the Board of Directors for the time being of the Company or a duly authorised
committee of the Board of Directors;

     

    Exchange Act
means
the Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder, as the same may be amended from time to
time;

     

    Instrument
means
this instrument and the Schedules hereto as from time to time modified in
accordance with the provisions herein
contained;

     

    LIBOR means, in
relation to any amount owed by the Company hereunder and any interest
period:

     

    
      	(a)	
            	the
      percentage rate per annum equal to the offered quotation which appears on
      the page of the Telerate Screen which displays an average British Bankers
      Association Interest Settlement Rate for US Dollars for such period at or
      about 11.00 a.m. (London time) on the first day of the relevant interest
      period; or
	 
	(b)	     	if a
      rate is not available pursuant to (a) above, the percentage rate per annum
      which is the arithmetic mean of the rates as supplied to the Company at
      its request quoted by three banks selected by the Company (one of which
      shall include, if in existence at the time, Barclays Bank plc) to leading
      banks in the London inter-bank market for three month deposits of similar
      size and currency.


    

     

    Loan Notes
means
up to $____________ Floating Rate Unsecured Loan Notes 2102 of the
Company to be issued under this Instrument or (as the context may require) the
principal amount thereof for the time being issued and
outstanding;

     

    Noteholders means the several persons for the
time being entered in the Register;

     

    Put and Call Agreement means the put and call agreement
relating to the Loan Notes entered into by the Company and other persons in
connection with the transaction contemplated by the Master Separation Agreement
on or about the date hereof;

     

    Register means the register of Noteholders
referred to in clause 8 hereof;

     

    Registration Rights Agreement
means the registration
rights agreement entered into by Vishay Intertechnology and other persons in
connection with the SPA on or about December 13,
2002;

     

    SPA means the share sale and purchase
agreement entered into by Vishay Intertechnology as purchaser and other persons
on or about December 13, 2002 pursuant to which the Vishay Intertechnology Loan
Notes were issued; and

     

    Vishay Precision Group means the Company (including its
successors) and its subsidiaries from time to
time.

     

    2

     

    

    
    


    Words denoting the singular number only shall
include the plural number and vice versa. Words denoting persons shall include
corporations.

     

    2. The Loan Notes shall be known as the Vishay
Precision Group, Inc. Floating Rate Unsecured
Loan Notes 2102 and shall be issued in amounts and multiples of $1000 by the
Company to such persons at such times and on such terms as the Directors may
determine.

     

    3. The aggregate principal amount of the Loan
Notes is limited to $_________. The Loan Notes, as and
when issued, and all accrued and unpaid interest thereon, shall (except as
regards the first payment of interest) rank pari passu equally and rateably
without discrimination or preference as an unsecured debt obligation of the
Company.

     

    4. As and when the Loan Notes or any part
thereof fall to be redeemed or repaid in accordance with the provisions hereof,
the Company will pay to the Noteholders entitled thereto the principal amount of
the Loan Notes to be repaid together with accrued interest (subject to any
requirement to deduct any income tax therefrom).

     

    5. Until such time as the Loan Notes are
redeemed or repaid in accordance with the provisions hereof, the Company will
pay to the Noteholders interest (subject to any requirement to deduct any income
tax therefrom) on the principal amount of the Loan Notes outstanding at the
rates and the times and as otherwise provided in the
Conditions.

     

    6. Every Noteholder shall be entitled without
charge to one certificate for the Loan Notes held by it. However, joint holders
of Loan Notes will be entitled only to one Loan Note certificate (provided that
the Company shall not be bound to register more than four persons as the joint
holders of any Loan Note) and such Loan Note will be sent to that one of the
joint holders who is first named in the Register. Every Loan Note certificate
shall be issued under the common or securities seal of the Company and shall be
substantially in the form set out in Schedule 1 hereto and shall have the
Conditions endorsed thereon. The Company shall comply with the provisions of the
Loan Notes and the Conditions and the Loan Notes shall be held subject to all
such provisions which shall be binding on the Company and the Noteholders and
all persons claiming through or under them respectively.

     

    7. Each Noteholder shall be entitled to
require all or any part (being $1000 nominal amount or any integral multiple
thereof) of the Loan Notes held by it to be repaid at par together with accrued
interest (subject to any requirement to deduct any income tax therefrom)
if:

     

    
      	(a)	
            	
              any principal or interest on any of the
      Loan Notes held by that Noteholder due to it shall fail to be paid in full
      within thirty days after receipt of written demand by the Company,
      addressed to its financial controller (with a copy to ___________ of _____________) and made by the relevant Noteholder
      following failure to pay; or

            
	  
	(b)	     	
              the Company breaches any of its
      obligations to issue shares or, if applicable, to pay cash under the Put
      and Call Agreement and such breach, if capable of remedy, is not remedied
      within ten days after written notification to the Company addressed to its
      financial controller (with a copy to _____________ of ___________________________);
or

            


    

     

    3

     

    

    
    


    
      	(c)	
            	
              any indebtedness of any member or members of the Vishay Precision
      Group having in aggregate a principal amount in excess of US$50,000,000 is
      not paid on its due date or within any applicable grace period, and such
      default in payment is not waived or remedied within a period of one month;
      or

            
	 
	(d)	
            	the Company pursuant to or under
      or within the meaning of any Bankruptcy Law:
	 
	 	
            	(i)	
            	commences a voluntary case or
      proceeding;
	 
	 	
            	(ii)	
            	consents to the entry of an order
      for relief against it in an involuntary case or proceeding or the
      commencement of any case against it;
	 
	 	
            	(iii)	
            	consents to the appointment of a
      Custodian of it or for any substantial part of its
    property;
	 
	 	
            	(iv)	
            	makes a general assignment for the
      benefit of its creditors;
	 
	 	
            	(v)	
            	files a petition in bankruptcy or
      answer or consent seeking reorganization or relief; or
	 
	 	
            	(vi)	
            	consents to the filing of such
      petition or the appointment of or taking possession by a Custodian;
      or
	 
	(e)	
            	a court of competent jurisdiction
      enters an order or decree under any Bankruptcy Law
  that:
	 
	 	
            	(i)	
            	is for relief against the Company
      in an involuntary case or proceeding, or adjudicates the Company insolvent
      or bankrupt;
	 
	 	
            	(ii)	
            	appoints a Custodian of the
      Company for any substantial part of its property; or
	 
	 	
            	(iii)	     	orders the winding up or
      liquidation of the Company; and the order or decree remains unstayed and
      in effect for 60 days; or
	 
	(f)	     	any event analogous to (d) or (e)
      above occurs in any jurisdiction.


    

     

    In paragraphs
(d) and (e) above:

     

    Bankruptcy Law means Title 11, United States
Code, or any similar Federal or state law for the relief of
debtors.

     

    Custodian means any receiver, trustee,
assignee, liquidator, custodian or similar official under any Bankruptcy
Law.

     

    The Company
shall notify each of the Noteholders forthwith on the occurrence of any of the
events described in sub-clause (a) to (f) of this clause 7.

     

    4

     

    

    
    


    8. A register of the Noteholders will be kept
at 3 Great Valley Parkway, Malvern, Pennsylvania 19355-1307 (or at such other place as the Company may from
time to time have appointed for the purpose and have notified to
the Noteholders) and there shall be entered in the Register:

     

    
      	(a)	
            	the
      names and addresses of the Noteholders;
	 
	(b)	
            	the telecopier numbers of the
      Noteholders;
	 
	(c)	
            	the
      principal amount of the Loan Notes held by each
    Noteholder;
	 
	(d)	
            	the
      date on which the name of each Noteholder is entered in respect of the
      Loan Notes standing in its name; and
	 
	(e)	     	the
      serial number of each Loan Note.


    

     

    9. Any change of name or address on the part
of any Noteholder which is notified to the Company at
the address set out in clause 8 above shall be entered in the
Register.

     

    10. Any Noteholder may at all reasonable times
during office hours inspect the Register.

     

    11. The Company hereby covenants with the
Noteholders and each of them duly to perform and observe the obligations herein
contained and imposed on it to the intent that these presents shall enure for
the benefit of all Noteholders, each of whom may sue for the performance or
observance of the provisions hereof so far as its holding of Loan Notes is
concerned.

     

    12. The Conditions and provisions contained in
the Schedules hereto shall have effect in the same manner as if such Conditions
and provisions were herein set forth.

     

    13. A memorandum of execution of any
instrument supplemental to this Instrument shall be endorsed by the Company on
this Instrument.

     

    14. This Instrument and the Loan Notes shall
be governed by and construed in accordance with the laws of the State of New
York.

     

    15. Each of the parties agrees that the courts
of the State of New York are to have exclusive jurisdiction to settle any
disputes that may arise in connection with this Agreement.

     

    In Witness Whereof this
Instrument has been duly executed by the Company the day and year first above
written.

     

    The
Company

     

    VISHAY PRECISION GROUP,
Inc.

     

     

    
      	By:	   	  
	 	
            	Name:	   	 	 
	 	
            	Title:	
            	 	  


    


    5

     

    

    
    


    SCHEDULE
1

     

    Form of Loan
Note

     

    No.
_____ Amount $_____

     

    VISHAY
PRECISION GROUP, INC.

     

    (Incorporated
in the State of Delaware)

     

    UP TO
$_____________ VISHAY PRECISION GROUP, INC. FLOATING
RATE
UNSECURED LOAN NOTES 2102

     

    THIS IS TO CERTIFY THAT _____ _____ is/are the
registered holder(s) of the above principal amount of the Vishay Precision
Group, Inc. Unsecured Loan Notes 2102 (the Loan Notes) constituted by an
Instrument entered into by the Company on _________, 2010 (together
with any instruments supplemental thereto) (the Instrument) and issued with the benefit
of, and subject to the provisions contained in, the Instrument and the
Conditions endorsed hereon. The Loan Notes further take the benefit of certain
representations and warranties contained in the Note Purchase Agreement referred
to in the Instrument as if made by Company as of ____, 2010, to the extent
relating to the Instrument and the Loan Notes.

     

    Interest is payable on the Loan Notes
quarterly in arrears on the interest payment dates in each year and at a
floating rate determined in accordance with the Conditions endorsed
hereon.

     

    The Loan Notes are redeemable in accordance
with Condition 8 endorsed hereon.

     

    The Loan Notes are transferable on the terms
set out in the Conditions endorsed hereon. This Loan Note certificate must be
surrendered before any transfer can be registered or any new Loan Note
certificate can be issued in exchange.

     

    The Loan Notes have not been, and will not be,
registered under the United States Securities Act of 1933, as amended and,
accordingly, certain restrictions on ownership and transfer apply to the Loan
Notes.1

     

    Copies of the Instrument constituting the Loan
Notes are available for inspection at the registered office of the
Company.

     

    The Loan Notes shall be governed by and
construed in accordance with the laws of the State of New
York.

     

    IN WITNESS
whereof Vishay Precision
Group, Inc. has executed this Loan Note
Certificate.

     

    ____________________

     

    
      	1	     	
              The provisions of the Registration
      Rights Agreement dated as of December 13, 2002 made between Vishay
      Intertechnology and the Original Holders (as such term is defined in the
      Registration Rights Agreement) shall govern whether or not legends in
      compliance with the United States Securities Act of 1933 appear on the
      face of the Loan Note certificates.

            


    

     

    1

     

    

    
    


    [EXECUTION
BLOCK FOR COMPANY]

     

    Issued on [ ]
20[__]

     

     

     

    2

     

    

    
    


    SCHEDULE
2

     

    The
Conditions

     

    1. The Loan Notes are issued in amounts and
multiples of $1000 and constitute unsecured obligations of the
Company.

     

    2. Interest on the Loan Notes will be
calculated on the basis of a 360 day year and will be payable (subject to any
requirement to deduct any income tax therefrom) by quarterly instalments in
arrears on 31 March, 30 June, 30 September and 31 December in each year (or if
such day is not a business day in New York and Frankfurt, on the immediately
preceding common business day in such cities) (interest payment dates) in
respect of the preceding interest period (as defined below) ending on the
interest payment date at a rate calculated for each interest period as provided
in Condition 3 below, except that the first interest payment on the Loan Notes,
which shall be made on _________, 2010 will be in respect of the period from
(and including) the first date of issue of any of the Loan Notes to (but
excluding) __________, 2010. The period from (and including) the
first date of issue of any Loan Notes to (but excluding) ___________ 2010 and the period from (and including)
___________ 2010 or any subsequent quarter date (where
quarter date means any of 31
March, 30 June, 30 September or 31 December) to (but excluding) the next
following quarter date is herein called an interest
period.

     

    3. (a) Subject to Condition 3(b), the rate of
interest on the Loan Notes for any interest period will be LIBOR for such
interest period.

     

    (b) If at any time during the period beginning
on the date of issue of the Loan Notes and ending on 31 December 2010, the
Common Stock has a Market Value of equal to or more than the Target Price per
share for 30 or more consecutive trading days, then the rate of interest on the
Loan Notes for all interest periods commencing on or after 1 January 2011 will
be the rate per annum equal to fifty per cent. (50%) of LIBOR for such interest
period.

     

    In this Condition 3:

     

    Common Stock means the common stock, par value US$0.10, of the
Company and any other security exchanged or substituted for such common stock or
into which such common stock is converted in any recapitalization,
reorganization, merger, consolidation, share exchange or other business
combination transaction, including any reclassification consisting of a change
in par value or a change from par value to no par value or vice
versa;

     

    Majority of the Noteholders
means, at any relevant time, the
Noteholders of a majority of the principal amount of the Loan Notes that are at
any relevant time outstanding;

     

    Market Value for any trading day means the volume-weighted average
of the per share selling prices on the New York Stock Exchange or other
principal United States securities exchange or inter-dealer quotation system on
which the Common Stock is then listed or quoted (or, if there is no sale of the
Common Stock reported on such trading day, the average of the low ask and high
bid price for the Common Stock reported on the last trading day in which such
sale was reported) or, if there are no high bid and low ask prices, the Market
Value shall be the per share fair market value of the Common Stock or other
security as determined by an investment banking firm of national reputation and
standing selected by the Company and reasonably acceptable to the Majority of
the Noteholders;

     

    3

     

    

    
    


    Target Price means $_____
per share of Common Stock,
provided that if any event(s) described in Article IV of the Put and Call
Agreement shall occur, then the Target Price shall be subject to adjustment in
the manner and to the extent applicable to the Target Price (as defined in the
Put and Call Agreement);

     

    trading day means any day on which securities are traded or
quoted on the principal securities exchange or interdealer quotation system on
which the Common Stock is listed for trading or quotation;
and

     

    Securities Act means the United States Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder, as the same may
be amended from time to time.

     

    4. If the Company fails to pay any amount
payable by it under this Instrument or the Loan Notes, it
must immediately on demand by the relevant Noteholder pay interest on the
overdue amount from its due date up to the date of actual payment, both before,
on and after judgement at the rate per annum equal to the Relevant Rate plus one per cent.
(1%). For these purposes the Relevant Rate is the rate for the time being
applicable pursuant to Condition 3 above.

     

    5. Each interest payment shall be made
(subject to any requirement to deduct any income tax therefrom) to the
Noteholder on the register of Noteholders at the close of business on the
twenty-eighth day preceding the date for payment of such interest and every such
Noteholder shall be deemed, for the purpose of these presents, to be the holder
on such interest payment date of the Notes held by it on such preceding date
notwithstanding any intermediate transfer or transmission of any such
Notes.

     

    6. In circumstances where the Company is
required (or would in the absence of any relevant filing be required) to make a
deduction or withholding for or on account of any taxes or any other deductions,
(and where any Noteholder is entitled to a reduced rate of withholding), the
Company shall (to the extent it is entitled or required to do so) co-operate in
a timely manner in filing such forms and documents as the Internal Revenue
Service and any other taxation authority may require in order to enable the
Company to make relevant payments under the Loan Notes without having to make
such deduction or withholding, or at the relevant reduced rate of
withholding.

     

    7.1 If the Company at any time is subject to a
transaction pursuant to which it becomes a subsidiary of any other person, it
will thereafter procure that its ultimate parent company from time to time, as
soon as practicable after becoming such, provides the Noteholders with a
binding, irrevocable and unconditional guarantee of all of the obligations of
the Company in respect of the Notes, the Registration Rights Agreement and the
Put and Call Agreement in customary form.

     

    7.2 If the Company ceases to be a reporting
company under Section 13(d) or 15 of the Exchange Act (a Reporting Entity), then, for so
long as it does not have a holding company that has issued a guarantee to the
Noteholders as required by Condition 7.1, it will in respect of each of its
financial quarters provide each Noteholder promptly after the same is prepared
with such quarterly and annual financial statements as it prepares in the
ordinary course in respect of itself and its subsidiaries and as is of the type
customarily provided to bank creditors.

     

    4

     

    

    
    


    7.3 If a guarantee of a holding company is in
effect as contemplated by Condition 7.1 above but the relevant guarantor is not
a Reporting Entity, then the Company shall be obliged to procure that the
relevant guarantor for the time being provides to each Noteholder the
information referred to in Condition 7.2 above in respect of itself and its
subsidiaries within the timeframe contemplated by that
Condition.

     

    8. Each Noteholder shall be entitled to
require all or any part (being $1000 nominal amount or any integral multiple
thereof) of the Loan Notes held by it to be repaid at par together with accrued
interest (subject to any requirement to deduct any income tax therefrom) up to
(but excluding the date of repayment) in the circumstances specified in clause 7
of the Instrument. Unless previously repaid, redeemed or purchased and
cancelled, the Company will redeem the Loan Notes on 31 December, 2102 at par
together with accrued interest (subject to any requirement to deduct income tax
therefrom) up to (but excluding) the date of repayment.

     

    9. Any Loan Notes repaid, redeemed or
purchased pursuant to Condition 8 shall forthwith be cancelled and the Company
shall not be at liberty to reissue the same.

     

    10. Every Noteholder any of whose Loan Notes
is due to be repaid or redeemed under these Conditions shall, not later than the
due date for such repayment or redemption, deliver up to the Company, at the
address specified in clause 8 of the Instrument constituting the Loan Notes, the
Loan Notes which are due to be repaid or redeemed in order that the same may be
cancelled. Upon such delivery and against a receipt for the principal moneys
payable in respect of the Loan Notes to be repaid or redeemed, the Company shall
pay to the Noteholder the amount payable to it in respect of such repayment or
redemption.

     

    11. Interest shall cease to accrue on any Loan
Notes becoming liable to repayment or redemption as from the due date for
repayment or redemption of such Loan Notes, unless (upon the Noteholder
demanding on or after such date and at the address specified in clause 8 of the
Instrument payment of the principal moneys payable in respect thereof and
tendering the certificate(s) therefor and a receipt for such moneys duly signed
and authenticated in such manner as the Company may reasonably require) payment
of such moneys shall not be made by the Company, in which case interest will
accrue from the date of such demand until (but excluding) the date of payment by
the Company.

     

    12. Amounts in respect of interest on any Loan
Notes which remain unclaimed by the Noteholder for a period of five years and
amounts due in respect of principal which remain unclaimed for a period of ten
years, in each case from the date on which the relevant payment first becomes
due, shall revert to the Company and the Noteholder shall cease to be entitled
thereto.

     

    13. Any Notes acquired by or on behalf of any
member of the Vishay Precision Group shall be automatically
cancelled.

     

    14. The provisions of the Instrument
constituting the Loan Notes and the rights of the Noteholders are subject to
modification, abrogation or compromise in any respect but only in accordance
with the provisions of Schedule 4 of the said Instrument and with the consent of
the Company.

     

    5

     

    

    
    


    15. The Loan
Notes are in registered form, and are transferable in accordance with the
provisions of Schedule 3 of the Instrument.

     

    16. All Loan
Notes shall form a single series and shall rank pari passu equally and rateably
without discrimination or preference as an unsecured debt obligation of the
Company.

     

    17. No
application has been or is intended to be made to any stock exchange for the
Loan Notes to be listed or dealt in.

     

    18. Any notice
or other document (including a Loan Note certificate) to be given to a
Noteholder may be given or sent to the Noteholder at its registered address for
the giving of notice to it by a method permitted pursuant to Condition 19. In
the case of joint registered holders of any Loan Notes, a notice given to the
Noteholder whose name stands first in the register in respect of such Loan Notes
shall be sufficient notice to all joint holders. Notice may be given to the
persons entitled to any Loan Notes in consequence of the bankruptcy of any
Noteholder by sending the same by a method permitted pursuant to Condition 19
addressed to them by name or by the title of the representative or trustee of
such holder at the address (if any) in the United Kingdom supplied for the
purpose by such persons or (until such address is supplied) by giving notice in
the manner in which it would have been given if the bankruptcy had not
occurred.

     

    19. Any notice
required to be given to the Company under the Instrument shall be sent in
writing to the address specified in clause 8 of the Instrument and shall be
sufficiently given or made when and if delivered by a recognized international
courier service or hand delivery, or by telecopier with in each case a copy sent
by first class or registered mail, post prepaid.

     

    20. Words and
expressions defined in the Instrument shall have the same respective meanings
whenever used in these Conditions.

     

    6

     

    

    
    


    SCHEDULE
3

     

    Provisions as
to Registration, Transfer and Other Matters

     

    1. Except as required by law or as ordered by
a court of competent jurisdiction, the Company will
recognise the registered holder of any Loan Notes as the absolute owner thereof
and shall not be bound to take notice or see to the execution of any trust,
whether express, implied or constructive, to which any Loan Notes may be
subject. The receipt of the registered holder for the time being of any Loan
Notes or, in the case of joint registered holders, the receipt of any of them
for the interest from time to time accruing due in respect thereof or any other
moneys payable in respect thereof shall be a good discharge to the Company,
notwithstanding any notice it may have, whether express or otherwise, of the
right, title, interest or claim of any other person to or in such Loan Notes,
interest or moneys. The Company shall not be bound to enter notice of any trust,
whether express, implied or constructive, on the register in respect of any Loan
Notes.

     

    2. Every Noteholder will be recognised by the
Company as entitled to its Loan Notes free from any equity, set-off or
counter-claim on the part of the Company against the original or any
intermediate holder of the Loan Notes.

     

    3. The Loan Notes are
transferable:

     

    
      	(a)	
            	
              in whole or in part (but in the case of
      a transfer of part in a minimum principal amount of at least $2,000,000
      and such that the transferor’s holding of Loan Notes after such transfer
      would not be less than $2,000,000) (and for these purposes a transfer of
      less than $2,000,000 shall not be a transfer in whole if it does not
      relate to all of the Loan Notes held by a transferor and its
      affiliates);

            
	 
      
	(b)	
            	
              subject to compliance with the
      restrictions set out in Schedule 6; and

            
	 
	(c)	     	
              in whole or in part to any affiliate of
      a Noteholder provided that, in the case of a transfer in part, the
      transferor and the transferee have entered into such documentation as the
      Company may reasonably require to provide that:

            
	 
      
	 	
            	(i)	
            	
              one member of the transferor’s group
      shall act as administrative agent for all Noteholders who are members of
      such group, with the effect that the Company will only be required to deal
      with one member of the transferor’s group in relation to the Loan Notes;
      and

            
	  
	 	
            	(ii)	     	
              if the transferee ceases to be an
      affiliate of the transferor, the Company will be notified and able to
      require the relevant Loan Notes promptly to be transferred back to the
      transferor.

            


    

     

    For these purposes, an affiliate of any person is (i)
any other person that is a holding company or subsidiary of the first, or a
subsidiary of any such holding company; (ii) in the case of a transferor that is
a fund management company, investment company, or venture capital or private
equity company, any fund, limited partnership or similar entity that is advised
or managed by that transferor; and (iii) in the case of a transferor that is a
fund, limited partnership or similar entity, any other such entity that is under
common management with the transferor.

     

    7

     

    

    
    


    No assignment, transfer, sale or other
disposal of any holding of Loan Notes will be registered except in accordance
with paragraphs 4 and 5 below.

     

    4. Every instrument of transfer shall be
substantially in the form set out in Schedule 5 and must be signed by the
transferor and the transferor shall be deemed to remain the owner of the Loan
Notes to be transferred until the name of the transferee is entered in the
register in respect thereof and until the transferee shall have executed an
assignment substantially in the form set out in Annex I to the Put and Call
Agreement.

     

    5. Every instrument of transfer must be left
for registration with the Company at the address specified in clause 8 of the
Instrument accompanied by the certificate for the Loan Notes to be transferred
together with any certificates required and such other evidence as the Directors
may require to prove the title of the transferor or its right to transfer the
Loan Notes, and, if the instrument of transfer is executed by some other person
on its behalf, the authority of that person to do so. The transfer will then
(subject to paragraphs 3 and 4 above) be registered and a note of such
registration will be entered in the Register and a new certificate for Loan
Notes issued accordingly.

     

    6. All instruments of transfer that are
registered shall be retained by the Company.

     

    7. No fee shall be charged for the
registration of any transfer or other document relating to or affecting the
title to any Loan Notes.

     

    8. Any person becoming entitled to Loan Notes
in consequence of the bankruptcy of a holder of Loan Notes or of any other event
giving rise to the transmission of such Loan Notes by operation of law may, upon
producing such evidence that it sustains the character in respect of which it
proposes to act under this Condition or of its title as the Company shall think
sufficient be registered itself as the holder of such Loan
Notes.

     

    9. The interest or other moneys payable in
respect of the Loan Notes and the principal amount of the Loan Notes or any part
thereof may be paid by electronic transfer to the bank account notified for such
purpose by the relevant Noteholder to the Company no less than 14 days prior to
the relevant date for payment; or if no such account is so satisfied, by cheque
sent through the post at the risk of the holder or holders to the registered
address of the holder or, in the case of joint registered holders, to the
registered address of that one of the joint registered holders who is first
named on the register in respect of such holding, or to such person and to such
address as the registered holder or the joint registered holders may in writing
direct. Every such cheque shall be made payable to the order of the person to
whom it is sent and payment of the cheque shall be a satisfaction of the moneys
represented thereby.

     

    10. If any Loan Note certificate is defaced,
lost or destroyed, it may be replaced on such terms (if any) as to evidence and
indemnity as the Company may require but so that, in the case of defacement, the
defaced Loan Note certificate shall be surrendered before the new Loan Note
certificate is issued.

     

    8

     

    

    
    


    SCHEDULE 4

     

    Amendments, Supplements and
Waivers

     

    Except as
described below the Company may amend the terms of the Loan Notes with the
written consent of Noteholders holding 66% of the aggregate principal amount of
the then outstanding Loan Notes. Noteholders holding a 66% of the aggregate
principal amount of the outstanding Loan Notes may waive compliance by the
Company with any provision of the Loan Notes. However, without the consent of
each affected Noteholder, an amendment, supplement or waiver may
not:

     

    
      	(a)	
            	change the maturity of the
      principal of or any instalment of interest on any Loan Note in a manner
      adverse to the Noteholders;
	 
	(b)	
            	reduce the principal amount of any
      Loan Note;
	 
	(c)	
            	reduce the rate of or extend the
      time for payment of interest on any Loan Note;
	 
	(d)	
            	change the place or currency of
      payment of principal of or interest on any Loan Note;
	 
	(e)	
            	modify any provision of the Loan
      Notes relating to the waiver of past defaults or the right of the
      Noteholders to institute suit for the enforcement of any payment on or
      with respect to any Loan Notes or the modification and amendment
      provisions of the Loan Notes;
	 
	(f)	
            	reduce the percentage of the
      principal amount of outstanding Loan Notes necessary for amendment to or
      waiver of compliance with any provision of the Loan Notes or for waiver of
      any breach of the terms thereof;
	 
	(g)	
            	waive a default in the payment of
      principal of, interest on, or redemption payment with respect to, the Loan
      Notes;
	 
	(h)	     	modify the ranking or priority of
      any Loan Note in any manner adverse to the
  Noteholders;


    

     

    It shall not be
necessary for the consent of the Noteholders under this Schedule 4 to approve
the particular form of any proposed amendment, supplement or waiver, but it
shall be sufficient if such consent approves the substance
thereof.

     

    After an
amendment, supplement or waiver under this Schedule 4 becomes effective, the
Company shall notify the Noteholders affected thereby with a notice briefly
describing the amendment; supplement or waiver. Any failure by the Company to
send such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such amendment, supplement or
waiver.

     

    9

     

    

    
    


    SCHEDULE
5

     

    Form of
Transfer Certificate

     

    To: Vishay Precision Group, Inc. (the
Company)

     

    TRANSFER
CERTIFICATE

     

    This Transfer Certificate relates to the
Instrument constituting up to $_____________ Vishay
Precision Group, Inc. Floating Rate Loan Notes 2102 dated ____________, 2010 of Vishay Precision Group, Inc. (the
Instrument). Capitalised terms
defined in the Instrument shall have, unless otherwise defined in this Transfer
Certificate, the same meanings when used in this Transfer
Certificate.

     

    1. [Transferor] (the Transferring Holder) confirms
that the principal outstanding amount of Notes that it holds is
$[_____] (the Transferring Holder’s
Notes).

     

    2. The Transferring Holder
requests:

     

    
      	(a)	
            	[___________]
      [Transferee] (the Transferee) to accept and
      procure the transfer to the Transferee of [the Transferring Holder’s
      Notes//[_____] principal amount of the Transferring
      Holder’s Notes, being a principal amount greater than $2,000,000] as
      further specified in the Appendix (the Transfer Notes) by
      countersigning and delivering this Transfer Certificate to the Company at
      its address for the service of notices specified in the Instrument;
      [and
	 
	(b)	     	the
      Company to issue a certificate in its name in relation to that portion of
      the Transferring Holder’s Notes not comprising the Transfer Notes (the
      Retained Notes) in
      accordance with clause 6 of the Instrument. For the avoidance of doubt,
      the Transferor acknowledges that this Transfer Certificate shall not
      affect its rights, undertakings, liabilities and obligations in respect of
      the Retained Notes.]


    

     

    3. The Transferring Holder makes no
representation or warranty and assumes no responsibility with respect to the
legality, validity, effectiveness, adequacy or enforceability of the Instrument
or any document relating thereto and assumes no responsibility for the financial
condition of the Company or for the performance and observance by the Company of
any of its respective undertakings, liabilities and obligations under the
Instrument or any document relating thereto, and any and all such conditions and
warranties, whether express or implied by law or otherwise, are hereby
excluded.

     

    4. In connection with the transfer of the
Transfer Notes, the Transferring Holder confirms that it has not utilised any
general solicitation or general advertising in connection with the Transfer
Notes or the transfer of the Transfer Notes.

     

    5. Unless, either (i), one of the boxes below
is checked by the Transferring Holder or (ii) the Loan Notes
are transferred pursuant to an effective registration statement under the
Securities Act, the Company shall not be obliged to register any of the Loan
Notes evidenced in the name of any person other than the Transferring
Holder.

     

    10

     

    

    
    


    6. By checking the box
checked below, the Transferring Holder confirms that the Transfer
Notes are being
transferred2:

     

    
      	
            	(i)	
            	[_____] to the Company or a subsidiary thereof;
      or
	
            	 
	
            	(ii)	
            	[_____] pursuant to and in compliance with Rule
      144A under the Securities Act; or
	
            	 
	
            	(iii)	
            	[_____] to an institutional “accredited
      investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the
      Securities Act); or
	
            	 
	
            	(iv)	
            	[_____] outside the United States to a “foreign
      person” in compliance with Rule 904 of Regulation S under the Securities
      Act; or
	
            	 
	
            	(v)	
            	[_____] pursuant to the exemption from
      registration provided by Rule 144 under the Securities Act;
      or
	
            	 
	     	(vi)	     	[_____] pursuant to another available exemption
      from the registration requirements of the Securities
  Act.


    

     

    7. The
Transferee hereby requests the Company:

     

    
      	(a)	
            	to accept this Transfer
      Certificate as being delivered to it pursuant to, and for the purposes of,
      paragraph 5 of Schedule 3 to the Instrument in relation to the Transfer
      Notes; and
	 
	(b)	
            	to register it in the Register as
      the Noteholder in respect of the Transfer Notes; and
	 
	(c)	     	to issue a certificate in its name
      in relation to the Transfer Notes in accordance with clause 6 of the
      Instrument.


    

     

    8. The
Transferee confirms that it has acceded to the Put and Call Agreement in
accordance with paragraph 4 of Schedule 3 to the Instrument and encloses
herewith:

     

    
      	 	(i)	
            	a copy of the form of assignment
      prescribed by the Put Call Agreement duly executed by it;
    and
	 	 
	     	(ii)	     	the certificate that evidences the
      Transferring Holder’s title to the Transfer
  Notes.


    
____________________
  

    
      	2	     	If box (iii), (iv),
      (v) or (vi) is checked, the Company may require, prior to registering any
      such transfer of the Transfer Notes such legal opinions, as the Company
      reasonably requests to confirm that such transfer is being made pursuant
      to an exemption from, or in a transaction not subject to, the registration
      requirements of the Securities Act.


    

     

    11

     

    

    
    


    9. The
Transferee warrants that it has received a copy of the Instrument together with
such other information as it has required in connection with this transaction
and that it has not relied, and will not hereafter rely, on the Transferring
Holder to check or enquire on its behalf into the legality, validity,
effectiveness, adequacy, accuracy or completeness of any such information and
further agrees that it has not relied, and will not rely, on the Transferring
Holder to assess or keep under review on its behalf the financial condition,
creditworthiness, condition, affairs, status or nature of the
Company.

     

    10. The
Transferee hereby undertakes with the Transferring Holder and each of the other
parties to the Instrument that it will perform in accordance with their terms
all those undertakings, liabilities and obligations that by the terms of the
Instrument will be assumed by it after delivery of this Transfer Certificate to
the Company and satisfaction of the conditions subject to which this Transfer
Certificate is expressed to take effect.

     

    11. This
Transfer Certificate is not assignable or otherwise negotiable (without
prejudice to the provisions of Schedule 3 to the Instrument which shall be
applicable to the Transferring Holder in respect of the Retained Notes and to
the Transferee in relation to any transfer or assignment of the rights,
undertakings, liabilities and obligations assumed by it pursuant
hereto).

     

    12. This
Transfer Certificate and the rights, undertakings, liabilities and obligations
of the parties hereunder shall be governed by and construed in accordance with
the laws of the State of New York.

     

    13. Each of the
Transferor and the Transferee agrees that the courts of the State of New York
are to have exclusive jurisdiction to settle any disputes that may arise in
connection with this Agreement.

     

    12

     

    

    
    


    APPENDIX

     

    
      	[Insert details of Transfer
      Notes.]	 	 
	 	 	
            	 	 
	 	
            	
            
	For and on behalf of the
      Transferring Holder	 	For and on behalf of the
      Transferee


    


     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    13

     

    

    
    


    SCHEDULE
6

     

    Restrictions
on Transfer of Loan Notes

     

    
      	(a)	     	
              Each Noteholder agrees that any proposed
      transfer of any Loan Notes, or any shares of Common Stock issuable upon
      conversion or exchange thereof, may be effected only (1)(w) inside the
      United States of America (I) to a person who the seller reasonably
      believes is a qualified institutional buyer within the meaning of Rule
      144A in a transaction meeting the requirements of Rule 144A, (II) in
      accordance with Rule 144 or (III) pursuant to another exemption from the
      registration requirements of the Securities Act, (x) to the Company, (y)
      outside the United States of America (A) to a non-U.S. person (within the
      meaning of Regulation S) in a transaction meeting the requirements of
      Regulation S or (B) pursuant to another exemption from the registration
      requirements of the Securities Act or (z) pursuant to an effective
      registration statement and (2) in each case, in accordance with the
      application securities laws of any state of the United States of America
      or any other application jurisdiction. Each Noteholder agrees to notify
      any purchaser of the resale restrictions set forth
      above.

            
	 
      
	(b)	
            	Prior
      to any Transfer or proposed Transfer of any Loan Notes, the Noteholder
      thereof shall deliver written notice to the Company in the form set out in
      Schedule 5 of such Noteholder’s intention to effect such transfer. If the
      transfer or proposed transfer is pursuant to clause (1)(w) or (1)(y) of
      the first sentence of the preceding paragraph, then upon receipt of such
      notice, the Company may request any or all of the following (each a Transfer Document) in a
      form reasonably acceptable to the Company:
	 
      
	 	
            	(i)	     	an
      agreement by such transferee to the impression of the restrictive
      investment legend set forth below on the Loan Note certificates, or any
      shares of Common Stock issuable upon conversion or exchange
      thereof;
	 
	 	
            	(ii)	
            	an
      agreement by such transferee, in form and substance reasonably
      satisfactory to the Company, to be bound by the provisions of this
      Schedule 6 relating to the transfer of such Loan Notes, or any shares of
      Common Stock issuable upon conversion or exchange thereof;
      and
	 
	 	
            	(iii)	
            	an
      opinion of counsel with expertise in securities law matters reasonably
      satisfactory to the Company that such transfer complies with applicable
      securities laws.
	 
	
            	
            	If the Company requests any Transfer Document(s), it shall do so as
      promptly as practicable following receipt of the Holder’s notice of
      intention to Transfer. The Company shall thereafter cause the Transfer to
      be recorded and a certificate or other evidence of ownership in the name
      of the transferee to be delivered as soon as practicable after it has
      received Transfer Documents complying with the terms of this
      Schedule.


    

     

    14

     

    

    
    


    
      	(c)	
            	The Noteholders agree that each
      certificate issued to evidence Loan Notes, or any shares of Common Stock
      issuable upon conversion of exchange thereof shall bear a legend to the
      following effect:
	 	 	 
	 	 	THE
      SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
      THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE ACT), OR ANY
      OTHER APPLICABLE SECURITIES LAWS AND HAVE BEEN ISSUED IN RELIANCE UPON AN
      EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
      SUCH OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
      PARTICIPATION HEREIN MAY BE SOLD, ASSIGNED, TRANSFERRED, PLEDGED,
      ENCUMBERED, OR OTHERWISE DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
      REGISTRATION STATEMENT UNDER THE ACT OR PURSUANT TO A TRANSACTION THAT IS
      EXEMPT FROM SUCH REGISTRATION.
	 
	 	
            	The
      foregoing legend shall be in addition to any other legend required by
      law.
	 
	(d)	     	The
      restrictions referenced in this Schedule, including the legend, shall
      cease and terminate as to any particular Loan Notes, or any shares Common
      Stock issuable upon conversion or exchange thereof when (x) such Loan
      Notes, or any shares Common Stock issuable upon conversion or exchange
      thereof have been transferred in a transaction pursuant to Rule 144 or a
      registration statement or (y) in the reasonable opinion of counsel for the
      Company, such restriction is no longer required in order to assure
      compliance with the Securities Act and applicable state securities laws.
      Whenever such restrictions shall cease and terminate as to any Notes, the
      Noteholder shall be entitled to received from the Company, without expense
      (other than applicable transfer taxes, if any, if such unlegended shares
      are being delivered and transferred to any person other than the
      registered Noteholder thereof), new certificates for a like number of
      Notes not bearing the relevant legend(s) set forth in this
      Schedule.


    

     

    15