Document:

mis_8k1130ex104.htm

    Exhibit
      10.4

    
 

     

    

     

    

     

    

     

    

     

    Securities
      Purchase Agreement

     

    By
      and Among

     

    Tontine
      Capital Partners, L.P.,

     

    Tontine
      Capital Overseas Master Fund, L.P.

     

    and

     

    Miscor
      Group, Ltd.

     

    

     

    

     

    

     

    November 30,
      2007

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    TABLE
      OF CONTENTS

     

    Page

     

    
      
        	
                ARTICLE
                  1

              	 	
                Definitions                                                                                                 

              	
                1

              
	
                ARTICLE
                  2

              	 	
                Purchase
                  and Sale of
                  Shares                                                                                                 

              	
                3

              
	
                2.1

              	 	
                Purchase
                  of
                  Shares                                                                                                 

              	
                3

              
	
                2.2

              	 	
                Purchase
                  Price and Form of Payment;
                  Delivery                                                                                                 

              	
                3

              
	
                2.3

              	 	
                Closing
                  Date                                                                                                 

              	
                3

              
	
                ARTICLE
                  3

              	 	
                Buyers’
                  Representations and
                  Warranties                                                                                                 

              	
                4

              
	
                3.1

              	 	
                Organization
                  and
                  Qualification                                                                                                 

              	
                4

              
	
                3.2

              	 	
                Authorization;
                  Enforcement                                                                                                 

              	
                4

              
	
                3.3

              	 	
                Securities
                  Matters                                                                                                 

              	
                4

              
	
                3.4

              	 	
                Information                                                                                                 

              	
                5

              
	
                3.5

              	 	
                Restrictions
                  on
                  Transfer                                                                                                 

              	
                5

              
	
                ARTICLE
                  4

              	 	
                Representations
                  and Warranties of the
                  Company                                                                                                 

              	
                5

              
	
                4.1

              	 	
                Organization
                  and
                  Qualification                                                                                                 

              	
                5

              
	
                4.2

              	 	
                Authorization;
                  Enforcement                                                                                                 

              	
                6

              
	
                4.3

              	 	
                Capitalization;
                  Valid Issuance of
                  Shares                                                                                                 

              	
                6

              
	
                4.4

              	 	
                No
                  Conflicts                                                                                                 

              	
                7

              
	
                4.5

              	 	
                SEC
                  Documents; Financial
                  Statements.                                                                                                 

              	
                7

              
	
                4.6

              	 	
                Absence
                  of Certain
                  Changes                                                                                                 

              	
                8

              
	
                4.7

              	 	
                Absence
                  of
                  Litigation                                                                                                 

              	
                8

              
	
                4.8

              	 	
                Patents,
                  Copyrights                                                                                                 

              	
                9

              
	
                4.9

              	 	
                Tax
                  Status                                                                                                 

              	
                9

              
	
                4.10

              	 	
                Permits;
                  Compliance.                                                                                                 

              	
                9

              
	
                4.11

              	 	
                Environmental
                  Matters                                                                                                 

              	
                10

              
	
                4.12

              	 	
                Title
                  to
                  Property                                                                                                 

              	
                10

              
	
                4.13

              	 	
                No
                  Investment Company or Real Property Holding Company

              	
                11

              
	
                4.14

              	 	
                No
                  Brokers                                                                                                 

              	
                11

              
	
                4.15

              	 	
                Registration
                  Rights                                                                                                 

              	
                11

              
	
                4.16

              	 	
                Exchange
                  Act
                  Registration                                                                                                 

              	
                11

              
	
                4.17

              	 	
                Labor
                  Relations                                                                                                 

              	
                11

              
	
                4.18

              	 	
                Transactions
                  with Affiliates and
                  Employees                                                                                                 

              	
                11

              
	
                4.19

              	 	
                Insurance                                                                                                 

              	
                11

              
	
                4.20

              	 	
                Approved
                  Acquisitions of Shares; No Anti-Takeover Provisions

              	
                12

              
	
                4.21

              	 	
                ERISA                                                                                                 

              	
                12

              
	
                4.22

              	 	
                Company
                  Shareholders of
                  Record                                                                                                 

              	
                12

              
	
                4.23

              	 	
                Disclosure                                                                                                 

              	
                12

              
	
                ARTICLE
                  5

              	 	
                Covenants                                                                                                 

              	
                12

              
	
                5.1

              	 	
                Form
                  D; Blue Sky
                  Laws                                                                                                 

              	
                12

              
	
                5.2

              	 	
                Use
                  of
                  Proceeds                                                                                                 

              	
                12

              
	
                5.3

              	 	
                Expenses                                                                                                 

              	
                12

              
	
                5.4

              	 	
                No
                  Integration                                                                                                 

              	
                13

              
	
                5.5

              	 	
                Board
                  Designee(s)                                                                                                 

              	
                13

              
	
                5.6

              	 	
                Observation
                  Rights                                                                                                 

              	
                13

              
	
                5.7

              	 	
                Participation
                  in Future
                  Issuances                                                                                                 

              	
                13

              
	
                5.8

              	 	
                Future
                  Acquisitions                                                                                                 

              	
                13

              
	
                5.9

              	 	
                Reverse
                  Stock Split and Amendment to Amended and Restated Articles of
                  Incorporation.

              	
                13

              
	
                ARTICLE
                  6

              	 	
                Conditions
                  To The Company’s
                  Obligation                                                                                                 

              	
                14

              
	
                6.1

              	 	
                Delivery
                  of Transaction
                  Documents                                                                                                 

              	
                14

              
	
                6.2

              	 	
                Payment
                  of Purchase
                  Price                                                                                                 

              	
                14

              
	
                6.3

              	 	
                Representations
                  and
                  Warranties                                                                                                 

              	
                14

              
	
                6.4

              	 	
                Litigation                                                                                                 

              	
                14

              
	
                ARTICLE
                  7

              	 	
                Conditions
                  to The Buyers’
                  Obligation                                                                                                 

              	
                14

              
	
                7.1

              	 	
                Delivery
                  of Transaction Documents; Issuance of Shares

              	
                14

              
	
                7.2

              	 	
                Martell
                  Option
                  Amendment                                                                                                 

              	
                15

              
	
                7.3

              	 	
                Representations
                  and
                  Warranties                                                                                                 

              	
                15

              
	
                7.4

              	 	
                Consents                                                                                                 

              	
                15

              
	
                7.5

              	 	
                Litigation                                                                                                 

              	
                15

              
	
                7.6

              	 	
                Opinion                                                                                                 

              	
                15

              
	
                7.7

              	 	
                No
                  Material Adverse
                  Change                                                                                                 

              	
                15

              
	
                7.8

              	 	
                Board
                  Approval                                                                                                 

              	
                15

              
	
                7.9

              	 	
                Irrevocable
                  Proxy                                                                                                 

              	
                15

              
	
                7.10

              	 	
                Closing
                  Certificate                                                                                                 

              	
                15

              
	
                7.11

              	 	
                Secretary’s
                  Certificate                                                                                                 

              	
                15

              
	
                7.12

              	 	
                Certificate
                  of
                  Existence                                                                                                 

              	
                16

              
	
                ARTICLE
                  8

              	 	
                Indemnification                                                                                                 

              	
                16

              
	
                8.1

              	 	
                Indemnification
                  by the
                  Company                                                                                                 

              	
                16

              
	
                8.2

              	 	
                Notification                                                                                                 

              	
                16

              
	
                ARTICLE
                  9

              	 	
                Governing
                  Law;
                  Miscellaneous                                                                                                 

              	
                16

              
	
                9.1

              	 	
                Governing
                  Law                                                                                                 

              	
                16

              
	
                9.2

              	 	
                Counterparts;
                  Electronic
                  Signatures                                                                                                 

              	
                17

              
	
                9.3

              	 	
                Headings                                                                                                 

              	
                17

              
	
                9.4

              	 	
                Severability                                                                                                 

              	
                17

              
	
                9.5

              	 	
                Entire
                  Agreement;
                  Amendments                                                                                                 

              	
                17

              
	
                9.6

              	 	
                Notices                                                                                                 

              	
                17

              
	
                9.7

              	 	
                Successors
                  and
                  Assigns                                                                                                 

              	
                18

              
	
                9.8

              	 	
                Third
                  Party
                  Beneficiaries                                                                                                 

              	
                18

              
	
                9.9

              	 	
                Publicity                                                                                                 

              	
                19

              
	
                9.10

              	 	
                Further
                  Assurances                                                                                                 

              	
                19

              
	
                9.11

              	 	
                No
                  Strict
                  Construction                                                                                                 

              	
                19

              
	
                9.12

              	 	
                Rights
                  Cumulative                                                                                                 

              	
                19

              
	
                9.13

              	 	
                Survival                                                                                                 

              	
                19

              
	
                9.14

              	 	
                Knowledge                                                                                                 

              	
                19

              

      

      

 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Securities
      Purchase Agreement

     

    

     

    This
      SECURITIES PURCHASE AGREEMENT, dated as of November 30, 2007, is entered into
      by
      and among MISCOR GROUP, LTD., an Indiana corporation (the
“Company”), and the investors identified on the
      signature page hereto (each a “Buyer” and
      collectively, the “Buyers”).

     

    Recitals:

     

    A.           The
      Buyers desire to provide financing to the Company, and the Company desires
      to
      obtain financing from the Buyers, upon the terms and conditions set forth in
      this Agreement, in connection with the Company’s proposed acquisition of 3D
      Services, Ltd. (“Target”);

     

    B.           To
      fund the above-described financing, the Buyers desire to purchase and the
      Company desires to issue and sell, upon the terms and conditions set forth
      in
      this Agreement, 83,333,333 shares of common stock, no par value per share of
      the
      Company; and

     

    C.           The
      Company and the Buyers are executing and delivering this Agreement in reliance
      upon the exemptions from securities registration afforded by Section 4(2) of
      the
      1933 Act and Rule 506;

     

    D.           In
      connection with the transactions contemplated by this Agreement, the Company
      and
      the Buyers desire to amend the Registration Rights Agreement.

     

    Agreement

     

    NOW
      THEREFORE, the Company and the Buyers hereby agree as follows:

     

     

    ARTICLE
      1

     

    Definitions

     

    “1933
      Act” means the Securities Act of 1933, as
      amended.

     

    “1934
      Act” means the Securities Exchange Act of 1934, as
      amended.

     

    “2007
      SEC Documents” has the meaning set forth in Section 3.4.

     

    “Action” means
      any action, suit claim, inquiry, notice of violation, proceeding (including
      any
      partial proceeding such as a deposition) or investigation against or affecting
      the Company, any of its Subsidiaries or any of their respective properties
      before or by any court, arbitrator, governmental or administrative agency,
      regulatory authority (federal, state, county, local or foreign), public board,
      stock market, stock exchange or trading facility.

     

    “Agreement” means
      this Securities Purchase Agreement.

     

    “Amended
      Registration Rights
      Agreement” means the Amended and Restated
      Registration Rights Agreement executed and delivered contemporaneously with
      this
      Agreement, pursuant to which the Company has agreed under certain circumstances
      to register the resale of the Shares and other shares of Common Stock held
      by
      the Buyers under the 1933 Act and the rules and regulations promulgated
      thereunder, and applicable state securities laws.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

     “Buyer”
      and “Buyers” have the meaning set forth in the
      preamble.

     

    “Closing”
      has the meaning set forth in Section 2.3.

     

    “Closing
      Date” has the meaning set forth in Section 2.3.

     

    “Common
      Stock” means the Company’s common stock, no par
      value per share.

     

    “Company”
      has the meaning set forth in the preamble.

     

    “Convertible
      Debentures Consent” has the meaning set forth in Section 4.4.

     

    “Environmental
      Laws” has the meaning set forth in Section 4.11.

     

    “ERISA”
      has the meaning set forth in Section 4.21.

     

    “GAAP”
      has the meaning set forth in Section 4.5.

     

    “Hazardous
      Materials” has the meaning set forth in Section 4.11.

     

    “Initial
      Securities Purchase Agreement” means the Securities Purchase
      Agreement, dated as of January 18, 2007, by and among the Company, TCP and
      TCOMF, pursuant to which the Company issued and sold, and TCP and TCOMF
      purchased, 62,500,000 shares of the Company’s common stock.

     

    “Intellectual
      Property” has the meaning set forth in Section
4.8.

     

    “Investment
      Company” has the meaning set forth in Section
4.13.

     

    “Legal
      Requirement” means any federal, state, local, municipal, foreign,
      international, multinational or other law, rule, regulation, order, judgment,
      decree, ordinance, policy or directive, including those entered, issued, made,
      rendered or required by any court, administrative or other governmental body,
      agency or authority, or any arbitrator.

     

    “Martell
      Option Amendment” means the amendment to the Conversion Option,
      dated September 12, 2005, among John A. Martell, Magnetech Industrial Services,
      Inc. and the Company.

     

    “Material
      Adverse Effect” means any material adverse effect on the business,
      operations, assets, financial condition or prospects of the
      Company.

     

    “Permits”
      has the meaning set forth in Section 4.10.

     

    “Per
      Share Purchase Price” means an
      amount equal to the lesser of (a) $0.24; and (b) the closing price of the
      Company’s Common Stock on the trading day one day prior to the earlier of (i)
      the Closing Date; and (ii) the announcement of the Closing.

     

    “Purchase
      Price” has the meaning given in Section 2.2.

     

    “Registration
      Rights Agreement” means the Registration Rights
      Agreement dated as of January 18, 2007, by and among the Company,
      TCP and TCOMF, pursuant to which the Company has agreed under certain
      circumstances to register the resale of the Shares under the 1933 Act and the
      rules and regulations promulgated thereunder, and applicable state securities
      laws.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Restated
      Irrevocable Proxy” has the meaning given in Section 7.9.

     

     “Rule
      506” means Rule 506 of Regulation D promulgated under the 1933
      Act.

     

    “SEC”
      means the United States Securities and Exchange Commission.

     

    “SEC
      Documents” has the meaning set forth in Section
4.5.

     

    “Shares”
      means the 83,333,333 shares of Common Stock being issued and sold under this
      Agreement.

     

    “Subsidiaries”
means
      with
      respect to the Company, Magnetech Industrial Services, Inc., an Indiana
      corporation, Martell Electric, LLC, an Indiana limited liability company, HK
      Engine Components, LLC, an Indiana limited liability company, Ideal
      Consolidated, Inc., an Indiana corporation and Magnetech Power Services, LLC,
      an
      Indiana limited liability company.

     

    “TCOMF”
      means Tontine Capital Overseas Master Fund, L.P., a Cayman Islands limited
      partnership.

     

    “TCP”
      means Tontine Capital Partners, L.P., a Delaware limited
      partnership.

     

    “Transaction
      Documents” means this Agreement, the Amended Registration Rights
      Agreement, the Martell Option Amendment and any other documents contemplated
      by
      this Agreement.

     

    “Transfer
      Instructions” has the meaning set forth in Section 2.2.

     

     

    ARTICLE
      2

     

     

    Purchase
      and Sale of Shares

     

    2.1  Purchase
      of Shares.  Subject to the terms and conditions of this Agreement,
      on the Closing Date, the Company shall issue and sell the Shares and each Buyer
      shall purchase from the Company the number of Shares as is set forth below
      such
      Buyer’s name on the signature page hereto.

     

    2.2  Purchase
      Price and Form of Payment; Delivery.  On the Closing Date each
      Buyer shall pay an amount per Share equal to the Per Share Purchase Price for
      each Share to be issued and sold to it at the Closing, for a total purchase
      price of $20,000,000 (the “Purchase
      Price”).  The Purchase Price shall be paid by wire
      transfer of immediately available funds in accordance with the Company’s written
      instructions.  At the Closing, upon payment of the Purchase Price
      therefore by the Buyers, the Company will deliver irrevocable written
      instructions (“Transfer Instructions”) to the transfer
      agent for the Company’s Common Stock to issue certificates representing the
      Shares registered in the name of each Buyer and to deliver such certificates
      to
      or at the direction of each Buyer.  The Company shall not have the
      power to revoke or amend the Transfer Instructions without the written consent
      of the Buyers.

     

    2.3  Closing
      Date.  Subject to the satisfaction (or written waiver) of the
      conditions set forth in Article 6 and Article 7 below,
      the closing of the transactions contemplated by this Agreement shall be held
      on
      November 30, 2007, or such other time as may be mutually agreed upon by the
      parties to this Agreement (the “Closing Date”), at the
      offices of Barack Ferrazzano Kirschbaum & Nagelberg LLP, 200 West Madison
      Street, Suite 3900, Chicago, Illinois 60606 or at
      such other location or by such other method (including exchange of signed
      documents) as may be mutually agreed upon by the parties to this Agreement
      (“Closing”).

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

     

    ARTICLE
      3

     

    Buyers’
      Representations and Warranties

     

    Each
      Buyer represents and warrants to the Company that:

     

    3.1  Organization
      and Qualification.  Each of the Buyers is an entity of the type
      identified on the signature page hereto, duly organized, validly existing and
      in
      good standing under the laws of the jurisdiction of its organization, with
      full
      power and authority to purchase the Shares and otherwise perform its obligations
      under this Agreement and the other Transaction Documents.

     

    3.2  Authorization;
      Enforcement.  This Agreement and each of the other Transaction
      Documents to be executed by the Buyers and the consummation of the transactions
      contemplated hereby and thereby have been duly and validly authorized by, and
      duly executed and delivered on behalf of, such Buyer.  This Agreement
      and each of the other Transaction Documents to be executed by the Buyers
      constitutes the valid and binding agreement of such Buyer enforceable in
      accordance with its terms, except as such enforceability may be limited
      by:  (i) applicable bankruptcy, insolvency, reorganization, moratorium
      or other similar laws in effect that limit creditors’ rights generally; (ii)
      equitable limitations on the availability of specific remedies; and (iii)
      principles of equity.

     

    3.3  Securities
      Matters.  In connection with the Company’s compliance with
      applicable securities laws:

     

    a.           Such
      Buyer understands that the Shares are being offered and sold to it in reliance
      upon specific exemptions from the registration requirements of United States
      and
      state securities laws and that the Company is relying upon the truth and
      accuracy of, and such Buyer’s compliance with, the representations, warranties,
      agreements, acknowledgments and understandings of such Buyer set forth herein
      in
      order to determine the availability of such exemption and the eligibility of
      such Buyer to acquire the Shares.

     

    b.           Such
      Buyer is purchasing the Shares for its own account, not as a nominee or agent,
      for investment purposes and not with a present view towards resale, except
      pursuant to sales exempted from registration under the 1933 Act, or registered
      under the 1933 Act as contemplated by the Registration Rights
      Agreement.

     

    c.           Such
      Buyer is an “accredited investor” as that term is defined in Rule 501(a) of
      Regulation D under the 1933 Act, and has such knowledge and experience in
      financial and business matters as to be capable of evaluating the merits and
      risks of an investment in the Shares.  Such Buyer understands that its
      investment in the Shares involves a significant degree of risk.  Such
      Buyer understands that no United States federal or state agency or any other
      government or governmental agency has passed upon or made any recommendation
      or
      endorsement of the Shares.

     

    d.           Such
      Buyer is not acting as an underwriter for the sale of the Shares to the public
      or to others.  Such Buyer is not a member of the National Association
      of Securities Dealers, Inc. (“NASD”) and for a period of 12 months prior to the
      date of this Agreement, has not been affiliated or associated with any company,
      firm, or other entity that is a member of the NASD.

     

    e.           Such
      Buyer is not executing this Agreement and purchasing the Shares as a result
      of
      (i) any advertisement, article, notice or other communication published in
      any
      newspaper, magazine or similar media or broadcast over television or radio,
      or
      (ii) any seminar or meeting whose attendees have been invited by any general
      solicitation or general advertising.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    3.4  Information.  Such
      Buyer has conducted its own due diligence examination of the Company’s business,
      financial condition, results of operations, and prospects.  In
      connection with such investigation, such Buyer and its representatives (i)
      have
      reviewed the Company’s annual report on Form 10-K for the year ended December
      31, 2006, the Company’s quarterly reports on Form 10-Q for the
      three most recently concluded interim periods, the
      Company’s Registration Statements on Form S-1 and Form S-1/A filed on November
      1, 2005, May 4, 2006, October 11, 2006, November 2, 2006 and July 13, 2007,
      the
      Company’s Registration Statements on Form S-8 filed on March 23, 2007 and June
      22, 2007 and the Company’s Current Reports on Form 8-K or Form 8-K/A filed in
      2007 (and all exhibits included therein and financial statements and schedules
      thereto and documents (other than exhibits to such documents) incorporated
      by
      reference therein, being hereinafter referred to herein as the “2007
      SEC Documents”), and (ii) have been given an opportunity to ask
      questions, to the extent such Buyer considered necessary, and have received
      answers from, officers of the Company concerning the business, finances and
      operations of the Company and information relating to the offer and sale of
      the
      Shares, and (iii) have received or had an opportunity to obtain such additional
      information as they deem necessary to make an informed investment decision
      with
      respect to the purchase of the Shares.

     

    3.5  Restrictions
      on Transfer.  Such Buyer understands that except as provided
      in the Registration Rights Agreement, the issuance of the Shares has not been
      and is not being registered under the 1933 Act or any applicable state
      securities laws. Such Buyer may be required to hold the Shares indefinitely
      and
      the Shares may not be transferred unless (i) the Shares are sold pursuant to
      an
      effective registration statement under the 1933 Act, or (ii) such Buyer shall
      have delivered to the Company an opinion of counsel to the effect that the
      Shares to be sold or transferred may be sold or transferred pursuant to an
      exemption from such registration, which opinion shall be reasonably acceptable
      to the Company. Such Buyer understands that until such time as the resale of
      the
      Shares has been registered under the 1933 Act as contemplated by the Amended
      Registration Rights Agreement or otherwise may be sold pursuant to an exemption
      from registration, certificates evidencing the Shares may bear a restrictive
      legend in substantially the following form (and a stop-transfer order may be
      placed against transfer of the certificates evidencing such
      Shares):

     

    “THE
      SHARES REPRESENTED BY THIS
      CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE FEDERAL SECURITIES ACT OF 1933,
      AS AMENDED, OR THE SECURITIES LAW OF ANY STATE.  THE SHARES MAY NOT BE
      SOLD OR OFFERED FOR SALE UNLESS THEY HAVE FIRST BEEN SO REGISTERED OR UNLESS
      THE
      COMPANY RECEIVES A WRITTEN OPINION FROM LEGAL COUNSEL ACCEPTABLE TO THE COMPANY
      THAT SUCH REGISTRATION IS NOT REQUIRED.”

     

     

    ARTICLE
      4

     

    Representations
      and Warranties of the Company

     

    Except
      as
      set forth in the Company’s Disclosure Schedule attached hereto, and subject to
      any information contained in the 2007 SEC Documents, the Company represents
      and
      warrants to the Buyers that:

     

    4.1  Organization
      and Qualification.  The Company has no subsidiaries other than the
      Subsidiaries.  The Company and each of its Subsidiaries is a
      corporation or limited liability company, as applicable, duly organized, validly
      existing and in good standing under the laws of the jurisdiction in which it
      is
      incorporated or organized, with corporate or limited liability company power
      and
      authority to own, lease, use and operate its properties and to carry on its
      business as now operated and conducted.  The Company and each of its
      Subsidiaries is duly qualified as a foreign corporation or limited liability
      company to do business and is in good standing in each jurisdiction in which
      its
      ownership or use of property or the nature of the business conducted by it
      makes
      such qualification necessary, except where the failure to be so qualified or
      in
      good standing would not have a Material Adverse Effect.  Neither the
      Company nor any Subsidiary is in violation of any provision of its respective
      certificate or articles of incorporation, partnership agreement, bylaws or
      other
      organizational or charter documents, as the same may have been
      amended.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    4.2  Authorization;
      Enforcement.  The Company has all requisite corporate power and
      authority to enter into and perform this Agreement and each of the other
      Transaction Documents to be executed by the Company and to consummate the
      transactions contemplated hereby and thereby and to issue the Shares, in
      accordance with the terms hereof and thereof.  The execution and
      delivery of this Agreement and each of the other Transaction Documents by the
      Company and the consummation by it of the transactions contemplated hereby
      and
      thereby (including without limitation, the issuance of the Shares) have been
      duly authorized by the Company’s Board of Directors and no further consent or
      authorization of the Company, its Board of Directors, or its shareholders is
      required.  This Agreement and each of the other Transaction Documents
      have been duly executed and delivered by the Company.  This Agreement
      and each of the other Transaction Documents will constitute upon execution
      and
      delivery by the Company, a legal, valid and binding obligation of the Company
      enforceable against the Company in accordance with its terms, except as such
      enforceability may be limited by:  (a) applicable bankruptcy,
      insolvency, reorganization, moratorium or other similar laws in effect that
      limit creditors’ rights generally; (b) equitable limitations on the availability
      of specific remedies; (c) principles of equity (regardless of whether such
      enforcement is considered in a proceeding in law or in equity); and (d) to
      the
      extent rights to indemnification and contribution may be limited by federal
      securities laws or the public policy underlying such laws.

     

    4.3  Capitalization;
      Valid Issuance of Shares.  As of the date hereof, and immediately
      prior to the closing of the Company’s proposed acquisition of Target, the
      authorized capital stock of the Company consists of 300,000,000 shares of Common
      Stock, of which 188,488,472 shares are issued and outstanding, and no
      shares are held by the Company as treasury shares, and 20,000,000 shares of
      preferred stock, of which no shares are issued and outstanding.  All
      of such outstanding shares of Common Stock are duly authorized, validly issued,
      fully paid and nonassessable.  The Shares have been duly authorized
      and when issued pursuant to the terms hereof will be validly issued, fully
      paid
      and nonassessable and will not be subject to any encumbrances, preemptive rights
      or any other similar contractual rights of the shareholders of the Company
      or
      any other person.  No shares of capital stock of the Company are
      subject to preemptive rights or any other similar rights of the shareholders
      of
      the Company or any liens or encumbrances imposed through the actions or failure
      to act of the Company.  As of the date hereof, and immediately prior
      to the closing of the Company’s proposed acquisition of Target, the Company had
      outstanding warrants to purchase 8,161,542 shares of Common Stock, 8,752,026
      shares issuable upon the conversion of the Company’s subordinated debt, options
      to purchase 1,815,000 shares of Common Stock issued under its 2005 Stock Option
      Plan, as well as 405,000 shares of restricted Common Stock issued under its
      2005
      Restricted Stock Plan.  As of the date of this Agreement, except to
      the extent described in the preceding sentence and Schedule 4.3 attached hereto, (i) there are
      no
      outstanding options, warrants, scrip, rights to subscribe for, puts, calls,
      rights of first refusal, agreements, understandings, claims or other commitments
      or rights of any character whatsoever relating to, or securities or rights
      convertible into or exchangeable for any shares of capital stock of the Company
      or any of its Subsidiaries, or arrangements by which the Company or any of
      its
      Subsidiaries is or may become bound to issue additional shares of capital stock,
      (ii) there are no agreements or arrangements under which the Company or any
      of
      its Subsidiaries is obligated to register the sale of any of its or their
      securities under the 1933 Act (except the Amended Registration Rights
      Agreement), and (iii) there are no anti-dilution or price adjustment provisions
      contained in any security issued by the Company (or in any agreement providing
      rights to security holders other than the Initial Securities Purchase Agreement)
      that will be triggered by the issuance of the Shares.  Except (x) for
      the Restated Irrecvocable Proxy, (y) as set forth in Section 5.9 below, or (z) as may be described
      in any
      documents which have been publicly filed by any of the Company's shareholders,
      to the Company’s knowledge, there are no agreements between the Company’s
      shareholders with respect to the voting or transfer of the Company’s capital
      stock or with respect to any other aspect of the Company’s
      affairs.  The Martell Option Amendment has been executed and delivered
      by all parties thereto and is in full force and effect.

     

    
      
        
        

      

      
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    4.4  No
      Conflicts.  The execution, delivery and performance of this
      Agreement and each of the other Transaction Documents by the Company and the
      consummation by the Company of the transactions contemplated hereby and thereby
      (including, without limitation, the issuance of Shares) will not (a) conflict
      with or result in a violation of any provision of the Amended and Restated
      Articles of Incorporation, as amended, of the Company or the Amended and
      Restated Code of By-Laws, as amended, of the Company, (b) violate or conflict
      with, or result in a breach of any provision of, or constitute a default (or
      an
      event which with notice or lapse of time or both could become a default) under,
      or give to others any rights of termination, amendment, acceleration or
      cancellation of, any material agreement, indenture, patent, patent license
      or
      instrument to which the Company or any of its Subsidiaries is a party, or (c)
      result in a violation of any Legal Requirement (including federal and state
      securities laws and regulations and regulations of any self-regulatory
      organizations to which the Company or its securities are subject) applicable
      to
      the Company or any of its Subsidiaries or by which any property or asset of
      the
      Company or any of its Subsidiaries is bound or affected (except for such
      conflicts, defaults, terminations, amendments, accelerations, cancellations
      and
      violations as would not, individually or in the aggregate, have a Material
      Adverse Effect).  Neither the Company nor any of its Subsidiaries is
      in violation of its Certificate or Articles of Incorporation, bylaws or other
      organizational documents and neither the Company nor any of its Subsidiaries
      is
      in default (and no event has occurred which with notice or lapse of time would
      result in a default) under, and neither the Company nor any of its Subsidiaries
      has taken any action or failed to take any action that would give to others
      any
      rights of termination, amendment, acceleration or cancellation of, any agreement
      or instrument to which the Company or any of its Subsidiaries is a party or
      by
      which any property or assets of the Company or any of its Subsidiaries is bound
      or affected, except for possible defaults as would not, individually or in
      the
      aggregate, have a Material Adverse Effect.  Except (x) for any
      consents required to be provided by the holders of the Company’s 6% subordinated
      convertible debentures, due February 28, 2008 (the “Convertible
      Debentures Consent”), and (y) with respect to any filings or
      notices related to the issuance of the Shares to be filed with the OTC Bulletin
      Board, if any, and as required under the 1933 Act and any applicable state
      securities laws, the Company is not required to obtain any consent,
      authorization or order of, or make any filing or registration with, any court,
      governmental agency, regulatory agency, self regulatory organization or stock
      market or any third party in order for it to execute, deliver or perform any
      of
      its obligations under the Transaction Documents.  All consents,
      authorizations, orders, filings and registrations that the Company is required
      to effect or obtain pursuant to the preceding sentence have been obtained or
      effected on or prior to the date hereof.  

     

    4.5  SEC
      Documents; Financial Statements.  

     

    a.  Since
      December 31, 2004, the Company has timely filed all reports, schedules, forms,
      statements and other documents required to be filed by it with the SEC pursuant
      to the reporting requirements of the 1933 Act and the 1934 Act (all of the
      foregoing filed prior to the date hereof and all exhibits included therein
      and
      financial statements and schedules thereto and documents (other than exhibits
      to
      such documents) incorporated by reference therein, being hereinafter referred
      to
      herein as the “SEC Documents”), or has timely filed
      for a valid extension of such time of filing and has filed any such SEC
      Documents prior to the expiration of any such extension.  As of their
      respective dates, the SEC Documents complied in all material respects with
      the
      requirements of the Securities Act and the Exchange Act and the rules and
      regulations of the SEC promulgated thereunder applicable to the SEC Documents,
      and none of the SEC Documents, at the time they were filed with the SEC,
      contained any untrue statement of a material fact or omitted to state a material
      fact required to be stated therein or necessary in order to make the statements
      therein, in light of the circumstances under which they were made, not
      misleading.

     

    
      
        
        

      

      
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    b.  As
      of
      their respective dates, the financial statements of the Company included in
      the
      SEC Documents complied as to form in all material respects with applicable
      accounting requirements and the published rules and regulations of the SEC
      with
      respect thereto.  Such financial statements have been prepared in
      accordance with United States generally accepted accounting principles
      (“GAAP”), consistently applied, during the periods involved
      (except (i) as may be otherwise indicated in such financial statements or the
      notes thereto, or (ii) in the case of unaudited interim statements, to the
      extent they may not include footnotes, year end adjustments or may be condensed
      or summary statements) and fairly present in all material respects the
      consolidated financial position of the Company and its consolidated Subsidiaries
      as of the dates thereof and the consolidated results of their operations and
      cash flows for the periods then ended (subject, in the case of unaudited
      statements, to normal year-end audit adjustments).  Except as set
      forth in the financial statements of the Company included in the SEC Documents,
      the Company has no liabilities, contingent or otherwise, other than (i)
      liabilities incurred in the ordinary course of business subsequent to September
      30, 2007, and (ii) obligations under contracts and commitments incurred in
      the
      ordinary course of business and not required under GAAP to be reflected in
      such
      financial statements, which, individually or taken in the aggregate would not
      reasonably be expected to have a Material Adverse Effect.

     

    c.  The
      Company has established and maintains disclosure controls and procedures (as
      such term is defined in Rule 13a-15(e) under the 1934 Act).  Such
      disclosure controls and procedures:  (A) are designed to ensure that
      material information relating to the Company and its Subsidiaries is made known
      to the Company’s chief executive officer and its chief financial officer by
      others within those entities, particularly during the periods in which the
      Company’s reports and filings under the 1934 Act are being prepared, (B) have
      been evaluated for effectiveness as of the end of the most recent annual period
      reported to the SEC, and (C) are effective to perform the functions for which
      they were established.  Neither the auditors of the Company nor the
      Board of Directors of the Company has been advised of: (x) any significant
      deficiencies or material weaknesses in the design or operation of the internal
      controls over financial reporting (as such term is defined in Rule 13a-15(f)
      under the 1934 Act) of the Company that have materially affected the Company’s
      internal control over financial reporting; or (y) any fraud, whether or not
      material, that involves management or other employees who have a role in the
      internal controls over financial reporting of the Company

     

    4.6  Absence
      of Certain Changes.  Except for the transactions contemplated by
      the Transaction Documents, or as set forth on Schedule 4.6, since December 31,
      2006, (a) the
      Company and each of its Subsidiaries has conducted its business only in the
      ordinary course, consistent with past practice, and since that date, no changes
      have occurred which would reasonably be expected to have a Material Adverse
      Effect; and (b) the Company has not incurred any liabilities (contingent or
      otherwise) other than: (i) trade payables, accrued expenses and other
      liabilities incurred in the ordinary course of business consistent with past
      practice, and (i) liabilities not required to be reflected on the Company’s
      financial statements pursuant to GAAP or required to be disclosed in filings
      made with the SEC.

     

    4.7  Absence
      of Litigation.  Except as set forth in Schedule 4.7, there
      is no Action pending or, to the knowledge of the Company or any of its
      Subsidiaries, threatened against or affecting the Company or any of its
      Subsidiaries that (a) adversely affects or challenges the legality, validity
      or
      enforceability of this Agreement, or (b) would, if there were an unfavorable
      decision, have or reasonably be expected to have a Material Adverse
      Effect.  Neither the Company nor any of its Subsidiaries, nor any
      director or officer thereof (in his or her capacity as such), is or has been
      the
      subject of any Action involving a claim of violation of or liability under
      federal or state securities laws or a claim of breach of fiduciary
      duty.  There has not been, and to the knowledge of the Company, there
      is not pending any investigation by the SEC involving the Company or any current
      or former director or officer of the Company (in his or her capacity as
      such).  The SEC has not issued any stop order or other order
      suspending the effectiveness of any registration statement filed by the Company
      under the 1934 Act or the 1933 Act.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    4.8  Patents,
      Copyrights.  The Company and each of its Subsidiaries owns or
      possesses the requisite licenses or rights to use all patents, patent
      applications, patent rights, inventions, know-how, trade secrets, copyrights,
      trademarks, trademark applications, service marks, service names, trade names
      and copyrights (“Intellectual Property”) necessary to
      enable it to conduct its business as now operated (and, to the Company’s
      knowledge, as presently contemplated to be operated in the future); there is
      no
      claim or Action by any person pertaining to, or proceeding pending, or to the
      Company’s knowledge threatened, which challenges the right of the Company or of
      a Subsidiary with respect to any Intellectual Property necessary to enable
      it to
      conduct its business as now operated and to the Company’s knowledge, the
      Company’s or its Subsidiaries’ current products and processes do not infringe on
      any Intellectual Property or other rights held by any person, except where
      any
      such infringement would not reasonably be expected to have a Material Adverse
      Effect.

     

    4.9  Tax
      Status.  The Company and each of its Subsidiaries has made or
      filed all federal, state and foreign income and all other material tax returns,
      reports and declarations required by any jurisdiction to which it is subject
      (unless and only to the extent that the Company and each of its Subsidiaries
      has
      set aside on its books provisions reasonably adequate for the payment of all
      unpaid and unreported taxes) and has paid all taxes and other governmental
      assessments and charges that are material in amount, shown or determined to
      be
      due on such returns, reports and declarations, except those being contested
      in
      good faith and has set aside on its books provisions reasonably adequate for
      the
      payment of all taxes for periods subsequent to the periods to which such
      returns, reports or declarations apply.  There are no unpaid taxes in
      any material amount claimed to be due by the taxing authority of any
      jurisdiction, and the officers of the Company know of no basis for any such
      claim.  The Company has not executed a waiver with respect to the
      statute of limitations relating to the assessment or collection of any foreign,
      federal, state or local tax.

     

    4.10  Permits;
      Compliance.

     

    a.  The
      Company and each of its Subsidiaries is in possession of all franchises, grants,
      authorizations, licenses, permits, easements, variances, exemptions, consents,
      certificates, approvals and orders necessary to own, lease and operate its
      properties and to carry on its business as it is now being conducted
      (collectively, “Permits”), and there is no Action
      pending or, to the knowledge of the Company, threatened regarding suspension
      or
      cancellation of any of the Permits.  Neither the Company nor any of
      its Subsidiaries is in conflict with, or in default or violation of, any of
      the
      Permits, except for any such conflicts, defaults or violations which,
      individually or in the aggregate, would not reasonably be expected to have
      a
      Material Adverse Effect.

     

    b.  Since
      December 31, 2006, no event has occurred or, to the knowledge of the Company,
      circumstance exists that (with or without notice or lapse of time): (i) would
      reasonably be expected to constitute or result in a violation by the Company
      or
      any of its Subsidiaries, or a failure on the part of the Company or its
      Subsidiaries to comply with, any Legal Requirement; or (ii) would reasonably
      be
      expected to give rise to any obligation on the part of the Company or any of
      its
      Subsidiaries to undertake, or to bear all or any portion of the cost of, any
      remedial action of any nature in connection with a failure to comply with any
      Legal Requirement, except in either case that would not reasonably be expected
      to have a Material Adverse Effect.  Neither the Company nor any of its
      Subsidiaries has received any notice or other communication from any regulatory
      authority or any other person, nor does the Company have any knowledge
      regarding: (x) any actual, alleged, possible or potential violation of, or
      failure to comply with, any Legal Requirement, or (y) any actual, alleged,
      possible or potential obligation on the part of the Company or any of its
      Subsidiaries to undertake, or to bear all or any portion of the cost of, any
      remedial action of any nature in connection with a failure to comply with any
      Legal Requirement, except in either case that would not reasonably be expected
      to have a Material Adverse Effect.

     

    
      
        
        

      

      
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    c.  The
      Company is in compliance in all material respects with the provisions of the
      Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated thereunder
      that are applicable to it and has taken reasonable steps such that the Company
      expects to be in a position to comply with the requirements of Section 404
      of
      the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated
      thereunder at such time as Section 404 becomes applicable to the
      Company.

     

    d.  The
      Company is, and has reason to believe that for the foreseeable future it will
      continue to be, in compliance with all applicable rules of the OTC Bulletin
      Board.  The Company has not received notice from the OTC Bulletin
      Board that the Company is not in compliance with the rules or requirements
      thereof.  The issuance and sale of the Shares under this Agreement
      does not contravene the rules and regulations of the OTC Bulletin Board, and
      no
      approval of the shareholders of the Company is required for the Company to
      issue
      the Shares as contemplated by this Agreement.

     

    4.11  Environmental
      Matters.  “Environmental Laws” shall
      mean, collectively, all Legal Requirements, including any federal, state, local
      or foreign statute, laws, rule, regulation, ordinance, code, policy or rule
      of
      common law or any judicial or administrative interpretation thereof, including
      any judicial or administrative order, consent, decree or judgment, relating
      to
      pollution or protection of human health, the environment (including, without
      limitation, ambient air, surface water, groundwater, land surface or subsurface
      strata) or wildlife, including, without limitation, laws and regulations
      relating to the release or threatened release of chemicals, pollutants,
      contaminants, wastes, toxic substances, hazardous substances, petroleum or
      petroleum products (collectively, “Hazardous
      Materials”) or to the manufacture, processing, distribution, use,
      treatment, storage, disposal, transport or handling of Hazardous
      Materials.  Except for such matters as could not, singly or in the
      aggregate, reasonably be expected to result in a Material Adverse Effect or
      as
      set forth on Schedule 4.11: (a) the Company and its Subsidiaries have
      complied and are in compliance with all applicable Environmental Laws; (b)
      without limiting the generality of the foregoing, the Company and its
      Subsidiaries have obtained, have complied, and are in compliance with all
      Permits that are required pursuant to Environmental Laws for the occupation
      of
      their respective facilities and the operation of their respective businesses;
      (c) none of the Company or its Subsidiaries has received any written notice,
      report or other information regarding any actual or alleged violation of
      Environmental Laws, or any liabilities or potential liabilities (including
      fines, penalties, costs and expenses), including any investigatory, remedial
      or
      corrective obligations, relating to any of them or their respective facilities
      arising under Environmental Laws, nor, to the knowledge of the Company is there
      any factual basis therefore; (d) there are no underground storage tanks,
      polychlorinated biphenyls, urea formaldehyde or other hazardous substances
      (other than small quantities of hazardous substances for use in the ordinary
      course of the operation of the Company’s and its Subsidiaries’ respective
      businesses, which are stored and maintained in accordance and in compliance
      with
      all applicable Environmental Laws), in, on, over, under or at any real property
      owned or operated by the Company and/or its Subsidiaries; (e) there are no
      conditions existing at any real property or with respect to the Company or any
      of its Subsidiaries that require remedial or corrective action, removal,
      monitoring or closure pursuant to the Environmental Laws; and (f) to the
      knowledge of the Company, neither the Company nor any of its Subsidiaries has
      contractually, by operation of law, or otherwise amended or succeeded to any
      liabilities arising under any Environmental Laws of any predecessors or any
      other Person.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    4.12  Title
      to Property.  The Company and its Subsidiaries have good and
      marketable title to all real property and all personal property owned by them
      which is material to the business of the Company and its
      Subsidiaries.  Any leases of real property and facilities of the
      Company and its Subsidiaries are valid and effective in accordance with their
      respective terms, except as would not have a Material Adverse
      Effect.

     

    4.13  No
      Investment Company or Real Property Holding Company.  The Company
      is not, and upon the issuance and sale of the Shares as contemplated by this
      Agreement will not be, an “investment company” as defined under the Investment
      Company Act of 1940 (“Investment
      Company”).  The Company is not controlled by an
      Investment Company.  The Company is not a United States real property
      holding company, as defined under the Internal Revenue Code of 1986, as
      amended.

     

    4.14  No
      Brokers.  The Company has taken no action which would give rise to
      any claim by any person for brokerage commissions, transaction fees or similar
      payments relating to this Agreement or the transactions contemplated
      hereby.

     

    4.15  Registration
      Rights.  Except pursuant to the Amended Registration Rights
      Agreement, and as otherwise set forth in Schedule 4.15 effective upon the
      Closing, neither the Company nor any Subsidiary is currently subject to any
      agreement providing any person or entity any rights (including piggyback
      registration rights) to have any securities of the Company or any Subsidiary
      registered with the SEC or registered or qualified with any other governmental
      authority.

     

    4.16  Exchange
      Act Registration.  The Common Stock is registered pursuant to the
      1934 Act, and the Company has taken no action designed to, or which, to the
      knowledge of the Company, is likely to have the effect of, terminating the
      registration of the Common Stock under the 1934 Act.

     

    4.17  Labor
      Relations.  No labor or employment dispute exists or, to the
      knowledge of the Company, is imminent or threatened, with respect to any of
      the
      employees of the Company that has, or could reasonably be expected to have,
      individually or in the aggregate, a Material Adverse Effect.

     

    4.18  Transactions
      with Affiliates and Employees.  Except as set forth in the SEC
      Documents, and Schedule 4.18, none of the officers or directors of the
      Company, and to the knowledge of the Company, none of the employees of the
      Company, is presently a party to any transaction or agreement with the Company
      (other than for services as employees, officers and directors) exceeding
      $60,000, including any contract, agreement or other arrangement providing for
      the furnishing of services to or by, providing for rental of real or personal
      property to or from, or otherwise requiring payments to or from any officer,
      director or such employee or, to the knowledge of the Company, any entity in
      which any officer, director, or any such employee has a substantial interest
      or
      is an officer, director, trustee or partner.

     

    4.19  Insurance.  The
      Company and its Subsidiaries have insurance policies in full force and effect
      of
      a type, covering such risks and in such amounts, and having such deductibles
      and
      exclusions as are customary for conducting businesses and owning assets similar
      in nature and scope to those of the Company and its Subsidiaries.  The
      amounts of all such insurance policies and the risks covered thereby are in
      accordance in all material respects with all material contracts and agreements
      to which the Company and/or its Subsidiaries is a party and with all applicable
      Legal Requirements.  With respect to each such insurance
      policy:  (a) the policy is valid, outstanding and enforceable in
      accordance with its terms, except as such enforceability may be limited by
      applicable bankruptcy, insolvency, reorganization, moratorium or other similar
      laws in effect that limit creditors’ rights generally, equitable limitations on
      the availability of specific remedies and principles of equity (regardless
      of
      whether such enforcement is considered in a proceeding in law or in equity);
      (b)
      neither the Company nor any of its Subsidiaries is in breach or default with
      respect to its obligations thereunder in any material respect; and (c) no party
      to the policy has repudiated, or given notice of an intent to repudiate, any
      provision thereof.

     

    
      
        
        

      

      
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    4.20  Approved
      Acquisitions of Shares; No Anti-Takeover Provisions.  The Board of
      Directors of the Company has unanimously approved this Agreement and taken
      all
      other requisite action such that the provisions of any anti-takeover laws and
      regulations of any governmental authority, including without limitation, the
      applicable provisions of the IBCL, and that any provisions of an anti-takeover
      nature adopted by the Company or any of its Subsidiaries or contained in the
      Company’s Amended and Restated Articles of Incorporation, Amended and Restated
      Code of Bylaws or the organizational documents of any of its Subsidiaries,
      will
      not apply to the Buyers, this Agreement or any of the other Transaction
      Documents.

     

    4.21  ERISA.  Based
      upon the Employee Retirement Income Security Act of 1974
      (“ERISA”), and the regulations and published
      interpretations thereunder: (a) neither the Company nor any of its Subsidiaries
      has engaged in any Prohibited Transactions (as defined in Section 406 of ERISA
      and Section 4975 of the Code); (b) the Company and each of its Subsidiaries
      has
      met all applicable minimum funding requirements under Section 302 of ERISA
      in
      respect to its plans; (c) neither the Company nor any of its Subsidiaries has
      any knowledge of any event or occurrence which would cause the Pension Benefit
      Guaranty Corporation to institute proceedings under Title IV of ERISA to
      terminate any employee benefit plan(s); neither the Company nor any of its
      Subsidiaries has any fiduciary responsibility for investments with respect
      to
      any plan existing for the benefit of persons other than its or such Subsidiary’s
      employees; and (e) neither the Company nor any of its Subsidiaries has
      withdrawn, completely or partially, from any multi-employer pension plan so
      as
      to incur liability under the Multiemployer Pension Plan Amendments Act of
      1980.

     

    4.22  Company
      Shareholders of Record.  As of November 28, 2007, the Company had
      87 “shareholders” as defined in Section 4 of Chapter 42 of the IBCL, and is
      not considered an “Issuing Public Corporation” for purposes of Chapter 42 of the
      IBCL.

     

    4.23  Disclosure.  The
      Company understands and confirms that the Buyers will rely on the
      representations and covenants contained herein in effecting the transactions
      contemplated by this Agreement and the other Transaction
      Documents.  All representations and warranties provided to the Buyers
      including the disclosures in the Company’s disclosure schedules attached hereto
      furnished by or on behalf of the Company, taken as a whole are true and correct
      and do not contain any untrue statement of material fact or omit to state any
      material fact necessary in order to make the statements made therein, in the
      light of the circumstances under which they were made, not
      misleading.  No event or circumstance has occurred or information
      exists with respect to the Company or its Subsidiaries or its or their
      businesses, properties, prospects, operations or financial conditions, which,
      under applicable law, rule or regulation, requires public disclosure or
      announcement by the Company but which has not been so publicly announced or
      disclosed.

     

     

    ARTICLE
      5

     

    Covenants

     

    5.1  Form
      D; Blue Sky Laws.  Upon completion of the Closing, the Company
      shall file with the SEC a Form D with respect to the Shares as required under
      Regulation D and each applicable state securities commission and will provide
      a
      copy thereof to the Buyers promptly after such filing.

     

    5.2  Use
      of
      Proceeds.  The Company shall use the proceeds from the sale of the
      Securities to complete the Acquisition and for other general business
      purposes.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    5.3  Expenses.  At
      the Closing, the Company shall reimburse the Buyers for all reasonable expenses
      incurred by them in connection with the negotiation, preparation, execution,
      delivery and performance of this Agreement and the other Transaction Documents
      and its due diligence review of the Company, including, without limitation,
      reasonable attorneys’ fees and expenses, and out-of-pocket travel costs and
      expenses.

     

    5.4  No
      Integration.  The Company shall not make any offers or sales of
      any security (other than the Shares) under circumstances that would require
      registration of the Shares being offered or sold hereunder under the 1933 Act
      or
      cause the offering of the Shares to be integrated with any other offering of
      securities by the Company in such a manner as would require the Company to
      seek
      the approval of its stockholders for the issuance of the Shares under any
      stockholder approval provision applicable to the Company or its
      securities.

     

    5.5  Board
      Designee(s).  The parties hereto acknowledge and affirm that the
      Buyers shall have the right to appoint certain members of the Board of Directors
      as set forth in Section 5.6 of the Initial Securities Purchase
      Agreement.

     

    5.6  Observation
      Rights.  The parties hereto acknowledge and affirm that the Buyers
      shall have Observation Rights (as defined in the Initial Securities Purchase
      Agreement) as set forth in Section 5.7 of the Initial Securities Purchase
      Agreement.

     

    5.7   Participation
      in Future Issuances.  The parties hereto acknowledge and affirm
      that the Buyers shall have the right to participate in any Future Offerings
      (as
      defined in the Initial Securities Purchase Agreement) as provided in Section
      5.7
      of the Initial Securities Purchase Agreement.

     

    5.8  Future
      Acquisitions.  The Company shall not revoke its approval (pursuant
      to Section 7.8 hereof) of the
      acquisition of up to fifty percent (50%) of the Common Stock on a fully diluted
      basis by the Buyers.  The Company shall use its best efforts to ensure
      that any future acquisitions of Common Stock by the Buyers (up to fifty percent
      (50%)) of the of the outstanding Common Stock on a fully diluted basis) shall
      not be made subject to the provisions of any anti-takeover laws and regulations
      of any governmental authority, including without limitation, the applicable
      provisions of the IBCL, and any provisions of an anti-takeover nature adopted
      by
      the Company or any of its Subsidiaries or contained in the Company’s Amended and
      Restated Articles of Incorporation, Amended and Restated Code of Bylaws or
      the
      organizational documents of any of its Subsidiaries.  The Buyers
      acknowledge and agree that they will obtain written approval from the Company’s
      Board of Directors before the Buyer and their affiliates acquire in excess
      of
      fifty percent (50%) of the Common Stock computed on a fully-diluted basis,
      provided, however that this covenant shall not apply to (a) any increase in
      the
      percentage ownership of Common Stock of the Buyers and their affiliates due
      to a
      redemption or repurchase by the Company of any of its Common Stock, or (b)
      any
      instances where the Buyers and their affiliates inadvertently acquires in excess
      of fifty percent (50%) of the Common Stock on a fully-diluted basis, provided
      that in such case the Buyers shall notify the Company in writing promptly upon
      discovery of such inadvertent acquisition, and the Buyers and their affiliates
      shall promptly take all such actions as are necessary to cure such circumstance
      within thirty (30) days of providing such notice unless the Company’s Board of
      Directors approves such inadvertent acquisition.

     

    5.9  Reverse
      Stock Split and Amendment to Amended and Restated Articles of
      Incorporation.

     

    a.  The
      Buyers acknowledge that the Company intends to effect a 1-for-25 reverse stock
      split of its Common Stock shortly after the date of this Agreement that would
      result in a reduction in the Company’s authorized Common Stock from three
      hundred million (300,000,000) shares to twelve million (12,000,000) shares
      and
      the redemption by the Company of any fractional shares resulting from the
      reverse stock split.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    b.  The
      Company agrees to use its reasonable best efforts to call a meeting of the
      Company’s shareholders, not later than one hundred twenty (120) days after the
      date of this Agreement, for the purpose of voting on an amendment to the
      Company’s Amended and Restated Articles of Incorporation to increase the number
      of authorized shares of Common Stock thereunder: (i) from twelve million
      (12,000,000) shares to twenty million (20,000,000) shares if the Company
      completes the reverse stock split described in Section 5.9(a)
      above, and (ii) from three hundred
      million (300,000,000) shares to five hundred million (500,000,000) shares if
      the
      Company fails to complete the reverse stock split described in Section 5.9(a)
      above within one hundred twenty (120)
      days after the date of this Agreement.  The Buyers agree to vote all
      shares of Common Stock over which the Buyers have voting control in favor of
      either such proposal to amend the Company’s Amended and Restated Articles of
      Incorporation.

     

     

    ARTICLE
      6

     

    Conditions
      To The Company’s Obligation

     

    The
      obligation of the Company hereunder to issue and sell the Shares to the Buyers
      at the Closing is subject to the satisfaction, at or before the Closing Date,
      of
      each of the following conditions thereto, provided that these conditions are
      for
      the Company’s sole benefit and may be waived by the Company at any time in its
      sole discretion:

     

    6.1  Delivery
      of Transaction Documents.  The Buyers shall have executed and
      delivered the Transaction Documents to the Company.

     

    6.2  Payment
      of Purchase Price.  The Buyers shall have delivered the Purchase
      Price in accordance with Section 2.2
      above.

     

    6.3  Representations
      and Warranties.  The representations and warranties of the Buyers
      shall be true and correct in all material respects (provided, however, that
      such
      qualification shall only apply to representations or warranties not otherwise
      qualified by materiality) as of the date when made and as of the Closing Date
      as
      though made at that time (except for representations and warranties that speak
      as of a specific date), and the applicable Buyer shall have performed, satisfied
      and complied in all material respects with the covenants, agreements and
      conditions required by this Agreement to be performed, satisfied or complied
      with by the applicable Buyer at or prior to the Closing Date.

     

    6.4  Litigation.  No
      litigation, statute, rule, regulation, executive order, decree, ruling or
      injunction shall have been enacted, entered, promulgated or endorsed by or
      in
      any court or governmental authority of competent jurisdiction or any
      self-regulatory organization having authority over the matters contemplated
      hereby which prohibits the consummation of any of the transactions contemplated
      by this Agreement.

     

     

    ARTICLE
      7

     

    Conditions
      to The Buyers’ Obligation

     

    The
      obligation of the Buyers hereunder to purchase the Shares at the Closing is
      subject to the satisfaction, at or before the Closing Date, of each of the
      following conditions, provided that these conditions are for the Buyers’ sole
      benefit and may be waived by the Buyers at any time in its sole
      discretion:

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    7.1  Delivery
      of Transaction Documents; Issuance of Shares.  The Company shall
      have executed and delivered the Transaction Documents to the Buyers, and shall
      deliver the Transfer Instructions to the transfer agent for the Company’s Common
      Stock to issue certificates in the name of each Buyer representing the Shares
      being purchased by such Buyer.  The Company shall deliver a copy of
      the Transfer Instructions to the Buyers at the Closing.

     

    7.2  Martell
      Option Amendment.  The Martell Option Amendment shall have been
      executed and delivered by all parties thereto and shall be in full force and
      effect, and a copy thereof shall have been provided to the Buyers.

     

    7.3  Representations
      and Warranties.  The representations and warranties of the Company
      shall be true and correct in all material respects (provided, however, that
      such
      qualification shall only apply to representations or warranties not otherwise
      qualified by materiality) as of the date when made and as of the Closing Date
      as
      though made at such time (except for representations and warranties that speak
      as of a specific date) and the Company shall have performed, satisfied and
      complied in all material respects with the covenants, agreements and conditions
      required by this Agreement to be performed, satisfied or complied with by the
      Company at or prior to the Closing Date.

     

    7.4  Consents.  Any
      consents or approvals required to be secured by the Company for the consummation
      of the transactions contemplated by the Transaction Documents, including, but
      not limited to, the Subordinated Debenture Consent, shall have been obtained
      and
      shall be reasonably satisfactory to the Buyers.

     

    7.5  Litigation.  No
      Action shall have been enacted, entered, promulgated or endorsed by or in any
      court or governmental authority of competent jurisdiction or any self-regulatory
      organization having authority over the matters contemplated hereby which
      prohibits the consummation of any of the transactions contemplated by this
      Agreement.

     

    7.6  Opinion.  The
      Buyers shall have received an opinion of the Company’s counsel, dated as of the
      Closing Date, in form, scope and substance reasonably satisfactory to the Buyers
      with respect to the matters set forth in Exhibit A attached
      hereto.

     

    7.7  No
      Material Adverse Change.  There shall have been no material
      adverse change in the assets, liabilities (contingent or otherwise), affairs,
      business, operations, prospects or condition (financial or otherwise) of the
      Company prior to the Closing Date.

     

    7.8  Board
      Approval.  The Board of Directors of the Company shall have
      approved the acquisition of the Shares in writing as required by Section 5.9
      of
      the Initial Securities Purchase Agreement and shall have adopted irrevocable
      resolutions approving on or prior to the Closing Date the acquisition by the
      Buyers and their affiliates of up to fifty percent (50%) of the Common Stock,
      on
      a fully diluted basis, including the acquisition of the Shares so that the
      Buyers and their affiliates are not subject to the restrictions to Section
      18 or
      Section 19 of Chapter 43 of the Indiana Business Corporation Law, as the same
      may be amended.

     

    7.9  Irrevocable
      Proxy.  The Buyers shall receive a restated irrevocable proxy from
      John A. Martell in the form attached hereto as Exhibit B (the
“Restated Irrevocable Proxy”).

     

    7.10  Closing
      Certificate.  The Buyers shall have received a certificate of the
      Company signed by an executive officer of the Company, dated as of the Closing
      Date, certifying that the conditions in Sections 7.2, 7.3,
      7.4, 7.5
      and 7.7 have been satisfied.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    7.11  Secretary’s
      Certificate.  The Buyers shall have received a certificate of the
      Company, signed by an executive officer of the Company, dated as of the Closing
      Date, including (i) true, correct and complete copies of the resolutions of
      the
      Board of Directors referred to in Section 7.8
      that were duly adopted and have not been amended or rescinded as of the Closing
      Date, (ii) a copy of the Company’s Bylaws and (iii) a copy of the Company’s
      Amended and Restated Articles of Incorporation, certified by the Secretary
      of
      State of Indiana as of a date no more than five (5) days prior to the Closing
      Date.

     

    7.12  Certificate
      of Existence.  The Buyers shall have received a certificate of
      existence for the Company issued by the Secretary of State of Indiana no more
      than five (5) days prior to the Closing Date.

     

     

    ARTICLE
      8

     

     

    Indemnification

     

    8.1  Indemnification
      by the Company.   The Company agrees to indemnify each Buyer
      and its affiliates and hold each Buyer and its affiliates harmless from and
      against any and all liabilities, losses, damages, costs and expenses of any
      kind
      (including, without limitation, the reasonable fees and disbursements of such
      Buyer’s counsel in connection with any investigative, administrative or judicial
      proceeding), which may be incurred by such Buyer or such affiliates as a result
      of any claims made against such Buyer or such affiliates by any person that
      relate to or arise out of (i) any breach by the Company of any of its
      representations, warranties or covenants contained in this Agreement or in
      the
      Transaction Documents (other than the Amended Registration Rights Agreement,
      which contains separate indemnification provisions), or (ii) any litigation,
      investigation or proceeding instituted by any person with respect to this
      Agreement or the Shares (excluding, however, any such litigation, investigation
      or proceeding which arises solely from the acts or omissions of such Buyer
      or
      its affiliates).

     

    8.2  Notification.  Any
      person entitled
      to indemnification hereunder (“Indemnified Party”)
      will (i) give prompt notice to the Company, of any third party claim, action
      or
      suit with respect to which it seeks indemnification (the
“Claim”) (but omission of such notice shall not
      relieve the Company from liability hereunder except to the extent it is actually
      prejudiced by such failure to give notice), specifying in reasonable detail
      the
      factual basis for the Claim, the amount thereof, estimated in good faith, and
      the method of computation of the Claim, all with reasonable particularity and
      containing a reference to the provisions of this Agreement in respect of which
      such indemnification is sought with respect to the Claim, and (ii) unless in
      such Indemnified Party’s reasonable judgment a conflict of interest may exist
      between such Indemnified Party and the Company with respect to such claim,
      permit the Company to assume the defense of the Claim with counsel reasonably
      satisfactory to the Indemnified Party.  The Indemnified Party shall
      cooperate fully with the Company with respect to the defense of the Claim and,
      if the Company elects to assume control of the defense of the Claim, the
      Indemnified Party shall have the right to participate in the defense of the
      Claim at its own expense.  If the Company does not elect to assume
      control or otherwise participate in the defense of the Claim, then the
      Indemnified Party may defend through counsel of its own choosing.  If
      such defense is not assumed by the Company, the Company will not be subject
      to
      any liability under this Agreement or otherwise for any settlement made without
      its consent (but such consent will not be unreasonably withheld or delayed).
      If
      the Company elects not to or is not entitled to assume the defense of a Claim,
      it will not be obligated to pay the fees and expenses of more than one counsel
      for all Indemnified Parties with respect to the Claim, unless an actual conflict
      of interest exists between such Indemnified Party and any other of such
      Indemnified Parties with respect to the Claim, in which event the Company will
      be obligated to pay the fees and expenses of such additional counsel or
      counsels.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      9

     

    Governing
      Law; Miscellaneous

     

    9.1  Governing
      Law.  This Agreement shall be enforced, governed by and construed
      in accordance with the laws of the State of Indiana applicable to agreements
      made and to be performed entirely within such state, without regard to the
      principles of conflict of laws.  The parties hereto hereby submit to
      the exclusive jurisdiction of the United States Federal Courts located in the
      Northern District of Indiana with respect to any dispute arising under this
      Agreement, the agreements entered into in connection herewith or the
      transactions contemplated hereby or thereby.  All parties irrevocably
      waive the defense of an inconvenient forum to the maintenance of such suit
      or
      proceeding.  All parties further agree that service of process upon a
      party mailed by first class mail shall be deemed in every respect effective
      service of process upon the party in any such suit or
      proceeding.  Nothing herein shall affect any party’s right to serve
      process in any other manner permitted by law. All parties agree that a final
      non-appealable judgment in any such suit or proceeding shall be conclusive
      and
      may be enforced in other jurisdictions by suit on such judgment or in any other
      lawful manner.  The party which does not prevail in any dispute
      arising under this Agreement shall be responsible for all reasonable fees and
      expenses, including reasonable attorneys’ fees, incurred by the prevailing party
      in connection with such dispute.

     

    9.2  Counterparts;
      Electronic Signatures.  This Agreement may be executed in one or
      more counterparts, each of which shall be deemed an original but all of which
      shall constitute one and the same agreement and shall become effective when
      counterparts have been signed by each party and delivered to the other
      party.  This Agreement, once executed by a party, may be delivered to
      the other party hereto by electronic transmission of a copy of this Agreement
      bearing the signature of the party so delivering this Agreement.

     

    9.3  Headings.  The
      headings of this Agreement are for convenience of reference only and shall
      not
      form part of, or affect the interpretation of, this Agreement.

     

    9.4  Severability.  In
      the event that any provision of this Agreement is invalid or unenforceable
      under
      any applicable statute or rule of law, then such provision shall be deemed
      inoperative to the extent that it may conflict therewith and shall be deemed
      modified to conform to such statute or rule of law.  Any provision
      hereof which may prove invalid or unenforceable under any law shall not affect
      the validity or enforceability of any other provision hereof.

     

    9.5  Entire
      Agreement; Amendments.  This Agreement and the instruments
      referenced herein contain the entire understanding of the parties with respect
      to the matters covered herein and therein and supersede all previous
      understandings or agreements between the parties with respect to such
      matters.  No provision of this Agreement may be waived other than by
      an instrument in writing signed by the party to be charged with
      enforcement.  The provisions of this Agreement may be amended only by
      a written instrument signed by the Company and the Buyers.

     

    9.6  Notices.  Any
      notices required or permitted to be given under the terms of this Agreement
      shall be sent by certified or registered mail (return receipt requested) or
      delivered personally or by courier (including a recognized overnight delivery
      service) or by facsimile and shall be effective five days after being placed
      in
      the mail, if mailed by regular United States mail, or upon receipt, if delivered
      personally or by courier (including a recognized overnight delivery service)
      or
      by facsimile, in each case addressed to a party.  The addresses for
      such communications shall be:

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

       

    

    If
      to the
      Company:

     

    MISCOR
      Group, Ltd.

    1125
      South Walnut Street

    South
      Bend, Indiana 46619

    Attention:      John
      A. Martell and

    James
      M. Lewis, Esq.

    Telephone:     (574)
      234-8131

    Facsimile:        (574)
      232-7648

    

     

    With
      copy
      to:

     

    Barnes
      & Thornburg LLP

    100
      N.
      Michigan, Suite 600

    South
      Bend, Indiana 46601

    Attention:      Richard
      L. Mintz, Esq.

    Telephone:     (574)
      234-1171

    Facsimile:        (574)
      237-1125

    

     

    If
      to the
      Buyers:

     

    Tontine
      Capital Partners, L.P.

    55
      Railroad Avenue, 1st Floor

    Greenwich,
      Connecticut 06830

    Attention:       Mr.
      Jeffrey L. Gendell

    Telephone:      (203)
      769-2000

    Facsimile:         (203)
      769-2010

    

     

    With
      copy
      to:

     

    Barack
      Ferrazzano Kirschbaum & Nagelberg LLP

    200
      W.
      Madison Street, Suite 3900

    Chicago,
      Illinois  60606

    Attention:        John
      E. Freechack, Esq.

    Telephone:       (312)
      984-3100

    Facsimile:          (312)
      984-3150

    

     

    Each
      party shall provide notice to the other party of any change in
      address.

     

    9.7  Successors
      and Assigns.  This Agreement shall be binding upon and inure to
      the benefit of the parties and their successors and assigns.  Neither
      the Company nor any Buyer shall assign this Agreement or any rights or
      obligations hereunder without the prior written consent of the other parties
      hereto.

     

    9.8  Third
      Party Beneficiaries.  This Agreement is intended for the benefit
      of the parties hereto and their respective permitted successors and assigns,
      and
      is not for the benefit of, nor may any provision hereof be enforced by, any
      other person.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

       

    

    9.9  Publicity.  The
      Company and the Buyers shall have the right to review a reasonable period of
      time before issuing any press releases or any other public statements with
      respect to the transactions contemplated hereby; provided, however, that the
      Company shall be entitled, without the prior approval of the Buyers, to make
      any
      press release with respect to such transactions as is required by applicable
      law
      and regulations (although the Buyers shall be consulted by the Company in
      connection with any such press release prior to its release and shall be
      provided with a copy thereof and be given an opportunity to comment
      thereon).  Notwithstanding the foregoing, the Company shall file with
      the SEC a Form 8-K disclosing the transactions herein within four (4) business
      days of the Closing Date and attach the relevant agreements and instruments
      to
      either such Form 8-K or the Company’s Annual Report on Form 10-K for the year
      ended December 31, 2007, and the Buyers may make such filings as may be required
      under Section 13 and Section 16 of the 1934 Act.

     

    9.10  Further
      Assurances.  Each party shall do and perform, or cause to be done
      and performed, all such further acts and things, and shall execute and deliver
      all such other agreements, certificates, instruments and documents, as the
      other
      party may reasonably request in order to carry out the intent and accomplish
      the
      purposes of this Agreement and the consummation of the transactions contemplated
      hereby.

     

    9.11  No
      Strict Construction.  The language used in this Agreement will be
      deemed to be the language chosen by the parties to express their mutual intent,
      and no rules of strict construction will be applied against any
      party.

     

    9.12  Rights
      Cumulative.  Each and all of the various rights, powers and
      remedies of the parties shall be considered cumulative with and in addition
      to
      any other rights, powers and remedies which such parties may have at law or
      in
      equity in the event of the breach of any of the terms of this
      Agreement.  The exercise or partial exercise of any right, power or
      remedy shall neither constitute the exclusive election thereof nor the waiver
      of
      any other right, power or remedy available to such party.

     

    9.13  Survival.  Any
      covenant or agreement in this Agreement required to be performed following
      the
      Closing Date, shall survive the Closing Date. Without limitation of the
      foregoing, the respective representations and warranties given by the parties
      hereto shall survive the Closing Date and the consummation of the transactions
      contemplated herein, but only for a period of the earlier of (i) eighteen (18)
      months following the Closing Date and (ii) the applicable statute of limitations
      with respect to each representation and warranty, and thereafter shall expire
      and have no further force and effect; provided, however, that (a) the
      representations and warranties of the Company made in Sections 4.1, 4.2, 4.3
      and 4.9 shall survive
      the Closing Date and the consummation of the transactions contemplated herein
      for a period of the earlier of (x) five (5) years following the Closing Date
      and
      (y) the applicable statute of limitations with respect to each such
      representation and warranty and (b) the representations and warranties of the
      Company made in Sections 4.5, 4.6 and 4.23
      shall
      survive the Closing Date and the consummation of the transactions contemplated
      herein for a period of the earlier of (x) four (4) years following the Closing
      Date and (y) the applicable statute of limitations with respect to each such
      representation and warranty.

     

    9.14  Knowledge.  The
      term "knowledge of the Company" or any similar formulation of knowledge shall
      mean, the actual knowledge of any of John A. Martell, Richard J. Mullin and
      James M. Lewis after reasonable inquiry made by them of the appropriate
      personnel or representatives of the Company or any of its
      Subsidiaries.

     

    [Signature
      Page Follows]

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed
      as of the date first above written.

     

    

      
        	 	
                COMPANY:

              
	 	 	 
	 	
                MISCOR
                  GROUP, LTD.

              
	 	 	 
	 	 	 
	 	
                By:

              	/s/
                John A. Martell
	 	
                Name:

              	John
                A. Martell
	 	
                Title:

              	President

      

       

       

    

    
      
        	 	
                BUYERS:

              
	 	 	 	 
	 	
                TONTINE
                  CAPITAL PARTNERS, L.P.

              
	 	 	 	 
	 	
                By:

              	
                Tontine
                  Capital Management, LLC, its general partner

              
	 	 	 	 
	 	 	 	 
	 	 	
                By:

              	/s/
                Jeffrey L. Gendell
	 	 	 	
                Jeffrey
                  L. Gendell, as managing member

              
	 	 	 	 

      

       

       

      
        	 	
                Total
                  Number of Shares:  66,666,667

              
	 	
                Total
                  Purchase Price: $16,000,000.08

              
	 	
                Form
                  of Entity and Jurisdiction of Organization:

              
	 	
                Delaware
                  Limited Partnership

              

      

    

    

     

    
      
        	 	
                TONTINE
                  CAPITAL OVERSEAS MASTER FUND, L.P.

              
	 	 	 	 
	 	
                By:

              	
                Tontine
                  Capital Overseas GP, L.L.C., its general partner

              
	 	 	 	 
	 	 	 	 
	 	 	
                By:

              	/s/
                Jeffrey L. Gendell
	 	 	 	
                Jeffrey
                  L. Gendell, as managing member

              
	 	 	 	 

      

      

      
        	 	
                Total
                  Number of Shares:  16,666,666

              
	 	
                Total
                  Purchase Price:  $3,999,999.84

              
	 	
                Form
                  of Entity and Jurisdiction of Organization:

              
	 	
                Cayman
                  Islands Limited Partnership

              

      

    

     

    

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

    

     

    
      EXHIBIT
        A

      

      FORM
        OF LEGAL OPINION

      

      
        	
                1.

              	
                The
                  Company is a corporation existing under and by virtue of the laws
                  of the
                  State of Indiana (the “State”). Based solely on our review of the
                  Certificates of Existence referred to below, as of the date of
                  such
                  certificate the records of the Secretary of  State of the State
                  show that the Company is in existence and that no notice of withdrawal,
                  dissolution or expiration has been filed or taken
                  place.

              

      

      

      
        	
                2.

              	
                Magnetech
                  Industrial Services, Inc. is a corporation existing under and by
                  virtue of
                  the laws of the State. Based solely on our review of the Certificates
                  of
                  Existence referred to below, as of the date of such certificate
                  the
                  records of the Secretary of  State of the State show that
                  Magnetech Industrial Services, Inc. is in existence and that no
                  notice of
                  withdrawal, dissolution or expiration has been filed or taken
                  place.

              

      

      

      
        	
                3.

              	
                Martell
                  Electric, LLC is a limited liability company existing under and
                  by virtue
                  of the laws of the State. Based solely on our review of the Certificates
                  of Existence referred to below, as of the date of such certificate
                  the
                  records of the Secretary of State of the State show that Martell
                  Electric,
                  LLC is in existence and that no notice of withdrawal, dissolution
                  or
                  expiration has been filed or taken
                  place.

              

      

      

      
        	
                4.

              	
                Ideal
                  Consolidated, Inc. is a corporation existing under and by virtue
                  of the
                  laws of the State. Based solely on our review of the Certificates
                  of
                  Existence referred to below, as of the date of such certificate
                  the
                  records of the Secretary of State of the State show that Ideal
                  Consolidated, Inc. is in existence and that no notice of withdrawal,
                  dissolution or expiration has been filed or taken
                  place.

              

      

      

      
        	
                5.

              	
                HK
                  Engine Components, LLC is a limited liability company existing
                  under and
                  by virtue of the laws of the State. Based solely on our review
                  of the
                  Certificates of Existence referred to below, as of the date of
                  such
                  certificate the records of the Secretary of  State of the State
                  show that HK Engine Components, LLC is in existence and that no
                  notice of
                  withdrawal, dissolution or expiration has been filed or taken
                  place.

              

      

      

      
        	
                6.

              	
                Magnetech
                  Power Services, LLC is a limited liability company existing under
                  and by
                  virtue of the laws of the State. Based solely on our review of
                  the
                  Certificates of Existence referred to below, as of the date of
                  such
                  certificate the records of the Secretary of  State of the State
                  show that Magnetech Power Services, LLC is in existence and that
                  no notice
                  of withdrawal, dissolution or expiration has been filed or taken
                  place.

              

      

      

      
        	
                7.

              	
                The
                  Company has the corporate power and authority to execute, deliver
                  and
                  perform its obligations under each of the Transaction Agreements.
                  The
                  execution, delivery and performance of each of the Transaction
                  Agreements
                  has been duly authorized by all necessary corporate action on the
                  part of
                  the Company.

              

      

      

      
        	
                8.

              	
                The
                  Company has the requisite corporate power and authority to own
                  and operate
                  its property and to conduct the business in which it is currently
                  engaged.

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      
 

      
        	
                9.

              	
                Each
                  of the Transaction Agreements has been duly executed and delivered
                  by the
                  Company and constitutes the legal, valid and binding obligation
                  of the
                  Company, enforceable against the Company in accordance with its
                  terms.

              

      

      

      
        	
                10.

              	
                The
                  issuance, sale and delivery of the common stock of the Company
                  to be
                  issued and sold to the Buyers pursuant to the Purchase Agreement
                  (the
                  “Shares”) and the execution, delivery and performance by the Company of
                  the Transaction Agreements and the consummation by the Company
                  of the
                  transactions contemplated thereby do not violate or result in a
                  breach of
                  or default under the Amended and Restated Articles of Incorporation
                  of the
                  Company, the Amended and Restated Code of By-laws of the Company,
                  the
                  Indiana Business Corporation Act or other laws of the State of
                  general
                  applicability to corporations in the
                  State.

              

      

      

      
        	
                11.

              	
                There
                  is no action, suit, proceeding or investigation known to us to
                  be pending
                  against the Company that contests or affects the execution, validity
                  or
                  performance of the Transaction Agreements or is likely to have
                  a material
                  adverse effect on the business, operations, assets, financial condition
                  or
                  prospects of the Company.

              

      

      

      
        	
                12.

              	
                Except
                  for filings, authorizations or approvals contemplated by the Transaction
                  Agreements, to our knowledge, no authorizations or approvals of,
                  and no
                  filings with any governmental authority of the State are necessary
                  or
                  required by any laws of general application to corporations in
                  the State
                  for the execution, delivery or performance by the Company of any
                  of the
                  Transaction Agreements.

              

      

      

      
        	
                13.

              	
                The
                  Shares have been duly authorized and, when issued and sold to the
                  Buyers
                  after payment therefor pursuant to and in accordance with the terms
                  of the
                  Transaction Agreements and upon delivery, will be validly issued,
                  fully
                  paid and non-assessable.

              

      

      

      
        	
                14.

              	
                To
                  our knowledge, except as set forth in the Purchase Agreement or
                  disclosed
                  in any Schedule included in the Disclosure Schedule to the Purchase
                  Agreement, the issuance of the Shares in accordance with the terms
                  of the
                  Transaction Agreements is not subject to any preemptive rights
                  or rights
                  of first refusal that have not been waived or complied
                  with.

              

      

      

      
        	
                15.

              	
                Assuming
                  that the representations, warranties and covenants of the Buyers
                  contained
                  in the Transaction Agreements are true, correct and complete, and
                  that any
                  required filings are made pursuant to Rule 503 of Regulation D
                  as
                  promulgated under the Securities Act of 1933, the offer, sale and
                  issuance
                  of the Shares to Buyers pursuant to the Purchase Agreement do not
                  require
                  registration under the Securities Act of 1933 and the rules promulgated
                  thereunder as they currently
                  exist.

              

      

    

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

     

    
      FORM
        OF RESTATED IRREVOCABLE PROXY

       

    

    All
      capitalized terms used but not
      defined in this Irrevocable Proxy shall have the meanings set forth in that
      certain Securities Purchase Agreement, of even date herewith (the
“Purchase Agreement”), by and among MISCOR Group, Ltd.
      (the “Company”), Tontine Capital Partners, L.P.
      (“Tontine”) and Tontine Capital Overseas Master Fund,
      L.P. (“TCOMF” and together with Tontine, the
“Purchasers”).

     

    WHEREAS,
      the Company and the Purchasers
      entered into a Securities Purchase Agreement dated January 18, 2007 (the
“Original Purchase Agreement”), pursuant to which the
      Company acquired 62,500,000 shares of Common Stock in the Company.

     

    WHEREAS,
      in connection with the
      Original Purchase Agreement, John A. Martell, the President and Chief Executive
      Officer of the Company (“Martell”) granted to the
      Purchasers an irrevocable proxy on January 18, 2007 (the “Original
      Proxy”).

     

    WHEREAS,
      in connection with and as a condition to the closing of the transactions
      contemplated by the Purchase Agreement, Martell desires to restate the Original
      Proxy.

     

    FOR
      VALUE RECEIVED,
      Martell does hereby irrevocably appoint Tontine and TCOMF and each of them
      (and
      any manager or officer of Tontine or TCOMF and any other Person appointed by
      Tontine or TCOMF), as the attorney-in-fact, agent, and proxy of Martell
      (collectively, the “Proxy
      Holders”),
      with full power
      of substitution, with full authority to act and vote in person or by revocable
      proxy, written consent, or otherwise, as fully and effectively as Martell could
      do so in person (or by proxy, written consent, or otherwise), with respect
      to
      any and all shares of Common Stock in the Company that Martell now or hereafter
      owns legally, beneficially, or of record, or over which Martell has voting
      control (the “Subject
      Common Stock”),
in
      such
      manner as the Proxy Holders shall, in their sole discretion, deem proper, and
      as
      may be allowable under applicable law, with respect to the following
      matters:  (i) the election
      to the
      Company’s Board of Directors of one or two individuals nominated by the
      Purchasers, as applicable, for such appointment pursuant to and in accordance
      with the Purchasers’ rights under Section 5.6 of the Original Purchase
      Agreement and Section 5.5 of the Purchase Agreement to appoint members to the
      Company’s Board of Directors, and (ii) solely for the purpose of enforcing the
      Purchasers’ rights under Section 5.8 of the Purchase Agreement and Section 5.9
      of the Original Purchase Agreement, any matter coming before the stockholders
      of
      the Company that would have the effect of ensuring that future acquisitions
      by
      the Purchasers of up to 50% of the outstanding Common Stock on a fully diluted
      basis will not be subject to the provisions of any anti-takeover or control
      share laws and regulations of any governmental authority, including without
      limitation, the applicable provisions of the IBCL, and any provisions of an
      anti-takeover or control share nature adopted by the Company or any of its
      Subsidiaries or contained in the Company’s Amended and Restated Articles of
      Incorporation, Amended and Restated Code of Bylaws or the organizational
      documents of any of its Subsidiaries.  In addition, Martell hereby
      agrees, in his capacity as a director of the Company, to vote for the nomination
      and appointment of the Purchasers’ director representatives as set forth and as
      provided in Section 5.6 of the Original Purchase Agreement and Section 5.5
      of
      the Purchase Agreement and to vote in such a manner as to enforce the
      Purchaser’s rights with respect to Section 5.9 of the Original Purchase
      Agreement and Section 5.8 of the Purchase Agreement.

     

    Martell
      hereby represents and warrants
      that, as of the date hereof: (1) Martell is the legal, beneficial, or record
      holder of the Subject Common Stock; and (2) Martell has full right, power,
      and
      capacity to grant and transfer to the Proxy Holders the voting and other rights
      represented hereby.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Martell
      shall not
to grant to any Person any proxy or enter into any voting agreement
      that
      is inconsistent with the rights and privileges granted to the Proxy Holders
      in
      this Irrevocable Proxy.

     

    This
      Irrevocable Proxy is issued as a
      condition precedent to the execution and delivery by the Purchasers of the
      Purchase Agreement and the consummation of the transactions contemplated
      thereby.  Martell has obtained substantial and material benefits as a
      result of the consummation of the transactions contemplated by the Original
      Purchase Agreement and will obtain substantial and material benefits as a result
      of the consummation of the transactions contemplated by the Purchase
      Agreement.  This Irrevocable Proxy is a material inducement to the
      Purchasers to execute and deliver the Purchase Agreement and to consummate
      the
      transactions contemplated thereby.  This Irrevocable Proxy is coupled
      with an interest and is irrevocable by Martell.  This Irrevocable
      Proxy is effective as of the date hereof and shall terminate automatically
      and
      be of no further force and effect at such time as the Proxy Holders and their
      affiliates no longer have any rights under Sections 5.6 and 5.9 of the Original
      Purchase Agreement and Sections 5.5 and 5.8 of the Purchase
      Agreement.

     

    9.15  If
      any
      provision of this Irrevocable Proxy is adjudicated to be invalid or
      unenforceable, then such provision shall be deemed deleted and the remainder
      of
      this Irrevocable Proxy, nevertheless, shall remain unaffected and fully
      enforceable.  Further, to the extent any provision herein is deemed
      unenforceable by virtue of its scope, but may be made enforceable by limitation
      thereof, the parties hereto agree the same shall, nevertheless, be enforceable
      to the full extent permissible.  This Irrevocable Proxy shall be
      binding upon the heirs, personal representatives, executors, and assigns of
      Martell.

     

    This
      Irrevocable Proxy shall be
      enforced, governed by and construed in accordance with the laws of the State
      of
      Indiana without regard to principles of conflicts of laws.

     

    

     

    Dated:      ____________,
      2007

    
 

    
      
        	 	
                By:

              	 
	 	 	
                John
                  A. Martell

              

      

      

    

     

    The
      undersigned, being the Proxy Holders, do hereby consent to the restatement
      of
      the Original Proxy and the granting of this Irrevocable Proxy in place
      thereof.

     

    

      
        	
                TONTINE
                  CAPITAL PARTNERS, L.P.

              	 	
                TONTINE
                  CAPITAL OVERSEAS MASTER FUND, L.P.

              
	 	 	 	 	 
	 	 	 	 	 
	
                By:

              	 	 	
                By:

              	 
	 	 	 	 	 
	
                Its:

              	 	 	
                Its:mis_8k1130ex105.htm

    Exhibit
      10.5

     

     

    

     

    

     

    

     

    Amended
      and Restated

     

    Registration
      Rights Agreement

     

    By
      and Between

     

    MISCOR
      Group, Ltd.,

     

    Tontine
      Capital Partners, L.P.

     

    And

     

    Tontine
      Capital Overseas Master Fund, L.P.

     

    November
      30, 2007

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    TABLE
      OF CONTENTS

     

    Page

     

    
      	
              ARTICLE
                1

            	 	
              Definitions

            	
              1

            
	
              ARTICLE
                2

            	 	
              Registration
                Rights

            	
              4

            
	
              2.1

            	 	
              Current
                Public Information

            	
              4

            
	
              2.2

            	 	
              Registration

            	
              4

            
	
              2.3

            	 	
              Demand
                Registration

            	
              5

            
	
              2.4

            	 	
              Piggyback
                Registration.

            	
              8

            
	
              2.5

            	 	
              Underwriting;
                Holdback Agreements.

            	
              9

            
	
              2.6

            	 	
              Registration
                Procedures

            	
              10

            
	
              2.7

            	 	
              Conditions
                Precedent to Company’s Obligations Pursuant to this
                Agreement

            	
              12

            
	
              2.8

            	 	
              Fees
                and Expenses

            	
              12

            
	
              2.9

            	 	
              Indemnification.

            	
              12

            
	
              2.10

            	 	
              Participation
                in Registrations.

            	
              15

            
	
              2.11

            	 	
              Compliance

            	
              16

            
	
              ARTICLE
                3

            	 	
              Transfers
                of Certain Rights

            	
              16

            
	
              3.1

            	 	
              Transfer

            	
              16

            
	
              3.2

            	 	
              Transferees

            	
              16

            
	
              3.3

            	 	
              Subsequent
                Transferees

            	
              16

            
	
              ARTICLE
                4

            	 	
              Miscellaneous

            	
              16

            
	
              4.1

            	 	
              Recapitalizations,
                Exchanges, etc

            	
              16

            
	
              4.2

            	 	
              No
                Inconsistent Agreements

            	
              16

            
	
              4.3

            	 	
              Amendments
                and Waivers

            	
              17

            
	
              4.4

            	 	
              Severability

            	
              17

            
	
              4.5

            	 	
              Counterparts

            	
              17

            
	
              4.6

            	 	
              Notices

            	
              17

            
	
              4.7

            	 	
              Governing
                Law

            	
              18

            
	
              4.8

            	 	
              Forum;
                Service of Process

            	
              18

            
	
              4.9

            	 	
              Captions

            	
              18

            
	
              4.10

            	 	
              No
                Prejudice

            	
              18

            
	
              4.11

            	 	
              Words
                in Singular and Plural Form

            	
              18

            
	
              4.12

            	 	
              Remedy
                for Breach

            	
              18

            
	
              4.13

            	 	
              Successors
                and Assigns, Third Party Beneficiaries

            	
              18

            
	
              4.14

            	 	
              Amendment
                and Restatement

            	
              19

            
	
              4.15

            	 	
              Attorneys’
                Fees

            	
              19

            
	
              4.16

            	 	
              Termination
                of Rights

            	
              19

            

    

     

     

    

    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    AMENDED
      AND RESTATED

     

    REGISTRATION
      RIGHTS AGREEMENT

     

    

     

    This
      AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this
“Agreement”), dated as of November 30, 2007, is
      entered into by and between MISCOR GROUP, LTD., an Indiana corporation (the
      “Company”), TONTINE CAPITAL PARTNERS, L.P., a Delaware
      limited partnership (“TCP” or a
“Buyer”) and TONTINE CAPITAL
      OVERSEAS MASTER FUND,
      L.P., a Cayman Islands limited partnership
      (a“Buyer” and
      together with TCP,
      the“Buyers”).

     

    RECITALS:

     

    A.           Pursuant
      to a Securities Purchase Agreement, dated as of January 18, 2007, entered into
      by and between the Company and the Buyers (the “Initial Securities
      Purchase Agreement”), the Company issued and sold 62,500,000
      shares of its Common Stock (the “Initial Shares”) to
      the Buyers.

     

    B.           In
      connection with the execution and delivery of the Initial Securities Purchase
      Agreement, the Company and the Buyers entered into a Registration Rights
      Agreement, dated as of January 18, 2007 (the “Initial Registration
      Rights Agreement”), pursuant to which the Company agreed under
      certain circumstances to register the resale of the Initial Shares under the
      1933 Act and the rules and regulations promulgated thereunder, and applicable
      state securities laws.

     

    C.           Pursuant
      to the terms of the Initial Registration Rights Agreement, the Company filed
      a
      registration statement on Form S-1 (File No. 333-144557) covering the resale
      of
      the Initial Shares on July 13, 2007 (the “Initial Registration
      Statement”).

     

    D.           The
      Company desires to issue and sell an additional 83,333,333 shares of its Common
      Stock to the Buyers as set forth in the Securities Purchase Agreement, dated
      as
      of November 30, 2007, entered into by and between the Company and the Buyers
      (the “New Securities Purchase
      Agreement”).

     

    E.           The
      Company and the Buyers desire to amend and restate the Initial Registration
      Rights Agreement in connection with the consummation of the transactions
      contemplated by the New Securities Purchase Agreement.

     

    F.           Certain
      terms used in this Agreement are defined in Article 1
      hereof.

     

    AGREEMENT

     

    NOW,
      THEREFORE, in consideration of the foregoing premises and the mutual covenants
      and agreements hereinafter contained, and for other good and valuable
      consideration, the receipt and sufficiency of which are hereby acknowledged,
      intending to be legally bound, the parties hereto, desiring to amend and restate
      the Initial Registration Rights Agreement, do hereby agree as
      follows:

     

     

    ARTICLE
      1

    DEFINITIONS

     

    “Affiliate”
      means any Person that directly or indirectly controls, or is under control
      with,
      or is controlled by such Person.  As used in this definition,
“control” (including with its correlative meanings, “controlled by” and “under
      common control with”) shall mean the possession, directly or indirectly, of the
      power to direct or cause the direction of the management or policies of a Person
      (whether through ownership of securities or partnership or other ownership
      interests, by contract or otherwise).

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    “Agreement”
      has the meaning set forth in the preamble.

     

    “Business
      Day” means any day excluding Saturday, Sunday or any other day
      which is a legal holiday under the laws of the State of Indiana or is a day
      on
      which banking institutions therein located are authorized or required by law
      or
      other governmental action to close.

     

    “Common
      Stock” means the common stock, no par value per share, of the
      Company.

     

    “Company”
      has the meaning set forth in the preamble.

     

    “Cut
      Back Shares” has the meaning set forth in Section 2.2.

     

    “Demand
      Notice” has the meaning set forth in Section 2.3.

     

    “Designated
      Holders” means the Buyers and any qualifying transferees of the
      Buyers under Section 3.1 hereof
      who hold Registrable Securities.

     

    “Effectiveness
      Date” means (a) with respect to the Initial
      Registration Statement, the earlier of:  (i) January 18, 2008, and
      (ii) the fifth trading day following the date on which the Company is notified
      by the SEC that the Initial Registration Statement is no longer subject to
      further review and comments, (b) with respect to the Registration Statement
      required to be filed pursuant to Section 2.2(b), the earlier of: (i) the 120th
      day following the
      date on which such Registration Statement is required to be filed, and (ii)
      the
      fifth trading day following the date on which the Company is notified by the
      SEC
      that such Registration Statement will not be reviewed or is no longer subject
      to
      further review and comments, and (c) with respect to any additional Registration
      Statements that may be required pursuant to Section 2.2(c), the earlier of (i) the 120th
      day following the
      Filing Date of such Registration Statement, and (ii) the fifth trading day
      following the date on which the Company is notified by the SEC that such
      additional Registration Statement will not be reviewed or is no longer subject
      to further review and comments.

     

    “Exchange
      Act” means the Securities Exchange Act of 1934, as amended, and
      the rules and regulations of the SEC promulgated thereunder.

     

    “Filing
      Date” means with respect to any Registration Statements that may
      be required pursuant to Section 2.2(c) because (a) the Company has
      not included
      some or all of the remaining Registrable Securities proposed to be included
      on
      previously-filed Registration Statements as a result of written comments from
      the SEC related to Rule 415, the date that is 180 days following the date the
      most recent Registration Statement covering Registrable Securities has been
      declared effective, (b) the SEC shall have notified the Company in writing
      that
      certain Registrable Securities were not eligible for inclusion on a
      previously-filed Registration Statement for any reason other than as described
      in clause (a) above, the 45th day following
      the
      date or time on which the SEC shall indicate as being the first date or time
      that such Registrable Securities may then be included in a Registration, or
      (c)
      if any such Registration Statement(s) is required for a reason other than as
      described in clauses (a) or (b) above, the 45th day following
      the
      date on which the Company first knows, or reasonably should have known, that
      such additional Registration Statement(s) is required.

     

    “Indemnified
      Party” has the meaning set forth in Section 2.9.

     

    “Initial
      Registration Rights Agreement” has the meaning set forth in the
      Recitals.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “Initial
      Registration Statement” has the meaning set forth in the
      Recitals.

     

    “Initial
      Shares” has the meaning set forth in the Recitals.

     

     “Initial
      Securities Purchase Agreement” has the meaning set forth in the
      Recitals.

     

     “Losses”
      has the meaning set forth in Section  2.9.

     

    “Majority
      Holders” means those Designated Holders holding a majority of the
      Registrable Securities.

     

    “Person”
      means any individual, company, partnership, firm, joint venture, association,
      joint-stock company, trust, unincorporated organization, governmental body
      or
      other entity.

     

    “Piggyback
      Registration” has the meaning set forth in
Section 2.4.

     

    “Buyers”
      has the meaning set forth in the preamble.

     

    “Purchase
      Price” has the meaning ascribed to such term in the Securities
      Purchase Agreement.

     

    “Registrable
      Securities” means, subject to the immediately following sentences,
      (i) shares of Common Stock acquired by the Buyers from the Company pursuant
      to the Initial Securities Purchase Agreement and the New Securities Purchase
      Agreement or, so long as this Agreement is still in effect, any other shares
      of
      Common Stock acquired by the Buyers after the date hereof, and (ii) any shares
      of Common Stock issued or issuable, directly or indirectly, with respect to
      the
      securities referred to in clause (i) by way of stock dividend or stock split
      or
      in connection with a combination of shares, recapitalization, merger,
      consolidation or other reorganization.  In addition, any particular
      shares of Common Stock constituting Registrable Securities will cease to be
      Registrable Securities when they (x) have been effectively registered under
      the
      Securities Act and disposed of in accordance with a Registration Statement
      covering them, (y) have been sold to the public pursuant to Rule 144 (or by
      similar provision under the Securities Act), or (z) are eligible for resale
      under Rule 144(k) (or by similar provision under the Securities Act) without
      any
      limitation on the amount of securities that may be sold under paragraph (e)
      thereof.

     

    “Registration
      Statement” means a registration statement on Form S-3 (or, if the
      Company is not eligible to use Form S-3, such other appropriate registration
      form of the SEC pursuant to which the Company is eligible to register the resale
      of Registrable Securities) filed by the Company under the Securities Act which
      covers any of the Registrable Securities pursuant to the provisions of this
      Agreement, including the prospectus, amendments and supplements to such
      registration statement, including post-effective amendments, all exhibits and
      all material incorporated by reference in such registration statement, which
      shall permit the Buyers to offer and sell, on a delayed or continuous basis
      pursuant to Rule 415 under the Securities Act, the Registrable Securities,
      including, but not limited to, the Initial Registration Statement.

     

    “register,”
      “registered” and
“registration” each shall refer to
      a registration
      effected by preparing and filing a registration statement or statements or
      similar documents in compliance with the Securities Act and the declaration
      or
      ordering of effectiveness of such registration statement(s) or documents by
      the
      SEC.

     

    “Representatives”
      has the meaning set forth in Section 2.9.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    “Rule
      144” means Rule 144 promulgated by the SEC
      pursuant to the Securities Act, as such Rule may be amended from time to time,
      or any similar rule or regulation hereafter adopted by the SEC having
      substantially the same effect as such Rule.

     

    “Rule
      415” means Rule 415 promulgated by the SEC
      pursuant to the Securities Act, as such Rule may be amended from time to time,
      or any similar rule or regulation hereafter adopted by the SEC having
      substantially the same effect as such Rule.

     

    “SEC”
      means the United States Securities and Exchange Commission or any other federal
      agency at the time administering the Securities Act.

     

    “Securities
      Act” means the Securities Act of 1933, as amended, and the rules
      and regulations of the SEC promulgated thereunder.

     

    “Securities
      Purchase Agreement” has the meaning set forth in the
      recitals.

     

     

    ARTICLE
      2

     

    
      REGISTRATION
        RIGHTS

    2.1  Current
      Public Information.  The Company covenants that it will use its
      best efforts to file all reports required to be filed by it under the Exchange
      Act and the rules and regulations adopted by the SEC thereunder, and will use
      its reasonable best efforts to take such further action as the Designated
      Holders may reasonably request, all to the extent required to enable the
      Designated Holders to sell Registrable Securities pursuant to Rule 144 or Rule
      144A adopted by the SEC under the Securities Act or any similar rule or
      regulation hereafter adopted by the SEC.  The Company shall, upon the
      request of a Designated Holder, deliver to such Designated Holder a written
      statement as to whether it has complied with such requirements during the twelve
      month period immediately preceding the date of such request.

     

    2.2  Registration.  The
      Company has received written comments from the SEC with respect to the Initial
      Registration Statement pertaining to Rule 415, a copy of which has been provided
      to the Buyers by the Company, which, unless rebutted by the Company, requires
      the Company to treat the registration of the Initial Shares under the Initial
      Registration Statement as a “primary offering” with the effect that the Buyers
      would be deemed to be “underwriters” for purposes of the Securities Act with
      respect to the sale of the Initial Shares in the Initial Registration
      Statement.  The Company represents and warrants to the Buyers that,
      after consultation with the Buyers and following discussions with the SEC in
      which the Company used its reasonable best efforts and devoted a reasonable
      amount of time to cause as many Registrable Securities as possible to be
      included in the Initial Registration Statement without characterizing any
      Designated Holder as an underwriter, the Company has been unable to cause the
      inclusion of all of the Initial Shares in the Initial Registration Statement
      and
      has determined to remove from the Initial Registration Statement a certain
      portion of the Initial Shares (the “Cut Back
      Shares”).

     

    (a)  The
      Company shall use its reasonable best efforts to cause the Initial Registration
      Statement to be declared effective under the Securities Act as soon as possible,
      but in any event, no later than the Effectiveness Date, and shall use its
      reasonable best efforts to keep the Initial Registration Statement continuously
      effective, supplemented and amended to the extent necessary to ensure that
      it is
      available for the resale of all Registrable Securities registered thereunder
      by
      the Designated Holders and that it conforms in all material respects to the
      requirements of the Securities Act during the entire period beginning on the
      Effectiveness Date and ending on the date on which all Registrable Securities
      registered thereunder have ceased to be Registrable Securities.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

       

    

    (b)  No
      later
      than the 180th
      day following the date the Initial Registration Statement is declared effective
      by the SEC, the Company shall prepare and file with the SEC an additional
      Registration Statement covering the resale of all Registrable Securities not
      already covered by the Initial Registration Statement (including the Cut Back
      Shares and the shares of Common Stock sold under the New Securities Purchase
      Agreement) for an offering to be made on a continuous basis pursuant to Rule
      415.  Such Registration Statement shall provide for the resale from
      time to time, and pursuant to any method or combination of methods legally
      available by the Designated Holders of any and all Registrable Securities
      registered thereunder; provided, however, that the Company shall only be
      required to register such number of Registrable Securities pursuant to this
      Section 2.2(b),
      such that the offering of such Registrable
      Securities will not be deemed, in the reasonable judgment of the Company after
      consultation with the Buyers and with the SEC, to be a “primary
      offering.”  The Company shall use its reasonable best efforts to cause
      such Registration Statement to be declared effective under the Securities Act
      as
      soon as possible but, in any event, no later than its Effectiveness Date, and
      shall use its reasonable best efforts to keep the Registration Statement
      continuously effective, supplemented and amended to the extent necessary to
      ensure that is available for the resale of all Registrable Securities registered
      thereunder by the Designated Holders and that it conforms in all material
      respects to the requirements of the Securities Act during the entire period
      beginning on the applicable Effectiveness Date and ending on the date on which
      all Registrable Securities registered thereunder have ceased to be Registrable
      Securities.

     

    (c)  If,
      for
      any reason, the Company has been unable to include all of the remaining
      Registrable Securities (including the Cut Back Shares and the shares of Common
      Stock issued under the New Securities Purchase Agreement ) in the Registration
      Statement filed pursuant to Section 2.2(b),
      then the Company shall prepare and file as soon as reasonably possible after
      the
      date on which the SEC shall indicate as being the first date or time that such
      filing may be made, but in any event by the Filing Date therefore, one or more
      additional Registration Statements covering the resale of all Registrable
      Securities not already covered by an existing and effective Registration
      Statement for an offering to be made on a continuous basis pursuant to Rule
      415.  Each such Registration Statement shall provide for the resale
      from time to time, and pursuant to any method or combination of methods legally
      available by the Designated Holders of any and all Registrable Securities
      registered thereunder.  The Company shall use its reasonable best
      efforts to cause each such Registration Statement to be declared effective
      under
      the Securities Act as soon as possible but, in any event, no later than its
      Effectiveness Date, and shall use its reasonable best efforts to keep such
      Registration Statement continuously effective under the Securities Act during
      the entire period beginning on the applicable Effectiveness Date and ending
      on
      the date on which all Registrable Securities registered thereunder have ceased
      to be Registrable Securities.  For the avoidance of doubt, the Company
      will prepare and file additional Registration Statements in accordance with
      the
      terms hereof until such time as all of the Registrable Securities are covered
      by
      effective Registration Statements.

     

    (d)  The
      Company may, at any time it is eligible to do so, file a post-effective
      amendment on Form S-3 to any Registration Statement on Form S-1 for the resale
      of any then existing Registrable Securities or in any such other manner as
      is
      preferred or permitted by the SEC to convert such Registration Statement to
      a
      Form S-3 Registration Statement.  Upon the effectiveness of such Form
      S-3 Registration Statement, all references to a Registration Statement in this
      Agreement shall then automatically be deemed to be a reference to the Form
      S-3
      Registration Statement.

     

    2.3  Demand
      Registration.  In addition to the registration obligations of the
      Company set forth in Section 2.2
      herein, the following provisions shall apply:

     

    (a)  Subject
      to Section 2.3(i), upon the
      written request of the Majority Holders, requesting that the Company effect
      the
      registration under the Securities Act of all or part of such Designated Holders’
Registrable Securities and specifying the intended method of disposition thereof
      (the “Demand Notice”), the Company will promptly give
      written notice of such requested registration to all Designated Holders, and
      thereupon the Company will use its reasonable best efforts to file with the
      SEC
      as soon as reasonably practicable following the Demand Notice (but in no event
      later than the date that is 90 days after the Demand Notice) a Registration
      Statement.  The Company shall use its reasonable best efforts to cause
      such Registration Statement to be declared effective by the SEC within 90 days
      after the initial filing of the Registration Statement.  The Company
      shall include in such Registration Statement:

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (i)  the
      Registrable Securities which the Company has been so requested to be registered
      by such Designated Holders for disposition in accordance with the intended
      method of disposition stated in such request;

     

    (ii)  all
      other
      Registrable Securities the holders of which shall have made a written request
      to
      the Company for registration thereof within 30 days after the giving of such
      written notice by the Company (which request shall specify the intended method
      of disposition of such Registrable Securities); and

     

    (iii)  all
      shares of Common Stock which the Company or Persons entitled to exercise
“piggy-back” registration rights pursuant to contractual commitments of the
      Company may elect to register in connection with the offering of Registrable
      Securities pursuant to this Section 2.3;

     

    all
      to
      the extent requisite to permit the disposition (in accordance with the intended
      methods thereof as aforesaid) of the Registrable Securities and the additional
      shares of Common Stock, if any, so to be registered; provided, that, the
      provisions of this Section 2.3
      shall not require
      the Company to effect more than two registrations of Registrable
      Securities.

     

    (b)  Notwithstanding
      anything to the contrary contained in this Agreement, the Company shall not
      be
      required to effect a registration pursuant to this Section 2.3 within 180 days following the
      effective
      date of a registration statement filed by the Company in accordance with
Sections 2.2, 2.3
      or 2.4
      for the account of another Designated Holder of Registrable Securities if the
      Designated Holders were afforded the opportunity to include the Registrable
      Securities in such registration.

     

    (c)  The
      registrations under this Section 2.3 shall be on an appropriate Registration
      Statement that permits the disposition of such Registrable Securities in
      accordance with the intended methods of distribution specified by the Majority
      Holders in their request for registration.  The Company agrees to
      include in any such Registration Statement all information which Designated
      Holders of Registrable Securities being registered shall reasonably request
      to
      effect the registration.

     

    (d)  A
      registration requested pursuant to this Section 2.3 shall not be deemed to have
      been effected
      (i) unless a Registration Statement with respect thereto has become effective;
      provided, that a Registration Statement which does not become effective after
      the Company has filed a Registration Statement with respect thereto solely
      by
      reason of the refusal to proceed of the Majority Holders (other than a refusal
      to proceed based upon the advice of counsel relating to a matter with respect
      to
      the Company) or because of a breach of this Agreement by any Designated Holder
      shall be deemed to have been effected by the Company at the request of the
      Majority Holders unless the Designated Holders electing to have Registrable
      Securities registered pursuant to such Registration Statement shall have elected
      to pay all fees and expenses otherwise payable by the Company in connection
      with
      such registration pursuant to Section 2.8, (ii) if, after it has become
      effective,
      such registration is withdrawn by the Company (other than at the request of
      the
      Majority Holders) or interfered with by any stop order, injunction or other
      order or requirement of the SEC or other governmental agency or court for any
      reason prior to the expiration of a 180 day period following such Registration
      Statement’s effectiveness, or (iii) if the conditions to closing specified in
      any purchase agreement or underwriting agreement entered into in connection
      with
      such registration are not satisfied, other than due solely to some act or
      omission by the Designated Holders electing to have Registrable Securities
      registered pursuant to such Registration Statement.

     

    
      
        
        

      

      
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    (e)  Intentionally
      Omitted.

     

    (f)  If
      a
      requested registration pursuant to this Section 2.3 involves an underwritten offering,
      and the
      managing underwriter shall advise the Company in writing (with a copy to each
      Designated Holder of Registrable Securities requesting registration) that,
      in
      its opinion, the number of securities requested to be included in such
      registration (including securities of the Company which are not Registrable
      Securities) exceeds the number which can be sold in such offering within a
      price
      range reasonably acceptable to the Company and to the holders of a majority
      (by
      number of shares) of the Registrable Securities requested to be included in
      such
      Registration Statement, the Company will include in such registration, to the
      extent of the number which the Company is so advised can be sold in such
      offering, (i) first, the Registrable Securities which have been requested to
      be
      included in such registration by the Designated Holders pursuant to this
      Agreement (pro rata based on the amount of Registrable Securities sought to
      be
      registered by such Persons), (ii) second, provided that no securities sought
      to
      be included by the Designated Holders have been excluded from such registration,
      the securities of other Persons entitled to exercise “piggy-back” registration
      rights pursuant to contractual commitments of the Company (pro rata based on
      the
      amount of securities sought to be registered by such Persons) and (iii) third,
      securities the Company proposes to register.

     

    (g)  The
      Company shall use its reasonable best efforts to keep any Registration Statement
      filed pursuant to this Section 2.3 continuously effective (i) for
      a period of
      two years after the Registration Statement first becomes effective, plus the
      number of days during which such Registration Statement was not effective or
      usable pursuant to Sections2.6(e) or
2.6(i);
      or (ii) if such Registration
      Statement related to an underwritten offering, for such period as in the opinion
      of counsel for the underwriters a prospectus is required by law to be delivered
      in connection with sales of Registrable Securities by an underwriter or
      dealer.  In the event the Company shall give any notice pursuant to
Sections 2.6(e) or (i),
      the additional time period mentioned in
Section 2.3(f)(i) during
      which the Registration Statement is to remain effective shall be extended by
      the
      number of days during the period from and including the date of the giving
      of
      such notice pursuant to Sections 2.6(e) or (i)
      to and including the date when each seller
      of a Registrable Security covered by the Registration Statement shall have
      received the copies of the supplemented or amended prospectus contemplated
      by
Sections 2.6(e) or (i).

     

    (h)  The
      Company shall have the right at any time, to suspend the filing of a
      Registration Statement under this Section 2.3 or require that the Designated
      Holders of
      Registrable Securities suspend further open market offers and sales of
      Registrable Securities pursuant to a Registration Statement filed hereunder
      for
      a period not to exceed an aggregate of 30 days in any six month period or an
      aggregate of 60 days in any twelve-month period for valid business reasons
      (not
      including avoidance of their obligations hereunder) (i) to avoid premature
      public disclosure of a pending corporate transaction, including pending
      acquisitions or divestitures of assets, mergers and combinations and similar
      events; (ii) upon the occurrence of any of the events specified in
Section 2.6(e), until the time
      that the Designated Holders receive copies of a supplement or amendment to
      the
      prospectus included in the applicable Registration Statement as contemplated
      in
Section 2.6(e); and (iii) upon
      the occurrence of any of the events specified in Section 2.6(i), until the time the Company
      notifies the
      Designated Holders in writing that such suspension is no longer
      effective.

     

    (i)  The
      right
      of Designated Holders to register Registrable Securities pursuant to this
Section 2.3 is only exercisable
      if, prior to such time as all of the Registrable Securities have ceased to
      be
      Registrable Securities, the Company becomes ineligible to register the
      Registrable Securities on the Registration Statement contemplated by
Section 2.2 or such Registration
      Statement otherwise becomes unusable (other than due solely to some act or
      omission by the Designated Holders electing to have Registrable Securities
      registered pursuant to such Registration Statement) or ineffective and the
      Company is not able to correct the misstatements, have the applicable stop
      order
      rescinded or otherwise restore the effectiveness of the Registration Statement
      as contemplated by this Agreement.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    2.4  Piggyback
      Registration.

     

    (a)  Whenever
      the Company proposes to register any of its securities under the Securities
      Act
      (other than pursuant to a registration pursuant to Section 2.2 or Section 2.3
      or a registration on Form S-4 or S-8 or any
      successor or similar forms) and the registration form to be used may be used
      for
      the registration of Registrable Securities, whether or not for sale for its
      own
      account, the Company will give prompt written notice (but in no event less
      than
      30 days before the anticipated filing date) to all Designated Holders (other
      than Designated Holders all of whose Registrable Securities are then covered
      by
      an effective Registration Statement), and such notice shall describe the
      proposed registration and distribution and offer to all such Designated Holders
      the opportunity to register the number of Registrable Securities as each such
      Designated Holder may request.  The Company will include in such
      registration statement all Registrable Securities with respect to which the
      Company has received written requests for inclusion therein within 15 days
      after
      the Designated Holders’ receipt of the Company’s notice (a
“Piggyback Registration”).

     

    (b)  The
      Company shall use its reasonable best efforts to cause the managing underwriter
      or underwriters of a proposed underwritten offering involving a Piggyback
      Registration to permit the Registrable Securities requested to be included
      in a
      Piggyback Registration to be included on the same terms and conditions as any
      similar securities of the Company or any other security holder included therein
      and to permit the sale or other disposition of such Registrable Securities
      in
      accordance with the intended method of distribution thereof.

     

    (c)  Any
      Designated Holder shall have the right to withdraw its request for inclusion
      of
      its Registrable Securities in any Registration Statement pursuant to this
Section 2.4 by giving written
      notice to the Company of its request to withdraw; provided, that in the event
      of
      such withdrawal (other than pursuant to Section 2.4(e) hereof, the Company shall not
      be
      required to reimburse such Designated Holder for the fees and expenses referred
      to in Section 2.8 hereof
      incurred by such Designated Holder prior to such withdrawal, unless such
      withdrawal was due to a material adverse change to the Company.  The
      Company may withdraw a Piggyback Registration at any time prior to the time
      it
      becomes effective.

     

    (d)  If
      (i) a
      Piggyback Registration involves an underwritten offering of the securities
      being
      registered, whether or not for sale for the account of the Company, to be
      distributed (on a firm commitment basis) by or through one or more underwriters
      of recognized standing under underwriting terms appropriate for such a
      transaction, and (ii) the managing underwriter of such underwritten offering
      shall inform the Company and Designated Holders requesting such registration
      by
      letter of its belief that the distribution of all or a specified number of
      such
      Registrable Securities concurrently with the securities being distributed by
      such underwriters would interfere with the successful marketing of the
      securities being distributed by such underwriters (such writing to state the
      basis of such belief and the approximate number of such Registrable Securities
      which may be distributed without such effect), then the Company will be required
      to include in such registration only the amount of securities which it is so
      advised should be included in such registration.  In such event: (x)
      in cases initially involving the registration for sale of securities for the
      Company’s own account, securities shall be registered in such offering in the
      following order of priority: (i) first, the securities which the Company
      proposes to register, and (ii) second, Registrable Securities and securities
      which have been requested to be included in such registration by Persons
      entitled to exercise “piggy-back” registration rights pursuant to contractual
      commitments of the Company (pro rata based on the amount of securities sought
      to
      be registered by Designated Holders and such other Persons); and (y) in cases
      not initially involving the registration for sale of securities for the
      Company’s own account, securities shall be registered in such offering in the
      following order of priority: (i) first, the securities of any Person whose
      exercise of a “demand” registration right pursuant to a contractual commitment
      of the Company is the basis for the registration, (ii) second, Registrable
      Securities and securities which have been requested to be included in such
      registration by Persons entitled to exercise “piggy-back” registration rights
      pursuant to contractual commitments of the Company (pro rata based on the amount
      of securities sought to be registered by Designated Holders and such other
      Persons), and (iii) third, the securities which the Company proposes to
      register.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (e)  If,
      as a
      result of the proration provisions of this Section 2.4, any Designated Holders shall
      not be
      entitled to include all Registrable Securities in a Piggyback Registration
      that
      such Designated Holders has requested to be included, such holder may elect
      to
      withdraw his request to include Registrable Securities in such
      registration.

     

    (f)  The
      right
      of the Designated Holders to register Registrable Securities pursuant to this
      Section 2.4 is only exercisable
      with respect to Registrable Securities not then covered by an effective
      Registration Statement.

     

    2.5  Underwriting;
      Holdback Agreements.

     

    (a)  In
      the
      event that one or more Designated Holders elect to dispose of Registrable
      Securities under a Registration Statement pursuant to an underwritten offering
      or a requested registration pursuant to Section 2.3 involves an underwritten offering,
      the
      managing underwriter or underwriters shall be selected by the holders of a
      majority (by number of shares) of the Registrable Securities to be sold in
      the
      underwritten offering or requested to be included in such Registration Statement
      and shall be reasonably acceptable to the Company.  In connection with
      any such underwritten offering, the Company shall take all such reasonable
      actions as are required by the managing underwriters in order to expedite and
      facilitate the registration and disposition of the Registrable Securities,
      including the Company causing appropriate officers of the company or its
      Affiliates to participate in a “road show” or similar marketing effort being
      conducted by such managing underwriters with respect to such underwritten
      offering.

     

    (b)  All
      Designated Holders proposing to distribute their Registrable Securities through
      an underwritten offering shall enter into an underwriting agreement in customary
      form with the managing underwriters selected for such underwritten
      offering.

     

    (c)  To
      the
      extent not inconsistent with applicable law, in connection with a public
      offering of securities of the Company, upon the request of the Company or,
      in
      the case of an underwritten public offering of the Company’s securities, the
      managing underwriters, each Designated Holder who beneficially owns (as defined
      in Rule 13d-3 adopted by the SEC under the Exchange Act) at least 5% of the
      outstanding capital stock of the Company will not effect any sale or
      distribution (other than those included in the registration statement being
      filed with respect to such public offering) of, or any short sale of, or any
      grant of option to purchase, or any hedging or similar transaction with respect
      to, any securities of the Company, or any securities, options or rights
      convertible into or exchangeable or exercisable for such securities during
      the
      14 days prior to and the 90-day period beginning on the effective date of such
      public offering, unless the Company, or in the case of an underwritten public
      offering, the managing underwriters otherwise agree to a shorter period of
      time.  At the request of the Company or the managing underwriters,
      each such Designated Holder shall execute a customary “lock-up” agreement
      consistent with the provisions of this Section 2.5; provided, however, that no
      Designated
      Holder shall be required to enter into any such “lock up” agreement unless and
      until all of the Company’s executive officers and directors execute
      substantially similar “lock up” agreements and the Company uses commercially
      reasonable efforts to cause each holder of more than 5% of its outstanding
      capital stock to execute substantially similar “lock up”
agreements.  Neither the Company nor the underwriter shall terminate,
      materially amend or waive the enforcement of any material provision under a
      “lock up” agreement unless each “lock up” agreement with a Designated Holder is
      also amended or waived in a similar manner or terminated, as the case may
      be.  The Company may impose stop-transfer instructions to enforce the
      restrictions imposed by this Section 2.5.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    2.6  Registration
      Procedures.  The Company will use its reasonable best efforts to
      effect the registration of Registrable Securities pursuant to this Agreement
      in
      accordance with the intended methods of disposition thereof, and pursuant
      thereto the Company will as expeditiously as possible:

     

    (a)  before
      filing the Registration Statement, the Company will furnish to any counsel
      selected by the holders of a majority of the Registrable Securities a copy
      of
      such Registration Statement, and will provided such counsel with all written
      correspondence with the SEC regarding the Registration Statement;

     

    (b)  prepare
      and file with the SEC such amendments and supplements to such Registration
      Statement and the prospectus used in connection therewith as may be necessary
      to
      keep such Registration Statement effective for the periods provided for in
      Section 2.2 and
Section 2.3,
      or the periods
      contemplated by the Company or the Persons requesting any Registration Statement
      filed pursuant to Section 2.4;

     

    (c)  furnish
      to each Designated Holder selling such Registrable Securities such number of
      copies of such Registration Statement, each amendment and supplement thereto,
      the prospectus included in the Registration Statement (including each
      preliminary prospectus) and such other documents as such seller may reasonably
      request in order to facilitate the disposition of the Registrable Securities
      owned by such Designated Holder;

     

    (d)  use
      its
      reasonable best efforts to register or qualify such Registrable Securities
      under
      such other state securities or blue sky laws as the selling Designated Holders
      selling such Registrable Securities reasonably requests and do any and all
      other
      acts and things which may be reasonably necessary or reasonably advisable to
      enable such Designated Holder to consummate the disposition in such
      jurisdictions of the Registrable Securities owned by such Designated Holder
      and
      to keep each such registration or qualification (or exemption therefrom)
      effective during the period which the Registration Statement is required to
      be
      kept effective (provided, that the Company will not be required to (i) qualify
      generally to do business in any jurisdiction where it would not otherwise be
      required to qualify but for this subparagraph, (ii) subject itself to taxation
      in any such jurisdiction or (iii) consent to general service of process in
      any
      such jurisdiction);

     

    (e)  notify
      each Designated Holder selling such Registrable Securities, at any time when
      a
      prospectus relating thereto is required to be delivered under the Securities
      Act, of the happening of any event as a result of which the prospectus included
      in the Registration Statement contains an untrue statement of a material fact
      or
      omits any fact necessary to make the statements therein not misleading in the
      light of the circumstances under which they were made, and, at the request
      of
      any such Designated Holder, the Company will as soon as possible prepare and
      furnish to such Designated a reasonable number of copies of a supplement or
      amendment to such prospectus so that, as thereafter delivered to the purchasers
      of such Registrable Securities, such prospectus will not contain an untrue
      statement of a material fact or omit to state any fact necessary to make the
      statements therein not misleading in the light of the circumstances under which
      they were made;

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (f)  cause
      all
      such Registrable Securities to be listed or quoted on each securities exchange
      or quotation service on which similar securities issued by the Company are
      then
      listed or quoted and, if not so listed, to be approved for trading on any
      automated quotation system of a national securities association on which similar
      securities of the Company are quoted;

     

    (g)  provide
      a
      transfer agent and registrar for all such Registrable Securities not later
      than
      the effective date of such Registration Statement;

     

    (h)  enter
      into such customary agreements (including underwriting agreements containing
      customary representations and warranties) and take all other customary and
      appropriate actions as the holders of a majority of the Registrable Securities
      being sold or the managing underwriters, if any, reasonably request in order
      to
      expedite or facilitate the disposition of such Registrable
      Securities;

     

    (i)  notify
      each Designated Holder of any stop order issued or threatened by the
      SEC;

     

    (j)  otherwise
      comply with all applicable rules and regulations of the SEC, and make available
      to its security holders, as soon as reasonably practicable, an earnings
      statement covering the period of at least twelve months beginning with the
      first
      day of the Company’s first full calendar quarter after the effective date of the
      Registration Statement, which earnings statement shall satisfy the provisions
      of
      Section 11(a) of the Securities Act and Rule 158 thereunder;

     

    (k)  in
      the
      event of the issuance of any stop order suspending the effectiveness of a
      Registration Statement, or of any order suspending or preventing the use of
      any
      related prospectus or suspending the qualification of any securities included
      in
      such Registration Statement for sale in any jurisdiction, the Company will
      use
      its reasonable best efforts to promptly obtain the withdrawal of such
      order;

     

    (l)  with
      respect to an underwritten offering pursuant to any Registration Statement
      filed
      under Section 2.2 or
Section 2.3,
      obtain one or more
      comfort letters, dated the effective date of the Registration Statement and,
      if
      required by the managing underwriters, dated the date of the closing under
      the
      underwriting agreement, signed by the Company’s independent public accountants
      in customary form and covering such matter of the type customarily covered
      by
      comfort letters in similar transactions;

     

    (m)  with
      respect to an underwritten offering pursuant to any Registration Statement
      filed
      under Section 2.2 or
Section 2.3,
      obtain a legal
      opinion of the Company’s outside counsel, dated the effective date of such
      Registration Statement and, if required by the managing underwriters, dated
      the
      date of the closing under the underwriting agreement, with respect to the
      Registration Statement, each amendment and supplement thereto, the prospectus
      included therein (including the preliminary prospectus) and such other documents
      relating thereto in customary form and covering such matters of the type
      customarily covered by legal opinions in similar transactions;

     

    (n)  subject
      to execution and delivery of mutually satisfactory confidentiality agreements,
      make available at reasonable times for inspection by each Designated Holder
      selling such Registrable Securities, any managing underwriter participating
      in
      any disposition of such Registrable Securities pursuant to the Registration
      Statement, and any attorney, accountant or other agent retained by such
      Designated Holder or any such managing underwriter, during normal business
      hours
      of the Company at the Company’s corporate office in South Bend, Indiana and
      without unreasonable disruption of the Company’s business or unreasonable
      expense to Company and solely for the purpose of due diligence with respect
      to
      the Registration Statement, legally disclosable, financial and other records
      and
      pertinent corporate documents of the Company and its subsidiaries reasonable
      requested by such Persons, and cause the Company’s employees to, and request its
      independent accountants to, supply all similar information reasonably requested
      by any such Person, as shall be reasonably necessary to enable them to exercise
      their due diligence responsibility;

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    (o)  cooperate
      with each seller of Registrable Securities and each underwriter participating
      in
      the disposition of such Registrable Securities and their respective counsel
      in
      connection with any filings required to be made with the OTC Bulletin Board
      or
      the National Association of Securities Dealers; and

     

    (p)  take
      all
      other steps reasonably necessary to effect the registration of the. Registrable
      Securities contemplated hereby.

     

    2.7  Conditions
      Precedent to Company’s Obligations Pursuant to this Agreement.  It
      shall be a condition precedent to the obligations of the Company to take any
      action pursuant to this Article 2 with respect to the Registrable
      Securities of any Designated Holder that such Designated Holder shall timely
      furnish to the Company such information regarding itself, the Registrable
      Securities held by it and the intended method of distribution of such securities
      as shall reasonably be required to effect the registration of such Designated
      Holder’s Registrable Securities.

     

    2.8  Fees
      and Expenses.  All expenses incident to the Company’s performance
      of or compliance with this Agreement including, without limitation, all
      registration and filing fees payable by the Company, fees and expenses of
      compliance by the Company with securities or blue sky laws, printing expenses
      of
      the Company, messenger and delivery expenses of the Company, and fees and
      disbursements of counsel for the Company and all independent certified public
      accountants of the Company, and other Persons retained by the Company will
      be
      borne by the Company, and the Company will pay its internal expenses (including,
      without limitation, all salaries and expenses of the Company’s employees
      performing legal or accounting duties), the expense of any annual audit or
      quarterly review, the expense of any liability insurance of the Company and
      the
      expenses and fees for listing or approval for trading of the securities to
      be
      registered on each securities exchange on which similar securities issued by
      the
      Company are then listed or on any automated quotation system of a national
      securities association on which similar securities of the Company are
      quoted.  In connection with any Registration Statement filed
      hereunder, the Company will pay the reasonable fees and expenses of a single
      counsel retained by the Designated Holders of a majority (by number of shares)
      of the Registrable Securities requested to be included in such Registration
      Statement.  The Company shall have no obligation to pay any
      underwriting discounts or commissions attributable to the sale of Registrable
      Securities and any of the expenses incurred by any Designated Holder which
      are
      not payable by the Company, such costs to be borne by such Designated Holder
      or
      Holders, including, without limitation, underwriting fees, discounts and
      expenses, if any, applicable to any Designated Holder’s Registrable Securities;
      fees and disbursements of counsel or other professionals that any Designated
      Holder may choose to retain in connection with a Registration Statement filed
      pursuant to this Agreement (except as otherwise provided herein); selling
      commissions or stock transfer taxes applicable to the Registrable Securities
      registered on behalf of any Designated Holder; any other expenses incurred
      by or
      on behalf of such Designated Holder in connection with the offer and sale of
      such Designated Holder’s Registrable Securities other than expenses which the
      Company is expressly obligated to pay pursuant to this Agreement.

     

    2.9  Indemnification.

     

    (a)  The
      Company agrees to indemnify and hold harmless, to the fullest extent permitted
      by law, each Designated Holder and its general or limited partners, officers,
      directors, members, managers, employees, advisors, representatives, agents
      and
      Affiliates (collectively, the “Representatives”), and
      each underwriter, if any, and any Person who controls such underwriter (within
      the meaning of Section 15 of the Securities Act), from and against any loss,
      claim, damage, liability, reasonable attorney’s fees, cost or expense and costs
      and expenses of investigating and defending any such claim (collectively, the
      “Losses”), joint or several, and any action in respect
      thereof to which such Designated Holder or its Representatives may become
      subject under the Securities Act or otherwise, insofar as such Losses (or
      actions or proceedings, whether commenced or threatened, in respect thereto)
      arise out of or are based upon (i) any breach by the Company of any of its
      representations, warranties or covenants contained in this Agreement, (ii)
      any
      untrue or alleged untrue statement of a material fact contained in any
      Registration Statement, prospectus or preliminary or summary prospectus or
      any
      amendment or supplement thereto or (iii) any omission or alleged omission to
      state therein a material fact required to be stated therein or necessary to
      make
      the statements therein not misleading, and the Company shall reimburse each
      such
      Designated Holder and its Representatives for any reasonable legal or any other
      expenses incurred by them in connection with investigating or defending or
      preparing to defend against any such Loss, action or proceeding; provided,
      however, that the Company shall not be liable to any such Designated Holder
      or
      other indemnitee in any such case to the extent that any such Loss (or action
      or
      proceeding, whether commenced or threatened, in respect thereof) arises out
      of
      or is based upon (x) an untrue statement or alleged untrue statement or omission
      or alleged omission, made in such Registration Statement, any such prospectus
      or
      preliminary or summary prospectus or any amendment or supplement thereto, in
      reliance upon, and in conformity with, written information prepared and
      furnished to the Company by any Designated Holder or its Representatives
      expressly for use therein and, with respect to any untrue statement or omission
      or alleged untrue statement or omission made in any preliminary prospectus
      relating to the Registration Statement, to the extent that a prospectus relating
      to the Registrable Securities was required to be delivered by such Designated
      Holder under the Securities Act in connection with such purchase, there was
      not
      sent or given to such Person, at or prior to the written confirmation of the
      sale of such Registrable Securities to such Person, a copy of the final
      prospectus that corrects such untrue statement or alleged untrue statement
      or
      omission or alleged omission if the Company had previously furnished copies
      thereof to such Designated Holder or (y) use of a Registration Statement or
      the
      related prospectus during a period when a stop order has been issued in respect
      of such Registration Statement or any proceedings for that purpose have been
      initiated or use of a prospectus when use of such prospectus has been suspended
      pursuant to Sections 2.6(e) or (i); provided that in each case, that
      such Holder received prior written notice of such stop order, initiation of
      proceedings or suspension from the Company.  In no event, however,
      shall the Company be liable for indirect, incidental or consequential or special
      damages of any kind.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    (b)  In
      connection with the filing of the Registration Statement by the Company pursuant
      to this Agreement, the Designated Holders will furnish to the Company in writing
      such information as the Company reasonably requests for use in connection with
      such Registration Statement and the related prospectus and, to the fullest
      extent permitted by law, each such Designated Holder will indemnify and hold
      harmless the Company and its Representatives, and each underwriter, if any,
      and
      any Person who controls such underwriter (within the meaning of Section 15
      of
      the Securities Act), from and against any Losses, severally but not jointly,
      and
      any action in respect thereof to which the Company and its Representatives
      may
      become subject under the Securities Act or otherwise, insofar as such Losses
      (or
      actions or proceedings, whether commenced or threatened, in respect thereof)
      arise out of or are based upon (i) the purchase or sale of Registrable
      Securities during a suspension as set forth in Section 2.6(e) or Section 2.6(i)
      in each case after receipt of written
      notice of such suspension, (ii) any untrue or alleged untrue statement of a
      material fact contained in the Registration Statement, prospectus or preliminary
      or summary prospectus or any amendment or supplement thereto, or (iii) any
      omission or alleged omission of a material fact required to be stated therein
      or
      necessary to make the statements therein not misleading, but, with respect
      to
      clauses (ii) and (iii) above, only to the extent that such untrue statement
      or
      omission is made in such Registration Statement, any such prospectus or
      preliminary or summary prospectus or any amendment or supplement thereto, in
      reliance upon and in conformity with written information prepared and furnished
      to the Company by such Designated Holder expressly for use therein or by failure
      of such Designated Holder to deliver a copy of the Registration Statement or
      prospectus or any amendments or supplements thereto, and such Designated Holder
      will reimburse the Company and each Representative for any reasonable legal
      or
      any other expenses incurred by them in connection with investigating or
      defending or preparing to defend against any such Loss, action or proceeding;
      provided, however, that such Designated Holder shall not be liable in any such
      case to the extent that prior to the filing of any such Registration Statement
      or prospectus or amendment or supplement thereto, such Designated Holder has
      furnished in writing to the Company information expressly for use in such
      Registration Statement or prospectus or any amendment or supplement thereto
      which corrected or made not misleading information previously furnished to
      the
      Company.  The obligation of each Designated Holder to indemnify the
      Company and its Representatives shall be limited to the net proceeds received
      by
      such Designated Holder from the sale of Registrable Securities under such
      Registration Statement.  In no event, however, shall any Designated
      Holder be liable for indirect, incidental or consequential or special damages
      of
      any kind.

     

    (c)  Promptly
      after receipt by any Person in respect of which indemnity may be sought pursuant
      to Section 2.9(a) or 2.9(b)
      (an “Indemnified
      Party”) of notice of any claim or the commencement of any action,
      the Indemnified Party shall, if a claim in respect thereof is to be made against
      the Person against whom such indemnity may be sought (an
“Indemnifying Party”), promptly notify the
      Indemnifying Party in writing of the claim or the commencement of such action;
      provided, that the failure to notify the Indemnifying Party shall not relieve
      the Indemnifying Party from any liability which it may have to an Indemnified
      Party under Section 2.9(a) or 2.9(b)
      except to the extent of any actual
      prejudice resulting therefrom.  If any such claim or action shall be
      brought against an Indemnified Party, and it shall notify the Indemnifying
      Party
      thereof, the Indemnifying Party shall be entitled to participate therein, and,
      to the extent that it wishes, jointly with any other similarly notified
      Indemnifying Party, to assume the defense thereof with counsel reasonably
      satisfactory to the Indemnified Party. After notice from the Indemnifying Party
      to the Indemnified Party of its election to assume the defense of such claim
      or
      action, the Indemnifying Party shall not be liable to the Indemnified Party
      for
      any legal or other expenses subsequently incurred by the Indemnified Party
      in
      connection with the defense thereof other than reasonable costs of
      investigation; provided, that the Indemnified Party shall have the right to
      employ separate counsel to represent the Indemnified Party and its
      Representatives who may be subject to liability arising out of any claim in
      respect of which indemnity may be sought by the Indemnified Party against the
      Indemnifying Party, but the fees and expenses of such counsel shall be for
      the
      account of such Indemnified Party unless (i) the Indemnifying Party and the
      Indemnified Party shall have mutually agreed to the retention of such counsel
      or
      (ii) in the written opinion of counsel to such Indemnified Party, representation
      of both parties by the same counsel would be inappropriate due to actual or
      potential conflicts of interest between them, it being understood, however,
      that
      the Indemnifying Party shall not, in connection with any one such claim or
      action or separate but substantially similar or related claims or actions in
      the
      same jurisdiction arising out of the same general allegations or circumstances,
      be liable for the fees and expenses of more than one separate firm of attorneys
      (together with appropriate local counsel) at any time for all Indemnified
      Parties.  No Indemnifying Party shall, without the prior written
      consent of the Indemnified Party, effect any settlement of any claim or pending
      or threatened proceeding in respect of which the Indemnified Party is or could
      have been a party and indemnity could have been sought hereunder by such
      Indemnified Party, unless such settlement includes an unconditional release
      of
      such Indemnified Party from all liability arising out of such claim or
      proceeding other than the payment of monetary damages by the Indemnifying Party
      on behalf of the Indemnified Party.  Whether or not the defense of any
      claim or action is assumed by the Indemnifying Party, such Indemnifying Party
      will not be subject to any liability for any settlement made without its written
      consent, which consent will not be unreasonably withheld.

     

    (d)  If
      the
      indemnification provided for in this Section 2.9 is unavailable to the Indemnified
      Parties
      in respect of any Losses referred to herein notwithstanding that this
Section 2.9 by its terms
      provides for indemnification in such case, then each Indemnifying Party, in
      lieu
      of indemnifying such Indemnified Party, shall contribute to the amount paid
      or
      payable by such Indemnified Party as a result of such Losses in such proportion
      as is appropriate to reflect the relative benefits received by the Company
      on
      the one hand and the Designated Holders on the other from the offering of the
      Registrable Securities, or if such allocation is not permitted by applicable
      law, in such proportion as is appropriate to reflect not only the relative
      benefits but also the relative fault of the Company on the one hand and the
      Designated Holders on the other in connection with the statements or omissions
      which resulted in such Losses, as well as any other relevant equitable
      considerations. The relative fault of the Company on the one hand and of each
      Designated Holder on the other shall be determined by reference to, among other
      things, whether any action taken, including any untrue or alleged untrue
      statement of a material fact, or the omission or alleged omission to state
      a
      material fact relates to information supplied by such party, and the parties’
relative intent, knowledge, access to information and opportunity to correct
      or
      prevent such statement or omission.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    The
      Company and the Designated Holders agree that it would not be just and equitable
      if contribution pursuant to this Section 2.9(d) were determined by pro rata
      allocation
      or by any other method of allocation which does not take account of the
      equitable considerations referred to in the immediately preceding
      paragraph.  The amount paid or payable by an Indemnified Party as a
      result of the Losses referred to in the immediately preceding paragraph shall
      be
      deemed to include, subject to the limitations set forth above, any reasonable
      legal or other expenses reasonably incurred by such Indemnified Party in
      connection with investigating or defending any such action or
      claim.  Notwithstanding the provisions of this Section 2.9, no Designated Holder shall
      be required to
      contribute any amount in excess of the amount by which the total price at which
      the Registrable Securities of such Designated Holder were offered to the public
      exceeds the amount of any Losses which such Designated Holder has otherwise
      paid
      by reason of such untrue or alleged untrue statement or omission or alleged
      omission.  No Person guilty of fraudulent misrepresentation (within
      the meaning of Section 11(f) of the Securities Act) shall be entitled to
      contribution from any Person who was not guilty of such fraudulent
      misrepresentation.  Each Designated Holder’s obligations to contribute
      pursuant to this Section 2.9 is
      several in the proportion that the proceeds of the offering received by such
      Designated Holder bears to the total proceeds of the offering received by all
      the Designated Holders.  The indemnification provided by this
Section 2.9 shall be a
      continuing right to indemnification with respect to sales of Registrable
      Securities and shall survive the registration and sale of any Registrable
      Securities by any Designated Holder and the expiration or termination of this
      Agreement.  The indemnity and contribution agreements contained herein
      are in addition to any liability that any Indemnifying Party might have to
      any
      Indemnified Party.

     

    (e)  Notwithstanding
      the foregoing, to the extent the provisions on indemnification and contribution
      contained in the underwriting agreement entered into in connection with an
      underwritten public offering are in conflict with the foregoing provisions,
      the
      provisions in the underwriting agreement shall control for parties to that
      agreement.

     

    2.10  Participation
      in Registrations.

     

    (a)  No
      Person
      may participate in any registration hereunder which is underwritten unless
      such
      Person (i) agrees to sell such Person’s securities on the basis provided in any
      underwriting arrangements approved by the Person or Persons entitled hereunder
      to approve such arrangements and (ii) completes and executes all questionnaires,
      powers of attorney, indemnities, underwriting agreements and other documents
      reasonably required under the terms of such underwriting arrangements and this
      Agreement.

     

    (b)  Each
      Person that is participating in any registration under this Agreement agrees
      that, upon receipt of any notice from the Company of the happening of any event
      of the kind described in Section 2.6(e) or Section 2.6(i)
      above, such Person will forthwith
      discontinue the disposition of its Registrable Securities pursuant to the
      Registration Statement and all use of the Registration Statement or any
      prospectus or related document until such Person’s receipt of the copies of a
      supplemented or amended prospectus as contemplated by such
Section 2.6(e) or
Section 2.6(i)
      and, if so
      directed by the Company, will deliver to the Company (at the Company’s expense)
      all copies, other than permanent file copies, then in such Designated Holder’s
      possession of such documents at the time of receipt of such
      notice.  Furthermore, each Designated Holder agrees that if such
      Designated Holder uses a prospectus in connection with the offering and sale
      of
      any of the Registrable Securities, the Designated Holder will use only the
      latest version of such prospectus provided by Company.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    2.11  Compliance.  With
      respect to any registration under this Agreement, each Designated Holder shall
      comply in all material respects with all applicable securities and other laws,
      rules and regulations, including but not limited to all rules and regulations
      of
      the SEC, the National Association of Securities Dealers and any securities
      exchange or quotation service on which the Company’s securities are listed or
      quoted.

     

     

    ARTICLE
      3

     

    TRANSFERS
      OF CERTAIN RIGHTS

    
       

3.1  Transfer.  The
      rights granted to the Buyers under this Agreement may be transferred, subject
      to
      the provisions of Sections 3.2
      and 3.3; provided that nothing contained
      herein shall be deemed to permit an assignment, transfer or disposition of
      the
      Registrable Securities in violation of the terms and conditions of the
      Securities Purchase Agreement or applicable law.

     

    3.2  Transferees.  Any
      transferee to whom rights under this Agreement are transferred shall, before
      and
      as a condition to such transfer, deliver to the Company a written instrument
      (i)
      stating the name and address of the transferor and the transferee and the number
      of Registrable Securities with respect to which the rights are intended to
      be
      transferred, and (ii) by which such transferee agrees to be bound by the
      obligations imposed upon the Buyers under this Agreement to the same extent
      as
      if such transferee were a Buyer hereunder.

     

    3.3  Subsequent
      Transferees.  A transferee to whom rights are transferred pursuant
      to this Section 3 may not again transfer such rights to any other
      Person, other than as provided in Sections 3.1 or 3.2
      above.

     

     

    ARTICLE
      4

     

    
      MISCELLANEOUS

       

    

    4.1  Recapitalizations,
      Exchanges, etc.  The provisions of this Agreement shall apply to
      the full extent set forth herein with respect to (a) the Registrable Securities,
      (b) any and all shares of Common Stock into which the Registrable Securities
      are
      converted, exchanged or substituted in any recapitalization or other capital
      reorganization by the Company, and (c) any and all equity securities of the
      Company or any successor or assign of the Company (whether by merger,
      consolidation, sale of assets or otherwise) which may be issued in respect
      of,
      in conversion of, in exchange for or in substitution of, the Registrable
      Securities and shall be appropriately adjusted for any stock dividends, splits,
      reverse splits, combinations, recapitalizations and the like occurring after
      the
      date hereof. The Company shall cause any successor or assign (whether by merger,
      consolidation, sale of assets or otherwise) to enter into a new registration
      rights agreement with the Designated Holders on terms substantially the same
      as
      this Agreement as a condition of any such transaction.

     

    4.2  No
      Inconsistent Agreements.  The Company has not and shall not enter
      into any agreement with respect to its securities that is inconsistent with
      the
      rights granted to the Buyers in this Agreement.  The parties
      acknowledge and agree that the Company may grant registration rights hereafter,
      which shall be pari passu with the registration rights of the Buyers, and shall
      not be deemed to conflict with this covenant.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    4.3  Amendments
      and Waivers.  The provisions of this Agreement may be amended and
      the Company may take action herein prohibited, or omit to perform any act herein
      required to be performed by it, if, but only if, the Company has obtained the
      written consent of Designated Holders of at least a majority of the Registrable
      Securities then in existence.

     

    4.4  Severability.  Whenever
      possible, each provision of this Agreement shall be interpreted in such manner
      as to be effective and valid under applicable law, but if any provision of
      this
      Agreement shall be held to be prohibited by or invalid under applicable law,
      such provision shall be ineffective only to the extent of such prohibition
      or
      invalidity, without invalidating the remainder of such provision or the
      remaining provisions of this Agreement.

     

    4.5  Counterparts.  This
      Agreement may be executed in one or more counterparts each of which shall be
      deemed an original, but all of which together shall constitute one and the
      same
      instrument.

     

    4.6  Notices.  Any
      notices required or permitted to be given under the terms of this Agreement
      shall be sent by certified or registered mail (return receipt requested) or
      delivered personally or by courier (including a recognized overnight delivery
      service) or by facsimile and shall be effective five days after being placed
      in
      the mail, if mailed by regular United States mail, or upon receipt, if delivered
      personally or by courier (including a recognized overnight delivery service)
      or
      by facsimile, in each case addressed to a party.  The addresses for
      such communications shall be:

     

    If
      to the
      Company:

     

    MISCOR
      Group, Ltd.

    1125
      South Walnut Street

    South
      Bend, Indiana 46619

    Attention:      John
      A. Martel

    James
      M. Lewis, Esq.

    Telephone:     (574)
      234-8131

    Facsimile:        (574)
      232-7648

    

     

    With
      copy
      to:

     

    Barnes
      & Thornburg LLP

    600
      1st Source
      Center

    100
      North
      Michigan Avenue

    South
      Bend, Indiana 46601

    Attention:       Richard
      L. Mintz, Esq.

    Telephone:      (574)
      237-1166

    Facsimile:         (574)
      237-1125

    

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    If
      to the
      Buyer:

     

    Tontine
      Capital Partners, L.P.

    55
      Railroad Avenue, 1st Floor

    Greenwich,
      Connecticut 06830

    Attention:        Mr.
      Jeffrey L. Gendell

    Telephone:       (203)
      769-2000

    Facsimile:          (203)
      769-2010

    

     

    With
      copy
      to:

     

    Barack
      Ferrazzano Kirschbaum & Nagelberg LLP

    200
      West
      Madison Street, Suite 3900

    Chicago,
      Illinois 60606

    Attention:         John
      E. Freechack, Esq.

    Telephone:        (312)
      984-3100

    Facsimile:           (312)
      984-3150

    

    Each
      party shall provide notice to the other party of any change in
      address.

     

    4.7  Governing
      Law.  This Agreement shall be governed by and construed in
      accordance with the laws of the State of Indiana, without regard to the
      conflicts of laws rules or provisions.

     

    4.8  Forum;
      Service of Process.  Any legal suit, action or proceeding brought
      by the Company, Buyers, any other Designated Holders, any Person entitled to
      indemnification or contribution hereunder, or any of their respective Affiliates
      arising out of or based upon this Agreement shall be instituted exclusively
      in
      any federal or state court in the State of Indiana, and each such Person
      irrevocably waives any objection which it may now or hereafter have to the
      laying of venue or any such proceeding, and irrevocably submits to the
      jurisdiction of such courts in any such suit, action or proceeding.

     

    4.9  Captions.  The
      captions, headings and arrangements used in this Agreement are for convenience
      only and do not in any way limit or amplify the terms and provisions
      hereof.

     

    4.10  No
      Prejudice.  The terms of this Agreement shall not be construed in
      favor of or against any party on account of its participation in the preparation
      hereof.

     

    4.11  Words
      in Singular and Plural Form.  Words used in the singular form in
      this Agreement shall be deemed to import the plural, and vice versa, as the
      sense may require.

     

    4.12  Remedy
      for Breach.  The Company hereby acknowledges that in the event of
      any breach or threatened breach by the Company of any of the provisions of
      this
      Agreement, the Designated Holders would have no adequate remedy at law and
      could
      suffer substantial and irreparable damage.  Accordingly, the Company
      hereby agrees that, in such event, the Designated Holders shall be entitled,
      and
      notwithstanding any election by any Designated Holder to claim damages, to
      obtain a temporary and/or permanent injunction to restrain any such breach
      or
      threatened breach or to obtain specific performance of any such provisions,
      all
      without prejudice to any and all other remedies which any Designated Holders
      may
      have at law or in equity.

     

    4.13  Successors
      and Assigns, Third Party Beneficiaries.  This Agreement and all of
      the provisions hereof shall be binding upon and inure to the benefit of the
      parties hereto, each assignee of the Designated Holders pursuant to Article
      3 and their respective successors and assigns and executors, administrators
      and heirs.  Designated Holders are intended third party beneficiaries
      of this Agreement and this Agreement may be enforced by such Designated
      Holders.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    4.14  Amendment
      and Restatement.  This Agreement amends and restates in its
      entirety the Initial Registration Rights Agreement and sets forth the entire
      agreement and understanding between the parties as to the subject matter hereof
      and merges and supersedes all prior discussions, agreements and understandings
      of any and every nature among them.

     

    4.15  Attorneys’
      Fees.  In the event of any action or suit based upon or arising
      out of any actual or alleged breach by any party of any representation,
      warranty, covenant or agreement in this Agreement, the prevailing party shall
      be
      entitled to recover its reasonable attorneys’ fees and expenses of such action
      or suit from the other party in addition to any other relief ordered by any
      court.

     

    4.16  Termination
      of Rights.  All rights under this Agreement will terminate as to a
      Designated Holder when that Designated Holder no longer holds any Registrable
      Securities.

     

    

     

    [Signature
      Page Follows]

     

    

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Amended and Restated
      Registration Rights Agreement to be duly executed as of the date and year first
      written above.

     

    
       

      
        	 	
                COMPANY:

              
	 	 	 
	 	 
	 	
                MISCOR
                  GROUP, LTD.

              
	 	 
	 	 
	 	
                By:

              	/s/
                John A. Martell
	 	
                Title:

              	President

      

    

     

     

    
      
        	 	
                BUYERS:

              
	 	 	 	 
	 	
                TONTINE
                  CAPITAL PARTNERS, L.P.

              
	 	 	 	 
	 	 	 	 
	 	
                By:

              	
                Tontine
                  Capital Management, LLC, its general partner

              
	 	 	 	 
	 	 	
                By:

              	/s/
                Jeffrey L. Gendell
	 	 	 	
                Jeffrey
                  L. Gendell, as managing member

              
	 	 	 	 

      

    

     

    
 

    
      	 	
              TONTINE
                CAPITAL OVERSEAS MASTER FUND, L.P.

            
	 	 	 	 
	 	
              By:

            	
              Tontine
                Capital Overseas GP, L.L.C., its general partner

            
	 	 	 	 
	 	 	
              By:

            	/s/
              Jeffrey L. Gendell
	 	 	 	
              Jeffrey
                L. Gendell, as managing member

            
	 	 	 	 

    

    

     

     

    
       

      19

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00133-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00133-of-00352.parquet"}]]