As Use ~~filed~~these ~~with~~links ~~the~~to ~~Securities~~rapidly ~~and~~review ~~Exchange~~the ~~Commission~~document TABLE onOF ~~January~~CONTENTS ~~16,~~ INDEX ~~2002~~TO FINANCIAL STATEMENTS

As filed with the Securities and Exchange Commission on February 7, 2005

Registration No. 333-

SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549

~~WASHINGTON,~~FORM ~~D.C.~~S-1 REGISTRATION ~~20549~~STATEMENT UNDER THE SECURITIES ACT OF 1933

~~FORM~~Medical ~~S-1~~ Device Manufacturing, Inc. (Exact name of registrant as specified in its charter)

~~REGISTRATION~~SEE ~~STATEMENT~~TABLE OF ADDITIONAL REGISTRANTS

~~Under~~Colorado (State or other jurisdiction of Incorporation or organization) 3841 (Primary Standard Industrial Classification Code Number) 91-2054669 (I.R.S. Employer Identification Number)

~~THE~~200 ~~SECURITIES~~West ~~ACT~~7th OFAvenue Collegeville, ~~1933~~PA 19426-0992 (610) 489-0300 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

~~MedSource~~Ron ~~Technologies~~Sparks President and Chief Executive Officer 200 West 7th Avenue Collegeville, ~~Inc.~~PA 19426-0992 (610) 489-0300 (Name, address, including zip code, and telephone number, including area code, of agent for service)

~~(Exact~~With ~~Name~~copies ofto: Christopher ~~Registrant~~J. asWalsh, ~~Specified~~Esq. Scott inA. ~~Its~~Berdan, ~~Charter~~Esq. Hogan & Hartson L.L.P. 1200 Seventeenth Street, Suite 1500 Denver, CO 80202 (303) 899-7300

Delaware		3841		52-2094496
(State of Incorporation)		(Primary S.I.C. Code Number)		(IRS Employer Identification No.)

Approximate Date Of Commencement Of Proposed Sale To The Public:
As soon as practicable after the effective date of this Registration Statement.

~~110~~ If ~~Cheshire~~any ~~Lane~~of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, ~~Suite~~check ~~100~~the following box. ý

~~Minneapolis~~ If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, MNcheck the following box ~~55305~~and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(~~952~~c) ~~807-1234~~under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(~~Address~~d) under the Securities Act, ~~including~~check ~~zip~~the ~~code~~following box and ~~telephone~~list the Securities Act registration statement number, of ~~registrant’s~~ ~~principal~~the ~~executive~~earlier ~~offices)~~effective registration statement for the same offering. o

~~Richard~~ If J.delivery ~~Effress~~of the prospectus is expected to be made pursuant to Rule 434, please check the following box. o

Chairman of the Board of Directors and Chief Executive Officer

MedSource Technologies, Inc.

110 Cheshire Lane, Suite 100

Minneapolis, MN 55305

(952) 807-1234

(Name, address, including zip code and telephone number, including area code, of agent for service)

Copies to:

Edward R. Mandell Jenkens & Gilchrist Parker Chapin LLP 405 Lexington Avenue New York, NY 10174 Telephone No.: (212) 704-6000 Telecopier No.: (212) 704-6288 Joseph J. Caffarelli Senior Vice President and Chief Financial Officer MedSource Technologies, Inc. 110 Cheshire Lane, Suite 100 Minneapolis, MN 55305 Telephone No.: (952) 807-1234 Telecopier No.: (952) 807-1235 Patrick O’Brien Ropes & Gray One International Place Boston, MA 02110 Telephone No.: (617) 951-7000 Telecopier No.: (617) 951-7050

Approximate date of commencement of proposed sale to public: From time to time after the effective date of this registration statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. ¨

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	~~Proposed~~Amount ~~Maximum~~to ~~Aggregate~~be ~~Offering Price(1)~~Registered		Proposed Maximum Offering Price Per Note	~~Amount of Registration Fee~~	Proposed Maximum Aggregate Offering Price	Amount of Registration Fee
Common Stock, par value $.01 per share	$	138,000,000		$	32,982
10% Senior Subordinated Notes Due 2012	$175,000,000		100%		$175,000,000	(1)
Guarantees of 10% Senior Subordinated Notes Due 2012	—		—		—	(2)

(1): The prospectus that is part of this registration statement will only be used by Credit Suisse First Boston LLC and its affiliates that are affiliates of Medical Device Manufacturing, Inc., in connection with offers and sales related to market-making transactions of an indeterminate amount of Medical Device Manufacturing, Inc.'s $175,000,000 10% Senior Subordinated Notes due 2012. Pursuant to Rule 457(q) of the rules and regulations under the Securities Act of 1933, no filing fee is required.
(2): Pursuant to Section 457(n) of the rules and regulations under the Securities Act, no separate registration fee for the guarantees is required.

~~(1)~~ The ~~Estimated~~Registrant ~~solely~~hereby ~~for~~amends ~~the~~this ~~purpose~~Registration ofStatement ~~calculating~~on such date or dates as may be necessary to delay its effective date until the ~~registration~~Registrant ~~fee~~shall file a further amendment that specifically states that this Registration Statement shall thereafter become effective in accordance with ~~Rule 457~~Section 8(oa) ~~under~~of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

~~The~~TABLE ~~registrant~~OF ~~hereby~~ADDITIONAL amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. REGISTRANTS

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

Exact Name of Registrant as Specified in its Charter(1)	State of Incorporation or Organization	Primary Standard Industrial Classified Code Number	I.R.S. Employer Identification Number
MedSource Technologies, Inc.	Delaware	3841	52-2094496
Noble-Met, Ltd.	Virginia	3499	54-1480585
UTI Corporation	Pennsylvania	3317	23-1721795
Spectrum Manufacturing, Inc.	Nevada	3841	36-2997517
American Technical Molding, Inc.	California	3082	99-0266738
UTI Holding Company	Delaware	6719	51-0407158
Micro-Guide, Inc.	California	3496	95-1866997
Venusa, Ltd.	New York	3841	13-3029017
MedSource Technologies, LLC	Delaware	6719	41-1934170
Brimfield Acquisition Corp.	Delaware	3814	51-0386457
Brimfield Precision, LLC	Delaware	6719	04-3457459
Kelco Acquisition, LLC	Delaware	3499	52-2139676
Hayden Precision Industries, LLC	Delaware	3841	16-1564447
Portlyn, LLC	Delaware	3841	02-0506852
The Microspring Company, LLC	Delaware	3841	04-3459102
Tenax, LLC	Delaware	3841	06-1567572
Thermat Acquisition Corp.	Delaware	3841	52-2235950
MedSource Technologies Newton, Inc.	Delaware	3841	41-1990432
MedSource Technologies Pittsburgh, Inc.	Delaware	3841	04-3710128
MedSource Trenton, Inc.	Delaware	3841	32-0000036
National Wire & Stamping, Inc.	Colorado	3841	84-0485552
Cycam, Inc.	Pennsylvania	3841	25-1567669
ELX, Inc.	Pennsylvania	3841	25-1711485
Texcel, Inc.	Massachusetts	3841	04-2973748
G&D, Inc.	Colorado	3496	84-0718817

(1): The address and telephone number of each co-registrant's principal executive offices is 200 W. 7^th Avenue, Collegeville, PA 19426, (610) 409-2225.

~~PROSPECTUS~~ ~~(Subject~~ to EXPLANATORY ~~Completion)~~ NOTE

~~Issued~~ Medical ~~January~~Device 16Manufacturing, Inc. ~~2002~~has filed a Registration Statement on Form S-4, as amended, with the Securities and Exchange Commission pursuant to which it is offering up to $175,000,000 in aggregate principal amount of its Series B 10% Senior Subordinated Notes due 2012 (the notes) and related guarantees in exchange for an equal principal amount of its outstanding Series A 10% Senior Subordinated Notes due 2012 (the old notes) and related guarantees issued June 30, 2004.

~~Shares~~ This Registration Statement on Form S-1 covers the registration of the notes for resale by Credit Suisse First Boston LLC and its affiliates that are affiliates of Medical Device Manufacturing, Inc. in market-making transactions following the issuance of the notes upon consummation of the exchange offer. The market-making prospectus included in this registration statement is substantially similar to the exchange offer prospectus included in the Registration Statement on Form S-4, except that the market-making prospectus has a different cover and has different sections captioned "Use of Proceeds" and "Plan of Distribution", and the section captioned "Material United States Federal Income Tax Consequences" in the exchange offer prospectus has been replaced with the section captioned "Certain United States Federal Income Tax Consequences." In addition, the market-making prospectus does not include the following captions, or the information set forth thereunder, included in the exchange offer prospectus: "Prospectus Summary—Summary of the Terms of the Exchange Offer," "Risk Factors—Risks Related to the Exchange Notes and Our Structure—We cannot assure you that an active trading market will develop for the exchange notes," "—If you fail to exchange your old notes, they will continue to be restricted securities and may become less liquid," and "The Exchange Offer." And, a new risk factor captioned "Risk Factors—Risks Related to the Notes and Our Structure—Because there is no public market for the notes, you may not be able to resell your notes" has been added to the market-making prospectus. All other sections of the exchange offer prospectus, with certain minor conforming changes, are included in the market-making prospectus.

~~MedSource~~The ~~Technologies,~~information ~~Inc~~in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer is not permitted.

~~COMMON~~SUBJECT ~~STOCK~~TO COMPLETION, DATED FEBRUARY , 2005

~~MedSource~~ Technologies, Inc. is offering shares of its common stock. This is our initial public offering and no public market currently exists for our shares. We anticipate that the initial public offering price will be between $ and $ per share. PROSPECTUS

WeMEDICAL ~~have~~DEVICE ~~applied for approval for quotation of our common stock on the Nasdaq National Market under the symbol “MEDT~~MANUFACTURING, INC.”

~~Investing~~$175,000,000 inSERIES ~~our common~~B ~~stock~~10% ~~involves~~SENIOR ~~risks.~~SUBORDINATED ~~See~~NOTES ~~“Risk~~DUE ~~Factors” beginning on page 9.~~ 2012

~~PRICE~~ The $ 10% Series B Senior Subordinated Notes due 2012, or the notes, were issued in exchange for the 10% Series A ~~SHARE~~Senior Subordinated Notes due 2012, or the old notes, by Medical Device Manufacturing, Inc., a Colorado corporation, in an exchange offer. Prior to the exchange offer, no public trading market existed for the old notes or the exchange notes.

~~Price~~ The notes will mature on July 15, 2012. We may redeem the notes, in whole or in part, at any time on or after July 15, 2008, at the redemption prices set forth in this prospectus. We may redeem up to ~~Public~~35% ~~Underwriting~~of ~~Discounts~~the aggregate ~~and~~principal ~~Commissions~~amount ~~Proceeds~~of the notes using net proceeds from qualified equity offerings completed on or prior to ~~Company~~July 15, ~~Per~~2007. ~~Share~~There $is $no $sinking ~~Total~~fund $for $the $notes. Holders may require us to repurchase the notes upon a change of control.

~~MedSource~~ The notes ~~Technologies~~are jointly and severally, ~~Inc.~~fully and ~~two~~unconditionally, ~~selling~~guaranteed ~~stockholders~~on ~~have~~a ~~granted~~senior ~~the~~subordinated ~~underwriters~~basis ~~the~~by ~~right~~each toof our existing domestic subsidiaries and by all our future domestic ~~purchase~~subsidiaries upthat are not designated by us as unrestricted subsidiaries. The notes and the guarantees rank junior to anall ~~additional shares~~of our and ~~shares~~ the applicable guarantors' existing and future senior indebtedness, ~~respectively,~~including toour ~~cover~~senior ~~over-allotments~~secured credit facility.

~~The~~ There is ~~Securities~~no ~~and~~established ~~Exchange~~trading ~~Commission~~market ~~and~~for ~~state~~the ~~securities~~notes. ~~regulators~~We ~~have~~do not ~~approved~~intend orto ~~disapproved these~~list ~~securities,~~the ornotes ~~determined~~on ifany ~~this~~securities ~~prospectus~~exchange, isand ~~truthful~~therefore orno ~~complete.~~active ~~Any~~public ~~representation~~market ~~to the contrary~~ is ~~a criminal offense~~anticipated.

~~Morgan Stanley~~ See &"Risk ~~Co.~~Factors" ~~Incorporated~~beginning ~~expects~~on topage 13 ~~deliver~~for ~~the~~a ~~shares~~discussion toof ~~purchasers~~certain ~~on ,~~risks ~~2002.~~that you should consider in connection with an investment in the notes.

~~MORGAN~~ Neither ~~STANLEY~~the ~~BEAR,~~Securities ~~STEARNS~~and &Exchange COCommission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. ~~INC~~Any representation to the contrary is a criminal offense.

~~THOMAS~~ This prospectus ~~WEISEL~~will ~~PARTNERS~~be used by Credit Suisse First Boston LLC and its affiliates in connection with offers and sales in market-making transactions in the notes effected from time to time. Credit Suisse First Boston LLC may act as principal or agent in such transactions. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from the sale of such securities.

~~WACHOVIA~~The ~~SECURITIES~~date of this prospectus is , 2005.

, 2002

TABLE OF CONTENTS

2INDUSTRY AND MARKET DATA PROSPECTUS SUMMARY SUMMARY HISTORICAL AND PRO FORMA CONDENSED CONSOLIDATED FINANCIAL DATA RISK FACTORS CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS THE TRANSACTIONS USE OF PROCEEDS CAPITALIZATION NON-GAAP FINANCIAL MEASURES SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS BUSINESS MANAGEMENT EXECUTIVE COMPENSATION SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS DESCRIPTION OF NEW SENIOR SECURED CREDIT FACILITY DESCRIPTION OF NOTES BOOK-ENTRY, DELIVERY AND FORM CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES PLAN OF DISTRIBUTION LEGAL MATTERS EXPERTS WHERE YOU CAN FIND MORE INFORMATION INDEX TO FINANCIAL STATEMENTS

		Page
Prospectus Summary		3
Risk Factors		9
Forward-Looking Statements		19
Use of Proceeds		20
Dividend Policy		21
Capitalization		22
Dilution		24
Selected Unaudited Pro Forma Condensed Combined Financial Information		25
Selected Consolidated Financial Data		30
Management’s Discussion and Analysis of Financial Condition and Results of Operations		32
Selected Financial Data of Predecessor Companies		40
Management’s Discussion and Analysis of Financial Condition and Results of Operations of Predecessor Companies		42

INDUSTRY AND MARKET DATA

		Page
Business		46
Management		56
Certain Transactions		65
Principal and Selling Stockholders		67
Description of Capital Stock		70
Shares Eligible for Future Sale		73
Underwriting		75
Legal Matters		78
Experts		78
Where You Can Find Additional Information		79
Index to Consolidated Financial Statements and Predecessor Company Financial Statements		F-1

Industry and market data used throughout this prospectus is based on independent industry publications, government publications, reports by market research firms and other published independent sources. Some data is also based on our good faith estimates, which are derived from our review of internal surveys and independent sources.

You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. We are offering to sell shares of common stock and seeking offers to buy shares of common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is current only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of common stock. Unless otherwise provided, in this prospectus, the “Company,” “we,” “us” and “our” refer to MedSource Technologies, Inc. and its subsidiaries. i

Until , 2002, all dealers that buy, sell or trade shares of our common stock, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

PROSPECTUS SUMMARY

~~This~~ The following summary ~~highlights~~should ~~information~~be ~~contained~~read ~~elsewhere~~ in ~~this~~conjunction ~~prospectus.~~with, ~~This~~and ~~summary~~is ~~does~~qualified ~~not~~in ~~contain~~its ~~all~~entirety ofby, the more detailed information ~~that~~and ~~you~~financial statements ~~should~~(including ~~consider~~the ~~before~~accompanying ~~investing~~notes) appearing elsewhere in ~~our common~~this ~~stock~~prospectus. ~~You~~We ~~should~~encourage you to read ~~the~~this entire ~~prospectus~~document, including "Risk Factors," and the ~~more~~documents ~~detailed~~to ~~information~~which ~~and~~we ~~the~~refer ~~financial~~you before ~~statements~~making ~~appearing~~an ~~elsewhere~~investment in ~~this~~the ~~prospectus~~notes.

~~Our~~ ~~Business~~ Our Company

We are a leading engineering and manufacturing services provider to the medical device industry. Our customers include many of the largest medical device companies in the world, such as Boston Scientific, Guidant, Johnson & Johnson affiliates and Medtronic, as well as other large and emerging medical device companies. We provide product development and design services, precision metal and plastic part manufacturing, product assembly services and supply chain management. Through these products and services, we offer our customers a single source solution for their device development and manufacturing needs, accelerated product development time, and reduced costs, allowing them to focus on their core competencies such as research and sales and marketing. Our revenues have grown from $89.4 million in fiscal 2000 to $128.5 million in fiscal 2001, or $149.8 million in fiscal 2001 on a pro forma basis. Overview

~~The~~ On ~~global~~April 27, ~~medical~~2004, ~~device~~we ~~market in~~entered ~~2000~~into ~~exceeded~~an ~~$170~~Agreement ~~billion,~~and ~~with~~Plan ~~the~~of ~~United~~Merger ~~States~~pursuant ~~portion~~to ~~alone~~which, ~~constituting~~on ~~approximately~~June 30, ~~$70 billion~~2004, ~~according~~we toacquired ~~Frost~~MedSource &by ~~Sullivan.~~merging ~~Our~~it ~~initial~~with ~~target~~our wholly ~~markets~~owned ~~are~~subsidiary, ~~the~~Pine ~~surgical~~Merger ~~instrumentation~~Corporation, ~~electro-medical~~a ~~implant~~Delaware corporation, ~~interventional~~which merger resulted in MedSource and ~~orthopedic~~ ~~markets~~its subsidiaries becoming our wholly owned subsidiaries. WeAs ~~selected~~a ~~these~~result ~~target~~of ~~markets~~our ~~based~~completion of onthe ~~their~~MedSource ~~size~~acquisition, ~~growth,~~we ~~margins,~~believe ~~customer~~we ~~dynamics~~are the largest provider of outsourced precision manufacturing and ~~competitive~~engineering ~~environment.~~services Wein ~~believe~~our ~~that~~target markets of the medical device industry. We are focused on the leading companies’ ~~cost~~in ofthe ~~goods~~medical ~~sold~~device ~~largely~~industry ~~represents~~in the ~~market~~cardiovascular, ~~for~~endoscopy ~~medical engineering~~and orthopaedic end markets. We offer our customers design and engineering, precision component manufacturing, device assembly and supply chain management services. ~~Based~~We have extensive resources focused on ~~Frost~~providing &our ~~Sullivan~~customers ~~data~~reliable, wehigh ~~believe~~quality, ~~the~~ cost-efficient, ofintegrated ~~goods~~outsourced solutions. ~~sold~~We ~~for~~often ~~our~~become ~~four~~the ~~target~~sole ~~markets~~supplier ~~currently~~of ~~represents~~manufacturing atand ~~least~~engineering aservices ~~$10~~for ~~billion~~the ~~annual~~products ~~worldwide~~we ~~opportunity~~provide to our customers.

~~According~~ Our design toand ~~Frost & Sullivan~~engineering, ~~outsourcing~~precision ofcomponent manufacturing, bydevice ~~medical~~assembly ~~device~~and ~~companies~~supply inchain ~~the~~management ~~United~~services ~~States~~provide ~~grew~~multiple atstrategic anbenefits ~~annual~~to ~~rate~~our incustomers. ~~excess~~We ofhelp ~~18%~~speed ~~from~~our ~~1999~~customers' products to ~~2000.~~market, Welower ~~believe~~their ~~that~~ manufacturing ~~outsourcing~~costs byand ~~medical~~enable ~~device~~our ~~companies~~customers ~~will continue~~ to ~~increase~~focus aton ~~approximately~~their ~~the~~core ~~same~~competencies, ~~rate~~including ~~through~~research, ~~2005~~sales and ~~expect~~marketing. ~~several trends to drive this growth, including:~~

r We have developed long-term relationships with our largest customers and work closely with our customers in the ~~need~~design, testing, prototyping and production of their products. Many of the end products we produce for ~~faster~~our ~~product~~customers ~~innovation~~are regulated by the U.S. Food & Drug Administration, or the FDA, which ~~requires~~has ~~accelerating~~stringent ~~product~~quality ~~development~~standards ~~cycle~~for ~~times;~~manufacturers of medical devices.

r We generate ~~cost~~a ~~containment~~recurring ~~pressures~~revenue base from a diverse range of products used in ~~healthcare~~a number of cardiovascular, ~~which~~endoscopic ~~necessitate~~and orthopaedic applications. The majority of our net sales come from products we consider high value, single use products. These products are either regulated for single use, implanted into the body or considered too critical to be re-used. Our revenue base has grown through a ~~more~~combination ~~efficient~~of ~~supply~~our ~~chain;~~customers' end market growth and their increased outsourcing of products to us.

~~r increased competition and industry consolidation.~~1

AsOur aOrganizational result of these factors, medical device companies are focusing on their core competencies in research and sales and marketing and are outsourcing other functions such as manufacturing and related engineering and product development services. We believe that the medical engineering and manufacturing services industry is highly fragmented with over 3,000 companies, many of which have annual revenues of less than $5 million and limited capabilities that do not satisfy current market requirements. We believe we address this market opportunity by providing our customers: Structure

r The afollowing ~~single~~organizational ~~source~~chart ~~solution;~~shows the relationships among us, our parent, and our direct and indirect wholly owned subsidiaries, the jurisdictions of organization of each of which are shown parenthetically:

rIndustry ~~accelerated time to market;~~Background

r We ~~quality~~believe ~~products~~our target market is represented by the amount of engineering and ~~practices;~~manufacturing services outsourced by the leading medical device companies to third-party manufacturers. Our target market is growing through a combination of growth in our customers' end markets and an increase in the amount of manufacturing and engineering services outsourced to third-party providers.

r We believe ~~reduced~~that ~~costs~~our targeted end markets are attractive based on their large size, growth, customer dynamics, competitive environment and need for high-quality engineering and manufacturing services. Many of the medical device companies in these end markets are increasingly utilizing third-party manufacturing and engineering providers as part of their business and manufacturing strategies. Medical device companies are choosing their strategic outsourcing partners based on the partner's ability to provide comprehensive precision manufacturing and engineering capabilities and deliver consistently high quality and highly reliable products at competitive prices. We believe medical device companies will continue to outsource manufacturing to third-party providers based on the: (1) desire of medical device companies to accelerate time-to-market; (2) increasing complexity of manufacturing medical device products; (3) rationalization of medical device companies' existing manufacturing facilities; and (4) increasing focus by medical device companies on their core competencies of research, sales and marketing.

~~r a financially stable product and service provider.~~2

Competitive Strengths

Our competitive strengths make us a preferred strategic manufacturing partner for many of the leading medical device companies and position us for profitable growth. Our preferred provider status is evident through our long term customer relationships, sole source agreements and/or by official designation.

•: Market Leader. We believe we are the largest provider of outsourced precision manufacturing and engineering services in our target markets of the medical device industry, which enables us to invest significant resources in our infrastructure including manufacturing facilities, engineering expertise, proprietary processes and sales force.
•: Strong Relationships With Targeted Customers. We provide manufacturing and engineering services to the leading medical device companies worldwide in our targeted medical end markets of cardiology, endoscopy and orthopaedics.
•: Preferred Supplier. We are the sole supplier of manufacturing and engineering services for a significant portion of the products we provide to our customers due to the high level of interaction necessary to design, develop and produce the high value medical devices on which we focus.
•: Breadth of Manufacturing and Engineering Capabilities. We provide a comprehensive range of manufacturing and engineering services, including design, testing, prototyping, production and device assembly, as well as global supply chain management services.
•: Strategic Locations. Our strategic locations allow us to facilitate speed to market, rapid prototyping, low cost assembly and overall customer familiarity.
•: Reputation for Quality. We believe our reputation and experience as a high quality manufacturer provide us with an advantage in winning new business as large medical device companies want to partner with a successful, proven manufacturer who has the systems and capabilities to ensure a high level of quality.
•: Experienced Management Team. We have a highly experienced management team at both the corporate and operational levels.

Business Strategy

Our objective is to grow profitably and strengthen our position as a leading provider of outsourced precision manufacturing and engineering services to the medical device industry through the following:

•: Increase Share Within Target Market Leaders. We are focused on increasing our share of revenues from the leading companies within our target markets.
•: Increase Manufacturing Efficiencies. We will continue to implement quality and manufacturing programs across all of our facilities to improve the cost structure of our manufacturing through the reduction of labor and overhead costs, tighter inventory controls and process improvement.

•: Expand Design and Prototyping Capabilities and Presence. We intend to grow revenues from design and prototyping services by continuing to invest in selected strategic locations. We believe being involved in the initial design and prototyping of medical devices positions us to capture the ongoing manufacturing business of these devices as they move to full production.

~~The~~ ~~key~~ ~~elements~~ Risk ~~of our strategy are to:~~ Factors

r Investing ~~focus~~in onthe ~~manufacturing~~notes ~~excellence~~involves risks. You should carefully consider the following risk factors and ~~leading~~refer ~~process~~to ~~technologies;~~the section captioned "Risk Factors" for an explanation of the material risks of participating in the exchange offer and investing in the notes. Specific factors that might cause actual results to differ from our expectations and that may affect our ability to pay timely amounts due under the notes or that may affect the value of the notes include, but are not limited to:

•: failure to successfully integrate MedSource or any future acquisition into our operations;
•: failure to realize the anticipated synergies from the MedSource acquisition;
•: our dependence on a few large customers for a significant portion of our revenue;
•: failure to continue to maintain or grow our business or successfully expand into new markets and products;
•: our obligations under our new senior secured credit facility and the notes;
•: downward fluctuations in our operating results, which could lead to an inadequacy of our cash flow to meet our operational and debt service requirements;
•: competitive pressures from our existing and potential competitors;
•: the unpredictable product cycles of the medical device manufacturing industry and uncertain demand for our manufacturing capabilities;
•: adverse trends or political, economic and regulatory changes affecting the medical device industry or our customers;
•: inability to recruit and retain experienced engineers and management personnel;
•: product liability claims and liability resulting from uninsured injury or death occurring at our facilities;
•: quality problems with our processes, products and services;
•: decreasing prices for our products or failure to reduce our expenses;
•: failure to respond to changes in technology and obsolescence of our manufacturing processes;
•: inability to protect our intellectual property and defend against infringement claims by third parties;
•: risks associated with our international operations;
•: our dependence on outside suppliers and subcontractors;
•: failure to obtain sufficient quantities of raw materials;
•: inability to access additional capital;
•: dependence on earnings of our operating subsidiaries and distributions of such earnings to us;
•: significant costs of compliance with, and liability from failure to comply with, environmental laws;

r strengthen our customer relationships by collaborating in the design and engineering of new products;

r drive additional component manufacturing business by continuing to expand our device assembly services;

r pursue product line transfers and acquisitions of customers’ manufacturing assets; and,

r selectively acquire companies to complement our product and service offerings.

We began operations during March 1999 through the acquisition of seven companies with complementary capabilities, and subsequently broadened our capabilities through five additional acquisitions. Since our launch, we have focused our efforts on integrating and growing our business and have made significant investments in our product design and development capabilities, sales and marketing teams, operations, quality systems and information technology infrastructure to support that growth. We currently have 15 manufacturing facilities with approximately 600,000 total square feet and over 1,350 employees.

Recent Development

On January 4, 2002, we acquired HV Technologies, a market leader in the specialized manufacture of polymide and composite micro-tubing that is used in interventional and minimally invasive catheters, delivery systems and instruments. The acquisition of HV Technologies advances our position in the interventional device market by expanding our offering of proprietary manufacturing capabilities to our customers.

We were formed under the name Veratek International, Inc. in Delaware in April 1998, changed our name to MedSource Technologies, Inc. in January 1999 and began operations in March 1999. Our principal executive offices are located at 110 Cheshire Lane, Suite 100, Minneapolis, Minnesota 55305 and our telephone number is (952) 807-1234. Our internet address is www.medsourcetech.com. Information on our web site is not part of this prospectus.

•: adverse determinations in lawsuits to which we are a party or legal or regulatory actions;
•: risks associated with the implementation of our new third-party enterprise resource planning system;
•: dependence on senior management;
•: inability to generate the cash needed to service our lease and debt obligations;
•: inability to restructure or refinance our leases or indebtedness if we are not able to meet our obligations under our leases and indebtedness;
•: inability to obtain all the funds necessary to purchase the notes upon a change of control;
•: fraudulent transfer statutes which may limit noteholders rights;
•: inability to develop an established trading market for the notes;
•: significant operating and financial restrictions imposed by our new senior secured credit facility and the indenture for the notes; and
•: other factors discussed under "Risk Factors" or elsewhere in this prospectus.

~~The~~ ~~Offering~~ The Transactions

Common stock to be offered by us		shares
Common stock to be outstanding after this offering		shares
Over-allotment option		shares of our common stock to be sold by us and an aggregate of 325,000 shares of our common stock to be sold by two selling stockholders.
Use of proceeds		For repayment of debt, redemption of our Series E and Series F preferred stock issued in connection with our acquisition of HV Technologies in January 2002, payment of accrued dividends on our Series B preferred stock, termination of certain management agreements and working capital and other general corporate purposes, including acquisitions, all as further described under the caption “Use of Proceeds.”
Dividend policy		We do not intend to pay dividends on our common stock. We plan to retain earnings for use in the operation of our business and to fund future growth.
Proposed Nasdaq National Market symbol		MEDT

On April 27, 2004, we entered into an Agreement and Plan of Merger pursuant to which, on June 30, 2004, we acquired MedSource by merging it with our wholly owned subsidiary, Pine Merger Corporation, a Delaware Corporation, which merger resulted in MedSource and its subsidiaries becoming our wholly owned subsidiaries. Upon the consummation of the MedSource acquisition, our parent, Accellent Inc., a Maryland corporation, whose name prior to its name change on November 18, 2004 was UTI Corporation, repurchased its outstanding Class C Redeemable Preferred Stock and paid accrued dividends to its holders of Class A 5% Convertible Preferred Stock and Class C Redeemable Preferred Stock. We also completed payment of approximately $9.2 million in respect of an earn-out obligation entered into in connection with our acquisition of Venusa, Ltd. and Venusa de Mexico, S.A. de C.V., referred to in this prospectus collectively as Venusa, in February, 2003.

~~Except~~ We financed asthe ~~otherwise~~foregoing ~~indicated,~~transactions ~~whenever~~primarily wewith ~~present~~the proceeds from the ~~number~~issuance ofon ~~shares~~June 30, 2004 of ~~common~~the notes, our new six-year $194.0 million senior ~~stock~~secured ~~outstanding~~term loan facility borrowed under our new senior secured credit facility, wewhich ~~have~~also ~~given~~includes ~~effect~~a five-year $40.0 million senior secured revolving credit facility, aswhich was undrawn at the closing of ~~December~~the transactions consummated on June 30, ~~2001~~2004, toand ~~the~~an ~~following~~$89.8 million ~~issuances~~equity ofinvestment ~~our~~in ~~common~~Accellent ~~stock~~by ~~upon~~the ~~completion~~DLJ ofMerchant ~~this~~Banking ~~offering:~~Buyers. See "The Transactions" on page 35.

r the conversion of all of our:

r Series A preferred stock into an aggregate of 1,918,500 shares of our common stock;

r Series B preferred stock into an aggregate of 3,327,280 shares of our common stock;

r Series C preferred stock into an aggregate of shares of our common stock (assuming that the initial public offering price is the midpoint of the price range on the cover of this prospectus), subject to adjustment depending upon the initial public offering price of our common stock in this offering as provided in the second paragraph under the caption “Description of Capital Stock — General”;

r Series D preferred stock into an aggregate of 1,769,569 shares of our common stock; and

r Series Z preferred stock into an aggregate of 650,000 shares of our common stock; and

r the exercise of a warrant to purchase 525 shares of our Series C preferred stock, and the conversion of preferred stock into an aggregate of shares of our common stock (assuming that the initial public offering price is the midpoint of the price range on the cover of this prospectus), subject to adjustment depending upon the initial public offering price of our common stock in this offering as provided in the second paragraph under the caption “Description of Capital Stock — General.”

We calculated the number of shares outstanding after this offering on the assumption that the underwriters do not exercise their over-allotment option, and we also excluded:

r 2,991,684 shares of our common stock issuable, at a weighted average exercise price of $15.60 per share, upon exercise of stock options outstanding as of December 30, 2001;

r ~~1,659,858~~ ~~shares~~ The ofEquity ~~our common stock available for future grant under our 1999 Stock Plan as of December 30, 2001;~~Sponsors

r Founded ~~500~~in 1996,~~000~~ ~~shares~~KRG Capital Partners, LLC, or KRG, is a Denver, Colorado based private equity firm that currently manages over $860 million of ~~our~~committed equity ~~common~~capital ~~stock~~and ~~available~~equity ~~for~~co-investments. ~~purchase~~KRG ~~under~~specializes ~~our~~in ~~Employee~~acquiring ~~Stock~~and ~~Purchase~~recapitalizing ~~Plan;~~unique and profitable middle-market companies. The firm seeks investment opportunities with owners and operating managers who are committed to expanding their companies and becoming, industry leaders through a combination of internal growth and complementary add-on acquisitions. KRG initiated its involvement with Accellent in 1999 and, together with its co-investors, provided the equity capital to support Accellent's growth to date.

r The DLJ ~~200~~Merchant Banking Buyers are part of DLJ Merchant Banking,~~000~~ ~~shares~~a leading private equity investor that has a 19-year record of ~~our~~investing ~~common~~in ~~stock~~leveraged ~~issuable~~buyouts ~~upon~~and ~~exercise~~related transactions across a broad range of ~~outstanding~~industries. ~~warrants~~Since as1985, DLJ Merchant Banking has invested more than $9 billion in more than 140 portfolio companies. DLJ Merchant Banking is currently investing through DLJ Merchant Banking Partners III, which has capital commitments of $5.3 billion. DLJ Merchant Banking is currently part of Credit Suisse First Boston's Alternative Capital Division. On December 307, ~~2001~~2004, atCredit anSuisse ~~exercise~~Group, ~~price~~the parent company of $Credit Suisse First Boston, announced that Credit Suisse First Boston intends to spin out its DLJ Merchant Banking business, including the transfer of the management of the DLJ Merchant Banking funds to an independent company to be formed by investment professionals from the existing DLJ Merchant Banking business.01 ~~per~~It ~~share~~is anticipated that Credit Suisse First Boston will engage the new company as a sub-advisor to manage the existing investments of the DLJ Merchant Banking funds.

Other Information

We were incorporated under the laws of the State of Colorado in May 2000 and became a wholly owned subsidiary of Accellent Inc., a Maryland Corporation (formerly known as UTI Corporation and MDMI Holdings, Inc.). MDMI Holdings, Inc. was organized in Colorado in July 1999 and conducted its own business and operations. Prior to our formation, MDMI Holdings, Inc. acquired our current wholly owned subsidiaries G&D Inc. d/b/a Star Guide and Noble-Met, Ltd. On the date of our formation, MDMI Holdings, Inc. became the first-tier holding company in our organizational structure. On February 23, 2001, MDMI Holdings, Inc. reincorporated by merger in Maryland and changed its name to UTI Corporation, which is today our parent and the first-tier holding company in our organizational structure. On November 18, 2004 UTI Corporation changed its name to Accellent Inc. We maintain our principal executive offices at 200 West 7th Avenue, Collegeville, Pennsylvania 19426, and our telephone number is (610) 489-0300.

Unless the context indicates otherwise, (1) the terms the "Company," "MDMI," "we," "our" and "us" refer to Medical Device Manufacturing, Inc. and its subsidiaries, (2) the term "Accellent" refers to our parent company and sole stockholder, Accellent Inc., a Maryland corporation, (3) the term "MedSource" refers to MedSource Technologies, Inc., a Delaware corporation, and (4) the "DLJ Merchant Banking Buyers" refers to DLJ Merchant Banking Partners III, L.P., DLJ Offshore Partners III-1, C.V., DLJ Offshore Partners III-2, C.V., DLJ Offshore Partners III, C.V., DLJ MB Partners III GmbH & Co. KG, Millennium Partners II, L.P. and MBP III Plan Investors, L.P. Unless the context indicates otherwise, "on a pro forma basis" or "pro forma" means after giving effect to the transactions described under "The Transactions."

Summary ~~Consolidated~~of ~~Financial~~the ~~Data~~Terms of the Notes

The ~~following~~summary ~~table~~below ~~summarizes~~describes ~~historical~~the ~~and~~principal ~~pro~~terms ~~forma~~of ~~consolidated~~the ~~financial data for our business~~notes. ~~You~~Certain ~~should~~of ~~read~~the ~~this~~terms ~~table~~and ~~along~~conditions ~~with~~described ~~“Selected~~below ~~Unaudited~~are ~~Pro~~subject ~~Forma~~to ~~Condensed~~important ~~Combined~~limitations ~~Financial~~and ~~Information,”~~exceptions. ~~“Selected~~The ~~Consolidated~~"Description ~~Financial~~of ~~Data,”~~Notes" ~~“Management’s~~section ~~Discussion~~of ~~and~~this ~~Analysis~~prospectus ofcontains ~~Financial~~a ~~Condition~~more ~~and~~detailed ~~Results~~description of ~~Operations”~~the ~~and~~terms ~~our consolidated financial statements~~ and ~~related~~conditions ~~notes~~of ~~appearing elsewhere~~the ~~in this prospectus~~notes.

The unaudited pro forma statement of operations data set forth below for the year ended June 30, 2001 show our pro forma results of operations as if our acquisition of ACT Medical in December 2000 and as if our acquisition of HV Technologies in January 2002 and our related issuances of Series E preferred stock and warrants and Series F preferred stock had all occurred on July 2, 2000, and the unaudited pro forma statement of operations data set forth below for the three months ended September 30, 2001 show our pro forma results of operations as if the acquisition of HV Technologies in January 2002 and the related issuance of Series E preferred stock and warrants and Series F preferred stock had all occurred on July 1, 2001, as further discussed under the caption “Selected Unaudited Pro Forma Condensed Combined Financial Information.”

Issuer	Medical Device Manufacturing, Inc.
Notes Offered	$175.0 million aggregate principal amount of Series B 10% senior subordinated notes due 2012.
Maturity Date	July 15, 2012.
Interest Rate and Payment Dates	The notes bear interest at the rate of 10% per year, payable in cash semi-annually, in arrears, on January 15 and July 15 of each year, commencing on January 15, 2005.
Subsidiary Guarantees	The notes are jointly and severally, fully and unconditionally, guaranteed on a senior subordinated basis by all our existing domestic subsidiaries and by all our future domestic subsidiaries that are not designated by us as unrestricted subsidiaries.
Ranking	The notes and the guarantees are our and the applicable guarantors' senior subordinated unsecured obligations and are:
	•	junior in right of payment to all of our and such guarantors' existing and future senior indebtedness;
	•	equal in right of payment to all of our and such guarantors' existing and future senior subordinated indebtedness; and
	•	senior in right of payment to all of our and such guarantors' existing and future subordinated indebtedness.
	As of September 30, 2004, we and the subsidiary guarantors had outstanding an aggregate of approximately $193.5 million of indebtedness that was senior to the notes. In addition, as of September 30, 2004, we and the subsidiary guarantors had the ability to incur up to $40.0 million of additional indebtedness under our revolving credit facility, which indebtedness, if incurred, would rank senior to the notes. The notes and the related subsidiary guarantees are our and the subsidiary guarantors only outstanding senior subordinated indebtedness.
Optional Redemption	We may redeem the notes, in whole or in part, on or after July 15, 2008, at the redemption prices set forth in this prospectus under the caption "Description of Notes—Optional Redemption."
	In addition, on or prior to July 15, 2007, we may redeem up to 35% of the aggregate principal amount of the notes with the net proceeds of one or more qualified equity offerings. For more information, see "Description of Notes—Optional Redemption."

The unaudited pro forma balance sheet data set forth below and the unaudited pro forma as adjusted balance sheet data set forth below both give effect to our acquisition of HV Technologies in January 2002 and our related issuances of Series E preferred stock and warrants and Series F preferred stock as if they had all occurred on September 30, 2001, as further discussed under the caption “Selected Unaudited Pro Forma Condensed Combined Financial Information.” The unaudited pro forma as adjusted balance sheet data set forth below also give effect to this offering and the conversion of all of our outstanding convertible preferred stock and the exercise of the warrant described in the first and second paragraphs of the table under “Summary — The Offering” on page 5.

	Fiscal Year Ended						Pro Forma Fiscal Year Ended June 30, 2001(b)			Three Months Ended September 30,						Pro Forma Three Months Ended September 30, 2001(b)
	July 1, 2000(a)			June 30, 2001						2000			2001
Statement of Operations Data:	(In thousands, except share and per share data)
Revenues	$	89,352		$	128,462		$	149,769		$	27,611		$	33,865		$	36,338
Costs and expenses:
Cost of products sold		59,811			94,386			108,126			20,793			26,106			27,196
Selling, general and administrative expense		21,167			26,199			31,334			5,621			6,402			7,125
Amortization of goodwill and other intangibles(c)		4,255			5,640			6,544			1,125			90			90
Restructuring charge(d)		—			11,464			11,464			—			—			—
Total costs and expenses		85,233			137,689			157,468			27,539			32,598			34,411
Operating income (loss)		4,119			(9,227	)		(7,699	)		72			1,267			1,927
Interest (expense), net		(10,682	)		(10,213	)		(10,155	)		(2,994	)		(2,468	)		(2,461	)
Other income (expense)		(7	)		53			64			63			(21	)		(17	)
Loss before income taxes		(6,570	)		(19,387	)		(17,790	)		(2,859	)		(1,222	)		(551	)
Income tax benefit (expense)		535			(70	)		(251	)		—			—			(40	)
Net loss		(6,035	)		(19,457	)		(18,041	)		(2,859	)		(1,222	)		(591	)
Preferred stock dividends and accretion of discount on preferred stock		(8,345	)		(9,688	)		(12,514	)		(2,104	)		(2,648	)		(3,025	)
Net loss attributed to common stockholders	$	(14,380	)	$	(29,145	)	$	(30,555	)	$	(4,963	)	$	(3,870	)	$	(3,616	)
Net loss per share attributed to common stockholders (basic and diluted)	$	(3.10	)	$	(5.55	)	$	(5.03	)	$	(0.95	)	$	(0.74	)	$	(0.60	)
Weighted average number of shares of common stock outstanding (basic and diluted)		4,633,571			5,252,749			6,076,974			5,248,341			5,255,958			6,080,183
Other Data:
Net cash provided by (used in) operating activities(e)	$	6,290		$	1,253					$	(2,074	)	$	(3,305	)
Net cash used in investing activities(e)		(22,244	)		(11,627	)					(1,000	)		(1,619	)
Net cash provided by (used in) financing activities(e)		16,356			28,453						931			(1,111	)
EBITDA(f)		12,867			3,021		$	6,262			2,764			3,197		$	4,001
Adjusted EBITDA(f)(g)		14,373			16,140			19,381			3,125			3,663			4,467

	As of September 30, 2001
Change of Control	If we experience a change of control, holders of the notes will have the right to require us to repurchase the notes at a purchase price of 101% of the principal amount of the notes, plus accrued and unpaid interest to the date of the repurchase. See "Description of Notes—Repurchase at the Option of Holders."
	Actual			Pro Forma(b)		Pro Forma As Adjusted(b)
Restrictive Covenants	The indenture governing the notes contains covenants that limit our and our subsidiaries' ability to, among other things:
	(In thousands)
	•	pay dividends, redeem capital stock and make other restricted payments and investments;
Balance Sheet Data:
	•	incur additional debt or issue preferred stock;
Cash and cash equivalents	$	14,254		$	16,264	$
	•	enter into agreements that restrict our subsidiaries from paying dividends or other distributions, making loans or otherwise transferring assets to us or to any other subsidiaries;
Working capital		24,055			28,009
	•	create liens on assets;
Total assets		197,929			224,064
	•	engage in transactions with affiliates;
Total debt (h)		88,493			88,493
	•	sell assets, including capital stock of subsidiaries; and
Mandatory redeemable convertible stock		100,972			104,608
	•	merge, consolidate or sell all or substantially all of our assets and the assets of our subsidiaries.
Total stockholders’ equity (deficit)		(17,725	)		3,935
	All of these limitations are subject to important exceptions and qualifications described under "Description of Notes—Certain Covenants."
Form of Notes	The notes are represented by one or more global notes deposited with U.S. Bank National Association for the benefit of Depository Trust Company, or DTC. You will not receive notes in certificated form unless one of the events set forth under the heading "Description of Notes—Form of Notes" occurs. Instead, beneficial interests in the notes will be shown on, and transfer of these interests will be effected only through, records maintained in book-entry form by DTC with respect to its participants.
Absence of a Public Market for the Notes	The notes are a new issue of securities for which there is currently no trading market. Although we expect the notes to be eligible for trading in The PortalSM Market, a subsidiary of The Nasdaq Stock Market, Inc., referred to in this prospectus as The PORTAL Market, we cannot assure you that an active trading market for the notes will develop or be sustained. The initial purchasers of the old notes advised us that they intend to make a market in the notes after the exchange offer relating to such notes was completed. The initial purchasers are not obligated, however, to make a market in the notes and any such market-making may be discontinued at any time at the sole discretion of the initial purchasers.

(a) Our fiscal years originally ended on the Saturday closest to June 30. Effective July 1, 2001, our fiscal year end was changed to June 30.

(b) In connection with our acquisition of HV Technologies in January 2002, we issued $6.0 million of our Series E preferred stock, and we issued warrants to purchase an aggregate of 200,000 shares of our common stock. We will record a discount of $2.5 million to the carrying value of the Series E preferred stock equal to the consideration allocated to the warrants. We plan to accrete this discount over the 12 month period ending December 31, 2002 because we plan to redeem our Series E preferred stock by that date. The effect of the accretion is excluded from the pro forma and pro forma as adjusted presentation.

(c) The Statement of Operations Data for the three months ended September 30, 2001 does not include a charge for the amortization of goodwill. Effective with our quarter ended September 30, 2001, we adopted the provisions of Statement of Financial Accounting Standards, or SFAS, No. 141, Business Combinations, and No. 142, Goodwill and Other Intangible Assets, and, accordingly, we reclassified certain identifiable intangibles to goodwill and will no longer amortize goodwill and intangible assets that are deemed to have indefinite lives under SFAS 142. Had we continued to amortize goodwill during the three months ended September 30, 2001, amortization expense in that period would have increased by approximately $1.4 million or $0.27 per common share.

(d) In June 2001, we completed a strategic review of our manufacturing operations and support functions. Based on this review and with board approval, we began actions to eliminate redundant facilities. These actions resulted in pre-tax charges of $11.5 million. The charges include employee termination benefits of $3.8 million, other exit costs of $2.2 million, impairment of goodwill and other intangibles of $3.6 million and impairment of property, plant, and equipment of $1.9 million.

(e) Because of the subjectivity inherent in the assumptions concerning the nature and timing of the uses of cash generated by the pro forma interest and other expenses, cash flows from operating, investing and financing activities are not presented for the pro forma periods.

(f) EBITDA represents earnings before interest expense, income taxes, depreciation and amortization. EBITDA should not be considered in isolation from, or as a substitute for, net income, cash flow from operations or other cash flow statement data prepared in accordance with generally accepted accounting principles or as a measure of our profitability or liquidity. Rather, EBITDA is presented because it is a widely accepted supplemental financial measure, and we believe that it provides relevant and useful information. A calculation of EBITDA may not be comparable to similarly titled measures reported by other companies, since all companies do not calculate this non-GAAP measure in the same manner. Our EBITDA calculation is not intended to represent cash provided by (used in) operating activities since it does not include interest and taxes and changes in operating assets and liabilities, nor is it intended to represent a net increase in cash since it does not include cash provided by (used in) investing and financing activities.

(g) Adjusted EBITDA further adjusts EBITDA to exclude management fees for all periods presented and excludes restructuring charges of $11.5 million for year ended June 30, 2001.

(h) In connection with the repayment of our debt, as discussed under the caption “Use of Proceeds,” we will expense $3.2 million of unamortized deferred financing costs, $2.6 million of unamortized discount and a redemption premium of $1.6 million.

~~RISK~~ ~~FACTORS~~ SUMMARY HISTORICAL AND PRO FORMA CONDENSED CONSOLIDATED FINANCIAL DATA

The ~~You~~following ~~should~~table ~~carefully~~contains ~~consider~~summary historical financial data for the ~~risks~~twelve ~~described~~months ~~below~~ended December 31, ~~together~~2003 ~~with~~and ~~all~~nine ofmonths ~~the~~ended ~~other~~September 30, 2004 ~~information~~derived from our and MedSource's audited and unaudited consolidated financial statements included elsewhere in this prospectus, ~~before~~and ~~deciding~~from ~~whether~~MedSource's tounaudited ~~invest~~consolidated infinancial statements not ~~our~~included ~~common~~in ~~stock~~this prospectus. The ~~following~~historical ~~risks~~statement of operations data of MedSource have been adjusted from a June 30 fiscal year to a calendar year presentation to match our fiscal year end. We consummated the MedSource acquisition on June 30, 2004 and, ~~uncertainties~~as a result, the assets and liabilities of MedSource are ~~not~~recorded on our balance sheet as of the ~~only~~date ~~ones~~of wethe ~~face.~~MedSource ~~However~~acquisition and the results of operations of MedSource for June 30, ~~these~~2004 are ~~the~~included ~~risks~~in our ~~management~~results ~~believes~~for ~~are~~that ~~material~~day and each day thereafter. IfThe ~~any~~table ofalso contains summary unaudited pro forma financial data derived from the ~~following~~financial ~~risks~~information ~~materializes,~~set forth under "Unaudited Pro Forma Condensed Consolidated Financial Statements" included elsewhere in this prospectus. The unaudited pro forma condensed consolidated financial data do not purport to present our ~~business,~~actual financial ~~condition~~position or results of operations ~~could~~had bethe ~~harmed.~~Transactions Inlisted ~~that~~below ~~case,~~and described in greater detail under "The Transactions" on page 35 actually occurred on the ~~trading~~date ~~price~~specified. The summary unaudited pro forma condensed consolidated statements of ~~our~~operations ~~common~~data ~~stock~~for ~~could~~the ~~decline~~twelve months ended December 31, 2003 and nine ~~you~~months ~~may~~ended ~~lose~~September 30, ~~all~~2004 orgive ~~part~~effect ofto ~~your~~the ~~investment~~Transactions as if they had occurred on January 1, 2003. The Transactions include:

•: the acquisition of MedSource for $204.9 million in cash (net of $14.3 million of cash acquired);
•: the payment in cash of MedSource's indebtedness and accrued interest of $37.0 million;
•: the payment in cash of our old senior secured credit facility, our old senior subordinated indebtedness, Accellent's senior indebtedness, and accrued interest of $154.1 million;
•: the payment of the $36.9 million Venusa earn-out, $9.6 million of which was paid in cash and the balance was paid in preferred stock and phantom stock of Accellent;
•: the payment in cash of dividends on Accellent's Class A 5% Convertible Preferred Stock of $20.2 million;
•: the payment in cash of dividends on Accellent's Class C 8% Redeemable Preferred Stock of $2.0 million;
•: the repurchase of Accellent's Class C 8% Redeemable Preferred Stock for cash of $18.8 million, including an accretive dividend of $6.2 million;
•: the borrowings under our new senior secured credit facility of $194.0 million;
•: the equity investment by the DLJ Merchant Banking Buyers in Accellent, which generated $88.0 million in cash;
•: the offering of the notes, which generated $175.0 million in cash; and
•: the payment in cash of $15.9 million of fees and expenses related to the foregoing.

~~Risks~~ The summary ~~Related~~pro forma data account for the MedSource acquisition using the purchase method of accounting, which requires that we adjust their assets and liabilities to ~~Our~~their ~~Business~~fair values. Such valuations are based upon available information and certain assumptions that we believe are reasonable. The total purchase price for the MedSource acquisition was allocated to our net assets based on preliminary estimates of fair value. The final purchase price allocation will be based on a formal valuation analysis and may include adjustments to the amounts shown here. A final valuation is in process. The result of the final allocation could be materially different from the preliminary allocation set forth in this prospectus.

Our business depends on industry trends and the business success of our customers

Our business depends on trends in the medical device industry, which is subject to rapid technological changes, short product life-cycles, frequent new product introductions and evolving industry standards, as well as economic cycles. Conditions or technological innovations adversely affecting any of our major customers, the medical device industry in general or the surgical instrumentation, electro-medical implant, interventional and orthopedic markets we target in particular, could adversely affect our operating results. For example, the discovery and market acceptance of non-device treatments for specific medical conditions could make the medical devices used to treat these conditions obsolete. In addition, the products and services that we provide to our customers generally are specific to a particular medical device being developed or marketed by them. If a customer’s medical device does not gain or maintain market acceptance because of competing medical devices or treatments, changing market conditions, unfavorable regulatory actions or other reasons, our revenues from that customer and our results of operations would be adversely affected.

We rely on a few large customers

The medical device industry is concentrated, with relatively few companies accounting for a large percentage of sales in the surgical instrumentation, electro-medical implant, interventional and orthopedic markets that we target. Accordingly, our revenue and profitability are highly dependent on our relationships with a limited number of large medical device companies. In fiscal 2001, our top four customers accounted for approximately 41% of our revenues, with one customer accounting for 18% of our revenues and another accounting for 12% of our revenues. In fiscal 2000, our top four customers accounted for approximately 42% of our revenues, with one customer accounting for 16% of our revenues and another accounting for 14% of our revenues. We provide products and services to several different divisions of our top customers. We are likely to continue to experience a high degree of customer concentration, particularly if there is further consolidation within the medical device industry. We cannot assure you that there will not be a loss or reduction in business from one or more of our major customers. In addition, we cannot assure you that revenues from customers that have accounted for significant revenues in the past, either individually or as a group, will reach or exceed historical levels in any future period. The loss or a significant reduction of business from any of our major customers would adversely affect our results of operations.

Our growth may depend on continued outsourcing

To date, we have benefited from the growing trend of medical device companies to outsource all or a portion of their engineering, product development, manufacturing and assembly requirements. Although we expect medical device companies to increase their outsourcing of these requirements in the future, we cannot be certain that this trend will continue or that, if it continues, we will benefit from it. Even if the outsourcing trend in the industry continues, one or more of our principal customers could decide to decrease its reliance on or use of outsourcing, which would reduce our customer base.

Also, as part of our growth strategy, we are seeking to accept full supply chain management and manufacturing responsibility for selected product lines from our customers and, in some cases, to acquire the related manufacturing assets from these customers. While we believe that product line transfers and asset

You ~~acquisitions~~should ofread ~~this~~the ~~kind~~summary ~~are~~historical ~~becoming~~and ~~increasingly~~pro ~~attractive~~forma todata ~~our~~set ~~customers~~forth in the following table in conjunction with "The Transactions," we"Capitalization," ~~have~~"Selected ~~only~~Historical ~~consummated~~Consolidated Financial ~~one~~Data," "Management's Discussion and Analysis of ~~these~~Financial ~~transactions~~Condition toand ~~date.~~Results Weof ~~cannot~~Operations," bethe ~~sure~~consolidated ~~that~~financial ~~opportunities~~statements of ~~this~~MDMI ~~nature~~and MedSource and the respective notes thereto, ~~will~~and bethe ~~available~~Unaudited Pro Forma Condensed Consolidated Financial Statements and the related notes thereto included in this prospectus. In addition, ~~especially~~future ifresults may vary significantly from the ~~trend~~results reflected ~~toward~~in ~~outsourcing~~such ~~does~~statements ~~not~~due ~~continue~~to certain factors beyond our control. See "Risk Factors."

We are a wholly owned subsidiary of Accellent. Accellent is a holding company with no operations and whose only asset is our capital stock. Proceeds from the issuance of indebtedness and sale of capital stock of Accellent were used by us for acquisitions of subsidiaries. Additionally, the proceeds of the MDMI notes offering were used to retire all of the senior notes of Accellent. Accordingly, in compliance with provisions of Staff Accounting Bulletin 54 (Topic 5-J, Question 3), the accompanying financial statements reflect the push down of Accellent's indebtedness, related interest expense, the Class B-1 and B-2 Redeemable and Convertible Preferred Stock, the Class C 8% Redeemable Preferred Stock and dividends on the redeemable and convertible preferred stock of parent company. The Accellent debt pushed down to us is included in our consolidated balance sheets as long-term debt. The Accellent Class B-1 and B-2 Redeemable and Convertible Preferred Stock, and the Class C 8% Preferred Stock pushed down to us is included in our consolidated balance sheets as redeemable and convertible preferred stock of parent company. Accellent has also raised capital from the sale of common stock, Class A-1 though A-8 5% Convertible Preferred Stock, Class AA Convertible Preferred Stock and warrants exercisable for Class AB Convertible Preferred Stock. The proceeds from the common stock, Class A-1 through A-8 5% Convertible Preferred Stock, Class AA Convertible Preferred Stock and warrants exercisable for Class AB Convertible Preferred Stock have ~~few~~been ~~contracts~~advanced ~~that~~to ~~ensure~~us and reflected in our consolidated balance sheets as additional paid-in capital since we are under no obligation to repay these amounts. Accellent pushes down all interest and debt issuance costs to us ~~future~~as ~~business~~all indebtedness has been pushed down. Accellent pushes down all dividends declared and paid, including accretive dividends, on the redeemable and convertible preferred stock of parent company which has been pushed down to us. Any costs incurred by Accellent for the benefit of MDMI have been fully allocated to MDMI. Accellent does not incur any common expenses for the benefit of both

Generally, we work with our customers on a project-by-project or purchase order-by-purchase order basis, without any long term revenue, volume or other commitments to ensure us future business. Customer orders typically may be cancelled and volume levels may be changed or delayed at any time. We cannot assure you that we can replace delayed, cancelled or reduced projects with new business in a timely manner. Also, we may not fully recover our costs in connection with cancelled, delayed or reduced projects.

Our results of operations fluctuate

Our operating results have fluctuated in the past from quarter to quarter and are likely to fluctuate significantly in the future due to a variety of factors, including:

r the timing of actual customer orders and the accuracy of our customers’ forecasts of future production requirements;

r the introduction and market acceptance of our customers’ new products and changes in demand for our customers’ existing products;

r changes in the relative portion of our revenue represented by our various products, services and customers, including the relative mix of our business across our target markets;

r changes in competitive or economic conditions generally or in our customers’ markets;

r changes in availability or costs of raw materials or supplies; and

r demand for our products and services, which, during our limited operating history, has been higher than average during the last quarter of our fiscal year and lower than average during the first quarter of our fiscal year.

For all these reasons, our quarterly results are difficult to predict and should not be relied upon as an indication of future performance. Fluctuations in our quarterly results could result in our failing to meet the expectations of the investment community, which could adversely affect the market price of our common stock even if those fluctuations are unrelated to our long term operating performance or prospects.

We may not successfully manage our growth and integrate acquired businesses

We were formed in March 1999 through the acquisition of seven separate businesses. In January 2000, we acquired the business of Tenax Corporation; in February 2000, we acquired Apex Engineering; in May 2000, we acquired Thermat Precision Technology, Inc.; in December 2000, we acquired ACT Medical, Inc.; and in January 2002, we acquired HV Technologies. As a result, we are experiencing rapid growth that could strain our managerial and other resources.

The successful integration and operation of an acquired business requires communication and cooperation among key managers, the transition of customer relationships, the management of ongoing projects of acquired companies and the management of new projects across previously independent facilities. Acquisitions also involve a number of other risks, including:

rAccellent and MDMI, therefore, no common expenses are allocated from Accellent to MDMI. Management believes the ~~diversion~~methods of ~~management~~allocation ~~attention;~~are reasonable.

r difficulties in integrating the operations and products of an acquired business or in realizing projected operational results, synergies and cost savings;

		Historical						Pro Forma			Historical						Pro Forma
		MDMI			MedSource						MDMI			MedSource
		Twelve Months Ended December 31, 2003			Twelve Months Ended December 28, 2003			Twelve Months Ended December 31, 2003			Nine Months Ended September 30, 2004			Interim Period Ended June 29, 2004			Nine Months Ended September 30, 2004
STATEMENT OF OPERATIONS DATA:			(dollars in thousands)
Net Sales		$	174,223		$	181,905		$	353,692		$	212,485		$	94,301		$	306,259
Gross Profit			53,194			44,847			100,115			57,330			22,730			80,060
Income (Loss) from Operations			15,664			(35,035	)		(18,771	)		18,582			5,132			23,090
Net Loss			(14,804	)		(38,462	)		(61,894	)		(6,440	)		3,641			(1,142	)
OTHER FINANCIAL DATA:
Cash Flows Provided by (Used in)
	Operating Activities	$	14,392		$	16,857					$	6,179		$	8,583
	Investing Activities		(20,370	)		(10,349	)					(221,317	)		(4,320	)
	Financing Activities		3,977			(8,264	)					218,583			(3,683	)
Capital Expenditures			(6,371	)		(9,934	)					(8,718	)		(4,757	)
Depreciation and Amortization			11,591			9,672						11,289			4,381
EBITDA(1)			27,246			(25,463	)					26,587			9,607

r inaccurate assessments of undisclosed liabilities; and

	As of September 30, 2004
	(in thousands)
BALANCE SHEET DATA:
Cash and Cash Equivalents	$	7,403
Total Assets		601,690
Total Debt		368,543
Redeemable and Convertible Preferred Stock of Parent Company		30
Stockholder's Equity		136,146

(1): We define EBITDA as net income (loss) before net interest expense, income tax expense, depreciation and amortization. Since EBITDA may not be calculated the same by all companies, this measure may not be comparable to similarly titled measures by other companies. We use EBITDA as a supplemental measure of our performance. EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under GAAP. See "Non-GAAP Financial Measures" for a discussion of our use of EBITDA and certain limitations of EBITDA as a financial measure. EBITDA is calculated as follows for the periods presented:

r potential loss of key customers or employees of the acquired businesses.

								MedSource
		MDMI						MedSource
		MDMI									Interim Period Ended June 29, 2004
		Twelve Months Ended December 31, 2003			Nine Months Ended September 30, 2004			Twelve Months Ended December 28, 2003			Interim Period Ended June 29, 2004
		(dollars in thousands)
	Net Income (Loss)	$	(14,804	)	$	(6,440	)	$	(38,462	)	$	3,641
	Interest Expense		16,587			19,397			2,870			1,302
	Income Tax Expense, net		13,872			2,341			457			283
	Depreciation and Amortization		11,591			11,289			9,672			4,381
EBITDA		$	27,246		$	26,587		$	(25,463	)	$	9,607

Customer satisfaction or performance problems with an acquired company could also harm our reputation as a whole, and any acquired business could significantly underperform relative to our expectations. Because all of our acquisitions were completed in the past 36 months, we are currently facing all of these challenges and our ability to meet them over the long term has not been established. For all these reasons, our pursuit of an overall acquisition strategy or any individual completed, pending or future acquisition may adversely affect the realization of our strategic goals.

In addition, while we anticipate cost savings, operating efficiencies and other synergies as a result of our acquisitions, the consolidation of functions and the integration of departments, systems and procedures present significant management challenges. We cannot assure you that we will:

r successfully accomplish those actions as rapidly as anticipated;

r achieve the cost savings and efficiencies that we expect from our acquisitions;

r successfully manage the integration of new locations or acquired operations;

r fully use new capacity; or

r enhance our business as a result of any past or future acquisition, including those mentioned above.

The acquisition of new operations can also introduce new types of risks to our business. For example, new acquisitions may require greater levels of financing or greater effort to address United States Food and Drug Administration, or FDA, regulation or similar foreign regulation.

We may face product liability claims

We may be exposed to product liability claims and product recalls, including those which may arise from misuse or malfunction of, or design flaws in, our customers’ products, whether or not such problems directly relate to the products and services we have provided. Generally, we do not at this time have agreements in place with our customers governing liability for product liability and recalls. Even where we have agreements with customers that contain provisions attempting to limit our damages, these provisions may not be enforceable or may otherwise fail to protect us from liability. Product liability claims or product recalls, regardless of their ultimate outcome, could require us to spend significant time and money in litigation or require us to pay significant damages. The occurrence of product liability claims or product recalls could cause our results of operations to be adversely affected.

We carry $20.0 million of product liability insurance coverage which is limited in scope. Our management believes that our insurance coverage is adequate given the risks we face. We cannot assure you that we will be able to maintain this insurance or to do so at reasonable cost and on reasonable terms. We also cannot assure you that this insurance will be adequate to protect us against a product liability claim that may arise in the future.

We ~~may~~ ~~experience~~ RATIO ~~decreasing~~OF ~~prices~~EARNINGS ~~for~~TO ~~the~~FIXED ~~products and services we offer~~ CHARGES

We The ~~may~~following ~~experience~~table ~~decreasing~~sets ~~prices~~forth our historical and pro forma ratios and deficiencies of earnings to fixed charges for the ~~products~~periods indicated and ~~services~~should webe ~~offer~~read ~~due~~in conjunction ~~to:~~with "Selected Historical Consolidated Financial Data" included elsewhere in this prospectus (dollars in thousands).

r pricing pressure experienced by our customers from managed care organizations and other third-party payors;

	Period from Parent's Inception (July 2, 1999) to December 31, 1999
													Pro Forma
			Twelve Months Ended December 31,										Pro Forma
			Twelve Months Ended December 31,								Nine Months Ended September 30, 2004		Twelve Months Ended December 31, 2003		Nine Months Ended September 30, 2004
			2000		2001		2002		2003		Nine Months Ended September 30, 2004		Twelve Months Ended December 31, 2003		Nine Months Ended September 30, 2004
Ratio of earnings to fixed charges	1.5	x		—		—		—		—		—		—	1.1	x
Deficiency of earnings to fixed charges	—		$	16,282	$	8,502	$	32,557	$	932	$	4,099	$	47,565	—

r For ~~increased~~periods ~~market~~prior ~~power~~to ofour parent's inception, our ~~customers~~predecessor for financial accounting purposes is UTI Corporation, a Pennsylvania corporation and our wholly owned subsidiary that we refer to as ~~the~~UTI ~~medical~~Pennsylvania. ~~device~~See ~~industry~~"Selected ~~consolidates;~~Historical Consolidated Financial Data" on page 46 for a discussion of our predecessor. The following table sets forth our predecessor's historical ratios and deficiencies of earnings to fixed charges for the periods indicated and should be read in conjunction with "Selected Historical Consolidated Financial Data" included elsewhere in this prospectus (dollars in thousands).

r increased competition among medical engineering and manufacturing services providers.

		Twelve Months Ended December 31, 1999		Five Months Ended May 31, 2000
Ratio of earnings to fixed charges		3.5x			—
Deficiency of earnings to fixed charges		—		$	16,840

If the prices for our products and services decrease for whatever reason and we are unable to reduce our expenses, our results of operations will be adversely affected.

Quality problems could harm our reputation and erode our competitive position

Quality is extremely important to us and our customers due to the serious and costly consequences of product failure. Our success depends in part on our ability to manufacture to exact design specifications precision engineered plastic and metal components, subassemblies and finished devices from multiple materials. If our products and services fail to meet the highest quality standards or fail to adapt to evolution in those standards, our reputation could be harmed and our competitive position could be damaged. In addition, our quality systems and certifications are critical to the marketing success of our products and services. If we fail to maintain our quality systems or certifications, our reputation could be damaged and our results of operations could be adversely affected.

We face competition from a variety of sources

Our current and prospective customers often evaluate our product and service offerings against the merits of internal design and engineering, manufacturing, assembly and supply chain management. In this sense, we often compete for business with the internal resources of our customers, many of whom are leading medical device companies with long-standing internal design and engineering, manufacturing and supply chain management capabilities. Our success therefore depends heavily upon our ability to demonstrate and deliver cost savings and accelerated time to market for our customers as compared to use of internal resources, without loss of quality, confidentiality or reliability.

In addition, we believe the medical engineering and manufacturing services industry is very competitive and fragmented with over 3,000 companies, many of which are specialized. To the extent that medical device companies seek to outsource more of the design, prototyping and manufacturing of their products, we will face increasing competitive pressures to broaden our capabilities and grow our business in order to maintain our competitive position, and we may encounter competition from other companies with design, technological and manufacturing capabilities similar or superior to ours.

Our indebtedness could have negative consequences for our business

Failure to comply with the covenants under our senior credit facility or with respect to any future indebtedness may result in an event of default. If an event of default occurs and is not cured or waived, substantially all of our indebtedness could become immediately due and payable. We anticipate that upon the closing of this offering our total debt will be approximately $40 million and our annual interest expense will be approximately $ million. The ability to pay interest and principal on our debt obligations will depend on our future operating performance, which will be affected by prevailing economic conditions and financial, business and other factors, many of which are beyond our control. There can be no assurance that our operations will generate earnings in any future period sufficient to cover the fixed charges. In addition, we may experience variable financial results as a consequence of floating interest rate debt. As interest rates fluctuate, we may

~~experience~~ ~~increases in interest expense, which may materially affect financial results. See “Management’s Discussion and Analysis of Financial Condition and Results of~~ ~~Operations—Liquidity~~RISK ~~and Capital Resources” on page 35.~~ FACTORS

We An ~~may~~investment ~~require~~in ~~additional~~the ~~capital~~notes involves a high degree of risk. You should consider carefully the following risk factors, in addition to the other information set forth in this prospectus, before deciding to invest in the notes.

~~Our~~Risks ~~growth~~Related strategy will require additional capital for, among other purposes, completing acquisitions of companies and customers’ product lines and manufacturing assets, integrating acquired companies and assets, acquiring new equipment and maintaining the condition of existing equipment. In connection with this offering, we intend to ~~repay~~Our all of our subordinated indebtedness and replace our existing senior credit facility with a new senior credit facility. If cash generated internally is insufficient to fund capital requirements, or if funds are not available under our new senior credit facility, we will require additional debt or equity financing. Adequate financing may not be available or, if available, may not be available on terms satisfactory to us. If we fail to obtain sufficient additional capital in the future, we could be forced to curtail our growth strategy by reducing or delaying capital expenditures and acquisitions, selling assets or restructuring or refinancing our indebtedness. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” on page 35. Business

~~Our~~We ~~growth~~ may ~~depend~~not ~~upon~~successfully ~~our~~integrate ~~ability~~MedSource toor ~~make~~any ~~acquisitions~~subsequent acquisition target into our business and operations.

~~Our~~ Prior ~~continued~~to ~~growth~~the ~~may~~consummation ~~depend~~of onthe ~~our~~MedSource ~~ability~~acquisition towe ~~identify~~ and ~~acquire~~MedSource onoperated ~~acceptable~~as ~~terms~~separate ~~companies that complement or enhance our business~~entities. We may ~~not be~~experience ~~able~~material tonegative ~~identify~~consequences orto ~~complete~~our business, ~~future~~financial ~~acquisitions.~~condition ~~Some~~or results of ~~the~~operations ~~risks~~if ~~that~~ we ~~may~~cannot ~~encounter~~successfully ~~include~~integrate ~~expenses~~MedSource's ~~associated~~operations with, ~~and~~ours. ~~difficulties~~The inintegration ~~identifying, potential targets, the costs associated with incomplete acquisitions and higher prices for acquired companies because~~ of ~~competition for attractive acquisition targets. If we fail to acquire additional capabilities, we may be unable to compete with other~~ companies ~~in our industry~~ that ~~are~~have ~~able~~previously tobeen ~~provide~~operated ~~more complete outsourcing~~separately ~~capabilities~~involves ~~and~~a ~~services~~number toof ~~medical~~risks, ~~device companies~~including, ~~which~~but ~~could~~not ~~adversely~~limited ~~affect~~to: ~~our results of operations.~~

•: demands on management related to the significant increase in the size of the business for which they are responsible;
•: diversion of management's attention from the management of daily operations to the integration of operations;
•: management of employee relations across facilities;
•: difficulties in the assimilation of different corporate cultures and practices, as well as in the assimilation and retention of broad and geographically dispersed personnel and operations;
•: difficulties and unanticipated expenses related to the integration of departments, systems (including accounting systems), technologies, books and records, procedures and controls (including internal accounting controls, procedures and policies), as well as in maintaining uniform standards, including environmental management systems;
•: expenses of any undisclosed or potential liabilities; and
•: ability to maintain our customers and MedSource's customers after the acquisition.

~~Our~~ Successful integration ~~business~~of MedSource's operations with ours depends on ~~identifying~~our ability to manage the combined operations, to realize opportunities for revenue growth presented by broader ~~quality~~product ~~suppliers~~offerings and ~~subcontractors~~expanded geographic coverage and to eliminate redundant and excess costs. If our integration efforts are not successful, we may not be able to maintain the levels of revenues, earnings or operating efficiency that we and MedSource achieved or might achieve separately. In addition, the unaudited pro forma condensed consolidated financial data presented in this prospectus cover periods during which we were not under the same management and, therefore, may not be indicative of our future financial condition or operating results.

~~Our~~We ~~current~~will ~~capabilities~~incur dosignificant ~~not~~costs ~~include all elements that are required~~ to ~~satisfy~~achieve ~~all of our customers’ requirements. As we increasingly position ourselves to provide our customers with a single source solution, we may rely increasingly on third party suppliers, subcontractors~~ and ~~other outside sources for components or services. Manufacturing problems~~ may ~~occur with these third parties. A supplier may fail to develop and supply products and components to us on a timely basis, or may supply us with products and components that do~~ not ~~meet our quality, quantity or cost requirements. If any of these problems occur, we may~~ be ~~unable~~able to ~~obtain~~realize ~~substitute~~the ~~sources~~anticipated ~~of these products and components on a timely basis or on terms acceptable to us~~savings, ~~which~~synergies ~~could harm our ability to manufacture our own products and components profitably~~ or onrevenue ~~time.~~enhancements Infrom ~~addition, if~~ the ~~processes that our suppliers use to manufacture products and components are proprietary, we may be unable to obtain comparable components from alternative suppliers~~MedSource acquisition.

We Even ~~may~~if ~~fail~~we are able to ~~maintain~~integrate successfully our ~~manufacturing~~operations ~~capabilities~~with MedSource's operations, we may not be able to realize the cost savings, synergies or revenue enhancements that we anticipate from the integration, either in the amount or the time frame that we currently expect. Our ability to realize

We use highly engineered, proprietary processes and sophisticated machining equipment to meet the specifications of our customers. Without the timely incorporation of new processes and enhancements, particularly relating to quality standards and cost-effective production, our manufacturing capabilities would likely become outdated, which would cause us to lose customers. In addition, new or revised technologies could render our existing process technology less competitive or obsolete or could reduce demand for our products and services. It is also possible that finished medical device products introduced by our customers may require fewer of our components or may require components that we lack the capabilities to manufacture or assemble. In addition, we cannot assure you that any investment that we make in new technologies will result in commercially viable processes for our business.

~~Although~~anticipated cost wesavings, ~~anticipate~~synergies ~~that our manufacturing~~ and ~~marketing~~revenue ~~expertise~~enhancements ~~will~~may ~~enable~~be usaffected ~~to successfully develop and market our capabilities, any failure~~ by ~~us to anticipate or respond in~~ a ~~cost-effective~~number ~~and~~of ~~timely~~factors, ~~manner to technological developments or changes in industry standards or customer requirements~~including, orbut ~~any~~not ~~significant~~limited ~~delays~~to: ~~in capability development or introduction could adversely affect our results of operations.~~

•: our ability to effectively eliminate duplicative backoffice overhead and overlapping and redundant selling, general and administrative functions, rationalize manufacturing capacity and shift production to more economical facilities;
•: the anticipated utilization of cash resources on integration and implementation activities to achieve those cost savings, which could be greater than we currently expect and which could offset any such savings and other synergies resulting from the MedSource acquisition;
•: increases in other expenses, operating losses or problems unrelated to the MedSource acquisition, which may offset the cost savings and other synergies from the MedSource acquisition or divert resources intended to be used in the integration plan; and
•: our ability to avoid labor disruption in connection with the integration.

~~There~~Because ~~are~~a ~~risks~~significant ~~associated~~portion ~~with~~of ~~international~~our ~~operations~~net sales comes from a few large customers, any decrease in sales to these customers could harm our operating results.

We The ~~operate~~medical device industry is concentrated, with relatively few companies accounting for a ~~manufacturing~~large ~~facility~~percentage of sales in ~~Navojoa~~the cardiology, ~~Mexico~~endoscopy and orthopaedic markets that we target. Accordingly, our net sales and profitability are inhighly ~~the~~dependent ~~process~~on our relationships with a limited number of ~~significantly~~large ~~expanding~~medical ~~that~~device ~~facility~~companies. Pro forma for the twelve months ended December 31, 2003, our top 15 customers accounted for approximately 60% of our net sales. In particular, Johnson & Johnson and Boston Scientific each accounted for more than 10% of our net sales for the twelve months ~~addition~~ended December 31, we2003 ~~may~~and ~~seek~~nine months ended September 30, 2004 on a pro forma basis. We are likely to ~~build~~continue to experience a high degree of customer concentration, particularly if there is further consolidation within the medical device industry. We cannot assure you that there will not be a loss or ~~acquire~~reduction ~~additional~~in ~~manufacturing~~business from one or ~~other~~more ~~facilities~~of ~~outside~~our ~~the~~major ~~United~~customers. ~~States~~For example, in 2002 we lost a start-up customer as a result of the ~~future~~customer's product not gaining market acceptance. ~~Our~~In ~~international~~addition, ~~operations~~we ~~may~~cannot ~~expose~~assure usyou tothat ~~risks~~net ~~and~~sales ~~uncertainties,~~from ~~including~~customers ~~political,~~that ~~social~~have ~~and~~accounted ~~economic~~for ~~instability,~~significant ~~difficulties~~net sales in ~~staffing~~the ~~and~~past, ~~managing~~either ~~international~~individually ~~operations~~or ~~and~~as ~~controlling~~a ~~manufacturing quality~~group, ~~product~~will reach or ~~material~~exceed ~~transportation~~historical ~~delays~~levels orin ~~disruption,~~any ~~trade~~future ~~restrictions~~period. For example, ~~currency~~Boston ~~fluctuation~~Scientific ~~and~~has ~~changes~~recently informed us that it intends to transfer a number of products currently assembled by us to its own assembly operation in ~~tariffs,~~2005 ~~regulatory~~and the first half of 2006. For a detailed discussion of the Boston Scientific relationship, ~~restrictions~~see "Management's Discussion and ~~import~~Analysis of Financial Condition and ~~export~~Results ~~license~~of ~~requirements~~Operations—Overview." IfThe ~~any~~loss or a significant reduction of ~~these~~business ~~risks~~from ~~materializes,~~any of our ~~business~~major ~~may~~customers bewould adversely ~~harmed~~affect our results of operations.

~~The~~Our ~~availability~~substantial leverage and ~~price of~~debt ~~the~~service ~~raw~~obligations ~~materials~~could ~~that~~harm weour ~~use~~ability to operate our business, remain in compliance with debt covenants and make payments on our ~~products~~debt, ~~fluctuates~~including the notes.

~~Raw~~ We ~~materials needed for our business~~ are ~~susceptible~~highly ~~to fluctuations~~leveraged ~~in price~~ and ~~availability~~have ~~due~~significant todebt ~~transportation~~service ~~costs,~~obligations ~~government~~under ~~regulations,~~the ~~price~~notes ~~controls,~~and ~~changes~~our innew ~~economic~~senior ~~climate~~secured orcredit ~~other unforeseen circumstances~~facility. InAs ~~particular~~of September 30, ~~stainless steel~~2004, we ~~titanium~~had ~~and~~total ~~platinum~~debt ~~are~~obligations ~~used~~of in$368.5 million, ~~some~~ of ~~our products~~which ~~and~~approximately ~~are~~$2.0 million inis ~~limited~~due ~~supply and subject to fluctuations~~ in ~~price~~one year. ~~Our~~Pro ~~cost~~forma offor ~~products~~the ~~sold~~twelve ~~may~~months beended ~~adversely~~December 31, ~~impacted~~2003 ~~by decreases in the availability~~ and ~~increases in~~ the ~~market~~nine months ~~prices~~ended ofSeptember 30, ~~the~~2004, ~~raw materials used in~~ our ~~manufacturing processes.~~interest ~~There~~expense, ~~can~~net bewas noapproximately ~~assurance~~$28.7 million ~~that~~and ~~price~~$21.7 million, ~~increases~~respectively. inFor ~~raw~~a ~~materials~~detailed ~~can~~discussion beof ~~passed on to~~ our ~~customers~~contractual ~~through~~cash obligations ~~increases~~and inother ~~product~~commercial ~~prices.~~commitments ~~Even~~over ~~when~~the wenext ~~are~~several ~~able~~years toand ~~pass~~the ~~along~~new ~~all~~senior orsecured acredit ~~portion of our raw material price increases~~facility, ~~there~~refer ~~is typically~~to a"Management's ~~lag~~Discussion ~~time~~and ~~between~~Analysis ~~the~~of ~~actual~~Financial ~~cost~~Condition ~~increase~~and Results of ~~raw~~Operations—Contractual ~~materials~~Obligations" and ~~the~~"Description ~~corresponding~~of ~~increase~~New inSenior ~~the~~Secured ~~price~~Credit ~~of our products~~Facility."

We If we ~~and~~are unable to meet our ~~customers~~ ~~are~~debt ~~subject~~service obligations, we could be forced to ~~governmental~~restructure ~~regulation~~or refinance our obligations and seek additional equity financing or sell assets. We may be unable to

We and our customers are subject to federal, state and local health and safety and consumer product regulation, including regulation by the FDA, and to similar regulatory requirements in other countries. These regulations govern a wide variety of activities from product safety and effectiveness to design and development to labeling, manufacturing, promotion, sales and distribution. We believe that we are in compliance with the requirements of FDA, of state and local authorities and, as applicable, of equivalent foreign authorities. In the event that we build or acquire additional facilities outside the United States, we will be subject to medical device manufacturing regulation in those jurisdictions as well. Also, our customers’ products are subject to regulation, including manufacturing standards, of other countries in which they sell their products. As a result, we also may be obliged to comply with these manufacturing standards.

To maintain manufacturing approvals, we are generally required, among other things, to register certain of our manufacturing facilities with the FDA and with certain state and foreign agencies, maintain extensive records and submit to periodic inspections by the FDA and certain state and foreign agencies. We may be required to incur significant expenses and to spend significant amounts of time to comply with these regulations or to remedy past violations of these regulations. These efforts could be burdensome. In addition, any failure by us to comply with applicable government regulations could result in cessation of portions or all of our operations, imposition of fines and restrictions on our ability to carry on or expand our operations. Compliance by our customers with governmental regulations and their remedying of past violations of these regulations also may be time consuming, burdensome and expensive and could negatively affect our customers’ abilities to sell their products, which in turn could adversely affect our ability to sell our products and services.

The regulations to which we are subject are complex, change frequently and have tended to become more stringent over time. In addition, future laws and regulations may increase governmental involvement in

restructure ~~healthcare~~or refinance our obligations and obtain additional equity financing or sell assets on satisfactory terms or at all. As a result, ~~lower~~inability ~~reimbursement~~to ~~rates~~meet our debt service obligations could cause us to default on those obligations. Many of our agreements governing the terms of our debt obligations contain restrictive covenants that limit our ability to take specific actions or ~~otherwise~~require ~~change~~us not to allow specific events to occur and prescribe minimum financial maintenance requirements that we must meet. If we violate those restrictive covenants or fail to meet the ~~environment~~minimum financial requirements contained in a lease or debt instrument, we would be in default under that instrument, which ~~healthcare~~could, ~~industry~~in ~~participants~~turn, ~~operate~~result in defaults under other leases and debt instruments. Any such defaults could materially impair our financial condition and liquidity.

~~Our~~The ~~facilities~~unpredictable ~~are~~product ~~subject~~cycles toof ~~environmental~~the ~~regulation~~medical device manufacturing industry and uncertain demand for our manufacturing, design and engineering capabilities and related services could cause our revenues to fluctuate.

~~Federal,~~ Our ~~state~~target ~~and~~customer ~~local~~base ~~laws impose~~of ~~various~~medical ~~environmental~~device ~~controls~~companies onoperates in the ~~management,~~medical ~~handling,~~device ~~generation,~~ manufacturing industry, ~~transportation~~which is subject to rapid technological changes, ~~storage~~short product life-cycles, ~~use~~frequent new product introductions and ~~disposal~~evolving ofindustry ~~hazardous~~standards, ~~chemicals~~as ~~and~~well ~~other~~as ~~materials~~economic ~~used~~cycles. orIf ~~generated~~the inmarket for our manufacturing, ~~activities.~~design Ifand weengineering capabilities ~~fail~~does ~~to comply~~not ~~with~~grow ~~any~~as ~~present~~rapidly oras ~~future~~forecasted ~~environmental~~by ~~laws~~industry experts, weour revenues could be ~~subject~~less tothan ~~future~~expected. ~~liabilities~~We oralso face the ~~suspension~~risk ofthat ~~production.~~changes Wein ~~cannot~~the ~~assure~~medical ~~you~~device ~~that~~industry, for example, cost-cutting measures, changes to manufacturing techniques or production standards, could cause our ~~operations~~manufacturing, ~~will~~design ~~not~~and ~~require~~engineering ~~expenditures~~capabilities ~~for~~to ~~clean-up~~lose inwidespread ~~the~~market ~~future~~acceptance. If ~~Although~~our wecustomers' products do not ~~anticipate~~ ~~that~~gain ~~these~~market ~~remediation~~acceptance ~~efforts~~or ~~will~~suffer bebecause ~~material~~of competing products, weunfavorable ~~cannot~~regulatory ~~assure~~actions, ~~you~~alternative ~~that~~treatment ~~the~~methods ~~costs~~or ~~associated~~cures, ~~with~~product ~~these~~recalls ~~efforts~~or liability claims, they will ~~not~~no longer have anthe ~~adverse~~need ~~effect~~for on our ~~business~~capabilities and services and we may experience a decline in revenues. For example, ~~financial~~the ~~condition~~discovery orand ~~results~~market acceptance of ~~operations~~non-device treatments for specific medical conditions could make the medical devices used to treat those conditions obsolete. ~~Changes~~Shifts in ~~environmental laws~~our ~~may~~customers' ~~impose~~market ~~costly~~shares ~~compliance~~may ~~requirements~~also oncause us orto ~~otherwise~~experience ~~subject~~a usdecline toin revenues. ~~future~~Our ~~liabilities~~customers' markets, which include cardiology, endoscopy and ~~additional~~orthopaedics, ~~laws~~and ~~relating~~our markets are also subject to economic cycles and are likely to experience periods of economic decline in the ~~management~~future. Adverse economic conditions affecting the medical device manufacturing industry, ~~handling~~in general, ~~generation~~or the market for our manufacturing, ~~manufacture~~design and engineering capabilities and services, ~~transportation~~in particular, ~~storage~~could result in diminished sales, ~~use~~reduced ~~and~~profit ~~disposal~~margins ofand ~~materials~~a ~~used~~disruption in ~~or generated~~our bybusiness. If our customers do not proceed with the ~~manufacture~~production of ~~our~~devices ~~products~~in ~~may~~development bebecause ~~imposed.~~of Intheir inability ~~addition,~~to weobtain ~~cannot~~approval ~~predict~~for ~~the~~those ~~effect~~devices, ~~that~~changing ~~these~~market ~~potential~~conditions ~~requirements~~or ~~may~~other ~~have~~reasons, onour usrevenue orcould decline and therefore our ~~customers~~results could suffer.

~~Accidents~~Our atoperating ~~our~~results ~~facilities~~may ~~could~~fluctuate, ~~delay~~which ~~production~~may ~~and~~make ~~adversely~~it ~~affect~~difficult ~~operations~~to forecast our future performance.

~~Our business~~ Fluctuations ~~involves~~in ~~complex~~our ~~manufacturing~~operating ~~processes~~results ~~and~~may ~~hazardous~~cause ~~materials~~uncertainty ~~that~~concerning ~~can be dangerous to~~ our ~~employees.~~performance ~~Although~~and weprospects ~~employ~~or ~~safety~~may ~~procedures~~result in ~~the design and operation of~~ our ~~facilities~~failure ~~and~~to wemeet ~~have~~expectations. ~~not experienced any serious accidents or~~Our ~~deaths,~~operating ~~there~~results ishave afluctuated ~~risk that an accident or death could occur~~ in ~~one~~the ofpast ~~our~~and ~~facilities.~~are ~~Any~~likely ~~accident~~to ~~could~~fluctuate ~~result~~significantly in ~~significant~~the ~~manufacturing~~future ~~delays~~due orto ~~claims~~a ~~for~~variety ~~damages~~of ~~resulting from injuries~~factors, which ~~would~~include, ~~harm~~but ~~our~~are ~~operations~~not ~~and~~limited ~~financial condition. The potential liability resulting from any such accident or death could cause our business~~ to: ~~suffer. Any disruption of operations at any of our facilities could harm our business.~~

•: the fixed nature of a substantial percentage of our costs, which results in our operations being particularly sensitive to fluctuations in revenue;
•: changes in the relative portion of our revenue represented by our various products, which could result in reductions in our profits if the relative portion of our revenue represented by lower margin products increases;
•: introduction and market acceptance of our customers' new products and changes in demand for our customers' existing products;
•: the accuracy of our customers' forecasts of future production requirements;

We depend on a few key personnel

Our future success depends in part on our ability to attract and retain key executive, engineering, marketing and sales personnel. Our key personnel include Mr. Effress and our other executive officers and the loss of certain key personnel could have a material adverse effect on us. We face intense competition for these professionals from our competitors, our customers and other companies operating in our industry. To the extent that the services of members of our senior management team and key technical personnel would be unavailable to us for any reason, we would be required to hire other personnel to manage and operate our company and to develop our products and technology. We cannot assure you that we would be able to locate or employ such qualified personnel on acceptable terms.

We need to continue to attract qualified personnel

Our success will depend in large part upon our ability to attract, train, retain and motivate highly skilled employees and management. There is currently aggressive competition for employees who have experience in the engineering and technology used in our products and services. We compete intensely with other companies to recruit and hire from this pool. The industries in which we compete for employees are characterized by high levels of employee attrition. Although we believe we offer competitive salaries and benefits, we may have to increase spending in order to retain personnel.

We and our customers may be subject to infringement claims by third parties, and we may be unable to protect our intellectual property

Litigation to enforce and defend patent and other intellectual property rights is common in the medical device industry. Although we do not believe that any of our products, services or processes infringe the

•: timing of orders placed by our principal customers that account for a significant portion of our revenues;
•: timing of payments by customers;
•: price concessions as a result of pressure to compete;
•: cancellations by customers as a result of which we may recover only our costs plus our target markup;
•: availability of raw materials, including nitinol, elgiloy, tantalum, stainless steel, columbium, zirconium, titanium, gold, silver and platinum;
•: increased costs of raw materials, supplies or skilled labor;
•: effectiveness in managing our manufacturing processes; and
•: changes in competitive and economic conditions generally or in our customers' markets.

Investors ~~intellectual~~should property rights of third parties, we may be accused of infringing the rights of others. Our customers’ products also may be the subject of third-party infringement claims, which could seek damages from both the customer and from us. With most of our customers, we do not ~~have~~rely ~~formal~~on ~~agreements~~results ~~governing allocation~~ of ~~liability~~operations ~~for~~in ~~such~~any ~~claims.~~past ~~Even~~period ~~where~~as ~~we do not have liability to third parties,~~ an ~~infringement~~indication ~~claim against one~~ of what our ~~customers~~results ~~could~~will ~~result~~be ~~in reduced demand~~ for ~~our~~any ~~products~~future ~~and services or increased pricing pressure~~period. ~~Any infringement claim, significant charge or injunction against our products or those of our customers could harm our business.~~

WeOur ~~rely~~industry onis avery ~~combination~~competitive; of patent, trade secret and trademark laws, confidentiality procedures and contractual provisions to protect our intellectual property, which relates principally to proprietary manufacturing processes. We cannot be sure that the steps we ~~take~~may toface ~~protect~~competition ~~our proprietary rights will adequately deter unauthorized disclosure or misappropriation of our intellectual property~~from, ~~technical knowledge, practice or procedures. We may be required to spend significant resources to monitor~~ and ~~defend our intellectual property rights,~~ we may be unable to ~~detect~~compete orsuccessfully ~~defend~~ against, ~~infringement~~new ofentrants ~~these~~and ~~rights~~established ~~and~~companies ~~we may lose any competitive advantage associated~~ with ~~these~~greater ~~rights~~resources.

~~Risks~~ The ~~Related~~medical device industry is very competitive and includes thousands of companies. As more medical device companies seek to ~~this~~outsource ~~Offering~~more of the design, prototyping and ~~Our~~manufacturing ~~Stock~~of their products, we will face increasing competitive pressures to grow our business in order to maintain our competitive position, and we may encounter competition from and lose customers to other companies with design, technological and manufacturing capabilities similar to ours. Some of our potential competitors have greater name recognition, greater operating revenues, larger customer bases, longer customer relationships and greater financial, technical, personnel and marketing resources than we have. If we are unsuccessful competing with our competitors for our existing and prospective customers' business, we could lose business and our financial results could suffer.

~~Our~~We ~~stock~~may ~~price~~not ~~could~~ be ~~extremely~~able ~~volatile~~to ~~and,~~continue asto agrow ~~result,~~our ~~you~~business ~~may~~if ~~not~~the betrend ~~able~~by medical device companies to ~~resell~~outsource ~~your~~their ~~shares~~manufacturing atactivities does not continue or ~~above~~if ~~the~~our ~~price~~customers ~~you~~decide ~~paid~~to ~~for~~manufacture ~~them~~internally products that we currently provide.

~~Before~~ Our ~~this~~design, ~~offering~~manufacturing ~~there~~and assembly business has ~~not~~grown ~~been~~as a ~~public~~result ~~market~~of ~~for~~the increase over the past several years in medical device companies outsourcing these activities. We view the increasing use of outsourcing by medical device companies as an important component of our ~~common~~future ~~stock~~growth strategy. While industry analysts expect the outsourcing trend to increase, our current and anprospective ~~active~~customers ~~public~~continue ~~market~~to ~~for~~evaluate our ~~common~~capabilities ~~stock~~against ~~may~~the ~~not~~merits of internal production. For example, recently Boston Scientific has informed us that it intends ~~develop~~to ortransfer bea ~~sustained~~number ~~after~~of ~~this~~products ~~offering.~~currently ~~Further,~~assembled by us to its own assembly operation in 2005 and the ~~market~~first ~~price~~half of 2006. Any substantial slowing of growth rates or decreases in outsourcing by medical device companies could cause our ~~common~~revenue ~~stock~~to decline, and we may ~~decline~~be ~~below~~limited ~~the~~in ~~price~~our ~~you~~ability ~~paid~~or ~~for~~unable ~~your~~to ~~shares~~continue to grow our business.

~~Among~~ Also, as part of our growth strategy, we are seeking to accept full supply chain management and manufacturing responsibility for selected product lines from our customers and, in some cases, to acquire the ~~factors~~related manufacturing assets from these customers. While we believe that ~~could~~product ~~affect~~line ~~our~~transfers ~~stock~~and ~~price~~asset acquisitions of this kind are: becoming increasingly attractive to our customers, we have only consummated one of these transactions to date. We cannot be sure that opportunities of this nature will be available, especially if the trend toward outsourcing does not continue.

r industry trends and the business success of our customers;

r loss of a key customer;

r fluctuations in our results of operations;

r our failure to meet the expectations of the investment community and changes in investment community recommendations or estimates of our future results of operations;

r strategic moves by our competitors, such as product announcements or acquisitions;

r regulatory developments;

r litigation;

r general market conditions; and

r other domestic and international macroeconomic factors unrelated to our performance.

The stock market has recently experienced extreme volatility that has often been unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the market price of our common stock.

In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been instituted. If a securities class action suit is filed against us, we would incur

~~substantial~~Our ~~legal~~business ~~fees~~may ~~and~~suffer ~~our~~if ~~management’s~~we ~~attention~~are unable to recruit and ~~resources~~retain ~~would~~the beexperienced ~~diverted~~engineers ~~from~~and ~~operating~~management ~~our~~personnel ~~business~~that inwe ~~order~~need to ~~respond~~compete toin the ~~litigation.~~medical device industry.

~~There~~ Our future success depends upon our ability to attract, retain and motivate highly skilled engineers and management personnel. We may not be ~~sales~~successful ofin attracting anew ~~substantial~~engineers ~~amount~~or ofmanagement personnel or in retaining or motivating our ~~common~~existing ~~stock~~personnel, ~~180~~which ~~days~~may ~~after~~lead ~~this~~to ~~offering~~increased recruiting, relocation and compensation costs for such personnel. These increased costs may reduce our profit margins or ~~earlier~~make hiring new engineers impracticable. Some of our manufacturing processes are highly technical in nature. Our ability to maintain, byexpand or renew existing engagements with our ~~stockholders~~customers, enter into new engagements and ~~these~~provide ~~sales~~additional ~~could~~services ~~cause~~to our ~~stock~~existing ~~price~~customers depends on our ability to hire and retain engineers with the skills ~~fall~~necessary to keep pace with continuing changes in the medical device industry. Competition for experienced engineers is intense. We compete with other companies in the medical device industry to recruit engineers. Our inability to hire additional qualified personnel may also require an increase in the workload for both existing and new personnel.

~~MedSource~~ Our future ~~and~~success ~~each~~also ofdepends ~~its~~on ~~directors,~~the ~~executive~~personal ~~officers~~efforts and ~~stockholders~~abilities ~~have entered into a lock-up agreement with Morgan Stanley on behalf~~ of the ~~underwriters~~principal ~~for~~members ~~a period~~ of ~~180~~our ~~days~~senior ~~after~~management ~~the~~and ~~date~~engineering ofstaff ~~this~~to ~~prospectus.~~provide ~~Sales~~strategic ofdirection, ~~substantial~~manage ~~amounts of~~ our operations ~~common~~and ~~stock~~maintain ina ~~the~~cohesive ~~public~~and ~~market~~stable ~~after~~environment. ~~this~~In ~~offering~~addition, orour ~~the~~successful ~~perception~~integration ~~that~~of ~~such~~acquired ~~sales~~companies ~~will~~depends ~~occur,~~in ~~could adversely~~part ~~affect~~on ~~the market price of~~ our ~~common~~ability ~~stock and make it difficult for us~~ to ~~raise~~retain ~~funds~~senior ~~through~~management ~~equity~~of ~~offerings in~~ the ~~future~~acquired companies. AAlthough ~~substantial~~we ~~number~~or ofour ~~outstanding~~parent ~~shares~~have ofemployment ~~common~~agreements ~~stock~~with ~~and~~many ~~shares~~of ~~issuable~~the ~~upon~~members ~~exercise~~ of ~~outstanding options~~our ~~and~~senior ~~warrants~~management ~~will~~staff, ~~become~~we ~~available~~do ~~for~~not ~~resale~~have inemployment ~~the~~agreements ~~public~~with ~~market~~all atof ~~prescribed~~our ~~times.~~key Ofpersonnel, ~~the shares~~and ~~to be outstanding after~~ the ~~offering,~~ ~~shares~~employment ~~offered~~agreements bywe ~~this~~do ~~prospectus~~have ~~will~~allow ~~be eligible for immediate sale in~~ the ~~public~~employees ~~market~~to ~~without~~terminate ~~restriction~~them byupon ~~persons~~written ~~other than our affiliates~~notice. ~~The remaining %,~~In ~~or shares~~addition, ofwe ~~our~~do ~~total~~not ~~outstanding shares~~carry ~~will~~key-man ~~become~~life ~~available~~insurance ~~for~~on ~~resale~~any inof ~~the~~our ~~public~~senior ~~market as shown in the chart below~~management.

Number of Shares		Date Available for Resale
		Immediately
		90 days after this offering ( , 2002)
		180 days after this offering , 2002) or earlier in the sole discretion of Morgan Stanley & Co. Incorporated
		Various dates beginning in , 2002.

Quality problems with our processes, products and services could harm our reputation for producing high quality products and erode our competitive advantage.

~~Beginning~~ Quality ~~180~~is ~~days~~extremely ~~after~~important ~~this~~to ~~offering ( ,~~us ~~2002),~~and ~~holders~~our ~~of shares~~customers due to the serious and costly consequences of ~~our~~product ~~common~~failure. ~~stock~~Many ~~may~~of our customers require us to ~~register~~adopt and ~~their~~comply ~~shares~~with ~~for~~specific ~~resale under~~quality ~~the~~standards, ~~federal~~and ~~securities~~they ~~laws,~~periodically ~~and~~audit ~~holders~~our ofperformance. anOur ~~additional shares~~quality certifications are critical to the marketing success of our ~~common~~products ~~stock~~and ~~are~~services. ~~entitled~~If we fail to meet ~~have~~these ~~their~~standards ~~shares~~our ~~included~~reputation incould ~~the~~be ~~registration~~damaged, ~~statement~~we could lose customers and our revenue could decline. Aside from specific customer standards, ~~all~~our ~~subject~~success depends generally on our ability to manufacture to ~~reduction~~exact ~~upon~~tolerances ~~the~~precision ~~request~~engineered ofcomponents, ~~the~~subassemblies ~~underwriter~~and infinished ~~the~~devices ~~offering,~~from ifmultiple ~~any~~materials. ~~Registration~~If ofour ~~those~~components ~~shares~~fail ~~would~~to ~~allow~~meet ~~the~~these ~~holders~~standards or fail to ~~immediately~~adapt ~~resell~~to ~~their~~evolving standards, ~~shares~~our inreputation ~~the~~as ~~public~~a ~~market.~~manufacturer ~~Any~~of ~~such~~high ~~sales~~quality orcomponents ~~anticipation~~could ~~thereof~~be harmed, our competitive advantage could ~~cause~~be ~~the~~damaged, ~~market price~~and ofwe ~~our~~could ~~common~~lose ~~stock~~customers toand ~~decline~~market share.

InIf ~~addition, after this offering,~~ we ~~intend~~experience ~~to register shares~~decreasing ofprices ~~common~~for ~~stock~~our ~~subject~~products toand ~~outstanding~~services ~~options~~and orwe ~~reserved~~are ~~for~~unable ~~issuance~~to ~~under~~reduce our ~~stock purchase plan. For more information~~expenses, ~~see~~our ~~“Shares~~results ~~Eligible~~of ~~for~~operations ~~Future Sale.”~~will suffer.

~~Our~~ We ~~principal~~may ~~stockholders~~experience ~~and~~decreasing ~~management~~prices ~~own~~for athe ~~significant~~products ~~percentage of our company~~ and ~~will~~services bewe ~~able~~offer due to: ~~exercise significant influence over our company~~

•: pricing pressure experienced by our customers from managed care organizations and other third-party payors;
•: increased market power of our customers as the medical device industry consolidates; and
•: increased competition among medical engineering and manufacturing services providers.

~~After~~ If the ~~this~~prices ~~offering,~~for our ~~executive~~products ~~officers~~ and ~~directors~~services ~~and~~decrease ~~principal stockholders~~ and ~~their~~we ~~affiliated entities~~are ~~will~~unable ~~together~~to ~~control~~reduce ~~approximately % of~~ our ~~outstanding common stock. Accordingly~~expenses, ~~these stockholders, if they act together, will be able to control the composition of~~ our ~~board~~results of ~~directors~~operations ~~and many other matters requiring stockholder approval and~~ will ~~continue~~be toadversely ~~have significant influence over our affairs~~affected. They may exercise this influence in a manner that advances their best interests and not necessarily those of other stockholders. This concentration of ownership also could have the effect of delaying or preventing a change in our control or otherwise discouraging a potential acquirer from attempting to obtain control of us.

Provisions in our charter documents and Delaware law may deter takeover efforts that you feel would be beneficial to stockholder value

Our certificate of incorporation and bylaws and Delaware law contain provisions which could make it difficult for a third party to acquire us without the consent of our board of directors. These provisions include a

~~classified~~If ~~board~~we ofdo ~~directors~~not ~~and~~respond ~~limitations~~to onchanges ~~actions~~in bytechnology, our ~~stockholders. In addition~~manufacturing, ~~our~~design ~~board of directors has the right to issue preferred stock without stockholder approval that could be used to dilute a potential hostile acquiror. Delaware law also imposes restrictions on mergers~~ and ~~other~~engineering ~~business~~processes ~~combinations~~may ~~between~~become usobsolete and ~~any holder of 15% or more of our outstanding common stock. While~~ we ~~believe~~may ~~these~~experience ~~provisions provide for an~~reduced ~~opportunity~~sales ~~to receive a higher bid by requiring potential acquirors to negotiate with our board of directors, these provisions apply even if the offer may be considered beneficial by some stockholders,~~ and alose ~~takeover bid otherwise favored by a majority of our stockholders might be rejected by our board of directors~~customers.

~~You~~ We use highly engineered, proprietary processes and highly sophisticated machining equipment to meet the critical specifications of our customers. Without the timely incorporation of new processes and enhancements, particularly relating to quality standards and cost-effective production, our manufacturing, design and engineering capabilities will ~~suffer~~likely ~~immediate~~become outdated, which could cause us to lose customers and ~~substantial~~result ~~dilution~~in reduced revenues or profit margins. In addition, new or revised technologies could render our existing technology less competitive or obsolete or could reduce demand for our products and services. It is also possible that finished medical device products introduced by our customers may require fewer of our components or may require components that we lack the capabilities to manufacture or assemble. In addition, we may expend resources on developing new technologies that do not result in commercially viable processes for our business, which could adversely impact our margins and operating results.

~~The~~Inability ~~initial~~to ~~public~~obtain ~~offering~~sufficient ~~price~~quantities of ~~our~~raw ~~common~~materials ~~stock~~could ~~will~~cause bedelays ~~substantially higher than the net tangible book value per share of our outstanding common stock. If you purchase common stock~~ in this offering, you will incur immediate and substantial dilution in the net tangible book value per share of the common stock from the price you paid. To the extent we raise additional capital by issuing equity securities, our ~~stockholders may experience substantial additional dilution~~production.

~~Absence~~ Our business depends on a continuous supply of ~~dividends~~raw ~~could~~materials. ~~reduce~~Raw materials needed for our business are susceptible to fluctuations in price and availability due ~~attractiveness~~to transportation costs, government regulations, price controls, change in economic climate or other unforeseen circumstances. Failure to ~~investors~~maintain our supply of raw materials could cause production delays resulting in a loss of customers and a decline in revenue. Due to the supply and demand fundamentals of raw material used by us, we have occasionally experienced extended lead times on purchases and deliveries from our suppliers. Consequently, we have had to adjust our delivery schedule to customers. In addition, fluctuations in the cost of raw materials may increase our expenses and affect our operating results. The principal raw materials used in our business include stainless steel, tantalum, columbium, zirconium, titanium, nitinol, elgiloy, gold, silver and platinum. In particular, tantalum and nitinol are in limited supply. For wire fabrication, we purchase approximately 100% of our stainless steel wire from an independent, third-party supplier. The loss of this supplier could interrupt production and harm our business.

~~Some~~Our ~~investors~~international ~~favor~~operations ~~companies~~are ~~that~~subject ~~pay dividends, particularly in market downturns. We currently intend~~ to ~~retain~~a ~~any~~variety ~~future~~of ~~earnings~~risks tothat ~~finance~~could ~~the~~adversely ~~continued~~affect ~~development~~those operations and ~~expansion~~thus of our ~~business,~~profitability and ~~therefore, we do not anticipate paying cash dividends on our common stock in the future. In addition, our new senior credit~~operating ~~facility will restrict our payment of dividends~~results. ~~Because we likely will not pay dividends, your return on this investment likely depends on your ability to sell our stock for a profit.~~

We have substantial international manufacturing operations in Europe and Mexico. We also receive a significant portion of our net sales from international sales, approximately half of which is generated by exports from our facilities in the United States and the other half of which is generated by sales from our international facilities. Although we take measures to minimize risks inherent to our international operations, the following risks may have a negative effect on our profitability and operating results, impair the performance of our foreign operations or otherwise disrupt our business:

•: fluctuations in the value of currencies could cause exchange rates to change and impact our profitability;
•: changes in labor conditions and difficulties in staffing and managing foreign operations, including labor unions, could lead to delays or disruptions in production or transportation of materials or our finished products;
•: greater difficulty in collecting accounts receivable and longer payment cycles, which can be more common in our international operations, could adversely impact our operating results over a particular fiscal period; and
•: changes in foreign regulations, export duties, taxation and limitations on imports or exports could increase our operational costs, impose fines or restrictions on our ability to carry on our business or expand our international operations.

~~FORWARD-LOOKING~~We ~~STATEMENTS~~may expand into new markets and products and our expansion may not be successful.

~~You~~ We ~~should~~may ~~not~~expand ~~rely~~into new markets through the development of new product applications based on ~~forward-looking~~our ~~statements~~existing inspecialized ~~this~~manufacturing, ~~prospectus~~design and engineering capabilities and services. ~~This~~These ~~prospectus~~efforts ~~contains~~could ~~forward-looking~~require ~~statements~~us ~~within~~to ~~the~~make ~~meaning~~substantial ofinvestments, ~~federal~~including ~~securities~~significant ~~laws~~research, ~~that~~development, ~~relate~~engineering ~~to future~~and ~~events~~capital expenditures for new, expanded or improved ~~our~~manufacturing ~~future~~facilities ~~financial~~which ~~performance.~~would Indivert ~~many~~resources ~~cases,~~from ~~you~~other ~~can~~aspects ~~identify~~of ~~forward-looking~~our ~~statements~~business. byExpansion ~~terminology~~into ~~such~~new asmarkets “and products may,” ~~“will,”~~be ~~“should,”~~costly ~~“expect,”~~without ~~“plan,”~~resulting ~~“anticipate,”~~in any benefit to us. ~~“believe,”~~Specific ~~“estimate,”~~risks ~~“predict,”~~in ~~“intend,”~~connection ~~“potential”~~with orexpanding ~~“continue”~~into ornew markets include the ~~negative~~inability to transfer our quality standards into new products, the failure of ~~these~~customers ~~terms~~in ornew ~~other~~markets ~~comparable~~to ~~terminology~~accept our products and price competition in new markets. If we choose to expand into new markets and are unsuccessful, our financial condition could be adversely affected and our business harmed.

~~Some~~We are subject to a variety of ~~the~~environmental ~~factors~~laws that ~~may~~could ~~cause~~be ~~actual~~costly ~~results~~for us to ~~differ~~comply ~~materially~~with, ~~from~~and ~~the~~we ~~results~~could ~~expressed~~incur orliability ~~implied~~if bywe ~~these~~fail ~~forward-looking~~to ~~statements~~comply with such laws or if we are ~~set~~responsible ~~forth~~for ~~under~~releases ~~“Risk Factors.”~~of contaminants to the environment.

~~Although~~ Federal, westate ~~believe~~and ~~that~~local laws impose various environmental controls on the ~~expectations~~management, ~~reflected~~handling, generation, manufacturing, transportation, storage, use and disposal of hazardous chemicals and other materials used or generated in the ~~forward-looking~~manufacturing ~~statements~~of ~~are~~our ~~reasonable,~~products. If we ~~cannot guarantee~~fail to comply with any present or future ~~results~~environmental laws, ~~levels~~we ofcould ~~activity~~be subject to fines, ~~performance~~corrective action, other liabilities or ~~achievements~~the suspension of production. We dohave ~~not~~in ~~intend~~the topast ~~update~~paid ~~any~~civil ofpenalties ~~the~~for ~~forward-looking~~violations ~~statements~~of ~~after~~environmental ~~the~~laws. To date, ofsuch ~~this~~matters ~~prospectus~~have not had a material adverse impact on our business or tofinancial ~~conform~~condition. ~~these~~We ~~statements~~cannot toassure ~~actual~~you, ~~results~~however, that such matters will not have a material impact on us in the future.

In addition, conditions relating to our operations may require expenditures for clean-up of releases of hazardous chemicals into the environment. For example, our subsidiary, UTI Corporation, a Pennsylvania corporation, referred to herein as UTI Pennsylvania, has incurred liability for various cleanup matters related to the disposal of regulated wastes at third-party disposal sites, as has MedSource and companies it has acquired, which are now our subsidiaries through the MedSource acquisition. Further, we (including MedSource and its subsidiaries after the MedSource acquisition) have incurred liability with respect to contaminations at our and their current and former properties as a result of operations performed at these facilities. For example, we were required and continue to perform remediation as a result of leaks from underground storage tanks at our Collegeville, Pennsylvania facility. In addition, we may have future liability with respect to contamination at their current or former properties or with respect to third-party disposal sites. Although we do not anticipate that currently pending matters will have a material adverse effect on our results of operations and financial condition, we cannot assure you that these matters or others that arise in the future will not have such an effect.

Changes in environmental laws may result in costly compliance requirements or otherwise subject us to future liabilities. In addition, to the extent these changes affect our customers and require changes to their devices, our customers could have a reduced need for our products and services, and, as a result, our revenue could suffer.

Our inability to protect our intellectual property could result in a loss of our competitive advantage, and infringement claims by third parties could be costly and distracting to management.

We rely on a combination of patent, trade secret and trademark laws, confidentiality procedures and contractual provisions to protect our intellectual property. The steps we have taken or will take to protect our proprietary rights may not adequately deter unauthorized disclosure or misappropriation of our intellectual property, technical knowledge, practice or procedures. We may be required to spend significant resources to monitor our intellectual property rights, we may be unable to detect

~~USE~~infringement of OFthese ~~PROCEEDS~~rights and we may lose our competitive advantage associated with our intellectual property rights before we do so. Although we do not believe that any of our products, services or processes infringe the intellectual property rights of third parties, we may in the future be notified that we are infringing patent or other intellectual property rights of third parties. In the event of infringement of patent or other intellectual property rights, we may not be able to obtain licenses on commercially reasonable terms, if at all, and we may end up in litigation. The failure to obtain necessary licenses or other rights or the occurrence of litigation arising out of infringement claims could disrupt our business and impair our ability to meet our customers' needs which, in turn, could have a negative effect on our financial condition and results of operations. Infringement claims, even if not substantiated, could result in significant legal and other costs and may be a distraction to management. We also may be subject to significant damages or injunctions against development and sale of our products. In addition, any infringement claims, significant charges or injunctions against our customers' products that incorporate our components may result in our customers not needing or having a reduced need for our capabilities and services.

~~Our~~If ~~net~~we ~~proceeds~~become ~~from~~subject ~~the~~to ~~sale~~product ~~of shares~~liability of common stock in this offering at an assumed initial public offering price of $ per share will be approximately $ million (approximately $ million if the underwriters’ over-allotment option is exercised in full)claims, ~~after~~our ~~deducting~~earnings ~~the underwriting discount~~ and ~~estimated~~financial ~~offering~~condition ~~expenses~~could ~~payable by us~~suffer.

We The ~~intend~~manufacture and sale of products that incorporate components manufactured or assembled by us exposes us to ~~use~~potential product liability claims and product recalls, including those ~~proceeds~~that may arise from misuse or malfunction of, or design flaws in, our components or use of our components with components or systems not manufactured or sold by us. Product liability claims or product recalls with respect to our components or the end-products of our customers into which our components are incorporated, whether or not such problems relate to the products and services we have provided and regardless of their ultimate outcome, could require us to spend significant time and money in litigation or require us to pay significant damages. We may also lose revenue from the sale of components if the commercialization of a product that incorporates our components or subassemblies is limited or ceases as ~~follows:~~a result of such claims or recalls. For example, two of MedSource's products were subject to recalls in 2001 and 2002. As a result of such product recalls, our customer redesigned the manufacturing process and decided to manufacture the device internally, resulting in lost annual revenues of approximately $5.0 million and $2.0 million, respectively. In addition, certain finished medical devices into which our components were incorporated have been subject to product recalls. Expenditures on litigation or damages, to the extent not covered by insurance, and declines in revenue could impair our earnings and our financial condition. Also, if, as a result of these claims or recalls our reputation is harmed, we could lose customers, which would also negatively affect our business.

	Approximate dollar amount
	(In millions)
Repayment of our senior credit facility(a)	$	28.3
Repayment of our 12.5% senior subordinated notes(b)		21.6
Redemption of our Series E preferred stock and our Series F preferred stock(c)		10.4
Payment of accrued and unpaid dividends on our Series B preferred stock(d)		4.0
One-time payments to terminate agreements with Kidd & Company and Whitney Mezzanine Management Company(e)		2.9
Working capital and other general corporate purposes, including potential acquisitions(f)
Total	$

We cannot assure you that we will be able to maintain our existing insurance, which is currently insured at an aggregate level of $20 million per year, or to do so at reasonable cost and on reasonable terms. In addition, if our insurance coverage is not sufficient to cover any costs we may incur or damages we may be required to pay if we are subject to product liability claims or product recalls, we will have to use other resources to satisfy our obligations. In some circumstances, we have agreements in place with our customers governing liability for product liability and recalls. Even where we have agreements with customers that contain provisions attempting to limit our damages, these provisions may not be enforceable or may otherwise fail to protect us from liability.

~~(a)~~We Asand ~~of the date of this prospectus, we owed $68.3 million under~~ our ~~existing~~customers ~~senior~~are ~~credit~~subject ~~facility. We expect~~ to ~~repay~~various ~~this~~political, ~~facility~~economic ~~in full with $28.3 million of the proceeds of this offering~~ and ~~$40.0~~regulatory ~~million~~changes ~~from~~in ~~our new senior credit facility, described below under~~ the ~~caption~~healthcare ~~“Management’s~~industry ~~Discussion~~that ~~and~~could ~~Analysis~~force ofus ~~Financial~~to ~~Condition~~modify ~~and~~how ~~Results~~we develop ~~of Operations — Liquidity~~ and ~~Capital~~price ~~Resources — New Senior Credit Facility.” The outstanding loans under~~ our ~~existing~~components, ~~senior~~manufacturing ~~credit~~capabilities ~~facility mature between March 2005~~ and ~~March~~services ~~2007~~ and ~~presently~~could ~~bear~~harm ~~interest~~our ~~at rates ranging from 5~~business.~~4% to 6.9% per year.~~

~~(b)~~ The ~~senior~~healthcare ~~subordinated~~industry ~~notes~~is ~~mature~~highly inregulated ~~2009,~~and ~~but~~is weinfluenced ~~will~~by ~~prepay~~changing ~~the~~political, ~~notes~~economic inand ~~full,~~regulatory ~~together~~factors. ~~with~~Federal aand ~~redemption~~state ~~premium~~legislatures ofhave periodically ~~$1.6~~considered ~~million,~~programs ~~with~~to ~~the~~reform ~~proceeds~~or ~~from~~amend ~~this~~the ~~offering,~~United asStates ~~further~~healthcare ~~discussed~~system ~~below~~at ~~under~~both the ~~caption~~federal ~~“Management’s~~and ~~Discussion~~state ~~and~~levels. ~~Analysis~~Regulations ofaffecting ~~Financial~~the ~~Condition~~healthcare ~~and~~industry ~~Results~~in ofgeneral, ~~Operations~~and —the ~~Liquidity~~medical device ~~and~~industry ~~Capital~~in ~~Resources~~particular, —are ~~Senior~~complex, ~~Subordinated~~change ~~Notes.”~~

(c) Our Series E preferred stock and Series F preferred stock were issued in connection with our acquisition of HV Technologies in January 2002. The Series E preferred stock was issued to investors for cash that was paid to shareholders of HV Technologies, and the Series F preferred stock was issued to one of the shareholders of HV Technologies. Our Series E preferred stock and our Series F preferred stock accrue dividends at the rate of 6% per year until December 31, 2002 and January 4, 2003, respectively, and accrue dividends at 16% per year on a retroactive basis thereafter. We expect to use a portion of the proceeds of this offering to redeem our Series E preferred stock before December 31, 2002, and we will use a portion of the proceeds of this offering to redeem our Series F preferred stock within 45 days after we complete this offering.

(d) This amount represents payment of accrued and unpaid dividends on our Series B preferred stock, which accrues dividends at the rate of 6% per year. As discussed above under the first paragraph after the table under the caption “Summary — The Offering” on page 5, the Series B preferred stock will convert into common stock upon completion of this offering.

(e) This amount represents amounts payable to terminate agreements with Kidd & Company and Whitney Mezzanine Management Company described below under the caption “Certain Transactions — Certain Services.”

(f) From time to time, in the ordinary course of business, we evaluate possible acquisitions of, or investments in, businesses, products and technologies that are complementary to our business. We currently have no arrangements, agreements or understandings for any such acquisitions or investments.

~~The~~frequently and ~~amounts~~have ~~and~~tended ~~timing~~to ofbecome ~~our~~more ~~use~~stringent ofover ~~the~~time. ~~proceeds~~In ofaddition, ~~this~~these ~~offering~~regulations ~~will~~may ~~depend~~contain ~~upon~~proposals ~~numerous factors~~to increase governmental involvement in healthcare, ~~including~~lower ~~the~~reimbursement ~~amount~~rates ofor otherwise ~~proceeds~~change ~~actually~~the ~~raised~~environment in ~~this~~which ~~offering~~healthcare industry participants, ~~the~~including ~~timing~~medical ofdevice ~~any~~companies, ~~acquisitions~~operate. While we ~~complete,~~are ~~the~~not ~~availability~~aware of ~~debt~~any ~~financing~~legislation ~~and~~or regulations specifically targeting the ~~amount~~medical ofdevice ~~cash~~industry ~~generated~~that byare currently pending, any such regulations could impair our ~~operations.~~ability ~~Until~~to ~~used~~operate asprofitably. ~~described~~In ~~above~~addition, weany ~~intend~~ failure by us to ~~invest~~comply with applicable government regulations could also result in the ~~proceeds~~cessation of ~~this~~portions ~~offering~~or inall ~~short-term~~of our operations, ~~investment-grade~~impositions ~~securities~~of fines and restrictions on our ability to carry on or expand our operations.

~~The~~Consolidation ~~above description represents our present intentions based on our current plans and business conditions. Unforeseen events or changed business conditions, however, could result~~ in the ~~application~~healthcare ofindustry ~~the~~could ~~net proceeds from this offering in a manner other than as described in this prospectus. Our management will~~ have ~~broad~~an ~~discretion~~adverse toeffect ~~allocate~~on ~~the~~our ~~net~~revenues ~~proceeds~~and ~~from~~results ~~this~~of ~~offering~~operations.

~~DIVIDEND~~ Many ~~POLICY~~healthcare industry companies, including medical device companies, are consolidating to create new companies with greater market power. As the healthcare industry consolidates, competition to provide products and services to industry participants will become more intense. These industry participants may try to use their market power to negotiate price concessions or reductions for medical devices that incorporate components produced by us. If we are forced to reduce our prices because of consolidation in the healthcare industry, our revenues would decrease and our business, financial condition and results of operations would suffer.

WeOur ~~anticipate that we will retain future earnings, if any, to finance the continued development and expansion of our~~ business. Inis ~~addition,~~indirectly ~~our~~subject ~~new senior credit facility will restrict our payment of dividends. Any future determination with respect~~ to ~~the~~healthcare ~~payment~~industry ofcost ~~dividends~~containment ~~will~~measures bethat ~~dependent~~could ~~upon,~~result ~~among~~in ~~other~~reduced ~~things,~~sales ~~our earnings, capital requirements, the terms~~ of ~~our~~medical ~~then~~devices ~~existing~~containing ~~indebtedness, applicable requirements of Delaware corporate law, general economic conditions and other factors considered relevant by~~ our ~~board of directors~~ components.

Our customers and the healthcare providers to whom our customers supply medical devices rely on third-party payors, including government programs and private health insurance plans, to reimburse some or all of the cost of the procedures in which medical devices that incorporate components manufactured or assembled by us are used. The continuing efforts of government, insurance companies and other payors of healthcare costs to contain or reduce those costs could lead to patients being unable to obtain approval for payment from these third-party payors. If that were to occur, sales of finished medical devices that include our components may decline significantly, and our customers may reduce or eliminate purchases of our components. The cost containment measures that healthcare providers are instituting, both in the United States and internationally, could harm our ability to operate profitably. For example, managed care organizations have successfully negotiated volume discounts for pharmaceuticals. While this type of discount pricing does not currently exist for medical devices, if managed care or other organizations were able to effect discount pricing for devices, it may result in lower prices to our customers from their customers and, in turn, reduce the amounts we can charge our customers for our design and manufacturing services.

Accidents at one of our facilities could delay production and could subject us to claims for damages.

Our business involves complex manufacturing processes and hazardous materials that can be dangerous to our employees. We employ safety procedures in the design and operation of our facilities; however, there is a risk that an accident or death could occur in one of our facilities. Any accident could result in significant manufacturing delays, disruption of operations or claims for damages resulting from injuries, which could result in decreased sales and increased expenses. To date, we have not incurred any such significant delays, disruptions or claims. The potential liability resulting from any accident or death, to the extent not covered by insurance, would require us to use other resources to satisfy our obligations and could cause our business to suffer.

~~CAPITALIZATION~~A substantial amount of our assets represents goodwill, and our net income will be reduced if our goodwill becomes impaired.

~~The~~ As ~~following~~of ~~table~~September 30, ~~sets~~2004, ~~forth~~goodwill, net represented approximately $300.3 million, or 49.9%, of our ~~capitalization~~total asassets. Goodwill is generated in our acquisitions when the cost of ~~September~~an 30acquisition exceeds the fair value of the net tangible and identifiable intangible assets we acquire. Goodwill is subject to an impairment analysis at least annually based on the fair value of the reporting unit. We could be required to recognize reductions in our net income caused by the write-down of goodwill, ~~2001:~~if significantly impaired, could materially and adversely affect our results of operations.

rOur inability to access additional capital could have a negative impact on anour ~~actual~~growth ~~basis;~~strategy.

r Our ongrowth astrategy ~~“pro~~will ~~forma”~~require ~~basis~~additional tocapital ~~reflect~~for, ~~our~~among ~~acquisition~~other ofpurposes, HVcompleting ~~Technologies~~acquisitions, inmanaging ~~January~~acquired ~~2002~~companies, acquiring new equipment and maintaining the ~~related~~condition ~~issuance~~of existing equipment. In connection with the offering of ~~our~~the ~~Series~~notes, Ewe ~~preferred~~repaid ~~stock~~all of our old senior and ~~warrants~~subordinated indebtedness and ~~Series~~entered Finto ~~preferred~~our ~~stock~~new assenior secured credit facility. If cash generated internally is insufficient to fund capital requirements, or if ~~they~~funds ~~had~~are ~~all~~not ~~occurred~~available under our new senior secured credit facility, we will require additional debt or equity financing. Adequate financing may not be available or, if available, may not be available on ~~September~~terms 30satisfactory to us. If we fail to obtain sufficient additional capital in the future, ~~2001;~~we could be forced to curtail our growth strategy by reducing or delaying capital expenditures and acquisitions, selling assets or restructuring or refinancing our indebtedness. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources."

rOur onnon-medical aoperations ~~“pro~~are ~~forma~~highly ascyclical ~~adjusted” basis to reflect~~and, in addition to the pro forma adjustments discussed above, (1) the sale of shares of common stock by us in this offering at an assumed initial public offering price of $ , after deducting the underwriting discount and estimated offering expenses payable by us; (2) the conversion of the preferred stock and the exercise of the warrant as ~~described~~a inpercentage ~~the first and second paragraphs after the table under the caption “Summary — The Offering” on page 5; and (3) the application~~ of ~~the~~our total net ~~proceeds of this offering~~sales, ~~together~~continue ~~with~~to ~~proceeds of approximately $40~~decline.~~0 million from the new senior credit facility described in footnote (a) below.~~

~~This~~ We ~~table~~have ~~should~~established becustomer ~~read~~relationships inwith ~~conjunction~~companies ~~with~~outside ~~“Management’s~~of ~~Discussion~~the medical device market, pursuant to which these customers incorporate our products and services ~~Analysis~~into oftheir ~~Financial~~products ~~Condition~~such as high density discharge lamps, fiber optics, motion sensors and power generators. For the twelve months ended December 31, 2003, on a pro forma basis, our ~~Results~~non-medical operations accounted for approximately 9.6% of ~~Operations~~our net sales. Historically,” ~~“Selected~~net ~~Unaudited~~sales ~~Pro~~from ~~Forma~~these ~~Condensed~~operations ~~Combined~~have ~~Financial~~been ~~Information”~~highly cyclical and ~~our~~since ~~consolidated~~2001 ~~financial~~we ~~statements~~have ~~and~~experienced ~~related~~a reduction ~~notes~~in ~~appearing~~revenues ~~elsewhere~~from this area of our business. We believe volatility in this ~~prospectus~~area of our operations is due in part to lower sales to customers servicing the electronics, power generation, telecommunication, aerospace and industrial markets due to the economic downturn. Accordingly, we cannot predict when volatility will occur and how severely it will impact our results of operations.

	As of September 30, 2001
	Actual			Pro Forma			Pro Forma As Adjusted
	(In thousands, except share data)
Cash and cash equivalents	$	14,254		$	16,264		$
Existing senior credit facility, including current portion	$	70,513		$	70,513		$	—
New senior credit facility, including current portion(a)		—			—			40,000
12.5% senior subordinated notes, including current portion and unamortized discount(b)		20,000			20,000			—
Other long-term debt including current portion		562			562			562
Mandatory redeemable stock:
Series B, Series C, Series D and Series F preferred stock, par value $.01 per share, 495,329 shares authorized in the aggregate actual, 499,329 shares authorized in the aggregate pro forma, none authorized pro forma as adjusted, 408,360 shares outstanding in the aggregate actual, 412,360 outstanding in the aggregate pro forma, and none outstanding pro forma as adjusted		100,972			104,608			—
Stockholders’ equity:
Series A, Series E and Series Z preferred stock, par value $.01 per share, 165,000 shares authorized in the aggregate actual, 171,000 shares authorized in the aggregate pro forma, none authorized pro forma as adjusted, 103,370 shares outstanding in the aggregate actual, 109,370 shares outstanding in the aggregate pro forma, and none outstanding pro forma as adjusted		1			3,538
Common stock, par value $.01 per share, 40,000,000 shares authorized, 5,256,158 shares outstanding actual, 6,080,380 shares outstanding pro forma and shares outstanding pro forma as adjusted		53			61
Additional paid-in capital		33,880			51,995
Accumulated other comprehensive loss		(2,771	)		(2,771	)
Accumulated deficit		(48,709	)		(48,709	)		(c	)(d)
Unaccrued compensation		(179	)		(179	)
Total stockholders’ equity		(17,725	)		3,935
Total capitalization	$	174,322		$	199,618		$

We face risks associated with the implementation of our new Enterprise Resource Planning System.

We are in the process of installing a third-party enterprise resource planning system, or ERP, across our facilities, which will enable the sharing of customer, supplier and engineering data across our company. The installation and integration of the ERP may divert the attention of our information technology professionals and certain members of management from the management of daily operations to the integration of the ERP. Further, we may experience unanticipated delays in the implementation of the ERP, difficulties in the integration of the ERP across our facilities or interruptions in service due to failures of the ERP. Continuing and uninterrupted performance of our ERP system is critical to the success of our business strategy. Any damage or failure that interrupts or delays operations may dissatisfy customers and could have a material adverse effect on our business, financial condition, results of operations and cash flow.

We license the ERP software from a third party. If these licenses are discontinued, or become invalid or unenforceable, there can be no assurance that we will be able to develop substitutes for this software independently or to obtain alternative sources at acceptable prices or in a timely manner. Any

~~(a)~~delays in ~~Concurrently~~obtaining ~~with~~or ~~this~~developing ~~offering,~~substitutes wefor ~~intend~~licensed tosoftware ~~replace~~could ~~our~~have ~~existing senior credit facility with~~ a ~~new~~material ~~$85.0~~adverse ~~million~~effect ~~senior~~on ~~credit~~our ~~facility described under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — New Senior Credit Facility~~operations.”

~~(b)~~As Inwe ~~connection~~rationalize ~~with~~manufacturing ~~the~~capacity ~~repayment~~and ofshift ~~our~~production ~~debt,~~to asmore ~~discussed~~economical ~~under the caption “Use of Proceeds~~facilities,” weour ~~will~~customers ~~expense~~may ~~$3.2~~choose ~~million~~to ofreallocate ~~unamortized~~their ~~deferred~~outsource requirements ~~financing~~among ~~costs,~~our ~~$2.6~~competitors ~~million~~or ofperform ~~unamortized~~such ~~discount~~functions ~~and a redemption premium of $1~~internally.~~6 million.~~

~~(c)~~ As ~~discussed~~we inintegrate ~~the~~MedSource's ~~second~~operations ~~paragraph~~and ~~under~~rationalize ~~the~~manufacturing ~~caption~~capability ~~“Description~~and ofshift ~~Capital~~production ~~Stock~~to —more ~~General~~economical facilities,” our ~~Series~~customers Cmay ~~preferred~~evaluate their ~~stock~~outsourcing ~~converts~~requirements ~~into~~and adecide ~~number~~to ofuse ~~shares~~the services of our ~~common~~competitors ~~stock~~or ~~that~~move ~~depends~~design ~~upon~~and ~~the~~production ~~public~~work ~~offering~~back ~~price~~to oftheir ~~our~~own ~~common~~internal ~~stock~~facilities. ~~The~~For ~~pro~~some ~~forma~~customers, asgeographic ~~adjusted~~proximity ~~accumulated~~to the ~~deficit~~outsourced ~~therefore~~design ~~reflects~~or amanufacturing ~~deemed~~facility ~~preferred~~may ~~stock~~be ~~dividend~~an ofimportant $consideration ~~million~~and ~~as the value of the additional shares of~~ our ~~common~~reallocation ~~stock~~may ~~issued~~cause them to ~~the~~no ~~holders~~longer ofuse our ~~Series~~services Cfor ~~preferred~~future ~~stock~~work. ~~upon~~If ~~conversion~~our incustomers ~~this~~reallocate ~~offering.~~work among Weoutsourcing ~~determined~~vendors ~~the~~or ~~value~~complete ofdesign ~~the~~or ~~dividend~~production in ~~accordance~~their ~~with~~own ~~Emerging~~facilities, ~~Issues~~we ~~Task~~would ~~Force,~~lose ~~or EITF~~business, ~~00-27~~which bycould ~~multiplying~~impair ~~the~~our ~~number~~growth ofand ~~additional~~operating ~~shares~~results. ofFurther, ~~our~~unanticipated ~~common~~delays ~~stock~~or difficulties ~~that~~in ~~are~~facility ~~issuable~~consolidation ~~upon~~and ~~conversion~~rationalization of our ~~Series~~current Cand ~~preferred~~future ~~stock,~~facilities ~~determined~~could ascause ~~set~~interruptions ~~forth~~ in ~~the~~our ~~second~~services ~~paragraph~~which ~~under~~could ~~the~~damage ~~caption~~our ~~“Description~~reputation ofand ~~Capital~~relationships ~~Stock~~with ~~— General,” by the value that an independent appraisal assigned to~~ our customers ~~common~~and ~~stock~~could onresult ~~the~~in ~~date~~a ~~that~~loss ~~investors~~of ~~first~~customers ~~committed~~and tomarket ~~purchase our Series C preferred stock~~share.

(d) In connection with our acquisition of HV Technologies in January 2002, we issued $6.0 million of our Series E preferred stock, and we issued warrants to purchase an aggregate of 200,000 shares of our common stock. We ~~will~~depend ~~record~~on a discount of $2.5 million to the carrying value of the Series E preferred stock equal to the consideration allocated to the warrants. We plan to accrete this discount over the 12 month period ending December 31, 2002 since we plan to redeem our ~~Series~~senior ~~E preferred stock by that date~~management.

~~The~~ Our ~~above~~success ~~table excludes~~depends upon the ~~shares~~retention of ~~common~~our ~~stock~~senior ~~issuable~~management, ~~upon~~including ~~exercise~~Ron ofSparks, ~~outstanding~~Accellent's ~~options~~and our President and ~~warrants~~Chief ~~described~~Executive inOfficer. ~~the~~We ~~second~~cannot ~~paragraph~~assure you ~~after~~that ~~the~~we ~~table~~would ~~under~~be able to find qualified replacements for the ~~caption~~individuals ~~“Summary~~who —make up our senior management if their services were no longer available. The ~~Offering”~~loss of services of one or more members of our senior management team could have a material adverse effect on ~~page 5~~our business, financial condition and results of operations. Accellent has entered into employment agreements with Ron Sparks, Stewart A. Fisher, its and our Chief Financial Officer, Executive Vice President, Treasurer and Secretary, and Gary D. Curtis, its and our Executive Vice President, Sales and Marketing and an incentive compensation agreement with Thomas F. Lemker, its Vice President of Finance and its and our Assistant Secretary and Assistant Treasurer. We have entered into an employment agreement with Jeffrey M. Farina, who currently serves as Accellent's Vice President Engineering. We do not currently maintain key-man life insurance for any of our employees.

We depend on outside suppliers and subcontractors, and our production and reputation could be harmed if they are unable to meet our volume and quality requirements and alternative sources are not available.

Our current capabilities do not include all elements that are required to satisfy all of our customers' requirements. As we position ourselves to provide our customers with a single source solution, we may rely increasingly on third-party suppliers, subcontractors and other outside sources for components or services. Manufacturing problems may occur with these third parties. A supplier may fail to develop and supply products and components to us on a timely basis, or may supply us with products and components that do not meet our quality, quantity or cost requirements. If any of these problems occur, we may be unable to obtain substitute sources of these products and components on a timely basis or on terms acceptable to us, which could harm our ability to manufacture our own products and components profitably or on time. In addition, if the processes that our suppliers use to manufacture products and components are proprietary, we may be unable to obtain comparable components from alternative suppliers.

~~DILUTION~~If we are not successful in making acquisitions we may be unable to expand our business and remain competitive.

~~Our~~ An ~~pro~~important ~~forma~~element ~~net~~of ~~tangible~~our ~~book~~strategy ~~value~~is ~~(deficit)~~to asmake selective acquisitions of ~~September~~component ~~30,~~manufacturers ~~2001~~and issuppliers ~~$ million,~~that orcomplement our core capabilities. If we ~~$ per~~cannot ~~share~~identify ofand ~~common~~acquire ~~stock.~~on ~~Pro~~acceptable ~~forma~~terms ~~net~~companies ~~tangible~~that ~~book~~complement ~~value~~or ~~(deficit)~~enhance ~~per~~our ~~share~~capabilities ~~represents~~and ~~the~~service ~~amount~~offerings ofwe ~~total~~may ~~tangible~~be ~~assets~~unable ~~less~~to ~~total~~grow ~~liabilities,~~our ~~divided~~business byor ~~the~~remain ~~number~~competitive with companies ofin ~~outstanding~~our ~~shares~~industry ofthat ~~common~~are ~~stock~~able ~~after~~to ~~giving~~provide ~~effect~~more complete outsourcing capabilities and services to ~~the~~medical ~~conversion~~device ofcompanies. ~~all~~We ~~outstanding~~may ~~convertible~~also ~~preferred~~incur ~~stock~~expenses associated with identifying suitable targets. In addition, if we incur costs associated with incomplete acquisitions, including legal and ~~the~~accounting ~~exercise~~fees, ofor ~~the~~are ~~warrant~~required ~~described~~to inpay ~~the~~higher ~~first~~prices ~~paragraph~~for ~~after~~acquired ~~the~~companies ~~table~~because ~~under~~of ~~“Summary—The~~competition, ~~Offering”~~this will onresult ~~page~~in 5a diversion of resources from other facets of our business.

~~After~~ ~~giving effect to the sale of shares of~~ ~~common~~ ~~stock offered by us in this prospectus at an assumed initial public offering price of $ per share, less the underwriting discount and estimated offering expenses payable~~ byRisks ~~us,~~Related ~~our~~to ~~pro forma net tangible book value at September 30, 2001 would have been $ million, or $ per share. This represents an immediate increase in~~ the ~~pro~~Notes ~~forma net tangible book value to existing stockholders of $ per share~~ and anOur ~~immediate dilution to new investors of $ per share. The following table illustrates this dilution on a per share basis:~~ Structure

Initial public offering price per share			$
Pro forma net tangible book value per share as of September 30, 2001	$	$
Increase per share attributable to new investors	$
Pro forma net tangible book value per share after this offering			$
Dilution per share to new investors			$

Our ability to generate the cash needed to service our lease and debt obligations depends on certain factors beyond our control.

The ~~following~~future ~~table~~success ~~summarizes~~of our operations will, onin alarge ~~pro~~part, ~~forma~~dictate ~~basis~~our asability ofto ~~September~~make 30scheduled payments on, ~~2001~~and satisfy our obligations under, our leases and ~~the~~debt, ~~difference~~including ~~between~~our ~~the~~debt ~~number~~incurred ofunder ~~shares~~our ofnew ~~common~~senior ~~stock~~secured ~~purchased~~credit ~~from~~facility ~~us,~~and the ~~total~~notes. ~~consideration~~Our ~~paid~~future tooperating usperformance will be affected by general economic, competitive, market, business and other conditions, many of which are beyond our control. To the ~~average~~extent ~~price~~we ~~per~~are ~~share~~not ~~paid~~able ~~(1)~~to bymeet our ~~existing~~obligations ~~stockholders~~under our leases and ~~(2)~~debt, bywe ~~the~~will ~~new~~be ~~investors~~required ~~purchasing~~to ~~stock~~restructure inor ~~this~~refinance ~~offering:~~them, seek additional equity financing or sell assets. We may not be able to restructure or refinance our leases or debt, obtain additional financing or sell assets on satisfactory terms or at all.

	Shares Purchased			Total Consideration			Average Price Per Share
	Number	Percent		Amount	Percent
Exiting stockholders		%			%		$
New investors
Total		100.0	%		100.0	%

Your right to receive payments on the notes and guarantees of those notes are subordinated to our new senior secured credit facility.

~~The~~ Payment ~~above~~on ~~table~~the ~~excludes~~notes ~~the~~is ~~outstanding~~subordinated ~~options~~in right of payment to our new senior secured credit facility and ~~warrants~~any ~~described~~future senior indebtedness we may incur. Payment on the guarantee of each subsidiary guarantor of the notes is subordinated in right of payment to that subsidiary guarantor's senior indebtedness, including its guarantee of our new senior secured credit facility. Upon any distribution to our creditors or the creditors of the guarantors in a bankruptcy, liquidation or reorganization or similar proceeding relating to us or the subsidiary guarantors or ~~third~~our ~~paragraph~~or ~~after~~their property, the ~~table~~holders ~~under~~of ~~“Summary~~our —senior ~~The~~indebtedness, ~~Offering”~~including the new senior secured credit facility, are entitled to be paid in full before any payment may be made on ~~page~~the 5notes or the subsidiary guarantees, as the case may be. ~~The~~In ~~exercise~~these ofcases, ~~all~~we ~~options~~or ~~outstanding~~a subsidiary guarantor, as the case may be, may not have sufficient funds to pay all of ~~September~~our 30creditors, ~~2001~~and ~~having~~holders anof ~~exercise~~the ~~price~~notes may receive less, ratably, than the ~~assumed~~holders ~~initial~~of ~~public~~senior ~~offering~~indebtedness ~~price~~and, ~~would~~due ~~increase~~to the ~~dilutive~~ ~~effect~~turnover toprovisions ~~new~~in ~~investors~~the toindenture, ~~$ per~~less ~~share~~ratably than the holders of unsubordinated obligations, including trade payables.

As of September 30, 2004, the notes and the related guarantees were subordinated to approximately $193.5 million of outstanding indebtedness under our new senior secured credit facility, and could become subordinated to up to an additional $40.0 million of senior secured indebtedness available to us under our Revolving Credit Facility at such time that it is drawn. The indenture for the notes and our new senior secured credit facility permits us, subject to specified limitations, to incur additional indebtedness, some or all of which may be senior secured indebtedness that would rank senior to the notes and the subsidiary guarantees.

~~SELECTED~~The ~~UNAUDITED~~indenture ~~PRO~~for ~~FORMA~~the ~~CONDENSED~~notes ~~COMBINED~~and ~~FINANCIAL~~our ~~INFORMATION~~new senior secured credit facility impose significant operating and financial restrictions which may limit our ability to operate our business.

The ~~following~~indenture ~~selected unaudited pro forma condensed combined statement of operations,~~ for the ~~year~~notes ~~ended June 30, 2001 is presented as if the acquisition of ACT Medical in December 2000~~ and asour ifnew ~~the~~senior ~~acquisition~~secured ofcredit HVfacility ~~Technologies~~impose insignificant ~~January~~operating ~~2002~~ and ~~the~~financial ~~related~~restrictions ~~issuance~~on ofus. ~~Series~~These Erestrictions ~~preferred~~limit ~~stock~~our ability ~~and~~to, ~~warrants~~among ~~and~~other ~~Series~~things: ~~F preferred stock had all occurred on July 2, 2000.~~

•: incur additional indebtedness;
•: make distributions or make certain other restricted payments;
•: incur liens;
•: pay dividends and other payment restrictions affecting our subsidiaries;
•: sell certain assets or merge with or into other companies; and
•: enter into transactions with affiliates.

~~The~~ These restrictions ~~following~~could ~~selected~~limit ~~unaudited~~our ~~pro~~ability ~~forma~~to ~~condensed~~finance ~~combined~~our ~~statement~~future of operations ~~for~~or ~~the~~capital ~~three~~needs, ~~months~~make ~~ended~~acquisitions ~~September~~or 30pursue available business opportunities. In addition, ~~2001~~our isnew senior ~~presented~~secured ascredit iffacility requires us to maintain specified financial ratios and to satisfy certain financial covenants. We may be required to take action to reduce our indebtedness or act in a manner contrary to our business objectives to meet these ratios and satisfy these covenants. Events beyond our control, including changes in economic and business conditions in the ~~acquisition~~markets in which we operate, may affect our ability to do so. We may not be able to meet these ratios or satisfy these covenants and we cannot assure you that our lenders will waive any failure to do so. A breach of HVany of ~~Technologies~~the covenants in, ~~January~~or ~~2002~~our ~~and~~inability to maintain the ~~related~~required ~~issuance~~financial ratios under, our new senior secured credit facility would prevent us from borrowing additional money under the facility and could result in a default under it. If a default occurs under any of ~~Series~~our Esenior ~~preferred~~indebtedness, ~~stock~~the relevant lenders could elect to declare the indebtedness, together with accrued interest and ~~warrants~~other fees, to be immediately due and ~~Series~~payable Fand proceed ~~preferred~~against ~~stock~~substantially ~~had~~all of our assets, which would serve as collateral securing the indebtedness. Moreover, if the lenders under a facility or other agreement in default were to accelerate the indebtedness outstanding under that facility, it could result in a default under other indebtedness. If all ~~occurred~~or onany ~~July~~part 1of our indebtedness were to be accelerated, ~~2001~~we may not have or be able to obtain sufficient funds to repay it. See "Description of New Senior Secured Credit Facility."

~~The~~We ~~following~~are ~~selected~~structured ~~unaudited~~as ~~pro~~a ~~forma~~holding ~~condensed~~company ~~combined~~and ~~balance~~conduct ~~sheet~~our ~~for~~operations ~~the~~through ~~three~~our ~~months~~subsidiaries ~~ended~~and ~~September~~may ~~30,~~be ~~2001~~limited isin ~~presented~~our asability ifto ~~the~~access ~~acquisition~~funds offrom ~~HV Technologies in~~these ~~January~~subsidiaries ~~2002~~to ~~and~~service ~~the~~our ~~related~~debt, ~~issuance~~including ofthe ~~Series E preferred stock and warrants and Series F preferred stock had all occurred on September 30, 2001~~notes.

~~The~~ We ~~following~~are ~~selected~~structured ~~unaudited~~as ~~pro~~a ~~forma~~holding ~~condensed~~company ~~combined~~and ~~financial~~conduct ~~information~~all ~~should~~of beour ~~read~~operations inthrough ~~conjunction~~our ~~with~~subsidiaries. ~~the~~Our ~~historical~~only ~~financial~~significant ~~statements~~asset is the capital stock of ~~MedSource~~our operating subsidiaries. Consequently, our cash flow and ~~ACT~~ability ~~Medical~~to service our debt obligations depend on the earnings of our operating subsidiaries and the ~~notes~~distribution ~~thereto~~of ~~appearing~~those earnings to us, or ~~elsewhere~~upon inloans, ~~this~~advances ~~prospectus~~or other payments made by our subsidiaries to us. The ~~historical~~ability ~~financial~~of ~~statements~~our subsidiaries to pay dividends or make other payments or advances to us depends upon their operating results and are subject to applicable laws and contractual restrictions, including those contained in our new senior secured credit facility. If the earnings of HVour ~~Technologies~~operating subsidiaries are not ~~separately~~adequate ~~presented~~for us into ~~this~~service ~~prospectus~~our debt obligations, we may default on our debt obligations and our business could be materially harmed. Our subsidiaries do not have any obligation to pay amounts due on the notes or to make funds available to us for these payments, unless they are guarantors of the notes.

~~The~~We ~~following~~may ~~selected~~incur ~~unaudited~~additional ~~pro~~indebtedness ~~forma~~ranking ~~condensed~~equal ~~combined financial information does not purport~~ to ~~represent~~ the ~~results~~notes ~~that~~or ~~would have been reported had such events actually occurred on~~ the ~~dates specified, nor is it indicative of our future results~~guarantees.

The indenture permits us to issue additional indebtedness on an equal and ratable basis with the notes, subject to satisfaction of a debt incurrence covenant. If we or a guarantor incur any additional indebtedness that is on an equal and ratable basis with the notes, the holders of that debt are entitled

~~MEDSOURCE~~to share ~~TECHNOLOGIES~~ratably with the holders of the notes in any proceeds distributed in connection with any foreclosure upon our collateral or our insolvency, ~~INC~~liquidation, reorganization, dissolution or other winding-up. This may have the effect of reducing the amount of proceeds paid to you.

~~UNAUDITED~~Fraudulent ~~PRO~~transfer ~~FORMA~~statutes ~~CONDENSED~~may ~~COMBINED~~limit ~~STATEMENT~~your OFrights ~~OPERATIONS~~as a holder of the notes.

~~FOR~~ Federal ~~THE~~and ~~YEAR~~state ~~ENDED~~fraudulent ~~JUNE~~transfer 30laws permit a court, ~~2001~~if it makes certain findings, to:

•: avoid all or a portion of our obligations to holders of the notes;
•: subordinate our obligations to holders of the notes to our other existing and future indebtedness, entitling other creditors to be paid in full before any payment is made on the notes; and
•: take other action detrimental to holders of the notes.

	Historical						Pro Forma						Historical			Pro Forma
	MedSource			ACT Medical			Adjustments			Combined			HV Technologies			Adjustments			Combined
	(In thousands, except share and per share amounts)
Revenues	$	128,462		$	12,786		$	—		$	141,248		$	8,521		$	—		$	149,769
Costs and expenses:
Cost of products sold		94,386			9,988			—			104,374			3,752			—			108,126
Selling, general and administrative expenses		26,199			3,257			—			29,456			1,878			—			31,334
Amortization of goodwill and other intangibles		5,640			58			(58	)(a)		6,544			—			—			6,544
								904	(b)
Restructuring charge		11,464			—			—			11,464			—			—			11,464
Total costs and expenses		137,689			13,303			846			151,838			5,630			—			157,468
Operating (loss) income		(9,227	)		(517	)		(846	)		(10,590	)		2,891			—			(7,699	)
Interest (expense), net		(10,213	)		(560	)		560	(c)		(10,213	)		7			51	(c)		(10,155	)
Other income (expense)		53			—			—			53			285			(274	)(d)		64
(Loss) income before income taxes		(19,387	)		(1,077	)		(286	)		(20,750	)		3,183			(223	)		(17,790	)
Income tax benefit (expense)		(70	)		—			—			(70	)		(181	)		—			(251	)
Net (loss) income		(19,457	)		(1,077	)		(286	)		(20,820	)		3,002			(223	)		(18,041	)
Preferred stock dividends and accretion of discount on preferred stock		(9,688	)					(1,317	)(e)		(11,005	)		—			(1,509	)(f)		(12,514	)
Net (loss) income attributed to common stockholders	$	(29,145	)	$	(1,077	)	$	(1,603	)	$	(31,825	)	$	3,002		$	(1,732	)	$	(30,555	)
Net loss per common share attributed to common stockholders — basic and diluted	$	(5.55	)							$	(6.06	)							$	(5.03	)
Weighted average common shares — basic and diluted		5,252,749									5,252,749						824,222	(g)		6,076,971

In that event, we cannot assure you that you would ever be repaid.

~~See~~ Under federal ~~notes~~and state fraudulent transfer laws, in order to ~~pro~~take ~~forma~~any ~~condensed~~of ~~combined~~those ~~financial~~actions, ~~information.~~courts will typically need to find that, at the time the notes were issued, we:

(1)

issued the notes with the intent of hindering, delaying or defrauding current or future creditors; or

(2)

received less than fair consideration or reasonably equivalent value for incurring the indebtedness represented by the notes; and

(a): were insolvent or were rendered insolvent by reason of the issuance of the notes;
(b): were engaged, or were about to engage, in a business or transaction for which our assets were unreasonably small; or
(c): intended to incur, or believed or should have believed we would incur, debts beyond our ability to pay as such debts mature.

Many of the foregoing terms are defined in or interpreted under those fraudulent transfer statutes. To the extent that proceeds of the notes offering are used, in part, to make payments to our stockholders, a court could find that we did not receive fair consideration or reasonably equivalent value for the incurrence of the debt represented by the notes.

Jurisdictions define "insolvency" differently. However, we generally would be considered insolvent at the time we issued the notes if (1) our liabilities exceeded our assets, at a fair valuation, or (2) the present saleable value of our assets is less than the amount required to pay our total existing debts and liabilities (including the probable liability related to contingent liabilities) as they become absolute or matured. We cannot assure you as to what standard a court would apply in order to determine whether we were "insolvent" as of the date the notes were issued, and we cannot assure you that, regardless of the method of valuation, a court would not determine that we were insolvent on that date. Nor can we assure you that a court would not determine, regardless of whether we were insolvent on the date the notes were issued, that the payments constituted fraudulent transfers on another ground.

Our obligations under the notes are guaranteed by all of our existing domestic subsidiaries and by all our future domestic subsidiaries, except as set forth in this prospectus, and the guarantees may also be subject to review under various laws for the protection of creditors. It is possible that creditors of the guarantors may challenge the guarantees as a fraudulent transfer or conveyance. The analysis set forth above would generally apply, except that the guarantees could also be subject to the claim that, because the guarantees were incurred for our benefit, and only indirectly for the benefit of the guarantors, the obligations of the guarantors thereunder were incurred for less than reasonably equivalent value or fair consideration. A court could void a guarantor's obligation under its guarantee

~~MEDSOURCE~~or the ~~TECHNOLOGIES~~liens securing its guarantee, ~~INC~~subordinate the guarantee to the other indebtedness of a guarantor, direct that holders of the notes return any amounts paid under a guarantee to the relevant guarantor or to a fund for the benefit of its creditors, or take other action detrimental to the holders of the notes. In addition, the liability of each guarantor under the indenture will be limited to the amount that will result in its guarantee not constituting a fraudulent conveyance or improper corporate distribution, and there can be no assurance as to what standard a court would apply in making a determination as to what would be the maximum liability of each guarantor.

~~UNAUDITED~~If ~~PRO~~we ~~FORMA~~redeem ~~CONDENSED~~all ~~COMBINED~~or ~~BALANCE~~part ~~SHEET~~of your notes, you may not be able to achieve your expected return on investment and if we only redeem a portion of the notes the trading market for the notes may become more limited.

AS We OFmay ~~SEPTEMBER~~redeem 30the notes, ~~2001~~in whole or in part, on or after July 15, 2008, at the redemption prices set forth under the caption "Description of Notes—Optional Redemption." In addition, on or prior to July 15, 2007, we may redeem up to 35% of the aggregate principal amount of the notes with the net proceeds of one or more qualified equity offerings. If we redeem your notes, you may not obtain your expected return on your investment in the notes because you may not be able to reinvest the proceeds from a redemption in an investment that results in a comparable return. To the extent that notes are traded, prices for the notes may fluctuate greatly depending on the trading volume and the balance between buy and sell orders. In addition, quotations for securities that are not widely traded, such as the notes, may differ from actual trading prices and should be viewed as approximations. To the extent that notes are partially redeemed by us, the trading market for the notes may become more limited. A debt security with a smaller outstanding principal amount available for trading (a smaller "float") may command a lower price than would a comparable debt security with a greater float. Therefore, the market price for notes not redeemed may be affected adversely by the reduced float. The reduced float may also tend to make the trading price more volatile. The extent of the public market for the notes following a redemption will depend upon, among other things, the remaining outstanding principal amount of notes after the redemption, the number of holders of such notes remaining at such time and the interest in maintaining a market in the notes on the part of securities firms and other factors.

	Historical					Pro Forma
	MedSource			HV Technologies		Adjustments			Combined
	(In thousands, except share and per share amounts)
Assets
Current assets:
Cash and cash equivalents	$	14,254		$	1,626	$	6,000	(h)	$	16,264
							(5,616	)(i)
Accounts and notes receivable, net		20,288			1,386		—			21,674
Inventories		14,242			1,197		—			15,439
Prepaid expenses and other current assets		3,165			—		—			3,165
Deferred income taxes		1,335			—		—			1,335
Total current assets		53,284			4,209		384			57,877
Property, plant and equipment, net		38,631			2,147		—			40,778
Goodwill, net		96,813			—		19,392	(j)		116,205
Other identifiable intangible assets, net		4,342			—		—			4,342
Deferred financing costs		3,209			—		—			3,209
Interest escrow fund		1,224			—		—			1,224
Other assets		426			3		—			429
Total assets	$	197,929		$	6,359	$	19,776		$	224,064
Liabilities, mandatory redeemable convertible stock and stockholders’ equity (deficit)
Current liabilities	$	29,229		$	639	$	—		$	29,868
Long term debt, less unamortized discount and current portion		80,844			568		(568	)(k)		80,844
Deferred income taxes		1,335			—		—			1,335
Other long-term liabilities		3,274			200		—			3,474
Mandatory redeemable stock		100,972			—		3,636	(l)		104,608
Stockholders’ equity (deficit)
Series A, Series E and Series Z preferred stock		1			—		3,537	(h)		3,538
Common Stock		53			50		8	(l)		61
							(50	)(m)
Additional paid-in capital		33,880			—		2,463	(h)		51,995
							15,652	(l)
Accumulated other comprehensive loss		(2,771	)		—		—			(2,771	)
Retained earnings (accumulated deficit)		(48,709	)		4,902		(4,902	)(m)		(48,709	)
Unearned compensation		(179	)		—		—			(179	)
Total stockholders’ equity (deficit)		(17,725	)		4,952		16,708			3,935
Total liabilities, mandatory redeemable convertible stock and stockholders’ equity (deficit)	$	197,929		$	6,359	$	19,776		$	224,064

We may be unable to purchase the notes upon a change of control.

~~See~~ Upon the occurrence of "change of control" events specified under the caption "Description of Notes," holders of the notes may require us to ~~pro~~purchase ~~forma~~the ~~condensed~~notes ~~combined~~at 101% of their principal amount, plus accrued and unpaid interest plus liquidated damages, if any. We cannot assure you that we will have the financial ~~information~~resources to purchase the notes, particularly as that change of control event may trigger a similar repurchase requirement for, or result in the acceleration of, other indebtedness. In addition, our new senior secured credit facility provides that certain change of control events, including any event constituting a change of control under the indenture governing the notes, constitutes a default and could result in the acceleration of our indebtedness under the new senior secured credit facility. Because we will be required to repay in full our new senior secured credit facility before repaying the amounts outstanding under the notes, you may not be repaid in full upon a change of control.

Because there is no public market for the notes, you may not be able to resell your notes.

The notes, although registered under the Securities Act, constitute a new issue of securities with no established trading market, and there can be no assurance as to:

•: the liquidity of any trading market that may develop;
•: the ability of holders to sell their notes; or
•: the price at which the holders would be able to sell their notes.

~~MEDSOURCE~~ If a ~~TECHNOLOGIES~~trading market were to develop, ~~INC~~the notes might trade at higher or lower prices than their principal amount or purchase price, depending on many factors, including prevailing interest rates, the market for similar debentures and our financial performance.

~~UNAUDITED~~ We understand ~~PRO~~that ~~FORMA~~the ~~CONDENSED~~initial ~~COMBINED~~purchasers ~~STATEMENT~~of OFthe ~~OPERATIONS~~notes presently intend to make a market in the notes. They are not obligated to do so however, and any market-making activity with respect to the notes may be discontinued at any time without notice. In addition, any market-making activity will be subject to the limits imposed by the Securities Act and the Exchange Act, and may be limited during the pendency of an applicable shelf registration statement. There can be no assurance that an active trading market will exist for the notes or that any trading market that does develop will be liquid.

~~FOR~~ One of ~~THE~~the ~~THREE~~initial ~~MONTHS~~purchasers ~~ENDED~~of ~~SEPTEMBER~~the 30old notes, ~~2001~~Credit Suisse First Boston LLC, is an affiliate of DLJ Merchant Banking Partners III, L.P. and related funds which beneficially own approximately 48.8% of the voting power of Accellent and have the right to appoint three directors to Accellent's and our board of directors. As a result of this affiliate relationship, if Credit Suisse First Boston LLC conducts any market-making activities with respect to the notes, Credit Suisse First Boston LLC will be required to deliver a market-making prospectus when effecting offers and sales of the notes. For as long as a market-making prospectus is required to be delivered, the ability of Credit Suisse First Boston LLC to make a market in the notes may, in part, be dependent on our ability to maintain a current market-making prospectus for its use. If we are unable to maintain a current market-making prospectus, Credit Suisse First Boston LLC may be required to discontinue its market-making activities without notice.

	Historical						Pro Forma
	MedSource			HV Technologies			Adjustments			Combined
	(In thousands, except share and per share amounts)
Revenues	$	33,865		$	2,473		$	—		$	36,338
Costs and expenses:
Cost of products sold		26,106			1,090			—			27,196
Selling, general and administrative expense		6,402			723			—			7,125
Amortization of goodwill and other intangibles		90			—			—			90
Total costs and expenses		32,598			1,813			—			34,411
Operating income		1,267			660			—			1,927
Interest (expense), net		(2,468	)		(5	)		12	(n)		(2,461	)
Other income (expense)		(21	)		54			(50	)(o)		(17	)
(Loss) income before income taxes		(1,222	)		709			(38	)		(551	)
Income tax benefit (expense)		—			(40	)		—			(40	)
Net (loss) income		(1,222	)		669			(38	)		(591	)
Preferred stock dividends and accretion of discount on preferred stock		(2,648	)		—			(377	)(p)		(3,025	)
Net (loss) income attributable to common stockholders	$	(3,870	)	$	669		$	(415	)	$	(3,616	)
Net loss per common share attributed to common stockholders — basic and diluted	$	(0.74	)							$	(0.60	)
Weighted average shares — basic and diluted		5,255,958						824,222	(q)		6,080,180

Broker-dealers or holders of the notes may become subject to the registration and prospectus delivery requirements of the Securities Act.

~~See~~ Any ~~notes~~broker-dealer tothat: ~~pro forma condensed combined financial information.~~

•: exchanges its old notes in the exchange offer for the purpose of participating in a distribution of the exchange notes; or
•: resells exchange notes that were received by it for its own account in the exchange offer,

may be deemed to have received restricted securities and may be required to comply with the registration and prospectus delivery provisions of the Securities Act in connection with any resale transaction by that broker-dealer. Any profit on the resale of the exchange notes and any commission or concessions received by a broker-dealer may be deemed to be underwriting compensation under the Securities Act.

In addition to broker-dealers, any holder of old notes that exchanges its old notes in the exchange offer for the purpose of participating in a distribution of the exchange notes may be deemed to have received restricted securities and may be required to comply with the registration and prospectus delivery provisions of the Securities Act in connection with any resale transaction by that holder.

We are controlled by stockholders whose interests may differ from your interests.

All of our outstanding shares of common stock are held by Accellent. KRG/CMS L.P. and DLJ Merchant Banking Partners III, L.P. and related funds collectively beneficially own approximately 71% of the voting power of Accellent. Accellent also entered into an Amended and Restated Shareholders' Agreement with certain of its stockholders, including KRG/CMS L.P. and the DLJ Merchant Banking Buyers. Under the agreement, KRG/CMS L.P. currently has the right to nominate five directors to Accellent's board of directors and the DLJ Merchant Banking Buyers have the right to nominate three directors to such board. In addition, through a management services agreement, KRG, which is the general partner of the general partner of KRG/CMS L.P., provides advisory services to Accellent and is compensated for the completion of acquisitions by us. In connection with the equity investment in Accellent by the DLJ Merchant Banking Buyers, Accellent entered into a similar agreement with DLJ

~~MEDSOURCE~~Merchant Banking ~~TECHNOLOGIES~~III, Inc., ~~INC~~or DLJMBIII, an affiliate of the DLJ Merchant Banking Buyers. These relationships create the potential for conflicts of interest in circumstances where Accellent's and our interests and the interests of KRG, KRG/CMS L.P., DLJMBIII and the DLJ Merchant Banking Buyers are not aligned. For as long as KRG and DLJMBIII provide advisory services and KRG/CMS L.P. and the DLJ Merchant Banking Buyers continue to own shares of Accellent's voting stock representing in the aggregate more than 50% of the combined voting power of all the outstanding voting stock of Accellent, they will be able to determine the outcome of all matters submitted to a vote of Accellent's stockholders, including matters involving mergers or other business combinations, the acquisition or disposition of assets, and the incurrence of indebtedness, any of which could have an impact on our business or operations. KRG/CMS L.P. and the DLJ Merchant Banking Buyers will also have the power to prevent or cause a change in control, and could take other actions that might be desirable to KRG/CMS L.P. and the DLJ Merchant Banking Buyers but not to other interested parties or to holders of our notes.

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

1. Unaudited Pro Forma Statement of Operations Adjustments for the Year Ended June 30, 2001

We have made the following pro forma adjustments to arrive at our pro forma statement of operations for the year ended June 30, 2001:

(a) Represents elimination of the amortization of goodwill that existed on ACT Medical’s balance sheet at the time of the acquisition.

(b) Represents the amortization of goodwill and other intangibles resulting from the acquisition of ACT Medical.

(c) Represents elimination of the interest income and interest expense incurred by ACT Medical or HV Technologies, as applicable, because the debt associated with the interest expense was paid off in connection with the acquisition.

(d) Represents elimination of HV Technologies licensing and royalty income related to licenses cancelled in connection with the acquisition.

(e) Represents recognition of the dividends and amortization of discount on the preferred stock issued in conjunction with the acquisition of ACT Medical.

(f) Represents recognition of the dividends and accretion of discount on the Series E and Series F preferred stock.

(g) Represents shares of common stock issued in connection with the acquisition of HV Technologies.

2. Unaudited Pro Forma Balance Sheet Adjustments as of September 30, 2001

We have made the following pro forma adjustments to arrive at our pro forma balance sheet as of

September 30, 2001:

(h) Represents issuance of $6.0 million of Series E preferred stock and related warrants to finance our acquisition of HV Technologies. The Series E preferred stock and warrants are recorded at their respective fair market values of $3.5 million and $2.5 million, respectively. We plan to accrete the discount allocated to the Series E preferred stock over the 12 month period ending December 31, 2002 because we plan to redeem the Series E preferred stock by that date.

(i) Represents cash paid to acquire HV Technologies.

(j) Represents excess of purchase price over book value of assets acquired in the acquisition of HV Technologies based on a preliminary purchase price allocation.

(k) Represents repayment of debt of HV Technologies on the date of acquisition.

(l) Represents issuance of Series F preferred stock and common stock in consideration of the acquisition of HV Technologies. The Series F preferred stock is recorded at its fair market value of $3.6 million. We will record an expense of $0.4 million when we redeem the Series F preferred stock.

(m) Represents elimination of existing equity of HV Technologies as of September 30, 2001.

3. Unaudited Pro Forma Statement of Operations Adjustments for the Three Months Ended

September 30, 2001

We have made the following pro forma adjustment to arrive at our pro forma statement of operations for the three months ended September 30, 2001:

(n) Represents elimination of interest expense incurred by HV Technologies because the debt associated with the interest expense was paid off in connection with the acquisition.

(o) Represents elimination of HV Technologies licensing and royalty income related to licenses cancelled in connection with the acquisition.

(p) Represents recognition of the dividends and accretion of discount on the Series E and Series F preferred stock.

(q) Represents shares of common stock in connection with the acquisition of HV Technologies.

~~SELECTED~~ ~~CONSOLIDATED~~ ~~FINANCIAL~~ CAUTIONARY ~~DATA~~STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

~~The~~ This ~~following~~prospectus ~~selected~~contains ~~consolidated~~forward-looking ~~financial~~statements, ~~data~~which ascan ofbe ~~and~~identified ~~for~~by the ~~dates~~use ~~and periods indicated have been derived from our consolidated financial statements. The selected consolidated statement~~ of ~~operations~~forward-looking ~~data for our fiscal period from March 31~~terminology, ~~1999~~including ~~(inception)~~the ~~through~~terms ~~July 3~~"believes," "estimates," ~~1999 and our fiscal years ended July 1~~"anticipates," ~~2000 and June 30~~"expects," ~~2001 and the selected consolidated balance sheet data as of July 1~~"intends," ~~2000 and June 30~~"may," ~~2001 were~~"will" ~~derived~~or ~~from~~"should" ~~the historical consolidated financial statements that were audited by Ernst & Young LLP~~or, ~~whose report appears elsewhere~~ in ~~this~~each ~~prospectus.~~case, ~~The~~their ~~selected~~negative ~~consolidated~~or ~~balance~~other ~~sheet~~variations ~~data~~or ascomparable ofterminology. ~~July~~These 3,forward-looking ~~1999~~statements ~~were~~include ~~derived from~~all ~~historical~~matters ~~consolidated~~that ~~financial~~are ~~statements~~not ~~audited~~historical byfacts. ~~Ernst~~They &appear ~~Young~~in ~~LLP,~~a ~~which~~number doof ~~not~~places ~~appear~~throughout ~~elsewhere in~~ this prospectus. ~~The~~and ~~selected~~include ~~consolidated~~statements ~~statement~~regarding ofour ~~operations~~intentions, ~~data~~beliefs ~~for~~or ~~the~~current ~~three~~expectations ~~months ended September 30~~concerning, ~~2000~~among other ~~and September 30~~things, ~~2001 and~~our ~~the~~results ~~selected consolidated balance sheet data as~~ of ~~September 30~~operations, ~~2001 have been derived from our unaudited consolidated~~ financial ~~statements~~condition, ~~included elsewhere in this prospectus~~liquidity, ~~which~~prospects, ~~in the opinion of management~~growth, ~~reflect~~strategies ~~all~~and ~~adjustments (consisting of normal recurring adjustments) necessary for~~ the ~~fair~~industry ~~presentation~~in ofwhich ~~the~~we ~~financial condition and results of operations for those periods~~operate.

~~You~~ By their ~~should~~nature, ~~read~~forward-looking ~~the~~statements ~~selected~~involve ~~consolidated~~risks ~~financial~~and ~~data~~uncertainties ~~set~~because ~~forth~~they ~~below~~relate to events and depend on circumstances that may or may not occur in ~~conjunction~~the ~~with~~future. ~~“Management’s~~We ~~Discussion~~caution you ~~and~~that ~~Analysis~~forward-looking statements are not guarantees of ~~Financial~~future ~~Condition~~performance and ~~Results~~that our actual results of ~~Operations”~~operations, financial condition and ~~our~~liquidity, ~~consolidated~~and the development of the industry in which ~~financial~~we operate may differ materially from those made in or suggested by the forward-looking statements contained in this prospectus. In addition, even if our results of operations, financial condition and liquidity, ~~related~~and ~~notes~~the ~~appearing~~development ~~elsewhere~~of the industry in which we operate are consistent with the forward-looking statements contained in this prospectus, those results or developments may not be indicative of results or developments in subsequent periods.

	Period from March 31, 1999 (inception) through July 3, 1999(a)			Fiscal Year Ended						Three Months Ended September 30,
				July 1, 2000(a)			June 30, 2001			2000			2001
	(In thousands, except share and per share data)
Statement of Operations Data:
Revenues	$	21,968		$	89,352		$	128,462		$	27,611		$	33,865
Costs and expenses:
Cost of products sold		13,437			59,811			94,386			20,793			26,106
Selling, general and administrative expense		4,458			21,167			26,199			5,621			6,402
Amortization of goodwill and other intangibles(b)		4,135			4,255			5,640			1,125			90
Organization and start-up costs		4,981			—			—			—			—
Restructuring charge(c)		—			—			11,464			—			—
Total costs and expenses		27,011			85,233			137,689			27,539			32,598
Operating (loss) income		(5,043	)		4,119			(9,227	)		72			1,267
Interest expense, net		(2,658	)		(10,682	)		(10,213	)		(2,994	)		(2,468	)
Other income (expense)		(289	)		(7	)		53			63			(21	)
Loss before income taxes		(7,990	)		(6,570	)		(19,387	)		(2,859	)		(1,222	)
Income tax benefit (expense)		2,975			535			(70	)		—			—
Net loss		(5,015	)		(6,035	)		(19,457	)		(2,859	)		(1,222	)
Preferred stock dividends and accretion of discount on preferred stock		(2,078	)		(8,345	)		(9,688	)		(2,104	)		(2,648	)
Net loss attributed to common stockholders	$	(7,093	)	$	(14,380	)	$	(29,145	)	$	(4,963	)	$	(3,870	)
Net loss per share attributed to common stockholders (basic and diluted)	$	(1.60	)	$	(3.10	)	$	(5.55	)	$	(0.95	)	$	(0.74	)
Weighted average number of shares of common stock outstanding (basic and diluted)		4,448,000			4,633,571			5,252,749			5,248,341			5,255,958
Other Data:
Net cash (used in) provided by operating activities	$	(244	)	$	6,290		$	1,253		$	(2,074	)	$	(3,305	)
Net cash used in investing activities		(93,744	)		(22,244	)		(11,627	)		(1,000	)		(1,619	)
Net cash provided by (used in) financing activities		95,796			16,356			28,453			931			(1,111	)
EBITDA(d)		(329	)		12,867			3,021			2,764			3,197
Adjusted EBITDA(d)(e)		5,007			14,373			16,140			3,125			3,663

Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from the forward-looking statements are set forth in this prospectus, including under the headings "Prospectus Summary—Risk Factors," "Management Discussion and Analysis of Financial Condition and Results of Operations," and "Risk Factors."

We undertake no obligation to update publicly or publicly revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the cautionary statements referred to above and contained elsewhere in this prospectus.

You should rely only on the information contained in this document or to which we have referred you herein. We have not authorized anyone to provide you with information that is different. This document may only be used where it is legal to sell these securities. The information in this document may only be accurate on the date of this document.

	Period from March 31, 1999 (inception) through July 3, 1999(a)		Fiscal Year Ended
			July 1, 2000(a)		June 30, 2001			Three Months Ended September 30, 2001
Balance Sheet Data (at end of period):	(In thousands)
Cash and cash equivalents	$	1,808	$	2,210	$	20,289		$	14,254
Current assets		18,109		28,903		59,577			53,284
Property and equipment, net		21,550		34,956		38,873			38,631
Total assets		126,792		151,722		205,300			197,929
Total debt		81,224		98,653		89,544			88,493
Mandatory redeemable convertible stock		16,250		22,293		98,867			100,972
Total stockholders’ equity (deficit)		21,248		15,072		(13,261	)		(17,725	)

THE TRANSACTIONS

~~(a)~~ On ~~Our~~April 27, ~~fiscal~~2004, ~~years~~we ~~originally~~entered ~~ended~~into onan ~~the~~Agreement ~~Saturday~~and ~~closest~~Plan of Merger, pursuant to which, on June 30, 2004, we acquired MedSource by merging it with our wholly owned subsidiary Pine Merger Corporation. The merger resulted in MedSource and its subsidiaries becoming our wholly owned subsidiaries. The existing indebtedness of MedSource and its subsidiaries, equal to approximately $37.0 million, including accrued interest, as of June 30, 2004, was repaid in connection with the MedSource acquisition. ~~Effective~~Upon ~~July~~the 1consummation of the MedSource acquisition, ~~2001~~Accellent repurchased its outstanding Class C Redeemable Preferred Stock and paid accrued dividends to its holders of Class A 5% Convertible Preferred Stock and Class C Redeemable Preferred Stock. We repaid Accellent's and our indebtedness in connection with the consummation of the Transactions in an aggregate amount of approximately $149.4 million, including accrued interest, as of June 30, 2004 and prepayment fees on such indebtedness of approximately $4.7 million. We also completed payment of approximately $9.6 million in respect of an earn-out obligation entered into in connection with our ~~fiscal~~acquisition ~~year~~of ~~end~~Venusa in February 2003, $3.0 million of which was ~~changed~~previously paid by us on May 28, 2004. For a description of the Venusa acquisition, see Note 2 to ~~June~~our 30Consolidated Financial Statements included in this prospectus.

~~(b)~~ We financed ~~The~~the ~~Statement~~Transactions ofprimarily ~~Operations~~with ~~Data~~the ~~for~~proceeds from the ~~three~~issuance ~~months~~and ~~ended~~sale ~~September~~of ~~30,~~the ~~2001~~old isnotes; ~~not~~our ~~comparable~~$234.0 million tonew ~~prior~~senior ~~periods~~secured ~~because~~credit wefacility, ~~have~~which ~~stopped~~consists ~~amortizing~~of ~~goodwill~~a six-year $194.0 million ~~Effective~~term ~~with~~facility ~~our~~and ~~quarter~~a ~~ended~~five-year ~~September~~$40.0 million ~~30,~~revolving ~~2001~~credit facility, weunder ~~adopted~~which ~~the~~up ~~provisions~~to of$15.0 million ~~SFAS~~is ~~No.~~available ~~141,~~in ~~Business~~the ~~Combinations,~~form of letters of credit and Noup to $5.0 million ~~142,~~under ~~Goodwill~~the ~~and~~revolving ~~Other~~credit ~~Intangible~~facility ~~Assets,~~is ~~and,~~available ~~accordingly,~~for weshort-term ~~reclassified~~borrowings ~~certain~~under ~~identifiable~~a ~~intangibles~~swingline tofacility ~~goodwill~~(see ~~and~~"Description ~~will~~of noNew ~~longer~~Senior Secured ~~amortize~~Credit ~~goodwill~~Facility"); and ~~intangible~~the ~~assets~~equity ~~that~~investment ~~are~~by ~~deemed~~the toDLJ ~~have~~Merchant ~~indefinite~~Banking ~~lives~~Buyers ~~under~~of ~~SFAS~~approximately ~~142~~$88.0 million ~~Had~~in wecash ~~continued~~in Accellent (up to ~~amortize~~$100,000 ~~goodwill~~of ~~during~~which may be returned to the ~~three~~DLJ Merchant ~~months~~Banking ~~ended~~Buyers ~~September~~in ~~30,~~the ~~2001,~~event ~~amortization~~that ~~expense~~we pay the Venusa earn-out in ~~that~~respect ~~period~~of ~~would~~Venusa's ~~have~~2004 ~~increased~~financial byperformance), ~~approximately~~net of $1.4 8 million of fees, orin $0exchange for an aggregate of approximately 7.276 million ~~per~~shares ~~common~~of ~~share~~Accellent's Class A-8 5% Convertible Preferred Stock and warrants to purchase additional shares of Accellent's Class A-8 5% Convertible Preferred Stock, subject to certain conditions.

(c) In June 2001, we completed a strategic review of our manufacturing operations and support functions. Based on this review and with board approval, we began actions to eliminate redundant facilities. These actions resulted in pre-tax charges of $11.5 million. The charges include employee termination benefits of $3.8 million, other exit costs of $2.2 million, impairment of goodwill and other intangibles of $3.6 million and impairment of property, plant, and equipment of $1.9 million.

(d) EBITDA represents earnings before interest expense, income taxes, depreciation and amortization. EBITDA should not be considered in isolation from, or as a substitute for, net income, cash flow from operations or other cash flow statement data prepared in accordance with generally accepted accounting principles or as a measure of our profitability or liquidity. Rather, EBITDA is presented because it is a widely accepted supplemental financial measure, and we believe that it provides relevant and useful information. A calculation of EBITDA may not be comparable to similarly titled measures reported by other companies, since all companies do not calculate this non-GAAP measure in the same manner. Our EBITDA calculation is not intended to represent cash provided by (used in) operating activities since it does not include interest and taxes and changes in operating assets and liabilities, nor is it intended to represent a net increase in cash since it does not include cash provided by (used in) investing and financing activities.

(e) Adjusted EBITDA further adjusts EBITDA to exclude management fees for all periods presented, start-up costs of $5.0 million for the period ended July 3, 1999 and restructuring charges of $11.5 million for year ended June 30, 2001.

~~MANAGEMENT’S~~ ~~DISCUSSION~~ ~~AND~~ USE ~~ANALYSIS~~ OF PROCEEDS

~~FINANCIAL~~ This ~~CONDITION~~prospectus ~~AND~~is ~~RESULTS~~delivered OFin ~~OPERATIONS~~connection with the sale of the notes by Credit Suisse First Boston LLC in market-making transactions. We will not receive any of the proceeds from such transactions.

~~You~~ ~~should read the following~~ ~~discussion~~ in conjunction with “Selected Consolidated Financial Data,” our financial statements and related notes appearing elsewhere in this prospectus. The following discussion contains forward-looking statements that involve risks and uncertainties. These statements refer to our future plans, objectives, expectations and intentions. These statements may be identified by the use of words such as “believes,” “expects,” “anticipates,” “intends,” “plans” and similar expressions. Our actual results could differ materially and adversely from those anticipated in such forward-looking statements. Factors that could contribute to these differences include, but are not limited to, the risks discussed below and elsewhere in this prospectus, particularly under the caption “Risk Factors.” CAPITALIZATION

A The ~~discussion~~following ~~about~~table ~~the~~shows ~~financial~~our ~~results~~material ofcapitalization ~~six~~as of ~~our seven predecessors~~September 30, ~~Kelco Industries, W~~2004.N. ~~Rushwood~~This ~~d/b/a~~table ~~Hayden~~should ~~Precision~~be ~~Industries,~~read ~~National~~in ~~Wire~~conjunction ~~and~~with ~~Stamping,~~the ~~The~~section ~~MicroSpring~~entitled ~~Company~~"The Transactions," ~~Portlyn~~our ~~and~~consolidated ~~Texcel,~~financial ~~appears~~statements ~~under the caption “Management’s Discussion~~ and ~~Analysis of Financial Condition and Results of Operations of Predecessor Companies.” No discussion about~~ the ~~financial~~related ~~results~~notes ofcontained ~~our~~elsewhere ~~seventh predecessor, Brimfield Precision, is presented~~ in this prospectus.

Overview

			As of September 30, 2004
			(in millions)
Debt:
	New Senior Secured Credit Facility:
		Revolving Credit Facility(1)		—
		Term Facility	$	193.5
Notes				175.0
Total Indebtedness				368.5
Total Stockholder's Equity				136.1

Total Capitalization			$	504.6

(1): The revolving credit facility provides for borrowings of up to $40.0 million and remained undrawn upon the consummation of the Transactions. Up to $15.0 million under the revolving credit facility is available in the form of letters of credit, and up to $5.0 million under the revolving credit facility is available for short-term borrowings under a swingline facility.

We provide product development and design services, precision metal and plastic part manufacturing, product assembly services and supply chain management. We provide our products and services to each of the following primary target markets:

& surgical instrumentation devices and components;

& electro-medical devices and components;

& custom interventional devices and components; and

& custom orthopedic devices and instruments.

Our revenues have grown from $89.4 million in fiscal 2000 to $128.5 million in fiscal 2001, or $149.8 million on a pro forma basis in fiscal 2001.

Company History

During 1998, our co-founders, Richard J. Effress and William J. Kidd, established MedSource to identify business opportunities in the medical engineering and manufacturing services industry. During March 1999, with additional equity capital from Whitney & Co., we acquired seven unaffiliated businesses to begin our operations. The original seven acquisitions were Kelco Industries, W.N. Rushwood d/b/a Hayden Precision Industries, National Wire and Stamping, The MicroSpring Company, Portlyn, Texcel and Brimfield Precision. Our first fiscal period, which ended July 3, 1999, consisted of only three months of consolidated results, which included material one-time expenses for business combination and formation.

Since our initial acquisitions, we have acquired five additional businesses. In fiscal 2000, we acquired the businesses of Apex Engineering, Tenax and Thermat Precision, in fiscal 2001 we acquired the business of ACT Medical and in fiscal 2002, we acquired the business of HV Technologies. All of our acquisitions were accounted for using the purchase method of accounting.

~~Results~~ of ~~Operations~~ NON-GAAP FINANCIAL MEASURES

~~Revenues~~ EBITDA (including pro forma presentations thereof) and the related ratios presented in this prospectus are supplemental measures of our performance that are not required by, or presented in accordance with GAAP. EBITDA is not measurement of our financial performance under GAAP and should not be considered as an alternative to net income or any other performance measures derived in accordance with GAAP.

In EBITDA represents ~~the~~net ~~case~~income of(loss) ~~the~~before ~~sale~~net ofinterest ~~products~~expense, weincome ~~recognize~~tax ~~revenue~~expense, atdepreciation ~~the~~and ~~time products are shipped~~amortization. ~~Product~~We ~~shipments~~present ~~are~~EBITDA ~~supported~~because bywe ~~purchase~~consider ~~orders~~it ~~from~~an ~~customers~~important ~~that~~supplemental measure ~~indicate the price for each product. In the case~~ of ~~services,~~our weperformance ~~recognize revenues primarily on a time~~ and ~~materials~~believe ~~basis.~~it ~~Service~~is ~~revenues~~frequently ~~are~~used ~~supported~~ by ~~customer~~securities ~~orders~~analysts, orinvestors ~~contracts~~and ~~that~~other ~~indicate~~interested ~~the~~parties ~~price~~in ~~for~~ the ~~services~~evaluation ~~being~~of ~~rendered.~~high ~~For~~yield ~~fiscal 2001~~issuers, ~~service~~many ~~revenues were less than 10%~~ of ~~total~~which ~~revenues.~~present ~~Revenues~~EBITDA ~~for product shipments and services rendered must also have reasonable assurance~~when ofreporting ~~collectability~~their ~~from the customer~~results. ~~Reserves for returns and allowances are recorded against revenues based on management’s estimates and historical experience.~~

~~Our~~ We also ~~top~~use ~~four~~financial ~~customers~~measures ~~accounted~~similar ~~for~~to ~~41%~~EBITDA, ofthough ~~our~~subject ~~revenues~~to ~~for~~certain ~~the~~different ~~year~~adjustments, ~~ended~~in ~~June~~our ~~30,~~new ~~2001,~~senior ~~with~~secured ~~one~~credit ~~customer~~facility ~~accounting~~that ~~for~~we ~~18%~~entered ofinto in connection with our refinancing ~~revenues~~transactions described herein and ~~another~~the ~~accounting~~indenture ~~for~~governing ~~12%~~the ofnotes to measure our ~~revenues~~ compliance with covenants such as interest coverage and debt incurrence. ~~For~~Measures ~~the~~similar ~~three~~to ~~months~~EBITDA ~~ended~~are also ~~September~~widely ~~30,~~used ~~2001,~~by us and others in our ~~top~~industry ~~four~~to ~~customers~~evaluate ~~accounted~~and ~~for~~price ~~48%~~potential ofacquisition ~~our~~candidates. ~~revenues,~~We ~~with~~believe ~~one~~EBITDA ~~customer~~facilitates ~~accounting~~operating ~~for~~performance ~~21%~~comparisons offrom ~~our~~period ~~revenues~~to period and company ~~another~~to company ~~accounting~~by ~~for~~backing ~~12%~~out ofpotential ~~our~~differences ~~revenues.~~caused Weby ~~expect~~variations ~~revenues~~in ~~from~~capital ~~our~~structures (affecting relative interest expense), tax positions (such as the impact on periods or companies of changes in ~~largest~~effective ~~customers~~tax torates ~~continue~~or tonet ~~constitute~~operating alosses) ~~significant~~and ~~portion~~the age and book depreciation of ~~our~~facilities ~~total~~and ~~revenues~~equipment (affecting relative depreciation expense).

We EBITDA has ~~generally~~limitations doas ~~not~~an ~~have~~analytical ~~long-term volume~~tool, ~~commitments~~and ~~from~~you ~~our~~should ~~customers,~~not ~~and~~consider ~~they~~it ~~may~~in ~~cancel~~isolation, ~~their~~or ~~orders~~as ora ~~change~~substitute orfor ~~delay~~analysis ~~volume~~of ~~levels~~our atresults ~~any~~as ~~time~~reported under GAAP. Some of these limitations are:

•: it does not reflect our cash expenditures for capital expenditures;
•: it does not reflect changes in, or cash requirements for, our working capital requirements;
•: it does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments on our indebtedness;
•: although deprecation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect cash requirements for such replacements;
•: other companies, including other companies in our industry, may calculate differently than we do, limiting its usefulness as a comparative measure.

~~Cost~~ Because of these limitations, EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business or reduce our indebtedness. We compensate for these limitations by relying primarily on our GAAP results and ~~Expenses~~using EBITDA only supplementally. For more information, see our consolidated financial statements and the notes to those statements included elsewhere in this prospectus.

Cost of products sold includes expenses for raw materials, purchased components, outside services, supervisory, engineering and direct production manpower, including benefits, production supplies, depreciation and other related expenses to support product manufacturing. We purchase most of the raw materials that are used in our products at prevailing market prices and, as a result, are subject to fluctuations in the market price of those raw materials. In particular, the prices of stainless steel, titanium and platinum have historically fluctuated, and the prices that we pay for these materials, and, in some cases, their availability, are dependent upon general market conditions.

Selling, general and administrative expense includes local support of our facilities for production and shipment to the customer as well as strategic investments in our sales and marketing, operations and quality teams and our corporate support staff.

We have accounted for all of our acquisitions by using the purchase method of accounting. Until our year ended June 30, 2001, we amortized the goodwill and other intangibles attributable to our acquisitions and incurred associated amortization expense of $4.3 million in fiscal 2000 and $5.6 million in fiscal 2001. In connection with our implementation of SFAS No. 142, “Goodwill and Other Intangibles,” we no longer amortize goodwill. Instead, as discussed below, we will periodically test goodwill and intangibles for impairment and record an expense if those assets become impaired, as further discussed under the caption “— Recent Accounting Pronouncements.”

In connection with our acquisition of HV Technologies in January 2002, we issued Series E preferred stock and warrants to purchase an aggregate of 200,000 shares of our common stock and we issued Series F preferred stock. We will record a discount of $2.5 million to the carrying value of the Series E preferred stock equal to the consideration allocated to the warrants. We plan to accrete this discount over the twelve month period ending December 31, 2002 because we plan to redeem our Series E preferred stock by that date.

As ~~discussed in the second paragraph under the caption “Description of Capital Stock — General,” our Series C preferred~~ ~~stock~~ converts into a number of shares of our common stock that depends upon the initial public offering price of our common stock in this offering. Our net income for the year ending June 30, 2002 will therefore reflect a deemed preferred stock ~~dividend~~SELECTED ofHISTORICAL ~~approximately~~CONSOLIDATED ~~$ million~~FINANCIAL as the value of the additional shares of our common stock issued to the holders of our Series C preferred stock upon conversion. We determined the value of the dividend in accordance with EITF 00-27 by multiplying the number of additional shares of our common stock that are issuable upon conversion of our Series C preferred stock, determined as set forth in the second paragraph under the caption “Description of Capital Stock — General,” by the value that an independent appraisal assigned to our common stock on the date that investors first committed to purchase our Series C preferred stock. DATA

~~Three~~ The ~~Months~~following ~~Ended~~presents ~~September~~our selected historical consolidated financial data or the selected historical consolidated data of our current wholly owned subsidiaries which were acquired by our parent prior to our formation for the period from July 2, 1999 (the date of inception of our parent) through December 31, 1999, for each of the four full fiscal years in the period ended December 31, 2003 and for the nine month periods ended September 30, ~~2001~~2003 ~~Compared~~and 2004, and presents selected historical consolidated financial data of our predecessor, UTI Corporation, a Pennsylvania corporation and our wholly owned subsidiary that we refer to ~~Three~~as ~~Months~~UTI Pennsylvania, ~~Ended~~for the full fiscal year ended December 31, 1999 and for the five month period ended May 31, 2000 (the date immediately preceding our acquisition of UTI Pennsylvania). The operating data for each of the three years in the period ended December 31, 2003 and the balance sheet data as of December 31, 2002 and 2003 were derived from our audited consolidated financial statements included elsewhere in this prospectus. The balance sheet data as of December 31, 2001 and 2000 were derived from our unaudited financial statements that are not included in this prospectus. The operating data for the year ended December 31, 2000 was derived from our and our parent's unaudited financial statements that are not included in this prospectus. The operating data for the period from July 2, 1999 through December 31, 1999, and the balance sheet data as of December 31, 1999, were derived from the audited consolidated financial statements of our parent that are not included in this prospectus. The operating data for UTI Pennsylvania for the five months ended May 31, 2000 and the twelve months ended December 31, 1999 and the balance sheet data for UTI Pennsylvania as of May 31, 2000 and December 31, 1999 are derived from the audited consolidated financial statements of UTI Pennsylvania that are not included in this prospectus. Our operating data for the nine month periods ended September 30, 2003 and September 30, ~~2000~~2004 and our balance sheet data as of September 30, 2004 were derived from our unaudited consolidated financial statements that are included elsewhere in this prospectus.

~~Revenues~~ Our selected ~~for~~historical consolidated financial data reflects the ~~three~~push down of our parent's indebtedness and related interest expense, the Class B-~~month~~1 ~~period~~and ~~ended~~B-2 Redeemable ~~September~~and 30Convertible Preferred Stock, ~~2001~~and ~~were~~the ~~$33~~Class C 8% Redeemable Preferred Stock and related dividends.9 ~~million~~The ~~compared~~Accellent debt pushed down to ~~$27~~us is included in our consolidated balance sheets as long-term debt.6 ~~million~~The ~~for~~Accellent Class B-1 and B-2 Redeemable and Convertible Preferred Stock, and the ~~same~~Class C ~~period~~8% Redeemable Preferred Stock pushed down to us is included in our consolidated balance sheets as redeemable and convertible preferred stock of parent company. Accellent has also raised capital from the ~~prior~~sale ~~year~~of common stock, Class A-1 though A-8 5% Convertible Preferred Stock, Class AA Convertible Preferred Stock and warrants exercisable for Class AB Convertible Preferred Stock. ~~This~~The ~~represented~~proceeds anfrom ~~increase~~the ofcommon 23stock, Class A-1 through A-8 5% Convertible Preferred Stock, Class AA Convertible Preferred Stock and warrants exercisable for ~~largely~~Class AB ~~due~~Convertible Preferred Stock have been advanced to us and reflected in our consolidated balance sheets as additional paid-in capital since we are under no obligation to repay these amounts. Our parent, Accellent, allocates all interests and debt issuance costs to us. Accellent pushes down all dividends declared and paid, including accretive dividends, on the redeemable ~~impact~~and convertible preferred stock of parent company which has been pushed down to us. Any costs incurred by Accellent for the ~~acquisition~~benefit of ~~ACT~~MDMI ~~Medical~~have inbeen fully allocated to MDMI. Accellent does not incur any common expenses for the benefit of both Accellent and MDMI, therefore, no common expenses are allocated from Accellent to MDMI. Management believes the methods of allocation are reasonable. We have included the related historical consolidated financial data which represents our current wholly owned subsidiaries which were acquired by our parent prior to our formation for the period from July 2, 1999 through December 31, 1999 and for the full year ended December 31, 2000 (which includes amounts that were pushed down to us from our parent). We have presented separately the selected historical consolidated financial data of UTI Pennsylvania for periods prior to our parent's inception to show a full five years of selected historical financial data in accordance with applicable commission rules. With respect to periods prior to our parent's inception in July 1999, our parent's and our predecessor for financial accounting purposes is our wholly owned subsidiary, UTI Pennsylvania. Our parent acquired UTI Pennsylvania in June 2000. Although our

Cost of products sold for the three-month period ended September 30, 2001 totaled $26.1 million (resulting in gross margin of 23%), compared to $20.8 million (resulting in gross margin of 25%) for the three-month period ended September 30, 2000. The increase in cost of products sold resulted from the increased revenues over the same prior year period. The 2% decrease in gross margin reflects our acquisition of ACT Medical, which had lower margins than our existing businesses.

Selling, general and administrative expense for the three-month period ended September 30, 2001 was $6.4 million, or 19% of revenues, compared to $5.6 million, or 20% of revenues, for the same prior year period. The increase in expense was attributable to our acquisition of ACT Medical. We anticipate selling, general and administrative expense as a percentage of revenues to decrease over time as our business grows.

Net interest expense for the three-month period ended September 30, 2001 was $2.5 million, compared to $3.0 million for the same prior year period. This decrease was due to the lower amounts outstanding under our existing senior credit facility.

Comparison of Fiscal Years Ended June 30, 2001 and July 1, 2000

Revenues for our fiscal year ended June 30, 2001 totaled $128.5 million compared to $89.4 million for the fiscal year ended July 1, 2000, an increase of 44%. Approximately two-thirds of this increase was due to acquisitions during fiscal year 2001 and 2000, with the other third due to base business growth. The strong performance in our base business was driven by increased demand for both new and existing products from established customers as well as new customers.

Cost of products sold for the fiscal year ended June 30, 2001 totaled $94.4 million (resulting in gross margin of 27%), compared to $59.8 million (resulting in gross margin of 33%) for the fiscal year ended July 1, 2000. The decrease in gross margin during fiscal year 2001 compared to fiscal year 2000 reflected the full year impact of businesses acquired during fiscal 2000 and 2001, all with lower margins than the base businesses, and growth in revenues from lower margin assembly of completed devices.

Selling, general and administrative expense was $26.2 million, or 20% of revenues, for the fiscal year ended June 30, 2001 and $21.2 million, or 24% of revenues, for the fiscal year ended July 1, 2000. Of the $5.0 million increase in selling, general and administrative expense, $2.5 million was attributable to the acquisition of ACT Medical in December 2000, while annualized operating expenses for the businesses acquired during fiscal 2000 accounted for $1.1 million of the increase. The balance of the increase occurred largely as a result of our investment in our sales and marketing infrastructure to support future growth.

~~In June 2001, we completed a strategic review of our manufacturing operations and support functions. Based on this review and with~~parent ~~board~~was ~~approval,~~the weacquiring ~~began actions to eliminate redundant facilities. These actions resulted in a pre-tax charge of $11.5 million. The charge includes employee termination benefits of $3.8 million~~corporation, ~~other exit costs of $2.2 million~~UTI Pennsylvania, ~~impairment~~which ~~of goodwill~~was ~~and~~substantially ~~other~~larger ~~intangibles~~than ofour ~~$3.6~~parent ~~million~~at ~~and~~the ~~impairment~~time of ~~property,~~the ~~plant~~acquisition, ~~and~~is ~~equipment~~viewed ofas ~~$1.9~~our ~~million.~~parent's ~~The~~and ~~accrual~~our ~~balance~~corporate ~~at June 30, 2001 of $6.0 million includes the accrual~~ predecessor for ~~employee~~financial ~~termination~~accounting ~~benefits and other exit costs~~purposes.

~~Net~~ We consummated ~~interest~~the ~~expense~~MedSource ~~was~~acquisition ~~$10.2~~on ~~million~~June 30, ~~for~~2004 and, as a result, the ~~fiscal~~assets ~~year~~and ~~ended~~liabilities ~~June~~of ~~30,~~MedSource ~~2001~~are ~~compared~~recorded toon ~~$10.7~~our ~~million~~balance ~~for~~sheet as of the ~~fiscal~~date ~~year~~of the ~~ended~~MedSource ~~July~~acquisition 1and the results of operations of MedSource for June 30, ~~2000~~2004 are included in our results for that day. ~~This~~The ~~decrease~~unaudited ~~was~~financial ~~due~~statements toreflect all adjustments necessary in the ~~lower~~opinion ~~amounts~~of ~~outstanding~~management ~~under~~for ~~our~~a ~~existing~~fair ~~senior~~presentation ~~credit~~of ~~facility~~financial condition and results of operations for such periods and as of such dates.

We The ~~incurred~~information ~~charges~~presented ~~related~~below toshould ~~the~~be ~~accrual~~read of dividends and accretion of discount on preferred stock of $9.7 million for our fiscal year ended June 30, 2001, compared to $8.3 million for our fiscal year ended July 1, 2000. The increase was due to the increase in ~~the~~conjunction ~~amount~~with of"Management's ~~preferred~~Discussion ~~stock~~and ~~outstanding~~Analysis ~~during fiscal year 2001. Following completion~~ of ~~this~~Financial ~~offering,~~Condition ~~the~~and ~~preferred~~Results ~~stock will be redeemed as described under the caption “Use~~ of ~~Proceeds”~~Operations" orand ~~will~~our ~~convert~~consolidated ~~into common stock.~~financial Westatements ~~will~~included ~~record~~elsewhere ain ~~discount of $2.5 million to the carrying value of the Series E preferred stock equal to the consideration allocated to the warrants. We plan to accrete~~ this ~~discount over the twelve month period ending December 31, 2002 since we plan to redeem our Series E preferred stock by that date~~prospectus. ~~We also will have accrued approximately $0.4 million relating to dividends on our Series E and Series F preferred stock prior to redemption.~~

Comparison of Fiscal Year Ended July 1, 2000 and Period from March 31, 1999 (Inception) through July 3, 1999

We began operations on March 30, 1999, and our first fiscal period ended July 3, 1999. This first fiscal period therefore only consisted of three months consolidated results, which included material one-time expenses for our business combination and formation. The following comments present comparisons to annualized results for our period ended July 3, 1999.

Revenues for the fiscal year ended July 1, 2000 were $89.4 million, compared to annualized revenues, excluding a one-time payment resulting from the cancellation of a customer contract, of $71.7 million for our period ended July 3, 1999. The increase in revenues was partially due to the acquisitions of Apex Engineering, Tenax and Thermat Precision in fiscal 2000 and partially from increased sales to our top volume customers, especially those purchasing components.

Gross margin as a percentage of revenues for the twelve-month period ended July 1, 2000 was 33% compared to 39% annualized results for our period ended July 3, 1999. The gross margin shortfall compared to our annualized fiscal 1999 results was predominantly the result of four factors. First, significant increased volume of new business led to increased overtime, manufacturing outsourcing, and professional services as well as normal inefficiencies of first run parts. Second, reduced volume in our laser welding business occurred as we refocused the business on medical customers. Third, we provided increased prototyping services, which deliver low or no margins. Fourth, we lost a major contract in 1999. These shortfalls were partially offset by significant improvement in other areas of our business with strong revenue growth driving high contribution margins.

Operating expenses, as a percentage of net sales, for the fiscal year ended July 1, 2000 were 22%. There is no relevant comparison to annualized fiscal 1999 results.

Other expenses of $10.7 million for the fiscal year ended July 1, 2000 mainly consisted of net interest expense.

Liquidity and Capital Resources

As of September 30, 2001, we had cash and cash equivalents totaling $14.3 million. Following completion of this offering, our principal sources of liquidity will be cash provided by operations and borrowings under our

~~new~~Our senior credit facility. Prior to this offering, our principal uses of cash have been to finance acquisitions, meet debt service requirements and finance capital expenditures. We expect that these uses will continue in the future. Company

Net cash used in operating activities totaled $3.3 million for the three-month period ended September 30, 2001 compared to net cash used in operating activities of $2.1 million for the same period of the prior year. The increase in cash used in operating activities over the prior year period is primarily the result of a $5.2 million decrease in accounts payable and accrued expenses, including the payment of the fiscal 2001 management bonus accrued during fiscal year 2000, partly offset by a $1.6 million decrease in our net loss. Cash provided by operating activities was $1.3 million for the year ended June 30, 2001 compared to $6.3 million for year ended July 1, 2000. This decrease occurred because the growth of our base business, acquisitions during fiscal 2001 and a full year of results for acquisitions completed during fiscal year 2000 were more than offset by increased strategic investments in our sales and marketing, operations and quality teams, as well as our corporate support staff.

		Period from Parent's Inception (July 2, 1999)to December 31, 1999(1)															Nine Months Ended September 30,
					Twelve Months Ended December 31,												Nine Months Ended September 30,
					2000(1)			2001(1)			2002(1)			2003(1)			2003			2004
		(in thousands)
STATEMENT OF OPERATIONS DATA:
Net Sales		$	5,739		$	77,965		$	137,488		$	135,841		$	174,223		$	128,052		$	212,485
Cost of Sales			3,140			54,403			88,974			96,740			121,029			88,891			155,155

Gross Profit			2,599			23,562			48,514			39,101			53,194			39,161			57,330
Selling, General and Administrative Expenses			839			19,055			27,040			23,548			28,612			21,224			30,681
Research and Development Expenses			1			1,321			2,106			2,380			2,603			1,938			2,023
Restructuring and Other Charges(2)			—			—			—			2,440			1,487			1,533			2,107
Impairment of Goodwill and Intangibles(3)			—			—			—			21,725			—			—			—
Amortization of Intangibles(3)			512			8,140			10,067			4,703			4,828			3,602			3,937

Income (Loss) from Operations			1,247			(4,954	)		9,301			(15,695	)		15,664			10,864			18,582
Other Income (Expense)
	Interest Expense, Net		(804	)		(11,363	)		(17,802	)		(16,923	)		(16,587	)		12,825			19,397
	Other(4)		23			35			(1	)		61			(9	)		(5	)		3,284

Total Other Expense			(781	)		(11,328	)		(17,803	)		(16,862	)		(16,596	)		12,820			22,681

Income (Loss) Before Income Taxes			466			(16,282	)		(8,502	)		(32,557	)		(932	)		(1,956	)		(4,099	)
Income Tax Expense (Benefit)			357			(5,404	)		(1,504	)		(5,145	)		13,872			(763	)		2,341

Net Income (Loss)		$	109		$	(10,878	)	$	(6,998	)	$	(27,412	)	$	(14,804	)	$	(1,193	)	$	(6,440	)
OTHER FINANCIAL DATA:
Cash Flows Provided by (Used in):
	Operating Activities	$	1,092		$	6,779		$	9,362		$	14,022		$	14,392		$	7,733		$	6,179
	Investing Activities		(21,421	)		(204,916	)		(14,163	)		(9,446	)		(20,370	)		(18,048	)		(221,317	)
	Financing Activities		21,173			205,349			(439	)		(1,517	)		3,977			8,069			218,583
Capital Expenditures			265			3,145			6,497			6,218			6,371			(4,061	)		(8,718	)
Depreciation and Amortization			663			11,902			15,455			10,858			11,591			8,602			11,289
EBITDA(5)			1,933			6,983			24,755			(4,776	)		27,246			19,471			26,587
Ratio of Earnings to Fixed Charges			1.5x			—			—			—			—			—			—
Deficiency of Earnings to Fixed Charges			—			16,282			8,502			32,557			932			1,956			4,099
BALANCE SHEET DATA (at period end):
Cash and Cash Equivalents		$	845		$	8,058		$	2,818		$	5,877		$	3,974		$	3,680		$	7,403
Total Assets			25,165			266,350			262,081			235,775			279,135			257,275			601,690
Total Debt			16,116			140,020			140,189			144,411			136,246			140,009			368,543
Redeemable and Convertible Preferred Stock			30			540			540			540			12,593			12,593			30
Stockholder's Equity			6,348			91,861			82,072			64,219			56,813			70,478			136,146

Management believes that current cash balances and cash generated from operations, combined with the net proceeds of this offering and unused available borrowings totaling approximately $45.0 million under our new senior credit facility, will be adequate to fund requirements for working capital and capital expenditures through fiscal 2003.

Cash used in investing activities was $1.6 million for the three months ended September 30, 2001, compared to $1.0 million for the three months ended September 30, 2000. This increase was primarily due to an increase in capital expenditures. Cash used in investing activities was $11.6 million for the fiscal year ended June 30, 2001, compared to $22.2 million for the fiscal year ended July 1, 2000. The decrease was primarily the result of a $15.1 million decrease in net cash used in acquisitions, partially offset by an increase in capital expenditures of $4.7 million. We expect capital expenditures in fiscal 2002 and fiscal 2003 to be approximately $12.0 million in each year.

Cash used in financing activities was $1.1 million for the three months ended September 30, 2001 compared to $0.9 million provided by financing activities for the three months ended September 30, 2000. Cash provided by financing activities was $28.5 million for the fiscal year ended June 30, 2001 compared to $16.4 million for the fiscal year ended July 1, 2000. This increase resulted from net proceeds of $37.9 million from the sale of our Series C preferred stock, partially offset by $9.6 million in debt repayments.

New Senior Credit Facility

Concurrent with this offering, we intend to replace our existing senior credit facility with a new $85.0 million senior credit facility that would provide a $25.0 million revolving credit facility, a $40.0 million term loan and $20.0 million for acquisitions. All loans under the new senior credit facility would mature on the fifth anniversary of the date of this offering. The term loan would provide for annual principal repayments of $4.0 million, $6.0 million, $8.0 million, $10.0 million and $12.0 million, respectively, payable quarterly, beginning at the end of the first full quarter following this offering. We expect that the other terms and provisions of the new senior credit facility would be similar to those of our existing credit facility. Following this offering and the use of the proceeds of this offering, we will have an outstanding balance of approximately $40.0 million under our new senior credit facility.

Existing Senior Credit Facility

Our wholly-owned subsidiary, MedSource Technologies, LLC, has an existing credit facility that provides for an aggregate of $65.0 million under two term loans, an aggregate of $30.0 million for acquisitions and an aggregate of $25.0 million under a revolving credit facility, which includes a sub-limit for letters of credit. At September 30, 2001, MedSource Technologies, LLC, our wholly-owned subsidiary and the borrower under our existing credit facility, had $18.0 million outstanding under the first term loan, $39.1 million outstanding under the second term loan, $13.4 million outstanding under the acquisition line and nothing outstanding under the revolving credit facility. The first term loan provides for principal payments pursuant to an agreed-upon schedule

and with the balance due in March 2005. The second term loan provides for quarterly principal payments of $0.1 million and the balance, of $37.0 million, is due in March 2007. The acquisition line provides for quarterly principal repayment pursuant to an agreed-upon schedule and the balance is due in March 2005. UTI Pennsylvania

In July 1999, the borrower under the existing credit facility entered into two interest rate swap transactions, designed to be interest rate hedges, for the majority of the first and second term loans.

		Twelve Months Ended December 31, 1999			Five Months Ended May 31, 2000
		(in thousands)
STATEMENT OF OPERATIONS DATA:
Net Sales		$	75,334		$	35,661
Cost of Sales			48,012			23,567

Gross Profit			27,322			12,094
Selling, General and Administrative Expenses			21,920			27,732
Research and Development Expenses			2,051			702
Amortization of Intangibles			422			188

Income (Loss) from Operations			2,929			(16,528	)
Interest Expense, Net			592			257
Other			210			55

Income (Loss) Before Income Taxes			2,127			(16,840	)
Income Tax Expense			233			234

Net Income (Loss)		$	1,894		$	(17,074	)
OTHER FINANCIAL DATA:
Cash Flows Provided by (Used in):
	Operating Activities	$	10,559		$	5,497
	Investing Activities		(9,876	)		1,333
	Financing Activities		(616	)		(6,580	)
Ratio of Earnings to Fixed Charges			3.5x			—
Deficiency of Earnings to Fixed Charges			—		$	16,840
BALANCE SHEET DATA (at period end):
Cash and Cash Equivalents			2,117			2,366
Total Assets			58,358			54,992
Total Debt			10,808			5,483
Stockholders' Equity			21,136			29,492

(1): Our parent acquired G&D, Inc. d/b/a/ Star Guide, Inc. on July 6, 1999 and Noble-Met, Ltd. on January 11, 2000, and we acquired UTI Pennsylvania on June 1, 2000, American Technical Molding, Inc. on December 22, 2000, Micro-Guide, Inc. on October 31, 2001, and Venusa on February 28, 2003. All acquisitions were accounted for using the purchase method of accounting. Accordingly the assets acquired and liabilities assumed were recorded in our financial statements at their fair market value and the operating results of the acquired companies are reflected since the date of acquisition.
(2): During 2002, we implemented two restructuring plans focused on consolidating our U.S. operations. During the second quarter of 2002, we announced the relocation of the majority of operations in our South Plainfield, New Jersey facility to the Collegeville, Pennsylvania facility. A restructuring charge of $0.5 million was recognized that consisted of $0.1 million related to severance and $0.4 million associated with the write-down of assets and other closure costs at the South Plainfield, New Jersey facility.
: During the fourth quarter of 2002, we announced the consolidation of our machining capabilities into our Wheeling, Illinois facility and the closing of our Miramar, Florida plant. As a result, we recognized a restructuring charge of $1.4 million consisting of: $0.1 million related to stay-on bonuses earned through December 31, 2002; $0.5 million related to the write-down of assets; and $0.8 million related to lease obligations. In 2003, the relocation was completed and we recognized a restructuring charge of $1.8 million consisting of: $0.5 million related to stay-on and relocation bonuses earned through the relocation date; $0.3 million related to the relocation of equipment and plant clean-up; $0.7 million of other exit costs; and $0.3 million related to excess inventory discarded (included in cost of sales in the consolidated statements of operations).
: During the third quarter of 2002, we decided not to proceed with the construction of a new technology center and recognized a loss of $0.5 million related to the write-down of previously capitalized costs.

As of September 30, 2001, the interest rate on the first term loan was 6.7%, the interest rate on the second term loan was 6.9% and the interest rate on the acquisition line was 5.4%.

The existing credit facility contains certain affirmative and negative covenants and limitations, including, but not limited to, restrictions on our ability to enter into acquisition and sales transactions, limitations on liens, restrictions on payments and limitations on our ability to incur additional indebtedness.

The existing senior credit facility contains various events of default, including, without limitation, defaults for non-payment of principal, interest, fees or reimbursement obligations in respect of letters of credit, breaches of warranties or covenants, bankruptcy or insolvency, changes in control, ERISA violations, and cross-defaults to other indebtedness.

Senior Subordinated Notes

In March 1999, our wholly-owned subsidiary, MedSource Technologies, LLC, sold an aggregate of $20.0 million of its 12.5% senior subordinated notes due 2008. The borrower pledged $7.5 million of the proceeds that it received from the issuance of the notes to secure payments that are due thereunder. As of September 30, 2001, there is an unamortized discount of $2.6 million on these notes.

We intend to repay these notes in full out of the proceeds of this offering, as described under the caption “Use of Proceeds.” We are also required to redeem the notes at the redemption price set forth below upon the occurrence of any change in control.

On any redemption of the notes that occurs prior to March 30 of the calendar year set forth below, we are required to pay the redemption prices set forth below (expressed as a percentage of the outstanding principal amount), as amended during December 2001, plus accrued and unpaid interest:

Period	Redemption Price
2002	108	%
2003	107	%
2004	106	%
2005 and thereafter	105	%

Pursuant to the terms of the notes, we are also required to comply with various affirmative and negative covenants and limitations, including, but not limited to, our ability to enter into acquisition and sales transactions, limitations on liens, restricted payments and our ability to incur additional indebtedness. The notes also contain various events of default, including, without limitation, defaults for non-payment of principal, interest, fees or reimbursement obligations in respect of letters of credit, breaches of warranties or covenants, bankruptcy or insolvency, changes in control, ERISA violations, and cross-defaults to other indebtedness.

Issuances of Preferred Stock for Cash

In March 1999 and May 1999, we received an aggregate of $24.4 million from the issuance of our Series B preferred stock.

In October 2000 and June 2001, we received an aggregate of $40.3 million from the issuance of our Series C preferred stock. In connection with the issuance of our Series C preferred stock in October 2000, we paid a cash fee of $2.1 million to a placement agent and issued a warrant to purchase an additional 525 shares of our Series C preferred stock to the placement agent.

: The following table summarizes the recorded accruals and activity related to the restructuring and other charges (in thousands):

In December 2001, we received an aggregate of $6.0 million from the issuance of our Series E preferred stock. In connection with the issuance, we also issued warrants to purchase an aggregate of 200,000 shares of our common stock at $.01 per share. The warrants entitle the holders thereof to purchase an additional 45,000 shares on each of the first five anniversaries of the date of issuance of the Series E preferred stock that the Series E preferred stock remains outstanding. We intend to use a portion of the proceeds of this offering to redeem the Series E preferred stock by December 31, 2002, which is prior to the first anniversary of the date of its issuance.

		Employee Costs			Other Exit Costs			Total
Restructuring and Other Charges		$	230		$	2,210		$	2,440
	Less: Cash Payments		(80	)		(143	)		(223	)
	Less: Non-Cash Items		—			(1,262	)		(1,262	)

Balance as of December 31, 2002			150			805			955
Restructuring Charge			471			1,016			1,487
Inventory Discarded			—			322			322
	Less: Cash Payments		(613	)		(1,559	)		(2,172	)

Balance as of December 31, 2003		$	8		$	584		$	592

: The balance as of December 31, 2003 was paid in August 2004.
(3): Effective January 1, 2002, we adopted SFAS No, 142, "Goodwill and Other Intangible Assets." Accordingly, we no longer amortize goodwill. For the period July 2, 1999 to December 31, 1999 and the year ended 2000, and 2001, we amortized $0.5 million, $3.2 million and $5.4 million, respectively of goodwill. As a result of a loss of significant customers during 2002, goodwill impairment was determined to exist in one of our three reporting units. Accordingly, an impairment of goodwill charge of $17.5 million was recognized. In addition, related intangible assets of developed technology and know how and customer base were reduced to their estimated fair value based on projected cash flow by $2.2 million and $2.0 million respectively.
(4): For the nine months ended September 30, 2004 other income (expense) includes $3,295,000 of pre-payment fees associated with the retirement of our old senior subordinated indebtedness and Accellent's senior indebtedness.
(5): We define EBITDA as net income (loss) before net interest expense, income tax expense, depreciation and amortization. Since EBITDA may not be calculated the same by all companies, this measure may not be comparable to similarly titled measures by other companies. We use EBITDA as a supplemental measure of our performance. EBITDA has limitations as an analytical tool, and you should not consider them in isolation, or as a substitute for analysis of our results as reported under GAAP. See "Non-GAAP Financial Measures" for a discussion of our use of EBITDA and certain limitations of EBITDA as a financial measure. EBITDA is calculated as follows for the periods presented:

Quarterly Results

																Nine Months Ended September 30,
		Period from Parent's Inception to December 31, 1999		Twelve Months Ended December 31,												Nine Months Ended September 30,
		Period from Parent's Inception to December 31, 1999		2000			2001			2002			2003			2003			2004
		(in thousands)
	Net Income (Loss)	$	109	$	(10,878	)	$	(6,998	)	$	(27,412	)	$	(14,804	)	$	(1,193	)	$	(6,440	)
	Interest Expense, net		804		11,363			17,802			16,923			16,587			12,825			19,397
	Provision for Income Taxes		357		(5,404	)		(1,504	)		(5,145	)		13,872			(763	)		2,341
	Depreciation and Amortization		663		11,902			15,455			10,858			11,591			8,602			11,289

EBITDA		$	1,933	$	6,983		$	24,755		$	(4,776	)	$	27,246		$	19,471		$	26,587

The following tables set forth selected unaudited quarterly consolidated financial information for the nine quarters ended September 30, 2001. This unaudited quarterly consolidated information, in the opinion of management, includes all adjustments necessary for a fair presentation of such information in accordance with generally accepted accounting principles. These quarterly results are not necessarily indicative of future results, growth rates or quarter-to-quarter comparisons.

We have completed five acquisitions since October 2, 1999, but the quarterly consolidated financial information set forth below is presented on an actual historical basis, not on a pro forma basis for any of those acquisitions. The increase in revenues over the periods presented resulted from both acquisitions and growth in our base business. In addition, during our limited operating history, excluding the impact of acquisitions, we have experienced higher than average revenues during the last quarter of our fiscal year and lower than average revenues during the first quarter of our fiscal year, but we cannot predict whether this will continue.

	Quarter Ended
	October 2, 1999			January 1, 2000			April 1, 2000			July 1, 2000			September 30, 2000			December 31, 2000			March 31, 2001			June 30, 2001			September 30, 2001
	(In millions)
Statement of Operations Data:
Revenues	$	18.9		$	19.4		$	24.7		$	26.4		$	27.6		$	27.9		$	34.8		$	38.2		$	33.9
Costs and expenses:
Cost of products sold		12.1			12.1			16.5			19.1			20.8			20.7			26.1			26.8			26.1
Selling, general and administrative expense		3.9			4.0			5.2			8.1			5.6			6.1			7.3			7.2			6.4
Amortization of goodwill and other intangibles(a)		1.0			1.1			1.1			1.1			1.2			1.2			1.7			1.5			0.1
Restructuring charge(b)		—			—			—			—			—			—			—			11.5			—
Operating income (loss)		1.9			2.2			1.9			(1.9	)		—			(0.1	)		(0.3	)		(8.8	)		1.3
Interest expense, net		(2.3	)		(2.2	)		(2.7	)		(3.5	)		(2.9	)		(2.5	)		(2.3	)		(2.5	)		(2.5	)
Other expense		—			—			—			—			(0.2	)		(0.2	)		0.3			0.1			—
Income tax benefit (expense)		0.3			0.1			0.3			(0.1	)		—			—			—			(0.1	)		—
Net loss	$	(0.1	)	$	0.1		$	(0.5	)	$	(5.5	)	$	(3.1	)	$	(2.8	)	$	(2.3	)	$	(11.3	)	$	(1.2	)
Other Data:
EBITDA(c)	$	3.8		$	4.2		$	4.3		$	0.6		$	2.5		$	2.4		$	3.4		$	(5.3	)	$	3.2

(a) The information for the three months ended September 30, 2001 does not include a charge for the amortization of goodwill. Effective with our quarter ended September 30, 2001, we adopted the provisions of SFAS No. 141, Business Combinations, and No. 142, Goodwill and Other Intangible Assets, and, accordingly, we reclassified certain identifiable intangibles to goodwill and will no longer amortize goodwill and intangible assets that are deemed to have indefinite lives under SFAS 142. Had we continued to amortize goodwill during the three months ended September 30, 2001, amortization expense in that period would have increased by approximately $1.4 million, or $0.27 per common share.

(b) In June 2001, we completed a strategic review of our manufacturing operations and support functions. Based on this review and with board approval, we began actions to eliminate redundant facilities. These actions resulted in pre-tax charges of $11.5 million. The charges include employee termination benefits of $3.8 million, other exit costs of $2.2 million, impairment of goodwill and other intangibles of $3.6 million and impairment of property, plant, and equipment of $1.9 million.

~~(c)~~ ~~EBITDA~~ ~~represents~~ MANAGEMENT'S ~~earnings~~DISCUSSION ~~before~~AND ~~interest~~ANALYSIS OF ~~expense,~~FINANCIAL ~~income~~CONDITION ~~taxes,~~AND ~~depreciation~~RESULTS ~~and~~OF amortization. EBITDA should not be considered in isolation from, or as a substitute for, net income, cash flow from operations or other cash flow statement data prepared in accordance with generally accepted accounting principles or as a measure of our profitability or liquidity. Rather, EBITDA is presented because it is a widely accepted supplemental financial measure, and we believe that it provides relevant and useful information. A calculation of EBITDA may not be comparable to similarly titled measures reported by other companies, since all companies do not calculate this non-GAAP measure in the same manner. Our EBITDA calculation is not intended to represent cash provided by (used in) operating activities since it does not include interest and taxes and changes in operating assets and liabilities, nor is it intended to represent a net increase in cash since it does not include cash provided by (used in) investing and financing activities.OPERATIONS

~~Quantitative~~ The following discussion should be read in conjunction with our consolidated financial statements and ~~Qualitative~~the ~~Disclosures~~notes ~~About~~thereto ~~Market~~included elsewhere in this prospectus. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described under "Risk Factors." Our actual results may differ materially from those contained in any forward-looking statements.

Interest Rate Risk. Amounts outstanding under our existing senior credit facility bear interest at a floating rate, and we expect that amounts outstanding under our new senior credit facility will also bear interest at a floating rate. To reduce our exposure to interest rate risk, we entered into interest rate swap agreements, and we expect to either continue these swap agreements or enter into similar swap agreements to hedge our exposure to interest rate risk under our new senior credit facility. Under the existing swap agreements, we swap a variable interest rate for fixed interest rates ranging from 6.245% to 6.395%. Changes in the fair value of the swaps are recorded in Accumulated Other Comprehensive Loss in Stockholders’ Equity. The effect of a 10% increase in interest rates would have resulted in an immaterial increase in interest expense during our year ended June 30, 2001. Overview

~~Foreign~~ As ~~Currency~~a ~~Risk. Most~~result of our ~~sales~~acquisition ~~and~~of ~~purchases are denominated in United States dollars and as a result~~MedSource, we ~~have~~believe ~~relatively~~we ~~little~~are ~~exposure~~the ~~to foreign~~largest ~~currency~~provider ~~exchange~~of ~~risk~~outsourced ~~with~~precision ~~respect~~manufacturing toand ~~our~~engineering ~~sales.~~services ~~Accordingly,~~in weour dotarget markets ~~not~~of ~~use~~the ~~forward~~medical ~~exchange~~device ~~contracts~~industry. toThe ~~hedge~~following ~~exposures~~discussion ~~denominated~~and inanalysis ~~foreign~~of ~~currencies~~our ~~or any other derivative~~ financial ~~instrument~~condition ~~for~~and ~~trading~~results orof ~~speculative~~operations ~~purposes. The~~covers ~~effect~~periods ofprior ato ~~10%~~the ~~change~~Transactions. inAccordingly, ~~exchange~~the ~~rates~~discussion and asanalysis of ~~June~~historical ~~30,~~periods ~~2001~~do ~~would~~ not ~~have~~reflect ~~had~~the asignificant ~~material~~ impact onthat ~~our~~the ~~operating~~Transactions ~~results~~will ~~for~~have ~~the~~on ~~fiscal~~us ~~year~~and ~~then~~our ~~ended~~subsidiaries.

~~Recent~~ We primarily ~~Accounting~~focus ~~Pronouncements~~on the leading companies within three large and growing markets within the medical device industry: cardiovascular, endoscopy, and orthopaedics. Our customers include many of the leading medical device companies, including Boston Scientific, Guidant, Johnson & Johnson, Medtronic, Smith & Nephew, St. Jude Medical, Stryker, Tyco International and Zimmer. During 2003, our top 10 customers accounted for approximately 52% of net sales with only one customer accounting for greater than 10% of net sales. Boston Scientific accounted for approximately 25% of net sales in 2003. Although we expect net sales from our largest customers to continue to constitute a significant portion of our net sales in the future, Boston Scientific has informed us that it intends to transfer a number of products currently assembled by us to its own assembly operation. Although the transfer schedule has not been finalized, we expect the majority of the transfer to take place during fiscal 2005 with a target completion date during the first half of 2006. The product lines that are expected to be transferred represented approximately $28 million and $27 million of our net sales for 2003 and the first nine months of 2004, respectively. Based on preliminary estimates, we expect that net sales from Boston Scientific to decline approximately $10 million to $15 million in 2005 and $15 million to $20 million in 2006. While we believe that the transferred business can be replaced with new business from existing and potential new customers to offset the loss, there is no assurance that we will replace such business and the loss will not adversely affect our operating results in 2005 and thereafter. While net sales are aggregated by us to the ultimate parent of a customer, we typically generate diversified revenue streams within these large customers across separate divisions and multiple products.

In We primarily ~~June~~generate ~~2001,~~our ~~the~~net ~~Financial~~sales ~~Accounting Standards Board issued SFAS No~~domestically. ~~141, Accounting~~In ~~for Business Combinations~~2003, ~~and~~$143.6 million Noor 82.0% ~~142,~~of ~~Goodwill~~our ~~and~~net ~~Other~~sales ~~Intangible~~were ~~Assets,~~sold ~~effective~~to ~~for~~customers ~~fiscal~~located ~~years~~in ~~beginning~~the ~~after~~U.S. ~~December~~Since ~~15,~~a ~~2001,~~substantial ~~with~~majority ~~early~~of ~~adoption~~the leading ~~permitted~~medical ~~for~~device companies ~~with~~are ~~fiscal~~located ~~years~~in ~~beginning after March 15, 2001. Under~~ the ~~new rules~~U.S., ~~goodwill~~we ~~and~~expect ~~intangible~~our ~~assets~~net ~~deemed~~sales to ~~have~~U.S.-based ~~indefinite~~companies ~~lives will no longer be amortized, but will be subject~~ to ~~annual~~remain ~~impairment~~a ~~tests.~~high ~~Other~~percentage ~~intangible~~of ~~assets~~our ~~will~~net ~~continue~~sales toin bethe ~~amortized over their useful lives~~future.

We ~~adopted the new rules on accounting for goodwill and other intangible assets beginning in the first quarter of fiscal 2002.~~ ~~Amounts~~primarily ~~previously~~recognize ~~recorded~~product asnet ~~separately~~sales ~~identifiable~~upon ~~intangibles for acquired work force and customer base have been subsumed into goodwill in accordance with SFAS 141~~shipment, ~~increasing~~when ~~goodwill~~title bypasses ~~$34.6~~to ~~million as of~~ the ~~date~~customer ~~of adoption. Effective with the July 1~~or, ~~2001~~if ~~adoption~~products ofare ~~SFAS~~shipped ~~142,~~on ~~goodwill~~consignment ~~will no longer be amortized but is instead subject~~ to ana ~~annual~~particular ~~impairment~~customer, ~~test.~~when ~~The transitional impairment test that we conducted in connection with~~ the ~~adoption~~customer ofuses ~~SFAS 142 resulted in no~~the ~~impairment being required~~product. AsFor ~~a result of our adoption of SFAS 142~~services, ~~our~~we ~~amortization~~recognize ~~expense~~net ~~will~~sales beat ~~reduced by approximately $5.8 million or $1.10 per common share for fiscal 2002 and $1.4 million or $0.27 per common share for~~ the ~~quarter~~time ~~ended September 30, 2001 (based on~~ the ~~common~~services ~~shares~~are ~~outstanding prior to this offering)~~rendered. ~~See note 6 to our audited financial statements.~~

Our operations are based on purchase orders that typically provide for 30 to 90 days delivery from the time the purchase order is received, but which can provide for delivery within 30 days or up to 180 days, depending on the product and the customer's ability to forecast requirements.

Cost of goods sold includes raw materials, labor and other manufacturing costs associated with the products we sell. Some products incorporate precious metals, such as gold, silver and platinum. Changes in prices for those commodities are generally passed through to our customers. As a result of the acquisition of MedSource, acquired inventories were stepped up in value by $3.4 million which resulted in higher cost of goods sales during our second and third quarters of fiscal year 2004 when this inventory was sold.

~~SELECTED~~ Selling, general ~~FINANCIAL~~and ~~DATA~~administrative OFexpenses ~~PREDECESSOR~~include ~~COMPANIES~~salaries, sales commissions, and other selling and administrative costs.

We Amortization of ~~began~~intangible ~~operations~~assets onis ~~March~~primarily ~~30,~~related ~~1999~~to ~~through~~our ~~the~~acquisitions ~~acquisition~~ of ~~seven unaffiliated businesses~~G&D, Inc. tod/b/a ~~which~~Star weGuide, ~~refer~~or asStar ~~our~~Guide, ~~“predecessor companies~~Noble-Met, Ltd.”, ~~The~~or ~~following~~Noble ~~tables~~Met, ~~set~~UTI Pennsylvania, ~~forth~~American ~~certain~~Technical ~~historical~~Molding, Inc., ~~financial~~or ~~data~~ATM, ofVenusa ~~six of the individual predecessor companies derived from audited financial statements included elsewhere in this prospectus~~ and ~~from~~MedSource. ~~audited~~Interest ~~and~~expense ~~unaudited~~is ~~financial statements~~primarily ~~that~~related ~~are~~to ~~not~~indebtedness ~~included~~incurred into ~~this~~finance ~~prospectus~~our acquisitions.

	Kelco Industries, Inc.						W.N. Rushwood, Inc. d/b/a Hayden Precision Industries
	Year Ended April 30,				Eleven Months Ended March 30,		Year Ended December 31,									Three Months Ended March 30,
	1997		1998		1999		1996			1997			1998			1999
	(In thousands)
Statement of Operations Data:
Net sales	$	19,518	$	23,192	$	22,877	$	6,149		$	6,003		$	9,777		$	2,227
Gross profit		7,883		9,742		9,951		1,881			1,583			2,787			448
Operating expenses		2,738		2,830		2,784		954			949			1,072			195
Operating income (loss)		5,145		6,912		7,167		927			634			1,715			253
Other income (expense)		56		99		76		(142	)		(201	)		(241	)		(100	)
Income before taxes		5,201		7,011		7,243		785			433			1,474			153
Income taxes		—		—		—		—			—			—			—
Net income (loss)	$	5,201	$	7,011	$	7,243	$	785		$	433		$	1,474		$	153
Balance Sheet Data (at end of period):
Total assets	$	9,803	$	13,484	$	18,962	$	3,655		$	3,410		$	7,066		$	7,206
Long-term debt		5		—		—		2,193			1,804			3,174			3,744
Shareholders’ equity		7,905		11,229		16,215		406			739			1,685			1,753

Concurrent with the acquisition of MedSource on June 30, 2004, we aligned our management by the three medical device market segments which we serve. As a result of this realignment, we believe we have three operating segments: Endoscopy, Cardiology and Orthopaedics. We believe that all of our operating segments meet the aggregation criteria of paragraph 17 of SFAS No. 131, and are treated as one reportable segment.

	National Wire and Stamping, Inc.										The MicroSpring Company, Inc.
	Year Ended December 31,							Three Months Ended March 30,			Year Ended December 31,								Three Months Ended March 30,
	1996			1997		1998		1999			1996		1997			1998			1999
	(In thousands)
Statement of Operations Data:
Net sales	$	6,823		$	9,513	$	8,619	$	1,636		$	11,264	$	11,782		$	10,176		$	1,792
Gross profit		2,921			3,730		3,618		669			5,520		3,321			2,896			394
Operating expenses		2,237			3,112		3,057		800			2,060		3,420			3,343			1,314
Operating income (loss)		684			618		561		(131	)		3,460		(99	)		(447	)		(920	)
Other income (expense)		(47	)		65		126		125			52		7			(32	)		1
Income before taxes		637			683		687		(6	)		3,512		(92	)		(479	)		(919	)
Income taxes		257			275		264		45			83		31			7			3
Net income (loss)	$	380		$	408	$	423	$	(51	)	$	3,429	$	(123	)	$	(486	)	$	(922	)
Balance Sheet Data (at end of period):
Total assets	$	3,038		$	3,894	$	4,373	$	3,250		$	4,983	$	6,185		$	3,984		$	3,895
Long-term debt		112			117		107		—			—		250			250			—
Shareholders’ equity		2,036			2,290		2,757		2,664			3,916		3,377			2,990			3,076

Results of Operations

The following table sets forth percentages derived from the consolidated statements of operations for the years ended December 31, 2001, 2002 and 2003 and nine months ended September 30, 2003 and 2004, presented as a percentage of net sales.

	Twelve Months Ended December 31,						Nine Months Ended September 30,
	2001		2002		2003		2003		2004
STATEMENT OF OPERATIONS DATA:
Net Sales	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Cost of Sales	64.7		71.2		69.5		69.4		73.0

Gross Profit	35.3		28.8		30.5		30.6		27.0
Selling, General and Administrative Expenses	19.7		17.3		16.4		16.6		14.4
Research and Development Expenses	1.5		1.8		1.5		1.5		1.0
Restructuring and Other Charges	—		1.8		0.9		1.2		1.0
Impairment of Goodwill and Intangibles	—		16.0		—		—		—
Amortization of Intangibles	7.3		3.5		2.8		2.8		1.9

Income (Loss) from Operations	6.8		(11.6	)	9.0		8.5		8.7

Nine Months Ended September 30, 2004 Compared to Nine Months Ended September 30, 2003

Net Sales

Net sales for the first nine months of fiscal year 2004 were $212.5 million, an increase of $84.4 million or 65.9% compared to net sales of $128.1 million for the same period in fiscal year 2003. The increase was due to the acquisition of MedSource on June 30, 2004 which increased net sales by $45.6 million, and the inclusion of Venusa for the full nine month period in 2004 which increased net sales by $3.9 million, as well as a $34.9 million increase primarily related to higher unit shipments as we were awarded new products and increases in unit shipments on existing products to customers that serve the endoscopic and cardiovascular markets. Two customers accounted for 21.1% and 13.6% of net sales, respectively, for the first nine months of fiscal year 2004. One customer accounted for 20.8% of net sales for the first nine months of fiscal year 2003.

Gross Profit

Gross profit for the first nine months of fiscal year 2004 was $57.3 million as compared to $39.2 million for the same period in fiscal year 2003. The $18.1 million increase in gross profit was primarily due to the acquisition of MedSource and higher unit shipments partially offset by a

	Portlyn Corporation												Texcel, Inc.
	Year Ended December 31,									Three Months Ended March 30,			Year Ended December 31,									Three Months Ended March 30,
	1996			1997			1998			1999			1996			1997			1998			1999
	(In thousands)
Statement of Operations Data:
Net sales	$	5,578		$	6,955		$	5,773		$	1,180		$	2,303		$	4,310		$	6,184		$	2,045
Gross profit		2,835			3,391			2,573			473			708			1,677			2,295			941
Operating expenses		2,905			3,259			2,572			522			521			900			952			270
Operating income (loss)		(70	)		132			1			(49	)		187			777			1,343			671
Other income (expense)		1			(76	)		(74	)		(14	)		(94	)		(62	)		(68	)		(11	)
Income before taxes		(69	)		56			(73	)		(63	)		93			715			1,275			660
Income taxes		—			—			—			—			42			307			15			14
Net income (loss)	$	(69	)	$	56		$	(73	)	$	(63	)	$	51		$	408		$	1,260		$	646
Balance Sheet Data (at end of period):
Total assets	$	1,646		$	2,710		$	1,886		$	1,818		$	1,216		$	2,324		$	3,278		$	3,363
Long-term debt		28			113			82			75			462			504			451			770
Shareholders’ equity		647			651			578			514			377			749			2,009			1,265

$3.4 million write-off of the step-up of inventory related to the MedSource acquisition. Excluding the inventory step-up expense, the acquisition of MedSource increased gross profit by $9.7 million.

Gross margin was 27.0% of net sales for the first nine months of fiscal year 2004 as compared to 30.6% of net sales for the same period in fiscal year 2003. As a result of the acquisition of MedSource, acquired inventories were stepped up in value by $3.4 million. This step up in inventory reduced gross margin by $3.4 million, or 1.6%, for the 2004 period. Additionally, the MedSource gross margins have historically been lower than gross margins attained by us before the acquisition. The lower MedSource gross margins impacted our gross margins in the first nine months of fiscal year 2004 by $4.4 million, or 2.1%.

Selling, General and Administration Expenses

SG&A expenses were $30.7 million for the first nine months of fiscal year 2004 compared to $21.2 million for the same period in fiscal year 2003. The increase in SG&A costs were due to the acquisition of MedSource, which added $5.6 million of SG&A costs during the fiscal year 2004 period.

SG&A expenses were 14.4% of net sales for the first nine months of fiscal year 2004 versus 16.6% of net sales for the same period in fiscal year 2003. The lower 2004 percentage was driven by sales growth resulting in improved absorption of our SG&A cost structure, and in the 2003 period we incurred $1.6 million of costs associated with executive officer transition.

Research and Development Expenses

R&D expenses for the first nine months of fiscal year 2004 were $2.0 million or 1.0% of net sales, compared to $1.9 million or 1.5% of net sales for the same period in fiscal year 2003. The increase in R&D costs was due to the acquisition of MedSource, which added $0.1 million of R&D costs during the fiscal year 2004 period. The lower 2004 percentage was driven by sales growth in combination with leveraging the R&D cost structure.

Restructuring and Other Charges

During the fourth quarter of 2002, we announced the consolidation of our machining capabilities into our Wheeling, Illinois facility and the closing of our Miramar, Florida plant. For the first nine months of fiscal year 2003, we recognized an additional $1.5 million in restructuring charges consisting of $0.5 million for stay-on and relocation bonuses earned and $1.0 million related to expenses to shut down and relocate the operations.

In connection with the MedSource acquisition, we identified $27.8 million of costs associated with eliminating duplicate positions and plant consolidations, which is comprised of $11.2 million in severance payments, $11.0 million in lease termination costs and $5.6 million to relocate operations. Severance payments relate to approximately 610 employees in manufacturing, selling and administration which are expected to be paid by mid-year 2006. All other costs are expected to be paid by 2010. The costs of these plant consolidations was reflected in the purchase price of MedSource in accordance with the FASB Emerging Issues Task Force ("EITF") No. 95-3, Recognition of Liabilities in Connection with a Purchase Business Combination.. These costs include estimates to close facilities and consolidate manufacturing capacity, and are subject to change based on the actual costs incurred to close these facilities. Changes to these estimates could increase or decrease the amount of the purchase price allocated to goodwill in the near term. During the third quarter of fiscal year 2004, we increased the estimated liability for the MedSource facilities consolidations by $0.8 million, resulting in an increase to the purchase price allocation to goodwill in the same amount.

~~MANAGEMENT’S~~ The following ~~DISCUSSION~~table ~~AND~~summarizes ~~ANALYSIS~~the OFrecorded ~~FINANCIAL~~accruals ~~CONDITION~~and ~~AND~~activity ~~RESULTS~~related OFto ~~OPERATIONS~~the ~~OF PREDECESSOR~~restructuring ~~COMPANIES~~(in thousands):

You should read the following discussion of our predecessor companies, Kelco Industries, W.N. Rushwood d/b/a Hayden Precision Industries, National Wire and Stamping, The MicroSpring Company, Portlyn and Texcel, in conjunction with their financial statements and related notes appearing elsewhere in this prospectus.

	Employee costs			Other costs			Total
Balance as of December 31, 2003	$	8		$	584		$	592
Plant closures and severance cost for MedSource integration		11,196			16,604			27,800
Restructuring charges incurred		1,635			—			1,635
Paid year-to-date		(2,884	)		(584	)		(3,468	)

Balance September 30, 2004	$	9,955		$	16,604		$	26,559

AInterest ~~discussion~~Expense, ~~about our financial results appears under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” elsewhere in the prospectus.~~ net

~~Kelco~~ Interest ~~Industries~~expense, net increased $6.6 million to $19.4 million for the first nine months of fiscal year 2004 versus $12.8 million for the same period in fiscal year 2003 due to the refinancing of our old senior secured credit facility and various senior subordinated indebtedness, which resulted in $4.5 million of accelerated amortization of debt discounts and deferred financing costs during the second quarter of fiscal year 2004, and interest expense on the increased debt incurred to acquire MedSource. Interest expense, net includes interest income of approximately $47,000 and $11,000 for the first nine months of fiscal years 2004 and 2003, respectively.

~~Kelco~~Income ~~Industries~~Tax ~~was~~Expense ~~a manufacturer of precision machined parts, primarily for medical device companies.~~ (Benefit)

~~Comparison~~ Income tax expense was $2.3 million for the first nine months of ~~Eleven~~fiscal ~~Months~~year ~~Ended~~2004 ~~March~~as 30compared to an income tax benefit of $0.8 million for the same period in fiscal year 2003. The expense incurred for the fiscal year 2004 period is primarily due to certain state and foreign taxes which cannot be offset by losses in other jurisdictions, ~~1999~~and a provision for deferred taxes related primarily to different book and ~~Twelve~~tax ~~Months~~treatment ~~Ended~~for ~~April~~goodwill. 30During the fourth quarter of fiscal year 2003, ~~1998~~we determined that it is more likely than not that our deferred tax asset will not be realized, and we provided a valuation allowance equal to the full amount of the deferred tax asset.

Net sales for the eleven-month period ended March 30, 1999 totaled $22.9 million compared with $23.2 million for the previous twelve-month period, a decrease of 1%. The eleven-month period had approximately 8% fewer days, but sales volume increased approximately 7% over the prior year. Amortization

~~Gross~~ Amortization ~~margin~~was as$3.9 million ~~a percentage of net sales~~ for the ~~eleven-month~~first ~~period~~nine ~~ended~~months ~~March~~of ~~30,~~fiscal ~~1999~~year ~~was~~2004 ~~43%,~~compared ~~versus~~to ~~42%~~$3.6 million for the ~~previous~~same ~~twelve~~period ~~months~~in fiscal year 2003. The higher 1%amortization ~~improvement~~ was due ~~primarily~~ to ~~reduced~~the ~~platinum~~acquisition ~~material~~of ~~costs~~MedSource, which added $0.3 million in the 2004 period.

~~Operating~~Dividends ~~expenses~~on ~~for~~Redeemable ~~the eleven-month period ended March 30, 1999~~ and ~~for~~Convertible ~~the~~Preferred ~~twelve~~Stock ~~month period ended April 30, 1998 each totaled $2.8 million, or 12%~~ of ~~net~~Parent ~~sales.~~ Company

W In connection with the Transactions, our parent company repurchased $18.N8 million of redeemable preferred stock, which had been pushed down to us in accordance with SAB Topic 5J, and at a carrying value on our balance sheet of $12.6 million. ~~Rushwood~~We ~~d/b/~~recorded the difference between the repurchase price and our carrying value of $6.2 million as an accretive dividend. In addition, our parent declared and paid a ~~Hayden~~dividend ~~Precision~~of ~~Industries~~$2.0 million on these redeemable shares which has also been pushed down to us.

~~Hayden~~2003 ~~Precision~~Compared ~~Industries~~to ~~was a manufacturer of components used primarily in surgical instrumentation for the medical and dental industries.~~ 2002

~~Comparison~~Net ~~of Annualized Three Months Ended March 30, 1999 and Twelve Months Ended December 31, 1998~~ Sales

Net sales for ~~the~~2003 ~~three~~were ~~months~~$174.2 million, ~~ended~~an ~~March~~increase ~~30,~~of ~~1999~~$38.4 million ~~were~~or $228.2% ~~million,~~compared orto net sales of $135.8 million for 2002.9 ~~million~~The onhigher net ansales ~~annualized~~were ~~basis.~~primarily ~~This~~the ~~represented~~result aof ~~decline~~the February 28, 2003 acquisition of Venusa which increased 2003 net sales by $036.8 5 million,. orApproximately 975%, ~~over~~of ~~1998.~~the ~~The~~net sales ~~decrease~~of ~~was~~Venusa ~~driven~~are ~~primarily~~from a bysingle ancustomer, ~~increase~~which incombined ~~new~~with ~~product~~existing ~~introductions~~sales infrom ~~the~~this ~~surgical~~customer, ~~instrumentation~~made ~~business~~this ~~during~~our ~~the~~largest ~~three~~customer ~~months~~generating ~~ended~~approximately ~~March~~25% ~~30,~~of ~~1999~~our total net sales for 2003.

Gross margin as a percentage of net sales for the three months ended March 30, 1999, annualized, decreased to 20% from 29% in 1998. A combination of increased costs due to facility expansion, higher than normal scrap and “learning curve” costs associated with new product introductions were the main drivers.

Annualized operating expenses for the three month period ended March 30, 1999 were $0.8 million, or 9% of net sales, versus $1.1 million, or 11% of net sales, for the year ended December 31, 1998. The operating expense decrease was attributable to a reduction in administrative salaries.

Comparison of Twelve Months Ended December 31, 1998 and Twelve Months Ended December 31, 1997

Net sales for the year ended December 31, 1998 increased $3.8 million or 63% versus the prior year. This increase was driven by rapid growth in the surgical instrumentation market during 1998.

Gross margin as a percentage of net sales for the year ended December 31, 1998 increased to 29% from 26% in the prior year. This improvement in margin was driven primarily by increases in volume and a resulting leverage of fixed costs.

~~Operating~~ Assuming the ~~expenses~~Venusa ~~for~~acquisition ~~the~~occurred ~~year~~on ~~ended~~January 1, ~~December 31~~2002, ~~1998~~net ~~increased~~sales ~~over~~from ~~the~~products ~~prior~~used ~~year~~in bymedical markets for 2003 were $0148.1 3 million, an increase of $22.3 million or ~~13%~~17.7% ~~This~~compared ~~increase~~to ~~reflects the~~net ~~hiring~~sales offrom aproducts ~~controller~~used in ~~1998~~medical ~~and~~markets ~~increases~~of in$126.0 million ~~bonus~~for ~~amounts~~2002. The increase was primarily due to athe ~~larger~~manufacturing ~~employee~~ramp-up ~~base~~of several toproduct ~~support~~lines ~~the~~for ~~growth~~endoscopic incustomers. Net sales. ~~However,~~from ~~operating~~products ~~expenses~~sold asinto the industrial markets for 2003 were $29.8 million, a ~~percentage~~decrease of ~~net~~$2.0 million ~~sales~~or ~~dropped~~6.3% compared to net sales from ~~16%~~products insold ~~1997~~into tothe ~~11%~~industrial inmarkets ~~1998~~of $31.8 million for 2002. The decrease was primarily due to the ~~growth~~continued ~~in sales~~economic slowdown.

~~National~~Gross ~~Wire and Stamping~~ Profit

~~National~~ Gross ~~Wire~~profit ~~and~~for ~~Stamping~~2003 was an$53.2 million ~~engineering~~as ~~and~~compared ~~manufacturing~~to ~~company~~$39.1 million ~~specializing in metal stamping and wire forming, primarily~~ for ~~the medical device industry~~2002. ~~When~~The weincrease ~~acquired~~in ~~National~~gross ~~Wire,~~profit ~~its~~was ~~total~~primarily ~~sales~~the ~~had decreased~~result inof the acquisition ~~prior~~of ~~year~~Venusa ~~due~~in to2003 and a ~~decrease~~$5.0 million incharge ~~sales~~related to ~~non-medical~~obsolete ~~device~~inventory ~~companies~~in 2002.

~~Comparison~~ Gross margin offor ~~Annualized~~2003 ~~Three Months~~increased ~~Ended~~to ~~March~~ 30,.5% ~~1999~~from ~~and~~28.8% ~~Twelve~~in ~~Months~~the ~~Ended~~prior ~~December~~year. The increase was primarily due to the $5.0 31million charge in 2002, ~~1998~~partially offset by product mix changes in part driven by the acquisition of Venusa. The $5.0 million charge was to reduce inventory to its expected net realizable value. Throughout 2002 and 2003 approximately $3.3 million of the written down inventory was discarded. The inventory charge negatively impacted gross margin for 2002 by 3.7%. The acquisition of Venusa negatively impacted gross margin for 2003 by 0.9%.

~~Net sales for the three months ended March 30~~Selling, ~~1999~~General ~~were~~and ~~$1.6~~Administrative million, or $6.5 million annualized. This represented a decrease of $2.1 million or 24% over 1998. The primary driver of the decline was a continued reduction in the non-medical business during the first quarter of 1999. Expenses

~~Gross~~ Selling, ~~margin~~general asand aadministrative ~~percentage~~expenses offor ~~net~~2003 ~~sales~~were ~~for~~$28.6 million ~~the~~compared ~~three~~to ~~months~~$23.5 million ~~ended~~in ~~March~~2002. ~~30,~~The ~~1999,~~increase ~~annualized,~~was ~~decreased~~primarily due to ~~41%~~the acquisition ~~from~~of ~~42%~~Venusa and higher selling costs related to planned investments in ~~the~~our ~~prior~~net ~~year~~sales and marketing staff. ~~Margins~~Also ~~were~~included ~~negatively~~in 2003 was $1.9 million of severance and relocation charges ~~impacted~~incurred byin ~~lower~~connection ~~plant~~with ~~capacity~~executive ~~utilization~~officer astransitions, awhich ~~result~~took ofplace ~~lower~~in ~~volumes~~the third and fourth quarter.

~~Operating expenses for the three month period ended~~ Selling, ~~March~~general ~~30,~~and ~~1999,~~administrative ~~annualized,~~expenses were $316.~~2 million, or 49~~4% of net sales, ~~versus~~in ~~$3.1~~2003 ~~million,~~versus ~~or 35~~17.3% of net sales, ~~for~~in ~~the~~2002. ~~year~~The ~~ended~~lower ~~December~~percentage ~~31,~~in ~~1998.~~2003 ~~The increase~~ was ~~due~~driven toby astrong ~~one-time~~net ~~payoff~~sales ofgrowth ~~deferred~~in combination ~~compensation~~with ~~contracts~~leveraging tothe ~~current~~selling, general and ~~former employees~~administrative ~~during~~cost structure, partially offset by the ~~first~~executive ~~quarter~~officer oftransition ~~1999~~charges.

~~Comparison~~Research ~~of Twelve Months Ended December 31, 1998~~ and ~~Twelve~~Development ~~Months Ended December 31, 1997~~ Expenses

~~Net~~ Research ~~sales~~and ~~for~~development ~~the~~expenses ~~year~~for ~~ended~~2003 ~~December~~were ~~31, 1998 declined 9% to~~ $82.6 million ~~versus~~or $91.5% ~~million~~of ~~for the~~net ~~year~~sales, ~~ended~~compared ~~December~~to ~~31, 1997~~$2.4 million ~~The~~or ~~main~~1.8% ~~driver~~ of ~~the~~net sales ~~decline was a reduction~~ in ~~major non-medical accounts for stamping and assembly~~2002.

~~Gross~~Restructuring ~~margin as a percentage of net sales for the year ended December 31, 1998 increased to 42% from 39% in the prior year. The improvement in margin can be attributed to the loss of lower margin sales~~ and aOther ~~shift in product mix from industrial to medical.~~ Charges

~~Operating~~ In ~~expenses for~~2003 ~~the~~we ~~year~~completed ~~ended~~the ~~December~~consolidation ~~31,~~of ~~1998~~machining ~~were~~capabilities ~~$3.1~~into ~~million~~the Wheeling, orIllinois ~~35%~~facility and the closing of ~~net~~our ~~sales~~Miramar, ~~versus~~Florida plant and recognized a restructuring charge of $3.1 .8 million, orincluding ~~33%~~$0.3 million ofrelated ~~net~~to excess inventory included in cost of sales, ~~for~~$0.5 million ~~the~~of ~~year~~employee-related ~~ended~~costs ~~December~~and $1.0 million ~~31,~~of ~~1997~~other exit costs.

~~The~~ During 2002, ~~MicroSpring~~we ~~Company~~implemented two restructuring plans focused on consolidating our U.S. operations. We relocated the majority of operations in the South Plainfield, New Jersey facility to the Collegeville, Pennsylvania facility. A restructuring charge of $0.5 million was recognized. We announced the consolidation of machining capabilities into the Wheeling, Illinois facility and the closing of our Miramar, Florida plant. A restructuring charge of $1.4 million was recognized. Also in 2002, we decided not to proceed with construction of a new technology center and recognized a loss of $0.5 million related to the write-down of previously capitalized costs. Employee-related costs included in the restructuring charge were $0.2 million and the remaining $2.2 million consisted of other exit costs.

The MicroSpring Company was engaged in manufacturing metal-based spring components, developing and manufacturing percutaneous transluminal coronary angioplasty, or PTCA, guidewires, manufacturing interventional neuroradiology guidewires and providing design and engineering services.

Comparison of Annualized Three Months Ended March 30, 1999 and Twelve Months Ended December 31, 1998

Net sales for the three months ended March 30, 1999 were $1.8 million, or $7.2 million on an annualized basis. This represented a decrease of $3.0 million or 30% versus full year 1998. The decline in annualized 1999 sales was due to cancellations of guidewire business during the first quarter of 1999.

Gross margin as a percentage of net sales for the three months ended March 30, 1999, annualized, decreased to 22% from 28% in the prior year. The deterioration in gross margin reflects the loss of high margin guidewire business coupled with pricing pressures.

~~Annualized operating expenses for the three-month period ended March 30, 1999 were $5.3~~ The ~~million,~~following ortable ~~73%~~summarizes ~~of net sales, versus $3.3 million, or 33% of net sales, for~~ the ~~year~~recorded ~~ended~~accruals ~~December~~and ~~31,~~activity ~~1998.~~related ~~Operating~~to ~~expenses for~~ the ~~three~~restructuring ~~months~~and ~~ended~~other ~~March~~charges ~~30, 1999 included $0.5 million~~ (in ~~compensation~~thousands): ~~expense for additional shares issued to a principal owner.~~

Comparison of Twelve Months Ended December 31, 1998 and Twelve Months Ended December 31, 1997

	Employee Costs			Other Exit Costs			Total
Restructuring and other charges	$	230		$	2,210		$	2,440
Less cash payments		(80	)		(143	)		(223	)
Less non cash items		—			(1,262	)		(1,262	)

Balance as of December 31, 2002		150			805			955

Restructure charge		471			1,016			1,487
Inventory discarded		—			322			322

Less cash payments		(613	)		(1,559	)		(2,172	)

Balance as of December 31, 2003	$	8		$	584		$	592

~~Net~~ The balance ~~sales~~as ~~for~~of ~~the year ended~~ December 31, ~~1998~~2003 ~~totaled $10.2 million compared with $11.8 million for the prior year, a decline of 14%. The sales decline~~ was ~~driven~~paid byin ~~the loss of stent business~~August 2004.

~~Gross~~Impairment ~~margin as a percentage~~ of ~~net~~Goodwill ~~sales~~and ~~for the year ended December 31, 1998 remained unchanged from the prior year at 28%.~~ Intangibles

~~Operating~~ In ~~expenses~~2002, ~~for~~as a result of the ~~year~~loss ~~ended~~of ~~December~~customers 31in a reporting unit, ~~1998~~ ~~were~~we recognized a $317.3 5 million, orimpairment ~~33%~~ of ~~net~~goodwill ~~sales~~charge ~~versus~~and a $3.4 .2 million, write ordown ~~29%~~ of ~~net~~related ~~sales,~~intangible ~~during the prior year~~assets.

~~Portlyn~~ Amortization

~~Portlyn~~ Amortization ~~manufactured components and surgical instruments used~~ in ~~the~~2003 ~~medical~~was ~~device~~$4.8 million ~~industry,~~compared ~~primarily~~ to ~~its customers’ proprietary design specifications~~$4.7 million ~~Portlyn~~in ~~also sold an insignificant amount of products directly to end-users~~2002.

~~Comparison~~Interest ~~of Annualized Three Months Ended March 30~~Expense, ~~1999 and Twelve Months Ended December 31, 1998~~ net

~~Net~~ Interest ~~sales for the three months ended March 30~~expense, ~~1999~~net ~~were~~decreased $10.2 3 million, orto ~~an annualized~~ $416.7 6 million. ~~This~~for ~~represented~~2003 afrom ~~decrease of~~ $116.0 9 million orfor ~~18%~~2002, ~~over~~mainly ~~full~~due ~~year~~to ~~1998~~a decrease in outstanding debt. ~~The~~Interest ~~sales~~expense, ~~decline~~net ~~was~~includes ~~primarily~~$19,000 ~~driven~~and by$78,000 aof ~~reduction~~interest inincome ~~the~~for ~~surgical~~years ~~instrumentation~~2003 ~~business~~and ~~throughout~~2002, ~~1998~~respectively.

~~Gross~~Income ~~margin~~Tax asExpense a percentage of net sales for the three months ended March 30, 1999, annualized, decreased to 40% from 45% in the prior year. Reduced volumes in the high margin surgical instrumentation business was the primary driver of the margin decline. (Benefit)

~~Operating~~ Income ~~expenses~~tax expense was $13.9 million for ~~the~~2003 ~~three-month~~as ~~period~~compared ~~ended~~to ~~March~~an ~~30,~~income ~~1999,~~tax ~~annualized,~~benefit ~~decreased~~of $0.5.1 million orfor ~~19%~~2002. ~~over~~The ~~full~~expense ~~year~~incurred ~~1998.~~for ~~The~~2003 ~~operating~~was ~~expense~~mainly ~~decline~~due ~~was~~to ~~primarily~~the provision ~~driven~~of byan ~~reduced~~allowance ~~key~~against ~~employee~~our ~~compensation~~deferred tax asset. ~~Operating~~In ~~expenses~~ accordance with SFAS 109, Accounting for Income Taxes, projected future taxable income generally cannot be used as a ~~percentage~~basis offor ~~sales~~recovering deferred ~~for~~tax assets if there are cumulative losses during recent years. During the ~~three-month~~fourth ~~period~~quarter ~~ended~~of ~~March~~2003 ~~30,~~we ~~1999~~determined ~~totaled~~that ~~44%~~income ~~compared~~from our operations would not be sufficient to ~~45%~~cover inour ~~the~~interest and ~~prior~~financing ~~year~~costs. Accordingly, ~~remaining~~we ~~virtually~~provided ~~unchanged~~a valuation allowance equal to the full amount of our net deferred tax asset.

~~Comparison~~2002 ofCompared ~~Twelve~~to ~~Months Ended December 31, 1998 and Twelve Months Ended December 31, 1997~~ 2001

Net sales for the year ended December 31, 1998 declined 17% to $5.8 million, compared with $7.0 million for the year ended December 31, 1997. The decline in sales was primarily due to a reduction in the surgical instrumentation business. Sales

Net sales for 2002 were $135.8 million, a decrease of $1.6 million or 1.2% compared to net sales of $137.5 million in 2001. Net sales from products used in medical markets for 2002 were $104.0 million, an increase of $8.9 million or 9.4% compared to net sales from products used in medical markets of $95.1 million for 2001. The higher net sales were due to the continued growth from products that serve the cardiovascular and endoscopic markets partially offset by a decrease of $3.8 million in net sales from the loss of certain customers in the endoscopy market during the second half of fiscal 2002. The annualized amount of sales lost from these customers was approximately $6.0 million. Net sales from products sold into the industrial markets for 2002 were $31.8 million, a decrease of $10.6 million or

~~Gross~~24.9% compared ~~margins~~to ~~as a percentage of~~ net sales ~~for the year ended December 31, 1998 decreased to 45%~~ from ~~49%~~products insold ~~the~~into ~~prior~~industrial ~~year.~~markets ~~This margin decline was attributed to the loss~~ of ~~higher~~$42.4 million ~~margin~~for ~~sales, a shift in product mix and increased labor costs~~2001. ~~These~~The ~~factors~~decrease ~~were~~was ~~partially~~principally ~~offset~~due ~~by a reduction in material costs~~ to ~~16%~~the ofeconomic ~~sales in 1998, versus 20% in 1997~~downturn.

~~Operating~~Gross expenses for the year ended December 31, 1998 were $2.6 million or 45% of net sales, compared with $3.3 million and 47% for the prior year. The decline in operating expenses was primarily driven by reduced key employee compensation. Profit

~~Texcel~~ Gross profit for 2002 was $39.1 million as compared to $48.5 million in 2001. The decrease in gross profit was due to our recording a $5.0 million charge for obsolete inventory, unfavorable product mix and higher manufacturing costs related to product launches.

~~Texcel~~ Gross margin ~~was~~for a2002 ~~contract~~decreased ~~precision~~to ~~laser~~28.8% ~~welding~~from ~~service~~35.3% ~~provider~~in ~~and~~the ~~component~~prior ~~manufacturer~~year. ~~With~~In ~~respect~~addition to ~~laser~~the ~~welding~~impact ~~services,~~of ~~Texcel~~the ~~performed~~$5.0 million ~~seam and~~charge ~~bond~~for ~~welding~~obsolete ~~services~~inventory, ~~using~~gross ~~hermetic~~margin ~~and~~was ~~multi-fiber~~also negatively ~~laser~~impacted ~~welding~~by ~~machinery,~~unfavorable ~~laser~~product ~~marking,~~mix ~~leak testing~~ and ~~documentation~~incremental ~~services on customer-owned materials. With respect to component~~ manufacturing, ~~Texcel~~costs ~~purchased~~related ~~raw materials and preformed welding services leading~~ to ~~final assembly of a finished~~ product ~~to the customer~~launches.

~~Comparison of Annualized Three Months Ended March 30~~Selling, ~~1999~~General and ~~Twelve~~Administrative ~~Months Ended December 31, 1998~~ Expenses

~~Net~~ Selling, ~~sales~~general and administrative expenses for ~~the~~2002 ~~three-month~~were ~~period ended~~$23.5 million ~~March~~compared ~~30,~~to ~~1999,~~$27.0 million ~~annualized,~~in ~~increased~~2001. ~~versus~~The ~~full~~2001 ~~year~~selling, ~~1998~~general byand administrative expenses included $2.0 3 million orof ~~32%.~~special ~~The~~charges ~~sales~~related ~~increase~~to ~~was~~the ~~driven~~termination ~~primarily~~of bya ~~the~~public ~~rapid~~offering, ~~expansion~~$0.8 million of ~~the~~charges ~~telecommunications~~related ~~market~~to ~~segment~~due diligence costs for acquisitions that were not completed and $0.8 million for severance and recruiting costs.

~~Gross~~ Selling, general ~~margin~~and asadministrative aexpenses ~~percentage~~were 17.3% of net sales ~~for~~in ~~the~~2002 ~~three-month~~versus ~~period~~19.7% ~~ended~~of ~~March~~net ~~30,~~sales ~~1999,~~in ~~annualized,~~2001. ~~increased~~The tolower ~~46%~~rate ~~from~~is ~~37%~~due into ~~1998.~~higher ~~The~~net ~~margin~~sales ~~improvement~~and ~~was~~the ~~attributable primarily~~impact toof the ~~telecommunications~~special charges ~~business~~in ~~growth~~2001 ~~coupled~~of ~~with increased manufacturing efficiencies~~$2.3 million.

~~Operating~~Research expenses for the three-month period ended March 30, 1999, annualized, were $1.1 million, or 13% of net sales, versus $1.0 million, or 15% of net sales, for the year ended December 31, 1998. The increase was due primarily to an active recruitment effort targeted at both engineering and ~~quality~~Development ~~professionals to support sales growth.~~ Expenses

~~Comparison~~ Research ofand ~~Year~~development ~~Ended~~expenses ~~December~~for ~~31,~~2002 ~~1998~~were ~~and Twelve~~$2.4 million ~~Months~~or ~~Ended~~1.8% ~~December~~of 31net sales, ~~1997~~compared to $2.1 million or 1.5% of net sales in 2001.

~~Net~~Restructuring sales for the year ended December 31, 1998 increased $1.9 million or 43% versus the prior year ended December 31, 1997. The sales increase was driven primarily by growth in the medical sector, including both surgical instruments and ~~biomedical~~Impairment ~~implants. In addition, the telecommunication business also experienced growth.~~ Charges

~~Gross~~ During ~~margin~~2002, aswe aimplemented ~~percentage~~two ofrestructuring ~~net~~plans ~~sales~~focused ~~for~~on consolidating our U.S. operations. We relocated the ~~year~~majority ~~ended~~of ~~December~~operations 31in the South Plainfield, New ~~1998~~Jersey facility to the Collegeville, Pennsylvania facility. A restructuring charge of $0.5 million was ~~37%~~recognized, ~~declining~~consisting ~~slightly~~of ~~over~~$0.1 million ~~gross~~of ~~margin~~employee-related ascost and a$0.4 million ~~percentage~~ of ~~net~~other ~~sales~~exit costs. We announced the consolidation of ~~39%~~machining ~~for~~capabilities into the ~~prior~~Wheeling, ~~year~~Illinois ~~ended~~facility ~~December~~and 31the closing of our Miramar, ~~1997~~Florida plant. ~~The~~A ~~decline~~restructuring charge of $1.4 million was ~~driven~~recognized, byconsisting ~~new~~of ~~product~~$0.1 million ~~development~~of employee related costs, $0.8 million of lease termination costs and $0.5 million of other exit costs.

~~Operating~~ In 2002, ~~expenses for~~ the ~~year~~Company ~~ended~~decided ~~December~~not ~~31,~~to ~~1998~~proceed ~~were~~with ~~$0.9~~construction ~~million,~~of ora ~~15%~~new oftechnology ~~net~~center ~~sales,~~and asrecognized ~~compared~~a toloss of $0.9 5 million, orrelated ~~21%~~to ~~of net sales, for~~ the ~~year~~write ~~ended~~down ~~December~~of ~~31,~~previously ~~1997~~capitalized costs.

During the third quarter of fiscal year 2002, one of our reporting units experienced a decline in sales due primarily to the loss of two key customers. Net sales for this reporting unit declined $3.8 million for fiscal year 2002 as compared to fiscal year 2001, with most of this decline occurring during the second half of fiscal year 2002. The annualized amount of sales lost from these two customers was approximately $6.0 million. We had earned high profit margins on the business that was lost, resulting in the elimination of all positive cash flow from this reporting unit. We immediately implemented cost reduction programs to mitigate the impact on cash flow, however, annual cash flow was still expected to drop in excess of $3.0 million per year after the impact of all cost reduction initiatives. The valuation of this reporting unit was based primarily on discounted future cash flows, including a five year cash flow projection plus a residual value calculation to value the cash flows beyond the years that are discretely forecast. The reduction in cash flows significantly reduced the value of this reporting unit, and lead to a goodwill impairment charge of $17.5 million and an intangible asset impairment charge of $4.2 recorded in the fourth quarter of fiscal year 2002.

~~BUSINESS~~ Amortization

~~Overview~~ Amortization in 2002 was $4.7 million, compared to $10.1 million in 2001. Beginning in 2002, amortization of goodwill was discontinued as the Company adopted FASB No. 142.

WeInterest ~~are a leading engineering and manufacturing services provider to the medical device industry. Our customers include many of the largest medical device companies in the world~~Expense, such as Boston Scientific, Guidant, Johnson & Johnson affiliates and Medtronic, as well as other large and emerging medical device companies. We provide product development and design services, precision metal and plastic part manufacturing, product assembly services and supply chain management. Through these products and services, we offer our customers a single source solution for their device development and manufacturing needs, accelerated product development time, and reduced costs, allowing them to focus on their core competencies such as research and sales and marketing. net

We Interest ~~began~~expense, ~~operations~~net ~~during~~decreased ~~March~~$0.9 million ~~1999~~to ~~through~~$16.9 million ~~the~~for ~~acquisition~~2002 offrom ~~seven~~$17.8 million ~~companies~~for ~~with~~2001, ~~complementary~~mainly ~~capabilities~~due ~~and~~to ~~subsequently~~a ~~broadened~~decrease ~~our~~in ~~capabilities through five additional~~interest ~~acquisitions~~rates. ~~Since~~Interest ~~our launch~~expense, wenet ~~have~~includes ~~focused our efforts on integrating and growing our business and have made significant investments in our product design and development capabilities~~$78,000 ~~sales~~ and ~~marketing teams~~$112,000 ~~operations,~~of ~~quality~~interest ~~systems~~income ~~and information~~for ~~technology~~years ~~infrastructure~~2002 ~~to support that growth. We currently have 15 manufacturing facilities with approximately 600,000 total square feet~~ and ~~over 1~~2001,~~350~~ ~~employees~~respectively.

~~Market~~Income ~~Opportunity~~Tax Benefit

~~The~~ Income ~~Market~~tax benefit was $5.1 million for ~~Medical~~2002 ~~Devices~~as compared to 1.5 million for 2002. The increased benefit is predominantly due to the increased net loss incurred for 2002.

~~According~~Liquidity to a report prepared for us by Frost & Sullivan, the global medical device market in 2000 exceeded $170 billion, with the United States portion alone constituting approximately $70 billion. This market has grown consistently over the past ten years due to the continued increase in overall healthcare expenditures resulting from the demographic shift towards an older population and ~~the~~ ~~development~~Capital ~~of new and innovative products. Spending for medical devices, like the rest of healthcare expenditures, has realized strong growth with little sensitivity to recession.~~ Resources

~~The~~ Our ~~medical~~principal ~~device~~sources ~~market~~of ~~may~~liquidity beare ~~separated~~cash ~~into~~provided ~~many~~by ~~distinct~~operations ~~product~~and ~~segments,~~borrowings ~~with~~under ~~the~~our ~~defining~~new ~~characteristic~~senior ~~being~~secured ~~the~~credit ~~medical~~facility, ~~specialty~~entered ~~served.~~into ~~The products~~ in ~~the~~conjunction ~~medical device~~with ~~market~~our ~~can~~June 30, ~~also~~2004 beacquisition ~~broadly~~of ~~categorized~~MedSource, aswhich ~~either~~included ~~value~~a five-~~added~~year orundrawn ~~commodity products~~$40.0 million ~~Value-added~~revolving ~~products~~credit ~~such~~facility asand ~~electro~~a six-~~medical~~year ~~and~~$194.0 million ~~orthopedic~~term facility. ~~implantable~~For ~~devices,~~a ~~general~~description ~~surgical~~of ~~instrumentation~~our ~~and~~new ~~minimally~~senior ~~invasive~~secured ~~surgical~~credit ~~instruments typically~~facility, ~~have~~please ~~lower~~see ~~unit~~"Description ~~sales~~of ~~and~~New ~~higher~~Senior ~~profit~~Secured ~~margins~~Credit Facility." ~~Commodity~~Our ~~products~~principal ~~such~~uses asof ~~needles,~~cash ~~syringes~~will be to meet debt service requirements, ~~gloves~~fund ~~and~~working ~~gowns~~capital ~~typically~~requirements ~~have~~and ~~higher~~finance ~~unit~~capital ~~sales~~expenditures and ~~lower~~acquisitions. ~~profit~~At ~~margins~~September 30, 2004, we had $4.0 million ~~Frost~~of &letters ~~Sullivan~~of ~~estimates~~credit outstanding that reduced ~~the~~by ~~global~~such ~~market~~amount ~~for~~the ~~value-added products~~amounts inavailable ~~2000~~under ~~exceeded~~our ~~$100~~revolving ~~billion~~credit facility.

~~Initially,~~ During the wefirst ~~are~~nine ~~targeting~~months ~~outsourcing~~of ~~opportunities~~fiscal inyear ~~select~~2004, ~~value-added~~cash ~~medical device~~generated ~~markets:~~from ~~surgical~~operating ~~instrumentation,~~activities ~~electro-medical~~was ~~implants,~~$6.2 million ~~interventional~~compared ~~and~~to ~~orthopedics~~$7.7 million Wefor ~~believe that these markets are currently~~ the ~~most~~same ~~attractive~~period ~~based~~in onfiscal ~~their size, growth, profit margins, customer dynamics, competitive~~year ~~environment~~2003. ~~and~~The ~~need~~decrease ~~for~~in ~~the~~cash ~~engineering~~from ~~and~~operations ~~manufacturing~~is ~~services~~primarily werelated ~~offer.~~to Weincreased ~~selectively~~accounts ~~serve~~receivable ~~customers~~and ininventories ~~other~~due ~~value-added~~to ~~portions~~higher ~~of the medical device market~~sales.

~~According~~ During the tofirst ~~Frost~~nine &months ~~Sullivan, our four target markets accounted for at least $14 billion~~ of ~~medical~~fiscal ~~device~~year ~~sales in the United States during 2000~~2004, ~~with~~cash ~~each~~used ofin ~~the~~investing ~~target~~activities ~~markets individually~~totaled ~~accounting for more than~~ $221.3 million ~~billion~~compared into ~~sales~~$18.0 million Wefor ~~believe that~~ the ~~ratio~~same ofperiod ~~United~~in ~~States~~fiscal ~~sales~~year 2003. toThe ~~international~~increase ~~sales~~ in ~~our~~cash ~~four~~used ~~target~~in ~~markets~~investing isactivities ~~consistent~~was ~~with~~attributable ~~Frost~~to &the ~~Sullivan’s~~acquisition ~~estimated ratio~~ of ~~United~~MedSource, ~~States sales (approximately 40%) to international sales (approximately 60%)~~ for ~~the~~which ~~2000~~we ~~global~~paid ~~medical device market as a whole~~$204.4 million ~~This~~during ~~indicates that~~ the ~~total~~first ~~global~~nine ~~market~~months ~~for~~of ~~end-user~~fiscal ~~sales~~year in2004, ~~our~~and increased ~~four~~capital ~~target~~spending ~~markets~~due into ~~2000~~the ~~exceeded~~MedSource ~~$35 billion~~acquisition.

During the first nine months of fiscal year 2004, financing activities generated $218.6 million of cash compared to $8.1 million of cash for the comparable period in 2003. In conjunction with the June 30, 2004 acquisition of MedSource, the following financing transactions took place:

•: The issuance of $369.0 million of indebtedness consisting of a $194.0 million six-year term facility and $175.0 million of 10% senior subordinated notes due July 15, 2012. The Company incurred $15.9 million of fees related to the new debt.
•: The repayment of all previously outstanding debt, which included our credit facility of $83.5 million, our senior subordinated notes of $21.5 million and Accellent's senior notes of $38.3 million.
•: The repayment of all MedSource debt and capital leases totaling $36.1 million.
•: The payment by Accellent of $22.2 million of dividends.
•: The repurchase by Accellent of $18.8 of its Class C Redeemable Preferred Stock.
•: The issuance by Accellent of 7,568,980 shares of its Class A-8 5% Convertible Preferred stock for approximately $88.0 million, net of $1.8 million of fees.

~~Global~~ Cash provided ~~Medical~~by ~~Device~~operating ~~Markets~~activities was approximately $14.4 million for the year ended December 31, 2003 compared to approximately $14.0 million for the year ended December 31, 2002. Fiscal year 2003 cash provided by operating activities was primarily related to a net loss of approximately $14.8 million, plus depreciation and amortization of approximately $11.6 million, non-cash interest expense of approximately $7.1 million and deferred income taxes of approximately $12.3 million. Fiscal year 2002 cash provided by operating activities was primarily related to a net loss of approximately $27.4 million, plus depreciation and amortization of approximately $10.9 million, non-cash interest expense of approximately $6.2 million, an impairment charge of approximately $21.7 million, partially offset by a change in deferred income taxes of approximately $5.2 million. In addition, cash was provided by inventory reduction of approximately $3.5 million.

MEDICAL DEVICE MARKETS	EXAMPLES		MAJOR PLAYERS
MedSource Target Markets
Surgical Instrumentation	— Arthroscopic — Ophthalmology	— Endo-laparoscopic — Electro-surgical	— Boston Scientific — Johnson & Johnson	— Stryker — Tyco
Electro-Medical Implants	— Pacemakers — Defibrillators	— Hearing assist devices — Heart pumps	— Biotronik — Guidant	— Medtronic — St. Jude
Interventional	— Stents — Angioplasty	— Catheter ablation — Distal protection	— Boston Scientific — Guidant	— Johnson & Johnson — Medtronic
Orthopedics	— Spinal fixation — Hip implants	— Knee implants	— Biomet — Johnson & Johnson	— Stryker — Zimmer
Other Markets
Other Value-Added Products	— Urology — Renal / hemodialysis	— Respiratory — Dental	— Abbott — Baxter	— C.R. Bard — Fresenius
Commodity Products	— Needles / syringes — Gloves / gowns	— Wound care	— Allegiance — Becton Dickinson	— 3M — Tyco
Imaging Equipment	— MRI — Ultrasound	— X-ray	— General Electric — Philips	— Siemens — Toshiba

Cash used in investing activities was approximately $20.4 million for the year ended December 31, 2003 compared to approximately $9.4 million for the year ended December 31, 2002. Fiscal year 2003 cash used in investing activities included approximately $6.4 million associated with capital spending and approximately $14.4 million (net of acquired cash) associated with the acquisition of Venusa. Fiscal year 2002 cash used in investing activities included approximately $6.2 million associated with capital spending and approximately $3.3 million (net of acquired cash) primarily associated with the earn-out related to an acquisition.

We Cash provided ~~believe~~by ~~that~~financing ~~the~~activities ~~market~~was ~~opportunity~~approximately $4.0 million for ~~medical~~the ~~engineering~~year ~~and~~ended ~~manufacturing services~~December 31, is2003 ~~largely~~compared ~~represented~~to bycash ~~the~~used ~~cost~~in offinancing ~~goods~~activities ~~sold~~ of ~~medical~~approximately $1.5 million ~~device~~for ~~companies.~~the ~~Applying~~year ~~Frost~~ended &December 31, ~~Sullivan’s~~2002. ~~estimated~~Fiscal ~~average~~year ~~gross~~2003 ~~margin~~cash ~~for~~provided ~~value-added~~by ~~medical~~financing ~~device~~activities ~~products~~was comprised of ~~70%,~~approximately we$18.7 million ~~believe~~of ~~that~~capital oncontributions received afrom ~~global~~Accellent, ~~basis~~ our ~~four~~parent, ~~target markets~~partially ~~currently~~offset ~~represent~~by atapproximately ~~least a~~ $1014.1 million ~~billion~~of ~~annual~~net ~~cost~~debt ofreduction ~~goods~~and ~~sold~~approximately ~~opportunity~~$0.7 million Inof ~~addition,~~deferred ~~there~~financing ~~are~~fees. ~~market~~Fiscal ~~opportunities~~year ~~for~~2002 cash usused ~~outside~~in offinancing ~~cost~~activities ofwas ~~goods~~comprised ~~sold, consisting largely~~ of aapproximately ~~portion~~$1.0 million of ~~the~~net ~~development~~debt ~~and~~reduction ~~selling, general~~ and ~~administrative~~ ~~expenditures~~approximately ~~that~~$0.5 million ~~support the cost~~ of ~~goods~~deferred ~~sold~~financing ~~in these markets~~fees.

~~Medical~~ Capital ~~Device~~Expenditures. We ~~Company~~anticipate ~~Outsourcing~~that we will spend approximately $3.5 to $5.0 million on capital expenditures for ~~Trend~~the remainder of 2004. Our new senior secured credit facility contains restrictions on our ability to make capital expenditures. Based on current estimates, our management believes that the amount of capital expenditures permitted to be made under our new senior secured credit facility will be adequate to grow our business according to our business strategy and to maintain our continuing operations.

~~Frost~~ Other &Expenditures. In ~~Sullivan~~connection ~~estimates~~with ~~that~~our ~~the~~acquisition ~~growth~~of Venusa in ~~manufacturing~~February ~~outsourcing~~of by2003, ~~medical~~we ~~device~~are ~~companies~~obligated into ~~the~~pay ~~United~~contingent ~~States~~consideration ~~from~~based ~~1999~~on toagreed ~~2000~~upon ~~was~~earnings intargets ~~excess~~for offiscal ~~18%.~~years ~~Frost & Sullivan further estimates that in the United States in 2000~~2002, ~~25%~~2003 ofand ~~the~~2004. ~~cost~~As of ~~goods~~December 31, ~~sold~~2003, ~~for~~we ~~value-added~~have ~~products~~$36.9 million ~~was~~included ~~outsourced~~in ~~and~~current ~~projects~~liabilities ~~that~~as ~~by 2005~~accrued expenses, ~~42%~~other offor ~~the~~amounts ~~cost~~due ofunder ~~goods~~the ~~sold~~Venusa ~~for value~~earn-~~added~~out ~~products will be outsourced~~obligation. ~~Frost~~During ~~& Sullivan also estimates that~~ the ~~United~~second ~~States~~quarter ~~medical~~of ~~device~~fiscal ~~market will grow at 5% per~~ year ~~over~~2004, ~~the~~we ~~next~~paid ~~five years~~$9.6 million ~~Based~~of onthe ~~these~~earn-out ~~estimated~~obligation ~~increases~~ in ~~outsourcing and market growth~~ cash, we$26.0 million ~~expect that~~in ~~outsourcing of value~~Class A-~~added~~7 ~~products~~5% byConvertible ~~medical~~Preferred ~~device~~Stock ~~companies~~of inAccellent, ~~the~~and ~~United States will grow at 17% per year through 2005~~$1.3 million ~~We believe that international markets will experience similar growth rates~~ in ~~manufacturing~~phantom ~~outsourcing~~stock asof ~~the United States~~Accellent.

In Other ~~the~~Long-Term ~~past,~~Liabilities. Other ~~medical~~long-term ~~device~~liabilities ~~companies~~increased ~~relied~~from ~~very~~$13.3 million ~~little~~as onof December 31, ~~manufacturing~~2003 ~~outsourcing~~to ~~because:~~$29.6 million ~~(1)~~as ~~the~~of ~~cost~~September 30, ~~benefits~~2004. ~~of outsourcing~~This ~~were~~increase ~~not~~is asprimarily ~~important~~ due to ~~the~~a ~~limited~~$12.5 million ~~cost~~increase ~~pressures~~in ~~that~~long-term ~~existed~~restructuring ~~before~~accruals ~~managed~~for lease ~~care;~~and ~~(2)~~severance ~~they~~costs ~~were~~related ~~unwilling~~ to ~~outsource~~the toplanned aclosure ~~supply~~of ~~base~~certain ~~which,~~MedSource ~~due~~facilities. toAlso ~~the~~in ~~small~~connection ~~size~~with ~~and~~the ~~limited~~acquisition ~~capabilities~~ of ~~most~~MedSource, ~~supplier~~we ~~companies,~~increased ~~was~~our ~~not~~long-term environmental ~~prepared~~accrual ~~for~~by ~~the~~$4.8 million ~~heavy~~for ~~ramp-up~~identified ~~and~~potential ~~delivery~~clean ~~requirements~~up obligations of ~~new~~MedSource ~~product~~as ~~introductions;~~described ~~and~~in ~~(3)~~greater ~~suppliers~~detail ~~were~~in ~~typically~~the ~~diversified~~following ~~across~~paragraph. ~~several~~These ~~industries~~increases ~~and~~on ~~therefore~~other ~~did~~long-term liabilities ~~not~~were ~~focus~~partially onoffset by the ~~requirements~~payment of ~~the~~long-term ~~medical~~accrued ~~device~~interest ~~industry,~~expense ~~such~~of as$4.4 million ~~FDA compliance~~during ~~and~~the ~~medical~~first ~~quality~~nine ~~standards~~months of fiscal year 2004.

~~The~~ As of ~~medical~~September 30, ~~device~~2004, ~~industry~~we ~~has~~have ~~experienced~~provided ~~rapid~~a ~~change~~liability inof ~~the~~$8.7 million ~~past~~for ~~decade~~environmental ~~and~~clean weup matters. The United States Environmental Protection Agency, or EPA, issued ~~expect~~an ~~many~~Administrative ofConsent ~~these~~Order ~~developments~~in ~~will~~July ~~lead~~1988 ~~medical~~requiring ~~device~~UTI ~~companies~~Pennsylvania, our subsidiary, to ~~increase~~study ~~their~~and, ~~use~~if ofnecessary, ~~manufacturing~~remediate ~~outsourcing.~~the Wegroundwater ~~believe~~and ~~the~~soil ~~key~~beneath ~~drivers~~and ofaround ~~this~~its ~~increase~~plant in ~~outsourcing~~Collegeville, Pennsylvania. ~~include:~~Since

rthat time, ~~the~~UTI ~~need~~Pennsylvania ~~for~~has ~~innovation~~implemented and ~~accelerated~~is ~~time-~~operating successfully a contamination treatment system approved by the EPA. We expect to~~-market~~ incur approximately $0.2 million of ongoing operating costs during fiscal year 2004 relating to the Collegeville remediation effort. Our environmental accrual at September 30, ~~including~~2004 ~~design~~includes $3.9 million related to Collegeville. We have identified potential additional clean up obligations in connection with our acquisition of MedSource, which we estimate will result in remediation costs up to between $3.5 to $5.1 million, for ~~manufacturability~~which we have accrued $4.8 million based on our best estimate of the total remediation costs. Due to the early stage of the MedSource investigation and ~~rapid~~remediation ~~prototyping~~process, we cannot estimate the timing of the costs to ~~support~~be ~~new~~incurred. ~~product~~We ~~introductions;~~believe that the clean up of these identified environmental matters will not have a material adverse effect upon our liquidity, capital resources, business or consolidated financial position. However, one or more of such environmental matters could have a significant negative impact on our consolidated financial results for a particular reporting period.

r Our ability ~~cost~~to ~~containment~~make ~~pressures~~payments ~~from~~on ~~healthcare~~our ~~providers~~indebtedness ~~such~~and asto ~~managed~~fund ~~care~~planned ~~organizations~~capital expenditures, ~~which~~other ~~necessitate~~expenditures and long-term liabilities, and necessary working capital will depend on our ability to generate cash in the future. This, to a ~~more~~certain ~~efficient~~extent, ~~supply~~is ~~chain;~~subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. For example, Boston Scientific has informed us that it intends to transfer a number of products currently assembled by us to its own assembly operation. Based on our current level of operations, we believe our cash flow from operations and available borrowings under our new senior secured credit facility will be adequate to meet our liquidity requirements for the next 12 months and the foreseeable future. No assurance can be given, however, that this will be the case.

rOff-Balance ~~increased~~Sheet ~~competition and industry consolidation.~~Arrangements

As We ado ~~result~~not ofhave ~~these~~any ~~factors,~~"off-balance ~~medical~~sheet ~~device~~arrangements" ~~companies~~(as ~~are~~such ~~increasingly~~term ~~focusing~~is ondefined ~~their core competencies~~ in ~~research~~Item ~~and~~303 ~~sales~~of ~~and~~Regulation S-K) ~~marketing,~~that ~~and~~are ~~outsourcing other functions such as manufacturing and related~~reasonably ~~engineering~~likely ~~and~~to ~~product~~have ~~development~~a ~~activities.~~current Weor ~~believe~~future ~~that~~effect ~~the~~on ~~medical~~our ~~engineering~~financial ~~and~~condition, ~~manufacturing~~changes ~~services~~in ~~industry~~financial iscondition, ~~highly~~revenues ~~fragmented~~or ~~with over 3~~expenses,~~000~~ ~~companies,~~results ~~many~~ of ~~which~~operations, ~~have~~liquidity, ~~annual~~capital ~~revenues~~expenditures ofor ~~less~~capital ~~than $5 million and limited capabilities that do not satisfy current market requirements~~resources. ~~We believe our products and services address this market opportunity.~~

~~Our~~Contractual ~~Products~~Obligations and ~~Services~~ Commitments

We The ~~offer~~following table sets forth our ~~customers~~long-term acontractual ~~broad~~obligations ~~range~~as of ~~products~~December 31, ~~and~~2003, ~~services~~other ~~for~~than ~~their~~purchase ~~medical~~obligations, ~~engineering~~which ~~and~~we ~~manufacturing~~are ~~needs~~unable to quantify as of December 31, ~~including:~~2003 without unreasonable effort and expense due to the historical reporting limitations of our business systems (in thousands).

r Product design and development. Our product design, design for manufacturability and prototyping capabilities allow us to participate early in the product development process to help reduce our customers’ costs, accelerate product development times and secure ongoing manufacturing relationships. Equipping our facilities with rapid prototyping technologies and using these technologies across multiple disciplines (e.g., machining and plastic molding) is an important element of our product development services. In providing these services, our internal application engineering group and internal product design engineers provide our customers with expertise in desired disciplines (e.g., mechanical design, electrical design, electronics and software).

		Payment due by Period
Contractual Obligations		Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Senior notes		$	54,681	$	—	$	45,987	$	8,694	$	—
Term notes and capital leases			73,613		12,370		61,243		—		—
Revolving credit facility			11,500		—		11,500		—		—
Operating leases			10,087		3,419		3,446		1,247		1,975
Other long-term obligations(1)			13,314		266		1,616		3,068		8,364

	Total	$	163,195	$	16,055	$	123,792	$	13,009	$	10,339

(1): Other long-term obligations include environmental remediation obligations of $4.0 million, accrued interest expense of $4.4 million, accrued employee compensation and pension benefits of $3.0 million and deferred income taxes of $1.9 million.

r Following the ~~Precision~~consummation ~~metal and plastic parts manufacturing. Precision metal manufacturing is a core element~~ of ~~our~~the ~~manufacturing capabilities. Our metal manufacturing capabilities include milling~~Transactions, ~~lathe~~our ~~turning,~~long-term ~~drilling,~~contractual ~~grinding,~~obligations ~~polishing,~~changed ~~lapping,~~materially ~~laser cutting, sintering, wire forming, stamping~~ and ~~precision~~we ~~metal~~rectified ~~injection manufacturing with materials as diverse as stainless steel and titanium. Trends in~~ the ~~medical~~reporting ~~industry~~limitations ~~towards~~of ~~minimally-invasive surgical techniques have made~~ our ~~micro-machining~~business ~~capabilities increasingly important. These micro-machining capabilities include computer numerically controlled~~systems, orallowing ~~CNC,~~us to ~~multi-axis~~calculate ~~and~~in Swiss-machining, as well as electric discharge machining, or EDM. Our plastic part manufacturing capabilities include tubing (dip coating and extrusion), molding (injection, insert and thermoforming) and machining.

r Product assembly services and supply chain management. Our product assembly and supply chain management capabilities allow us to provide customers with completed medical devices and subassemblies. Our assembly capabilities include mechanical, electromechanical and instrumentation assembly, as well as functional testing, inspection, complex integration (with advanced materials), kitting and packaging. We use our supply chain management services to source components and services, either from internal operations or from third party suppliers, for the devices we assemble. Our assembly and supply chain management capabilities enable us to extend our vertically integrated manufacturing business and further distinguish us from suppliers with more limited capabilities.

We provide our products and services to each of the following primary target markets:

r Surgical instrumentation devices and components, for both the minimally invasive and general surgery markets. Surgical instruments are typically produced from metal or plastic materials and, in the case of powered products, electronic components. We manufacture a variety of surgical products for our customers such as clip appliers, endoscopic instruments, forceps, electrocautery blades, staple cartridges and suturing devices.

raccordance with ~~Electro~~commission rules our long-~~medical~~term ~~implant~~purchase ~~devices~~obligations. ~~and~~The ~~components,~~acquisition ~~for~~of ~~the~~MedSource ~~cardiac~~added ~~rhythm~~10 ~~management,~~new orleased ~~CRM,~~facilities ~~neurologic~~with future operating lease payments of $17.0 million, ~~and~~resulting in ~~hearing~~a ~~assist~~significant ~~markets~~increase in operating lease obligations from December 31, ~~including~~2003 ~~pacemakers~~to ~~and~~September 30, ~~defibrillators~~2004. ~~These~~This ~~products~~increase ~~are~~was ~~high~~partially ~~precision~~offset ~~and~~by ~~are~~payments ~~typically~~on ~~produced~~pre-MedSource acquisition ~~from~~operating ~~metal~~lease ~~and~~obligations. ~~plastic~~The ~~materials~~following ~~and~~table ~~electronic~~sets ~~components.~~forth Wethe ~~provide~~material ~~our~~changes ~~customers~~in ~~with~~our ~~laser~~long-term ~~welding~~contractual ~~services~~obligations ~~and~~as ~~manufacture~~of ~~guidewires~~September 30, ~~set~~2004 ~~screws,~~and ~~pins,~~for ~~ferrules,~~the ~~connector~~periods ~~blocks~~presented thereafter ~~and~~ending ~~other~~September 30 ~~components~~(in thousands).

r Custom interventional devices and components, for the cardiology, radiology, neuroradiology, vascular access and electrophysiology markets. Interventional products are typically produced from a combination of metal and plastic materials. We manufacture a variety of interventional products for our customers, including precision catheters, PTCA guidewires, electrophysiology catheters and distal protection devices.

		Payment due by Period
Contractual Obligations		Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
New Senior Secured Credit Facility		$	194,000	$	1,940	$	3,880	$	3,880	$	184,300
Notes			175,000		—		—		—		175,000
Operating leases			23,066		6,043		6,988		3,393		6,642
Purchase obligations			31,865		31,865		—		—		—
Other long-term obligations(1)			18,489		734		886		56		16,813

	Total	$	442,420	$	40,582	$	11,754	$	7,329	$	382,755

(1): Other long-term obligations include environmental remediation obligations of $8.7 million, accrued severance benefits of $1.4 million, accrued compensation and pension benefits of $4.2 million and deferred income taxes of $4.2 million. The increase in long-term accrued compensation and pension benefits from December 31, 2003 to September 30, 2004 is a result of Accellent phantom stock issued in connection with the Venusa earn-out obligation. The increase in deferred income taxes from December 31, 2003 to September 30, 2004 is primarily due to the acquisition of MedSource. Accrued future rental obligations of $11.1 million included in other long-term liabilities on our consolidated balance sheet as of September 30, 2004 are included in our operating leases in the table.

rCritical ~~Custom~~Accounting orthopedic devices and instruments, for the reconstructive, spinal implant and trauma markets. Orthopedic products are typically produced from metal, plastic and ceramic materials. We manufacture a variety of orthopedic implants for our customers, such as hips, knees, spinal cages, hooks and plates and instruments for the placement of these implants.Policies

Our ~~Customer~~consolidated ~~Solution~~financial statements have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We base our estimates on historical experience, current conditions and various other assumptions that are believed to be reasonable under the circumstances. Estimates and assumptions are reviewed on an ongoing basis and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Actual results could differ materially from those estimates under different assumptions or conditions. We believe the following critical accounting policies impact our judgments and estimates used in the preparation of our consolidated financial statements.

~~Our~~ Revenue ~~medical~~Recognition. The amount of product revenue recognized in a given period is impacted by our judgments made in ~~engineering~~establishing ~~and~~our ~~manufacturing~~reserve ~~capabilities~~for ~~enable~~potential future product returns. We provide a reserve for our ~~customers~~estimate toof ~~concentrate~~future ~~their~~returns ~~internal~~against ~~resources~~revenue in the period the revenue is recorded. Our estimate of future returns is based on ~~developing~~such ~~innovative~~factors ~~technologies~~as historical return data and ~~broadening~~current ~~their~~economic ~~product~~condition ~~offerings~~of our customer base. The ~~key~~amount ~~components~~ of revenue we recognize will be directly impacted by our ~~customer~~estimates ~~solution~~made ~~are:~~to establish the reserve for potential future product returns. To date, the amount of estimated returns has not been material to total net revenues. Our provision for sales returns was $0.3 million and zero at December 31, 2003 and 2002, respectively.

r Provide a single source solution. By providing a broad range of engineering, development, manufacturing, assembly and supply chain management capabilities, we offer our customers the ability to outsource all or part of the production of a device to a single provider. We have won several significant projects under which we design, manufacture and package finished devices for leading global medical device companies. In addition, we work closely with smaller, emerging medical device companies as their engineering and manufacturing partner.

r Accelerate product development cycle time. Our experience in design engineering and rapid prototyping positions us as a valuable resource early in the new product development process and enables critical processes to occur simultaneously, which reduces the overall time-to-market. We employ over 85 engineers of whom approximately 50 are devoted to new product introductions. Our engineers provide technical expertise to transform our customers’ concepts into finished devices that can be efficiently manufactured on a commercial scale.

r Provide quality products and practices. Quality is of the highest importance to our customers due to the serious and costly consequences of product failure. We operate our facilities under a single integrated quality system and they comply with the ISO 9001 quality management standard and ISO 13485 medical device-specific standard. We believe that our quality system also complies with FDA quality system regulations.

r Reduce costs for customers. We reduce our customers’ total costs associated with manufacturing by:

– designing for manufacturability;

– providing purchasing power on raw materials and machinery; and

– delivering manufacturing processes that lower costs through increased efficiencies and continuous improvement efforts.

In addition, by offering a single source solution encompassing design, engineering, manufacturing and other services such as assembly, sterilization and packaging, we are able to lower the total cost of the products that we deliver to our customers by designing optimal manufacturing processes and reducing coordination costs, redundant engineering and overhead related to quality and purchasing.

r Allowance ~~Offer~~for ~~financial~~Doubtful ~~stability~~Accounts. We ~~believe~~estimate the ~~medical~~collectibility ~~engineering~~of ~~and~~our ~~manufacturing~~accounts ~~services~~receivable ~~industry~~and ~~includes~~the ~~over~~related ~~3,000~~amount ~~companies, many~~ of ~~which~~bad debts ~~have~~that ~~annual~~may ~~revenues~~be ofincurred ~~less~~in ~~than~~the ~~$5 million~~future. WeThe ~~believe~~allowance ~~our~~for ~~customers~~doubtful ~~prefer~~accounts ~~working~~results ~~with~~from ~~large~~an ~~and~~analysis ~~well~~of ~~capitalized~~specific ~~medical~~customer ~~engineering~~accounts, ~~and~~historical ~~manufacturing service providers such as MedSource~~experience, ~~who~~credit ~~can~~ratings ~~ensure~~and acurrent ~~stable~~economic ~~supply~~trends. Based ofon ~~products~~this ~~and services. Additionally~~analysis, we ~~have~~provide ~~the~~allowances ~~financial~~for ~~capacity~~specific toaccounts ~~allow~~where uscollectibility tois ~~respond~~not ~~rapidly~~reasonably ~~to our customers’ requirements, such as higher production volumes~~assured.

~~Our~~ Provision ~~Strategy~~for Inventory Valuation. Inventory purchases and commitments are based upon future demand forecasts. Excess and obsolete inventory are valued at their net realizable value, which may be zero. We periodically experience variances between the amount of inventory purchased and contractually committed to and our demand forecasts, resulting in excess and obsolete inventory valuation charges.

~~Our~~ Valuation ~~objective~~of Goodwill. Goodwill is tothe beexcess of the ~~leading~~purchase ~~medical~~price ~~engineering~~over ~~and~~the ~~manufacturing~~fair value of identifiable net assets acquired ~~services~~in ~~provider~~business tocombinations. ~~established,~~In asaccordance ~~well~~with asSFAS ~~emerging~~No. 142, ~~medical~~goodwill ~~device~~is ~~companies~~assigned to the reporting unit expected to benefit from the synergies of the combination. We ~~expect~~have assigned our goodwill to three ~~grow~~reporting byunits. ~~focusing~~Goodwill ~~our~~for ~~sales~~each ~~and~~reporting ~~marketing~~unit ~~teams~~is onsubject ~~cross-selling~~to ~~our~~an ~~design~~annual ~~and~~impairment ~~engineering~~test, ~~manufacturing~~or more often if impairment indicators arise, ~~assembly~~using a fair-value-based approach. In assessing the fair value of goodwill, we make projections regarding future cash flow and ~~supply~~other ~~chain~~estimates, ~~management~~and may utilize third party appraisal services. toIf these projections or other estimates for ~~both~~one ~~existing~~or ~~customers~~all ~~and~~of ~~new~~these ~~customers~~reporting units change, we may be required to record an impairment charge.

~~The~~ Valuation ~~key~~of ~~elements~~Long-lived Assets. Long-lived assets are comprised of ~~our~~property, ~~business~~plant ~~strategy~~and ~~include:~~equipment and intangible assets with finite lives. We assess the impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable through projected undiscounted cash flows expected to be generated by the asset. When we determine that the carrying value of intangible assets and fixed assets may not be recoverable, we measure impairment by the amount by which the carrying value of the asset exceeds the related fair value. Estimated fair value is generally based on projections of future cash flows and other estimates, and guidance from third party appraisal services.

r Environmental ~~Focus on manufacturing excellence and leading process technologies~~Reserves. We ~~are~~accrue ~~committed~~for toenvironmental ~~maintaining~~remediation ~~and~~costs ~~improving~~when ~~our~~it ~~manufacturing~~is ~~processes~~probable ~~and~~that ~~services,~~a ~~which~~liability wehas ~~believe~~been ~~has~~incurred and ~~made~~a usreasonable ~~one~~estimate of the ~~most~~liability ~~efficient~~can ~~and~~be ~~high~~made. ~~quality~~Our ~~medical~~remediation ~~engineering~~cost ~~and~~estimates ~~manufacturing~~are ~~services~~based ~~providers.~~on ~~Our~~the ~~manufacturing~~facts ~~capabilities~~known ~~are~~at ~~supported~~the bycurrent ~~advanced~~time ~~manufacturing~~including ~~process~~consultation ~~technologies~~with ~~and~~ a ~~strong~~third ~~culture~~party ofenvironmental specialist ~~continuous~~and ~~improvement~~external legal counsel. WeChanges ~~are~~in ~~implementing~~environmental alaws, ~~manufacturing~~improvements ~~strategy~~in ~~founded~~remediation ontechnology ~~the~~and ~~principles~~discovery of ~~employee~~additional ~~excellence,~~information ~~technology~~concerning ~~deployment,~~known ~~quality-driven~~or ~~operations,~~new anenvironmental ~~integrated~~matters ~~low-cost~~could affect ~~manufacturing~~our ~~network,~~operating ~~lean manufacturing and customer satisfaction~~results.

r Pension ~~Strengthen our customer relationships by collaborating in the design~~ and ~~engineering~~Other ofEmployee ~~new products~~Benefits. Certain ~~Working~~assumptions ~~closely~~are ~~with~~used ~~customers~~ in the ~~design~~calculation ~~and engineering~~ of ~~new~~the ~~products~~actuarial ~~provides~~valuation ~~significant~~of ~~opportunity~~our defined tobenefit ~~anticipate~~pension ~~customers’~~plans. ~~needs~~These ~~and~~assumptions ~~secure~~include ~~ongoing~~the ~~manufacturing~~weighted ~~relationships.~~average ~~Increasingly~~discount rate, ~~our~~rates ~~customers~~of ~~provide~~increase ~~only~~in ~~functional~~compensation orlevels ~~system performance specifications~~ and ~~request~~expected ~~that~~long-term werates ~~provide much~~ of ~~the~~return ~~design~~on ~~and engineering specifications associated with new products or product modifications~~assets. ~~Our~~If actual ~~ability~~results toare ~~provide~~less ~~product~~favorable ~~design~~than ~~and~~those ~~development~~projected ~~services~~by ~~enables~~management, usadditional toexpense ~~secure~~may ~~long~~be ~~term manufacturing relationships for finished devices, sub-assemblies and components~~required.

r Income ~~Drive~~Taxes. We ~~additional~~estimate ~~component~~our ~~manufacturing~~income ~~business~~taxes byin ~~continuing~~each toof ~~expand~~the ~~our~~jurisdictions ~~device~~in ~~assembly~~which ~~services~~we operate. AsThis weprocess ~~increase~~involves estimating our ~~assembly~~actual ~~business,~~current wetax ~~have~~exposure ~~the~~together ~~opportunity~~with toassessing ~~also~~temporary ~~increase~~differences ~~our~~resulting ~~manufacturing~~from differing treatment of ~~components~~items, ~~because~~such ~~the~~as ~~assembler~~goodwill amortization, orfor ~~sub-assembler~~tax and accounting purposes. These differences result in deferred tax assets and liabilities, ofwhich aare ~~device~~included ~~typically~~within ~~controls~~our ~~the~~consolidated ~~source~~balance ofsheet. ~~the~~We ~~components~~then ~~used~~assess inthe likelihood that ~~device.~~our ~~Our~~deferred ~~manufacturing~~tax ~~capabilities~~assets ~~position~~will usbe ~~well~~recovered tofrom future ~~produce~~taxable ~~many~~income ofand to the ~~components~~extent ~~for~~we believe that recovery is not likely, we establish a valuation allowance. To the ~~products~~extent we ~~assemble~~establish a valuation allowance or increase this allowance in a period, we increase or decrease our income tax provision in our consolidated statement of operations. If any of our estimates of our prior period taxable income or loss prove to be incorrect,

r Pursue product line transfers and acquisitions of customers’ manufacturing assets. We believe that the transfer of the manufacturing responsibility for product lines and our acquisition of customer manufacturing facilities will provide a vehicle for substantial growth, as well as a mechanism to develop closer relationships with leading medical device companies. These transactions allow our customers to reduce capital employed and focus resources on their core competencies, including research and sales and marketing. During October 2001, we acquired a manufacturing assembly facility for a product line from one of our major customers, a leading medical device company. As part of this transaction, we signed a multi-year supply agreement with this customer. We believe that product line transfers and asset acquisitions of this kind are becoming increasingly attractive to our customers.

r Selectively acquire new companies. We plan to make select acquisitions of complementary medical engineering and manufacturing services providers that bring desired capabilities, customers or geographic coverage and either strengthen our position in our target markets or provide us with a significant presence in a new market. We have an experienced business development team focusing on acquisitions and integrating these acquisitions into our operations. Since our formation through the acquisition of seven companies in March 1999, we have completed five additional acquisitions. We believe that our ability to identify, close and integrate acquisitions is a competitive advantage.

Wematerial differences ~~intend~~could toimpact ~~continue~~the toamount ~~build our brand name~~ and ~~deploy~~timing ~~our~~of ~~sales~~income ~~and~~tax ~~marketing~~benefits ~~team,~~or aspayments ~~well as~~for toany ~~use our information technology infrastructure, to further implement our strategy~~period. ~~In addition, we believe that our scale and resources provide our customers with security and reliability.~~

~~Sales~~Quantitative and ~~Marketing~~Qualitative Disclosures About Market Risk

~~Our~~Market sales organization uses a team approach that integrates approximately 50 account managers, application engineering managers, customer support managers and project managers. This team approach is designed to allow us to serve our customers while providing a single point of contact through each phase of a project. We believe this customer team approach distinguishes us by enabling us to handle complex projects involving outsourcing of completed medical devices from design to delivery. Risk

We ~~have~~are asubject ~~group~~to ofmarket ~~applications~~risk ~~engineering~~associated ~~managers~~with ~~who~~change ~~are trained~~ in ~~our~~interest ~~various~~rates ~~manufacturing technologies~~ and ~~processes.~~foreign ~~These~~currency ~~managers~~exchange ~~assist our customers’ engineering groups and our sales professionals by specifying the best manufacturing technology for a particular device or component~~rates. ~~These managers are supported by our process experts in each of the facilities who provide functional expertise in each of the various manufacturing processes.~~

~~Our~~Interest ~~market~~Rate development team provides strategic marketing support to our sales and operations organizations. Market development helps to optimize the allocation of our sales and application engineering resources across our four key target markets and aligns their efforts with our manufacturing capabilities and capacity. In addition, this team plays an important role in tailoring our broad product and service offerings, including key account and market strategies, pricing strategies, capability bundling strategies, marketing campaigns and establishing strategic alliances with business partners in each of our target markets.Risk

We ~~invest~~are ~~significant~~subject ~~resources~~ to ~~develop~~market risk associated with change in the ~~MedSource~~London ~~brand~~Interbank ~~name~~Offered Rate (LIBOR) and the Federal Funds Rate published by ~~participating~~ inthe aFederal ~~number~~Reserve Bank of ~~medical~~New ~~related~~York ~~tradeshows,~~in ~~including~~connection ~~medical~~with ~~design~~our ~~and~~new ~~manufacturing~~senior ~~shows~~secured incredit facility. Based on the ~~United~~outstanding ~~States~~balance ~~and~~at ~~Europe~~September 30, ~~and~~2004, bya ~~advertising~~hypothetical ~~our~~10% ~~capabilities~~change in arates ~~number~~under ofthe ~~medical~~new ~~device~~senior ~~and~~secured credit ~~equipment~~facility ~~industry~~would ~~magazines~~result ~~and~~in ~~trade publications~~a change to our annual interest expense of approximately $0.9 million.

~~Customers~~Foreign Currency Risk

We ~~serve~~operate ~~leading~~some ~~medical~~facilities ~~device~~in ~~companies~~foreign ~~as well as many other private and public emerging medical device companies~~countries. ~~During~~At ~~fiscal~~December 31, ~~2001~~2003, weapproximately ~~had~~$5.0 million ~~sales~~of tolong-lived ~~over~~assets ~~200~~were ~~medical~~located ~~device~~in foreign ~~companies,~~countries. ~~and~~Our ~~our~~principal ~~customers~~currency ~~include~~exposures ~~eight~~relate ofto the ~~largest ten medical device companies (by revenues)~~Euro, ~~including~~British ~~Boston~~pound ~~Scientific, Guidant, Johnson & Johnson affiliates~~ and ~~Medtronic~~Mexican pesos. ~~Johnson~~We &consider ~~Johnson~~the ~~affiliates~~market ~~and~~risk ~~Medtronic~~to ~~each~~be ~~accounted~~low, ~~for~~as ~~more~~the ~~than~~majority ~~10%~~ of ~~our~~the ~~revenues~~transactions ~~during~~at ~~our~~these ~~year ended June 30, 2001~~locations ~~and~~are ~~during~~denominated ~~our~~in ~~three~~the ~~months~~local ~~ended September 30, 2001~~currency.

WeNew ~~work~~Accounting with our customers on a product by product basis and often work with many different divisions of our largest customers. To date, most of our new sales have been made to existing customers that, we believe, have typically ordered new products from us based upon their previous satisfactory experiences. The products that we manufacture are made to order based on the customer’s specifications and may be designed using our design and engineering services. Our customers retain ownership of and the rights to their product’s design while we generally retain the rights to any of our proprietary manufacturing processes. Pronouncements

~~Information~~ In ~~Technology~~December 2003, the FASB issued SFAS No. 132 (revised 2003) "Employers' Disclosures about Pensions and Other Post-retirement Benefits." This standard increases the existing disclosure requirements by requiring more details about pension plan assets, benefit obligations, cash flows, benefit costs and related information. The expanded disclosures require that plan assets be segregated by category, such as debt, equity and real estate, and that disclosures on certain expected rates of return be incorporated. SFAS No. 132 (R) also will require the us to disclose various elements of pension and post-retirement benefit costs in interim-period financial statements. The Company adopted SFAS No. 132 (R) on January 1, 2004. The adoption did not have an impact on the Company's condensed statements of consolidated earnings, financial position or cash flows.

We believe that our use of information technology will be a competitive advantage. We are installing the Oracle 11i enterprise resource planning, or ERP, system in all of our facilities. We successfully completed the implementation at our initial site and are in the process of installing the Oracle 11i software and business processes at additional sites. We also installed the Oracle integrated financial reporting system at all locations and generally convert newly acquired facilities to this system within six months to one year. In addition, we have standardized our computer aided design, or CAD, and computer aided manufacturing, or CAM, software at our facilities.

We ~~expect these systems to provide several key benefits to us, our customers and our suppliers.~~ ~~The~~ systems enable the sharing of customer, supplier and engineering data across our company. We believe that this will enable us to better understand and predict customer demand, take advantage of economies of scale, provide greater flexibility to move product design between sites and improve the accuracy of capturing and estimating our manufacturing and engineering costs. In addition, the systems provide greater visibility into the operations of the enterprise through integrated financial and management reporting capabilities. This system also benefits our suppliers by giving them more accurate and timely information about our requirements. Overall, these systems will provide the infrastructure that will enable us to provide additional value to our customers through improved supply chain management capability, reduced costs and accelerated product development. BUSINESS

~~Manufacturing~~ Overview

To On ~~achieve~~April 27, ~~excellence~~2004, inwe ~~manufacturing~~entered into an Agreement and Plan of Merger pursuant to which, on June 30, 2004, we ~~combine~~acquired ~~advanced~~MedSource ~~manufacturing~~by ~~technology,~~merging ~~such~~it aswith our ~~CAD/CAM~~wholly owned subsidiary, ~~with~~Pine ~~manufacturing~~Merger ~~techniques~~Corporation, ~~such~~which asmerger ~~just-~~resulted in~~-time~~ ~~manufacturing~~MedSource and ~~total~~its ~~quality~~subsidiaries ~~management,~~becoming orour ~~TQM.~~wholly ~~Just-in-time~~owned ~~manufacturing~~subsidiaries. isAs a ~~production~~result ~~technique~~of ~~that~~our ~~minimizes~~completion ~~work-in-process~~of ~~inventory~~the ~~and~~MedSource acquisition, ~~manufacturing~~we ~~cycle~~believe ~~time~~we ~~while~~are ~~enabling delivery~~the largest provider of ~~products~~outsourced toprecision ~~customers~~manufacturing and engineering services in ~~the~~our ~~quantities~~target ~~and~~markets ~~time~~of ~~frame~~the ~~required~~medical device industry. ~~TQM~~Our istarget amarkets ~~management~~are ~~philosophy~~the leading ~~that~~medical ~~seeks~~device tocompanies ~~impart~~that ~~high~~serve ~~levels~~the ofcardiology, ~~quality~~endoscopy inand ~~every~~orthopaedics ~~operation~~end markets. ~~TQM~~We ishad ~~accomplished~~net bysales ~~setting~~of ~~quality~~$369.7 million ~~objectives~~ for ~~every~~the ~~operation, tracking~~twelve ~~performance~~months ~~against~~ended ~~those~~December 31, ~~objectives~~2003, ~~identifying~~on ~~work~~a pro ~~flow~~forma basis, and, ~~policy~~as ~~changes~~a ~~required~~result toof ~~achieve~~our ~~higher~~completion ~~quality~~of ~~levels,~~the ~~and~~MedSource ~~committing~~acquisition, ~~executive~~now ~~management~~have toover ~~support~~20 ~~changes~~facilities ~~required~~in tofive ~~deliver higher quality~~countries.

To We offer ~~serve~~ our ~~market~~customers asdesign aand ~~comprehensive manufacturing solution for medical device companies~~engineering, weprecision ~~address~~component ~~customers’ requirements from a “quote-to-order~~manufacturing,” ~~“order-to-fill”~~device assembly and asupply ~~post-order~~chain ~~perspective~~management services. We have ~~identified~~extensive ~~the~~resources ~~key~~focused ~~processes~~on ~~within~~providing our ~~this~~customers ~~structure~~reliable, ~~and~~high ~~are~~quality, ~~currently~~cost-efficient, ~~implementing~~integrated ~~standard~~outsourced ~~operating procedures to create a seamless process within our organization structure and with our customers~~solutions. ~~This~~We ~~approach~~often tobecome ~~customer~~the ~~service~~sole issupplier ~~vital~~of inmanufacturing ~~maintaining~~ and ~~developing~~engineering ~~customer~~services ~~relationships~~for ~~and~~the ~~differentiating~~products uswe provide ~~from~~to our ~~competitors~~customers.

We provide ~~intend~~multiple tostrategic ~~continue~~benefits to ~~offer~~ our customers. ~~advanced~~Our ~~manufacturing~~design ~~process~~and ~~technologies~~engineering, ~~which~~precision ~~currently~~component ~~include computer integrated~~ manufacturing, ~~CNC~~device ~~machines,~~assembly ~~laser~~and ~~cutting, injection~~supply ~~molding,~~chain ~~stamping,~~management ~~dip~~services ~~coating,~~provide multiple ~~extruding~~strategic ~~and~~benefits to our ~~patented precision metal injection manufacturing~~customers. ~~Our~~We ~~flexible~~help ~~manufacturing~~speed ~~capability~~our ~~allows~~customers' usproducts to ~~efficiently~~market, ~~produce~~lower ~~both~~their ~~high-volume~~manufacturing ~~products~~costs and ~~low-volume~~enable ~~products.~~our ~~Our~~customers ~~investment in new equipment will position us~~ to ~~continue~~focus toon ~~provide~~their ~~efficient~~core ~~and~~competencies, ~~flexible~~including research, ~~medical~~sales ~~engineering~~ and ~~manufacturing services to medical device companies~~marketing.

We have ~~operate~~developed ~~a multi~~long-~~facility~~term ~~manufacturing~~relationships ~~network~~with ~~strategically~~our ~~located~~largest ~~throughout~~customers. In many cases, we have been doing business with these customers for over 10 years. We work closely with our customers in the ~~United~~design, ~~States~~testing, prototyping, validation and inproduction ~~Mexico~~of their products and processes. InMany ~~addition~~of tothe ~~providing~~end ~~redundancy~~products inwe produce for our customers are regulated by the FDA, ~~event~~which has stringent quality standards for manufacturers of anmedical ~~unexpected~~devices. ~~disaster~~Because of these stringent standards, ~~this~~multiple validations of our manufacturing ~~network~~ ~~helps~~process usare required by both our customers and the FDA to ~~better~~ensure ~~meet~~high quality, reliable production. This joint investment of time and process validation between us and our customers’ ~~needs~~creates high switching costs for transferring product lines once a product begins production. Typically, once our customers have begun production of a certain product with us, they do not move their products to another supplier.

~~Quality~~ We generate a recurring revenue base from a diverse range of products used in a number of cardiovascular, endoscopic and orthopaedic applications. The majority of our net sales come from products we consider high value, single use products. These products are either regulated for single use, implanted into the body or considered too critical to be re-used. Our revenue base has grown through a combination of our customers' end market growth and their increased outsourcing of products to us. This growing revenue base is made up of a diversified product mix with limited technology or product obsolescence risk. We manufacture many products that have been used in medical devices for over 10 years, such biopsy instruments, joint implants, pacemakers and surgical instruments. Even as our customers' end market products experience new product innovation, we continue to supply the base products and services across end market product cycles. In addition, for the twelve months ended December 31, 2003, on a pro forma basis, our non-medical operations accounted for approximately 9.6% of our net sales. For fiscal year 2003 and the first nine months ended September 30, 2004, on a

We believe that product quality is a critical success factor in the medical engineering and manufacturing services market. We strive for continuous improvements of our processes and have adopted a number of quality improvement and measurement techniques to monitor our performance.

We operate our facilities under a single integrated quality system and they comply with the ISO 9001 quality management standard and the ISO 13485 medical device-specific quality management standard. The ISO 9001 standard specifies quality system requirements for product design and production. ISO 13485 establishes additional, more specific requirements for medical devices in particular. Newly acquired facilities are promptly brought into conformity with our integrated quality system, generally within six months to one year. We believe our quality system also complies with FDA quality system regulations with respect to all of our products, services and internal processes. With our integrated company-wide quality system in place, customers are able to audit select MedSource facilities knowing that every facility that has been integrated into the system is subject to the same quality system and process controls, as applicable to the facility’s particular operations. This system can provide significant time and cost savings for customers, as well as reduced risk of non-conforming products resulting in customer dissatisfaction, product recall or patient adverse events.

~~Supply~~pro forma ~~Arrangements~~basis assuming the acquisition of MedSource occurred on January 1, 2003, our net sales by end market were:

We have established relationships with many of our materials providers. However, most of the raw materials that are used in our products are subject to fluctuations in market price. In particular, the prices of stainless steel, titanium and platinum have historically fluctuated, and the prices that we pay for these materials, and, in some cases, their availability, are dependent upon general market conditions. In the short term, we generally cannot pass these cost increases on to our customers.

	Twelve Months Ended December 31, 2003		Nine Months Ended September 30, 2004
Endoscopy	50.0	%	51.5	%
Cardiology	33.6	%	32.1	%
Orthopaedic	6.8	%	7.8	%
Non-medical	9.6	%	8.6	%

	100.0	%	100.0	%

~~Our~~Industry current capabilities do not include all elements that are required to satisfy all of our customers’ requirements. As we increasingly position ourselves to provide our customers with a fully integrated supply chain solution, we may rely increasingly on third party suppliers, subcontractors and other outside sources for components or services. Background

To Medical ~~date~~Device End Markets. As a leading provider of precision manufacturing and engineering services to our target markets within the medical device industry, we ~~have~~benefit ~~not~~from ~~experienced~~the ~~any~~size ~~difficulty~~of ~~obtaining~~and ~~necessary~~growth ~~raw~~in ~~materials~~our orcustomers' ~~subcontractor~~end markets. We are focused on the leading companies in the medical device industry in the cardiovascular, endoscopy and orthopaedics end markets. We believe that these end markets are attractive based on their large size, growth, customer dynamics, competitive environment and need for the high-quality engineering and manufacturing services we offer.

~~Intellectual~~ We believe ~~Property~~the demand for medical devices in our targeted markets is expected to continue to grow primarily as a result of:

•: Aging Population. The average age of the U.S. population is expected to increase significantly over the next decade. According to U.S. Census data, the total U.S. population is projected to grow approximately 10% from 2000 to 2010, while the number of individuals in the U.S. over the age of 65 is projected to grow 15% during the same period. As the average age of the population increases, the demand for medical products and services, including medical devices, is expected to increase.
•: Active Lifestyles. As people are living longer, more active lives, utilization of medical devices such as orthopaedic implants and arthroscopy devices is increasing. In addition, in order to maintain this active lifestyle, patients demand more functional, higher technology devices.
•: Advances in Medical Device Technology. The development of new medical device technology and minimally invasive procedures is driving growth in the medical device market. Examples include neurostimulation, drug-eluting stents and innovative pacemakers, which are experiencing rapid adoption in the medical community because of the significant patient benefits.

The products that we manufacture are made to order based on the customer’s specifications and may be designed using our design and engineering services. Our customers retain ownership of and the rights to their product’s design while we generally retain the rights to any of our proprietary manufacturing processes.

We rely on a combination of patents, licenses, trade secrets and know-how to establish and protect the proprietary rights to our technologies and products. We have been issued patents in the United States and select foreign countries in connection with our guidewire technology, plastic tubing manufacturing processes and precision metal injection manufacturing processes.

In addition, we are a party to several license agreements with third parties pursuant to which we have obtained, on varying terms, non-exclusive rights to patents held by third parties in connection with precision metal injection manufacturing technology.

It is our policy to require all employees, consultants and other parties to execute confidentiality agreements. These agreements prohibit disclosure of confidential information to third parties except in specified circumstances. In the case of employees and consultants, the agreements generally provide that all confidential information relating to our business is the exclusive property of MedSource.

We have an agreement with one of our employees that provides him with an exclusive license to our precision metal injection technology for use only outside the medical industry in the event that his employment terminates. In the event that the employee is terminated by us without cause, the license will be royalty-free. Otherwise, we will receive royalties from any sublicense of these intellectual property rights by the employee. In addition, we must obtain the employee’s consent if we desire to sublicense or exploit this technology for non-medical applications.

Competition

We compete with different companies depending on the type of product or service offered or the geographic area served. Our management believes that the primary basis of competition in our targeted markets is existing customer relationships, as well as reputation, quality, delivery, responsiveness, breadth of capabilities and price. We are not aware of a single competitor that operates in all of our target markets or offers the same range of products and services that we offer. To remain competitive, we must continue to provide a single source solution, accelerate product development time, provide quality products and practices, reduce costs for our customers and offer financial stability.

~~Our~~ The chart ~~existing~~below orprovides ~~potential~~examples ~~competitors include the internal operations~~ of ~~medical~~customer ~~device~~products ~~companies themselves and other medical engineering and manufacturing services providers. Other medical engineering and manufacturing services providers currently compete~~ in ~~some~~our ~~but~~targeted ~~not all of the same target~~ markets ~~that~~and ~~we do. We believe that~~ the ~~medical~~products ~~engineering~~ and ~~manufacturing~~ services ~~industry is highly fragmented with over 3,000 companies~~ that ~~have~~we ~~limited~~provide ~~manufacturing~~for ~~capabilities~~each ~~and limited sales and marketing expertise. Many~~ of ~~these~~the ~~3,000~~customer ~~companies~~end ~~have less than $5 million in annual revenues from to medical device companies~~products.

Government Regulation

Market			Customer Devices/Products		Our Products and Services
*Cardiovascular*
	Interventional Cardiology	•	Stents	•	Stent tubing, stents, mandrels
		•	Rotational artery clearing device	•	Ground guidewires, tubular drive components
		•	Guidewires, delivery systems	•	Marker bands, catheter shafts, tooling mandrels, corewires, guidewire assemblies
	Cardiac Rhythm Management	•	Pacemakers	•	Implantable electrodes,
		•	Implantable defibrillators		connector blocks, lugs
				•	Electrodes & leads
	Cardiac Surgery	•	Heart immobilization devices	•	Machined tubing
		•	Heart valves	•	Machined valve bodies and leaflets
	Interventional Neurology	•	Implantable coils	•	Wire coiling
		•	Catheters/delivery systems	•	Guidewires
	Peripheral Vascular	•	Stents	•	Stents, stent tubing, guidewires,
		•	Delivery systems		hypotubing

We are a medical engineering and manufacturing services provider. Some of the products and components of products that we manufacture may be considered finished medical devices, and the manufacturing processes used in the production of finished medical devices are subject to FDA inspection and assessment, and must comply with FDA quality system regulation. Our products must also comply with state and foreign requirements. Also, in order to comply with regulatory requirements, our customers may wish to audit our operations to evaluate our quality systems. Accordingly, we routinely permit audits by our customers.

In addition, the FDA and state and foreign governmental agencies regulate many of our customers’ products as medical devices. FDA approval is required for those products prior to commercialization in the United States, and approval of regulatory authorities in other countries may also be required prior to commercialization in those jurisdictions. Moreover, in the event that we build or acquire additional facilities outside the United States, we will be subject to the medical device manufacturing regulations of those countries. Some other countries may rely upon compliance with United States regulations or upon ISO certification as sufficient to satisfy certain of their own regulatory requirements for a product or the manufacturing process for a product.

Other than as described in the prior two paragraphs, our business is not subject to direct governmental regulation other than the laws and regulations generally applicable to businesses in the jurisdictions in which we operate, including those federal, state and local environmental laws and regulations governing the emission, discharge, use, storage and disposal of hazardous materials and the remediation of contamination associated with the release of these materials at our facilities and at off-site disposal locations. Our manufacturing activities involve the controlled use of, and some of our products contain, small amounts of hazardous materials. Liabilities associated with hazardous material releases arise principally under the Clean Water Act, the Clean Air Act, the Resource Conservation and Recovery Act and the Comprehensive Environmental Response, Compensation and Liability Act and analogous state laws which impose strict, joint and several liability on owners and operators of contaminated facilities and parties that arrange for the off-site disposal of hazardous materials. We are not aware of any material noncompliance with the environmental laws currently applicable to our business and we are not subject to any material claim for liability with respect to contamination at any company facility or any off-site location. We cannot assure you, however, that we will not be subject to such environmental liabilities in the future as a result of historic or current operations.

Properties

Market			Customer Devices/Products		Our Products and Services
*Endoscopy*
	Laparoscopy/Gynecology	•	Harmonic scalpel blades	•	Blade assemblies
		•	Breast biopsy devices	•	Tubular components, MIM jaws
		•	Trocars		and anvils, stamped
		•	Infertility devices		components
				•	Tubular components and complete assemblies
				•	Tubular machined components
				•	Complete finished devices
	Arthroscopy	•	Shaver blades	•	Blade assemblies
		•	Arthroscopes	•	Arthroscope tubing
		•	Suture anchors	•	Machined anchors, drivers
	Urology	•	Stone retrieval baskets	•	Wire grinding
		•	Thermal tumor shrinkage	•	Catheter design and fabrication
		•	Bladder stapling devices	•	Finished goods
	Gastrointestinal	•	Biopsy forceps	•	Complete assembly, supply chain management
				•	MIM jaws
				•	Plastic catheters
				•	Plastic injection molded assemblies
	Ophthalmology	•	Ultrasonic tips	•	Micro tube drawing and machining
	Drug Delivery	•	Drug pumps	•	Case stamping
				•	Hypotube needle fabrication
	Wound Closure	•	Stapling devices	•	Stamped components
				•	Anvils
				•	Tubular components

Currently, our principal operations are conducted at the following locations:

Market			Customer Devices/Products		Our Products and Services
*Orthopaedics*
	Joint Replacement	•	Prosthetic joints, hips, knees,	•	Machined trial joints
			elbow, knuckles	•	Forged hip joint components
		•	Implantation instruments	•	Machined drills, reamers, taps
	Spinal	•	Spinal fusion plates screws,	•	Machined plates and fixation
		•	Spinal instruments, drills, burrs		screws
		•	Spinal hooks, rods	•	Forged instruments
				•	Machined components
	Trauma	•	Long bone nails, screws	•	Orthopaedic tubing
		•	Compression plating	•	Machined fixation screws

Location	Approx. Square Feet	Leased/ Owned
Brimfield, Massachusetts	30,000	Owned
Brooklyn Park, Minnesota	70,000	Leased
Corry, Pennsylvania	40,000	Leased
Danbury, Connecticut	87,000	Leased
E. Longmeadow, Massachusetts	15,000	Leased
Englewood, Colorado	35,000	Leased
Laconia, New Hampshire	31,000	Leased
Minneapolis, Minnesota(a)	7,000	Leased
Navojoa, Mexico	38,000	Leased
Newton, Massachusetts	69,000	Leased
Norwell, Massachusetts	37,000	Leased
Orchard Park, New York	41,000	Leased
Pittsfield, Massachusetts	26,000	Owned
Redwood City, California	28,000	Leased
Santa Clara, California	10,000	Leased
Trenton, Georgia	42,000	Leased
Total	606,000

Medical Device Companies in Our Key Target End Markets Are Outsourcing Manufacturing. As medical devices have become more technically complex, the demand for precision manufacturing capabilities and related engineering services has increased significantly. Many of the leading medical device companies in our targeted markets are increasingly utilizing third-party manufacturing and engineering providers as part of their business and manufacturing strategies. Outsourcing allows medical device companies to take advantage of the manufacturing technologies, economies of scale and

(a) Corporate offices.

We believe these facilities and the manufacturing and assembly capacity they provide are adequate for our current and foreseeable purposes and that additional space and capacity will be available when needed.

Employees

We currently employ over 1,350 people. None of our employees is represented by a labor union. We have not experienced any work stoppages, and we consider our relations with our employees to be good.

Litigation

From time to time, we are involved in legal proceedings in the ordinary course of our business. We are not currently involved in any pending legal proceedings that we believe could have a material adverse effect on our financial position or results of operations.

~~MANAGEMENT~~supply chain management expertise of third-party manufacturers. Outsourcing also enables medical device companies to concentrate on their core competencies in research, sales and marketing.

~~The~~ Medical device ~~following~~companies ~~table~~carefully ~~sets~~select ~~forth~~their ~~our~~manufacturing ~~directors,~~and ~~executive~~engineering ~~officers~~outsourcing partners. Medical devices companies require stringent validation processes and ~~key~~manufacturing standards ~~employees~~to ensure high quality production and ~~their~~reliable ~~ages~~delivery. asThe validation and approval process for third-party manufacturing requires a significant amount of ~~January~~time 15and engineering resources. This may also include inspection by the FDA of the manufacturing facilities in connection with products undergoing premarket review. As a result, ~~2002~~we believe that medical device companies increasingly seek to reduce the number of suppliers they use by consolidating their manufacturing with a limited number of strategic partners. We believe medical device companies are choosing their strategic outsourcing partners based on the partner's ability to:

•: Provide comprehensive precision manufacturing and engineering capabilities
•: Assist in rapid time-to-market and time-to-volume manufacturing requirements
•: Deliver consistently high quality and highly reliable products at competitive prices
•: Manage a global supply chain

Name	Age	Position
Richard Effress	31	Chairman of the Board, Chief Executive Officer and Co-founder
Joseph Caffarelli	56	Senior Vice President, Chief Financial Officer and Treasurer
Dan Croteau	36	Vice President—Corporate Development
Jim Drill	37	Vice President—Sales and Marketing
Bill Ellerkamp	42	Vice President—Market Development
Karl Hens	41	Vice President—Technology
Rick McWhorter	53	Senior Vice President—Operations
Ralph Polumbo	50	Vice President—Human Resources and Integration
Rich Snider	50	Vice President—New Product Introduction
Douglas Woodruff	44	Vice President—Regulatory Affairs and Quality Assurance
Joseph Ciffolillo (b)	63	Director
John Galiardo (a)(b)	68	Director
Wayne Kelly	39	Director and Vice President
William Kidd	60	Director and Co-founder
T. Michael Long (a)(b)	58	Director
Ross Manire (a)(b)	49	Director

The significant resources invested in selecting and validating a third-party manufacturing partner often result in long-term relationships.

( Growth in Outsourced Manufacturing Services. We believe our target market is represented by the amount of engineering and manufacturing services outsourced by the leading medical device companies to third-party manufacturers. Our target market is growing through a) ~~Member~~combination of growth in our customers' end markets and an increase in the ~~Compensation~~amount of manufacturing and ~~Benefits~~engineering ~~Committee~~services outsourced to third-party providers.

~~(b)~~ We believe ~~Member~~our ofcurrent target market will continue to increase due to both the ~~Audit~~growth ~~Committee~~in medical device end markets and an increase in outsourcing by medical device companies. Key factors driving growth in outsourcing include:

•: Desire to Accelerate Time-to-Market. The leading medical device companies are focused on research, sales and marketing in order to maximize the commercial potential from new products. For these new products, the medical device companies are attempting to reduce development time in order to bring products to market faster and compete more effectively. Outsourcing enables medical device companies to accelerate time-to-market and clinical adoption.
•: Increasing Complexity of Medical Device Products. As medical device companies seek to provide additional functionality in their products, the complexity of the technologies and processes involved in producing medical devices has increased. Third-party manufacturers have invested in state-of-the-art facilities with comprehensive services and experienced personnel to deliver precision manufacturing services for these increasingly complex products. Medical device companies may also outsource because they do not posses the capabilities to manufacture their new products.
•: Rationalization of Medical Device Companies' Existing Manufacturing Facilities. Medical device companies are continually looking to reduce costs and improve efficiencies within their organizations. As device companies rationalize their manufacturing base as a way to realize cost savings, they are increasingly turning to outsourcing. Through outsourcing, medical device companies can reduce capital investment requirements, and fixed overhead costs as well as benefit from the economies of scale of the third-party manufacturer.
•: Increasing Focus on Core Competencies. We believe medical device companies are increasingly focusing resources on their core competencies of research, sales and marketing. Outsourcing

Richard Effress was a co-founder of MedSource, has been the Chairman of our board of directors since inception and became Chief Executive Officer in January 2000. From May 1997 until March 1999, he worked as a partner at Kidd & Company, a venture management firm, of which he is also a founder. While at Kidd & Company he participated in the development of Chatham Technologies, a provider of custom electronic enclosure systems for the communications industry. Previously, he was an associate at Kidd, Kamm & Company, a private equity investment firm, and an investment banking analyst at Donaldson, Lufkin Jenrette Securities Corporation. Rich received a B.S. from the Wharton School of the University of Pennsylvania and an M.B.A. from Harvard Business School, where he was a Baker Scholar.

Joseph Caffarelli joined MedSource in February 2001 as Senior Vice President, Chief Financial Officer and Treasurer. From April 1999 until January 2001, he was Senior Vice President and Chief Financial Officer of Airspan Networks, a wireless communications equipment company, and from November 1994 until March 1999, he was the Executive Vice President and Chief Financial Officer of Physio-Control, a medical equipment company. Joe also served in numerous senior financial management positions at General Electric, a diversified industrial corporation. Joe received a B.A. from the State University of New York.

Dan Croteau joined MedSource in June 1999 as Director of Business Development, became our Vice President—Business Development in January 2000 and became our Vice President—Corporate Development in December 2001. From September 1997 until June 1999, he was a consultant at Booz Allen & Hamilton in Sydney, Australia. Previously, he worked at General Electric, a diversified industrial corporation, in various technical marketing, sales, and general management roles. Dan has a B.S. from the University of Vermont and an M.B.A. from Harvard Business School.

Jim Drill joined MedSource in February 1999 as Vice President—Sales and Marketing. From 1991 until 1999, he worked at Parametric Technology Corporation, a developer and marketer of design and manufacturing software platforms, where he was Senior Vice President—North America West and served in several other senior sales management positions throughout the United States and Europe. Prior to that he worked at International Business Machines, a computer manufacturer. Jim has a B.S. from the University of Wisconsin-Madison.

~~Bill Ellerkamp joined MedSource in March 2000 as~~enables ~~Vice President—Market Development. From 1995 until 2000, he worked at TFX Medical, a supplier of engineered components, assemblies and products to~~ medical device ~~and~~companies ~~equipment original equipment manufacturers, most recently as President. Prior~~ to ~~that~~focus hegreater ~~spent~~resources ~~over~~on ~~ten~~their ~~years~~core incompetencies ~~Europe~~while ~~with~~taking ~~Teleflex~~advantage ~~and~~of ~~Rusch~~the ~~International~~manufacturing intechnologies, ~~various~~economies ~~sales~~of ~~and~~scale ~~marketing positions. Bill has a B.A. from Colgate University~~ and ansupply ~~M.B.A.~~chain ~~from~~management expertise ~~the~~of ~~London~~third-party ~~Business School~~manufacturers.

~~Dr.~~Competitive Karl Hens joined MedSource in May 2000 as Vice President—Technology. From December 1995 until its acquisition by MedSource, Karl was the founder, President and Chief Executive Officer of Thermat Precision Technology, a precision metal injection manufacturing company. Previously, he held a faculty position at The Pennsylvania State University and was a founding partner of the Powder Metallurgy Lab. Karl has a B.S. from the University of Waterloo, and an M.S. and Ph.D. from Rensselaer Polytechnic Institute. Strengths

~~Rick~~ Our ~~McWhorter~~competitive ~~joined~~strengths ~~MedSource~~make inus ~~March~~a ~~2001~~preferred asstrategic ~~Senior~~manufacturing ~~Vice~~partner ~~President—Operations.~~for ~~From~~many ~~1977~~of ~~until~~the ~~2000,~~leading hemedical ~~worked~~device atcompanies ~~Baxter~~and ~~Healthcare~~position ~~International,~~us afor ~~global healthcare manufacturing company, where he was most recently~~profitable ~~Vice President—Manufacturing of Baxter’s I~~growth.V. ~~Systems~~Our ~~group.~~preferred ~~Prior~~status tois ~~that~~evidenced hethrough ~~worked~~our atlong ~~Ludlow~~term ~~Corporation~~customer relationships, asole ~~textile~~source ~~manufacturing~~agreements ~~company. Rick has a B.S.~~ and/or ~~M.B.A.~~by ~~from~~offered ~~Delta State University~~designation.

•: Market Leader. We believe we are the largest provider of outsourced precision manufacturing and engineering services in our target markets of the medical device industry. We believe our size enables us to invest significant resources in our infrastructure including manufacturing facilities, engineering expertise, proprietary processes and sales force. We continue to invest in information technology and quality systems that enable us to meet or exceed the increasingly rigorous standards of our customers and differentiate us from our competitors.
•: Strong Relationships With Targeted Customers. We provide manufacturing and engineering services to the leading medical device companies worldwide: cardiovascular, endoscopy, and orthopaedics. Our largest customers include Boston Scientific, Guidant, Johnson & Johnson, Medtronic, Smith & Nephew, St. Jude, Stryker, Tyco and Zimmer, many of which we have had relationships with for over 10 years. Within these large customers, we generate diversified revenue streams across separate divisions and multiple products. As a result of our strong relationships, we are well-positioned to compete for a majority of our customers' outsourcing needs and to benefit as our customers seek to consolidate their supplier base.
•: Preferred Supplier. We are the sole supplier of manufacturing and engineering services for a significant portion of the products we provide to our customers. We develop these close relationships with our customers due to the high level of interaction necessary to design, develop and produce the high value medical devices on which we focus. In situations where we are not the sole supplier, we are usually among a small number of preferred strategic manufacturing partners which enables us to compete for a majority of our customers' medical device outsourcing needs. As a result of our position as a preferred supplier to many of our customers and our track record of high quality manufacturing, we are well-positioned to benefit as our customers seek to consolidate their supplier base.
•: Breadth of Manufacturing and Engineering Capabilities. We provide a comprehensive range of manufacturing and engineering services, including design, testing, prototyping, production and device assembly, as well as global supply chain management services. We have over 100 engineers available to help design, prototype and test feasibility and manufacturability. We have made significant investments in precision manufacturing equipment, information technology and quality systems. Our facilities have areas of expertise and proprietary processes which create economies of scale that can reduce production costs and often enable us to manufacture products at lower costs than our customers.
•: Strategic Locations. We believe that the location of our design, prototyping and engineering centers near our major customers, and the location of certain of our facilities in advantageous manufacturing centers provide us with a competitive advantage. Our strategic locations allow us to facilitate speed to market, rapid prototyping, low cost assembly and overall customer familiarity. For example, our design, prototyping and engineering centers in Boston, Massachusetts and Minneapolis, Minnesota and our manufacturing center in Galway, Ireland, are located near our major customers. In addition, our Juarez, Mexico facility provides our customers with a low-cost manufacturing and assembly solution.

Ralph Polumbo joined MedSource in April 1999 as Vice President—Human Resources and Integration. From 1995 until 1999, he worked at Rubbermaid, a company that produces and markets products principally in the home, juvenile and commercial products categories, where he held several positions including Vice President of Integration and Vice President of Human Resources for Rubbermaid’s Home Products division. Previously, he worked at The Stanley Works, a tool manufacturer, in a variety of positions including Vice President of Human Resources and Vice President of Operations. Ralph has a B.S. from the Wharton School of the University of Pennsylvania and a Masters of Labor and Industrial Relations from Michigan State University.

Rich Snider joined MedSource in February 2000 as Vice President—New Product Introduction. From 1996 until 2000, he worked at Bridge Medical, a start-up medical device and information company, where he was a Vice President and co-founder. Rich served in various senior management positions at Amcare Health Services, McGaw, and Quest Medical. Rich has a B.S. degree in Mechanical Engineering from Southern Methodist University and an M.B.A. from Louisiana State University.

Doug Woodruff joined MedSource in January 2000 as Vice President—Regulatory Affairs and Quality Assurance. From 1998 until 2000, he was the Vice President—Quality Assurance and Technical Services for Tenax Corporation, a company acquired by MedSource. From 1996 to 1998 he was the Director of Quality Assurance and Regulatory Affairs for the Meadox Division of Boston Scientific, a medical technology company. Doug has a B.S. and M.S. from Washington State University.

Joseph Ciffolillo has been a director of MedSource since April 2001. From 1983 until his retirement in 1996, he worked at Boston Scientific, a medical technology company, most recently as Chief Operating Officer. Prior to Boston Scientific, he worked in several positions at Johnson & Johnson, a diversified medical products company, where he last served as president of Johnson & Johnson Orthopedics. He serves as a director of Boston Scientific and as Chairman of the Advisory Board of the Health Science Technology Division of Harvard University and Massachusetts Institute of Technology. Joe received his B.A. from Bucknell University.

John Galiardo has been a director of MedSource since January 2000. From 1977 until his retirement in 1999, he worked at Becton Dickinson, a medical technology company, where he was Vice Chairman and General Counsel. He is a director of Gynetics, a healthcare products company, VISX Incorporated, a company that develops products and procedures to improve eyesight using lasers, and the New Jersey Manufacturers Insurance Companies, an insurance company. Jack received a B.S. from the University of Maryland and an L.L.B. from Columbia Law School.

Wayne Kelly joined MedSource in March 1999 as the Vice President of our Brooklyn Park, Minnesota facility, and served in that position until March 2001, at which time he assumed his current position as a company Vice President. He has been a director of MedSource since March 1999. From 1983 until March 1999, he held various positions at Kelco Industries, a company acquired by MedSource in March 1999. Wayne received a B.S. from the University of Minnesota.

•: Reputation for Quality. We believe we have a reputation as a high quality manufacturer. Due to the patient-critical and highly regulated nature of the products our customers provide, strong quality systems are an important factor in our customers' selection of a strategic manufacturing partner. As a result, our reputation and experience provide us with an advantage in winning new business as large medical device companies want to partner with a successful, proven manufacturer who has the systems and capabilities to ensure a high level of quality.
•: Experienced Management Team. We have a highly experienced management team at both the corporate and operational levels. Our senior management team has an average of 20 years of experience. Members of our management team also have extensive experience in mergers, acquisitions and integrations.

~~William~~Business Kidd was a co-founder of MedSource and has been a director since our inception. Bill was a founding partner of Kidd & Company, a venture management firm he founded in 1997. Prior to Kidd & Company, Bill was a founding partner of Kidd, Kamm & Company, a private equity investment firm. Bill received a B.A. and M.B.A. from Cornell University. Strategy

Our T.objective ~~Michael~~is ~~Long~~to ~~has~~grow ~~been~~profitably ~~a director of MedSource since October 2000. He has been a Partner of Brown Brothers Harriman & Co., an investment bank, since 1983~~ and ~~has~~strengthen ~~been~~our ~~with~~position ~~Brown Brothers Harriman since 1971. He serves~~ as a ~~director~~leading provider of ~~HCA,~~outsourced aprecision ~~company~~manufacturing ~~that owns~~ and ~~operates~~engineering ~~hospitals~~services ~~and~~to ~~related~~our ~~health care entities, Vaalco Energy Company, an independent energy company,~~target ~~and~~markets ~~Genesee~~through &the ~~Wyoming,~~following: ~~a company that operates short line and regional freight railroads and provides related rail services. Michael received a B.A. from Harvard University and an M.B.A. from Harvard Business School.~~

•: Increase Share Within Target Market Leaders. We are focused on increasing our share of revenues from the leading companies within our target markets. We intend to strengthen our close relationships with the top companies in our target markets by continuing to deliver high quality products and services. We have dedicated Corporate Account Teams focused primarily on generating new revenue opportunities within these leading medical device companies.
•: Generate Cash Flow Benefits from the MedSource Acquisition. We are focused on realizing the cost savings identified as part of the MedSource acquisition. We estimate that the elimination of duplicative personnel and administrative functions will generate approximately $11.0 million of annual cost savings. We expect to complete the actions needed to achieve these savings within the first 90 days after the MedSource acquisition. We also anticipate that the closure of redundant facilities in the 2005-2006 timeframe will result in additional cost savings of approximately $8.0 million to $10.0 million per year when fully implemented.
•: Increase Manufacturing Efficiencies. We plan to introduce a new quality improvement program during our fourth quarter of fiscal year 2004 aimed at harmonizing all quality management systems within the newly combined MDMI and MedSource facilities. Our initial objectives, which are expected to be completed by the end of fiscal year 2004, include a review of senior management processes, addressing management responsibility and the review and approval of a corporate wide quality policy. We expect to begin production site reviews in early 2005. Additionally, we are introducing our "Lean Manufacturing" program designed to improve manufacturing cycle times. Our facility reviews will include a readiness assessment, followed by customized training, process mapping, and the implementation of process improvements. Our first readiness assessment is expected to begin during the first quarter of fiscal year 2005. Further, we will work with our customers to transfer as much finished product assembly and supply chain management to our Juarez, Mexico, facility as possible. This will allow the customer to access a world class assembly plant registered with the FDA in a low cost environment.
•: Expand Design and Prototyping Capabilities and Presence. We intend to grow revenues from design and prototyping services by continuing to invest in selected strategic locations. We believe being involved in the initial design and prototyping of medical devices positions us to capture the ongoing manufacturing business of these devices as they move to full production.

~~Ross Manire has been a director of MedSource since November 2000.~~Capabilities Ross is President of Flextronics Enclosures, a division of Flextronics International, an electronics contract manufacturer. He is the former President and CEO of Chatham Technologies, Inc., which merged with Flextronics in September 2000. Prior to joining Chatham in 1999, Ross was Senior Vice President of the Carrier Systems Business Unit of 3Com Corporation, a provider of networking solutions, a position he held since 1997. Previously, he served in various executive positions with U.S. Robotics including Chief Financial Officer, Senior Vice President, Operations, and General Manager, Network Systems Division. Ross holds a B.A. from Davidson College and an M.B.A. from the University of Chicago.

~~Our~~ As ~~board~~medical ofdevice ~~directors~~companies' ~~currently~~outsourcing ~~consists~~continues ~~of seven members. Prior~~ to ~~the~~grow, ~~closing~~we ofbelieve ~~this~~that ~~offering,~~ our ~~board~~customers' ofreliance ~~directors~~upon will be divided into three classes, with each director serving a three-year term and one class being elected at each year’s annual meeting of stockholders. , and will be in the ~~class~~breadth of ~~directors~~our ~~whose~~capabilities ~~initial term expires at the 2002 annual meeting of stockholders~~increases. ~~, and will~~ ~~be in the class of~~Our ~~directors~~capabilities ~~whose~~include ~~initial~~Design ~~term~~and ~~expires~~Engineering, atPrecision ~~the~~Component ~~2003~~Manufacturing, ~~annual~~Device ~~meeting~~Assembly ~~of the stockholders.~~ and ~~will~~ beSupply inChain ~~the class of directors whose initial term expires at the 2004 annual meeting of stockholders~~Management.

Our executive officers are elected by the board of directors and serve until their successors have been duly elected and qualified or until their earlier resignation or removal. There are no family relationships among any of our directors or officers.

Committees of the Board of Directors

Audit Committee. The audit committee, which consists of Messrs. Ciffolillo, Galiardo, Long and Manire, assists the board in fulfilling its responsibilities of ensuring that management is maintaining an adequate system of internal controls to assure:

r that assets are safeguarded and that financial reports are properly prepared;

r consistent application of generally accepted accounting principles; and

r compliance with management’s policies and procedures.

In performing these functions, the audit committee meets periodically with the independent auditors and management to review their work and confirm that they are properly discharging their responsibilities. The audit committee also:

r recommends an independent audit firm to audit financial statements and to perform services related to audits;

r approves the audit fees payable to the independent audit firm and reviews the scope and results of audits with the independent auditors;

r Design ~~reviews~~and ~~with~~Engineering. We ~~management~~offer design and ~~the~~engineering ~~independent~~services ~~auditors~~that include product design engineering, design for manufacturability, analytical engineering and rapid prototyping. We focus on providing design solutions to meet our ~~annual~~customers' ~~operating~~functional ~~results;~~and cost needs by incorporating reliable manufacturing and assembly methods. Through our engineering design services, we engage our customers early in the product development to reduce their manufacturing costs and accelerate the development cycle.

r considers the adequacy of our internal accounting control procedures; and

Capability		Description & Customer Application
Product Design Engineering		Computer Aided Design (CAD) tool used to model design concepts which supports the design portion of the project, freeing the customer's staff for additional research
Design for Manufacturability		Experience in manufacturing and process variation analysis ensures reliability and ongoing quality are met which eliminates customers' need for duplicate quality assurance measures, provides for continuous improvement and assures long term cost control objectives are met
Analytical Engineering		Finite Element Analysis (FEA) and Failure Mode and Effect Analysis (FMEA) tools verify function and reliability of a device prior to producing physical models which shortens the design cycle allowing products reach the market faster and more cost effectively
Physical Models		Computer Aided Manufacturing (CAM), Stereolithography and "Soft Tooling" concepts which permit rapid prototyping to provide customers with assurance that they have fulfilled the needs of their clinical customers and confirms a transition from design to production

r Precision ~~considers~~Component ~~our~~Manufacturing. We ~~auditors’~~utilize ~~independence~~a broad array of manufacturing processes to produce metal and plastic based medical device components. These include metal forming, machining and casting and polymer molding, machining and extrusion processes.

Compensation and Benefits Committee. The primary function of the compensation and benefits committee is to determine management and executive compensation and establish health and benefit plans and other compensation policies. The compensation and benefits committee is also responsible for the administration of our stock plans, including reviewing management recommendations with respect to grants of awards and taking other actions that may be required in connection with our compensation and incentive plans.

Capability		Description & Customer Application
Tube Drawing		Process to manufacture miniature finished tubes or tubular parts used in cardio catheters, endoscopy instruments & orthopaedic implants
Wire Drawing		Specialized clad wires utilized in a variety of cardiovascular and neurological applications
Wire Grinding & Coiling		Secondary processing of custom wires to create varying thicknesses, or shapes (springs) used as "guide-wires" for angioplasty and as components in neurological applications
Micro-Laser Cutting		Laser to remove material in tubular components resulting in tight tolerances and the ability to create the "net like" shapes used in both cardiovascular and peripheral stents
CNC Multi-Axis & Swiss Machining		Machining processes using a predetermined computer controlled path to remove metal or plastic material thereby producing a three dimensional shape. Used in orthopaedic implants to create highly specialized bone screws and miniature components used in cardiac rhythm management

Compensation and Benefits Committee Interlocks and Insider Participation

Mr. Effress served on our compensation and benefits committee from March 1999 until he became our Chief Executive Officer in January 2000. Since then, he has participated in discussions concerning management and executive officer compensation. The members of our compensation and benefits committee are Messrs. Galiardo, Long and Manire.

Director Compensation

We reimburse directors for reasonable expenses incurred in attending board or committee meetings. Following the offering, we will pay non-employee directors $10,000 per year, payable, at their option, in cash or shares of our common stock. We also expect to grant to each non-employee director an option to purchase 2,100 shares of our common stock in connection with this offering and additional grants each year thereafter.

Executive Compensation

The following table sets forth the compensation earned by our Chief Executive Officer and our four other most highly compensated executive officers during our fiscal year ended June 30, 2001:

					Long-Term Compensation Awards
	Annual Compensation				Number of Securities Underlying Options	All Other Compensation
	Salary		Bonus
Richard Effress	$	250,000	$	50,000	300,000	$ —
Chairman and Chief Executive Officer
Jim Drill		208,333		41,466	—	—
Vice President—Sales and Marketing
William Ellerkamp		178,750		35,750	27,500	—
Vice President—Market Development
Ralph Polumbo		175,000		35,000	—	—
Vice President—Human Resources and Integration
Rich Snider		175,000		30,641	10,000	—
Vice President—New Product Introduction

Option Grants in Fiscal 2001

The following table shows grants of stock options to our Chief Executive Officer and to the other executive officers named in the Summary Compensation Table above during our fiscal year ended June 30, 2001.

~~All~~Electrical ~~options~~Discharge ~~were~~Machining ~~granted~~Machining ~~under~~process ~~our~~using ~~1999~~thermal ~~stock~~energy ~~plan.~~from ~~These~~an ~~options~~electrical ~~were~~discharge ~~granted~~to atcreate ~~exercise prices~~very ataccurate, ~~least~~thin ~~equal~~delicate shapes and to ~~the~~manufacture ~~fair~~complete ~~market~~components ~~value~~used ofin ~~our~~arthroscopy, ~~common~~laparoscopy ~~stock~~and asother ~~determined~~surgical byprocedures ~~our~~Plastic ~~board~~Injection ofMolding ~~directors~~Melted onplastic flows into a mold which has been machined in the ~~dates~~mirror image of ~~grant.~~the ~~The~~desired ~~percentage~~shape; process is used throughout the medical industry to create components of ~~options~~assemblies ~~granted~~and iscommonly ~~based~~combined onwith ~~options~~metal components Metal Injection Molding Metal powders bound by a polymer are injected into a mold to ~~purchase~~produce ana ~~aggregate~~metal part of 1the desired shape; used in higher volume metal applications to reduce manufacturing costs in orthopaedics,~~555~~ endoscopy,~~660~~ ~~shares~~arthroscopy and other procedures Plastic Extrusion Process that forces liquid polymer material between a shaped die and mandrel to produce a continuous length of ~~our~~plastic ~~common~~tubing; ~~stock granted~~used byin uscardiovascular ~~during~~catheter applications Alloy Development Product differentiation in the ~~fiscal~~medical ~~year~~device ~~ended~~industry ~~June~~is ~~30,~~commonly ~~2001~~driven toby the use of alternative materials; we work with our ~~employees,~~customers ~~including~~to ~~the~~develop ~~named~~application-specific ~~executive~~materials ~~officers~~that offer marketable features and demonstrable benefits Forging Process using heat and impact to "hammer" metal shapes and forms. Secondary processing needed to bring to finished form. Most often to fabricate surgical instruments within the medical industry

~~The potential~~ Device ~~realizable~~Assembly. Device ~~value~~assembly ~~amounts~~is inbeing ~~the~~driven ~~last~~by ~~two columns of~~ the ~~following~~medical ~~chart~~device ~~are~~companies' ~~based~~focus on ~~the~~more ~~assumption~~products ~~that~~being ~~our~~released ~~common~~in shorter ~~stock~~timeframes. ~~appreciates~~To atfulfill ~~the~~this ~~annual~~growing ~~rate shown~~need, ~~compounded~~we ~~annually,~~provide ~~from~~contract ~~the~~manufacturing ~~date~~services offor ~~grant~~complete/finished ~~until~~medical ~~the~~devices ~~expiration~~at ofboth ~~the~~our ~~10-year term~~U.S. ~~Potential~~and ~~realizable~~Mexico ~~value~~facilities. ~~has~~We ~~been~~provide ~~calculated using~~ the ~~initial~~full ~~public~~range ~~offering price~~ of assembly ~~$ per~~capability ~~share,~~defined ~~although~~by weour ~~estimate~~customers' ~~that~~needs, inincluding ~~each~~packaging, ~~case~~labeling, ~~the~~kitting ~~fair market value of our stock at the time the option was granted was less than that amount. These number are calculated based on the requirements of the SEC~~ and ~~do not reflect our estimate of future stock price growth~~sterilization.

Capability	Description & Customer Application
Name	Individual Grants						Potential Realizable Value at Assumed Annual Rates of Stock Price Appreciation for Option
	Number of Securities Underlying Options Granted	Percent of Total Options Granted to Employees in Fiscal Year (%)		Exercise Price per Share ($)		Expiration Date
Mechanical Assembly	Uses a variety of sophisticated attachment methods such as laser, plasma, ultrasonic welding, or adhesives to join components into complete medical device assemblies
							5%	10%
Electro-Mechanical Assembly	Uses a combination of electrical devices such as printed circuit boards, motors and graphical displays with mechanical sub-assemblies to produce a finished medical device
Richard Effress	300,000	19.3	%	$	16.24	11/21/10
Marking/Labeling & Sterile Packaging	Use of laser or ink jet marking, or pad printing methods for product identification, branding, and regulatory compliance; applying packaging methods such as form-fill-seal or pouch-fill-seal to package individual medical products for sterilization and distribution
Jim Drill	—	—			—	—
William Ellerkamp	27,500	*			16.24	11/21/10
Ralph Polumbo	—	—			—	—
Rich Snider	10,000	*			17.00	2/6/11

* Supply ~~Less~~Chain ~~than~~Management. Our ~~one~~supply ~~percent~~chain management services encompass the complete order fulfillment process from raw material to finished devices for entire product lines. This category of capabilities is an umbrella for the capabilities listed above, not only including design and engineering,

Option Values as of June 30, 2001

The following table provides summary information concerning stock options held as of June 30, 2001 by our Chief Executive Officer and by the other executive officers named in the Summary Compensation Table above. The value of in-the-money options represents the difference between the exercise price of the option and the initial public offering price of $ per share.

	Shares Acquired on Exercise	Value Realized		Number of Securities Underlying Unexercised Options as of June 30, 2001		Value of Unexercised In-the-Money Options as of June 30, 2001
Name				Exercisable	Unexercisable	Exercisable	Unexercisable
Richard Effress	—	$	—	75,000	225,000
Jim Drill	—		—	67,500	82,500
William Ellerkamp	616			12,509	66,875
Ralph Polumbo	—		—	32,500	37,500
Rich Snider	7,500			11,250	66,250

1999 Stock Plan

In March 1999, we adopted our 1999 Stock Plan, which, as amended to date, authorizes the issuance of up to 4,430,000 shares of common stock, subject to adjustment upon the occurrence of any stock dividend or other distribution, consolidation, combination, exchange of shares or other specified corporate transaction or event.

In accordance with our stock plan, our board of directors or a board committee composed of non-employee directors may grant non-qualified stock options or shares of common stock subject to restrictions or contingencies to employees (including directors and officers who are employees) and to consultants and directors who are not employees of MedSource or any of its subsidiaries. The term of any particular grant, including any performance-based requirements, exercise price, vesting terms and other restrictions are determined by the board or by the committee of the board that makes the grant.

~~The exercise price of non-qualified options may be above, at or below fair market value of the~~component ~~common~~manufacturing ~~stock~~and ondevice ~~the~~assembly ~~date of grant. The exercise period may be set by the board or the committee that makes the grant~~ but ~~may~~also ~~not~~raw ~~exceed~~materials ~~ten~~sourcing, ~~years.~~quality ~~Stock~~control/sterilization ~~options~~and ~~will~~warehousing ~~be exercisable at such times~~ and ~~upon such conditions as the board or the committee that makes the grant may determine~~delivery, aswhich ~~reflected~~are indescribed ~~the applicable grant~~below.

A restricted stock award is an award of common stock that is subject to any vesting, performance criteria, restrictions on transferability and other restrictions, if any, that the board or the committee making the grant may impose at the date of grant. These restrictions may lapse separately or in combination at such times, under such circumstances, in such installments or otherwise, as the board or the committee making the grant may determine. Except to the extent restricted under the grant relating to the restricted stock, a participant granted restricted stock will have all of the rights of a stockholder, including, without limitation, the right to vote and the right to receive dividends. The board or the committee making the grant has the authority to cancel all or any portion of any outstanding restrictions.

Capability		Description & Customer Application
Raw Materials Sourcing		Procurement and consulting on the choice of raw materials, allow design and materials suitability
Quality Control/Sterilization		The ability to design and validate quality control systems that meet or exceeds customer requirements. In addition we provide validated sterilization services
Warehousing and Delivery		The ability to provide customer storage and distribution services, including end user distribution

~~Except~~Sales ~~as otherwise determined by the committee making the grant, options~~ and ~~restricted shares granted under the plan may not be transferred other than by will or by the laws of descent and distribution.~~ Marketing

~~Our~~ We ~~1999~~market ~~Stock Plan~~and ~~terminates~~sell inour ~~2009.~~products Asdirectly ~~of January 15, 2002, we had outstanding options~~ to ~~purchase~~our ancustomers ~~aggregate~~through ofour ~~2,749,434~~sales ~~shares~~team of ~~common~~approximately ~~stock~~35 ~~under the plan at exercise prices ranging from $12~~individuals.00 ~~per~~Approximately ~~share to $20.00 per share. Our standard form of stock option contract provides for vesting of options at a rate of 25~~80% ~~after the first year~~ of ~~employment and 25% each year thereafter until all options have vested and become exercisable. The vesting of some or all of~~ the ~~options~~sales ~~granted~~force tois ~~some~~based ~~of our~~in ~~executives and directors accelerates upon~~ the ~~occurrence~~U.S. ofand ~~specified~~20% ~~change~~is based in ~~control transactions~~Europe.

~~ACT~~ Our sales ~~Medical,~~force ~~Inc~~targets the top medical device customers in each of the target markets that we serve. ~~1998~~Each ~~Omnibus~~of ~~Stock~~these ~~Plan~~top accounts is assigned dedicated Corporate Account Teams based upon the target markets in which they participate. The primary mission of our sales force is to increase our market share with these top customers by expanding our relationships and securing new business. Our end market focus allows us to better serve our customers.

~~In connection with our acquisition of ACT Medical in December 2000, we assumed the ACT Medical 1998 Omnibus Stock Plan.~~ The ~~ACT~~engineering ~~Medical~~expertise ~~stock plan terminates in December 2008. As~~ of ~~January~~our ~~15,~~sales ~~2002,~~force weallows ~~had~~us ~~outstanding options~~ to ~~purchase~~provide antechnical ~~aggregate~~assistance ofand ~~242,250~~advice ~~shares~~to of our ~~common~~customers ~~stock~~in ~~under~~ the ~~ACT Medical stock plan at exercise prices ranging from $3~~field.39 ~~per~~This ~~share~~assistance ~~to $20.00 per share. The standard form of stock option contract for options granted under the ACT Medical stock plan provides for vesting of options at a rate of 25% after the first year of employment~~ and ~~25%~~advice ~~each~~strengthens ~~year~~our ~~thereafter~~close ~~until all options have~~working ~~vested~~relationships ~~and~~between ~~become~~our ~~exercisable.~~sales ~~The~~personnel ~~vesting~~and ~~of some or all of the options granted to some of~~ our ~~executives and directors accelerates upon the occurrence of specified change in control transactions~~customers. ~~We do not expect to grant any additional options under the ACT Medical stock plan.~~

~~2001 Employee Stock Purchase Plan~~ Customers

Our ~~2001~~customers ~~Employee~~include ~~Stock~~the ~~Purchase~~top ~~Plan~~worldwide ~~was~~medical ~~adopted~~device bymanufacturers ~~our~~that ~~board~~concentrate ofprimarily ~~directors~~ in ~~December~~the ~~2001~~cardiovascular, endoscopy and byorthopaedics ~~our~~markets. ~~stockholders~~We inhave ,built ~~2002.~~strong ~~This~~relationships ~~plan provides our employees~~ with ~~an opportunity to purchase~~ our ~~common~~customers ~~stock~~by ~~through~~delivering ~~accumulated~~highly ~~payroll~~customized ~~deductions.~~and Weengineered ~~initially reserved 500~~components,~~000~~ ~~shares~~assemblies ofand ~~common~~finished ~~stock~~goods for ~~issuance~~their ~~under this purchase plan~~markets. AsPro offorma ~~the date of this prospectus, we had not issued any shares under this plan, but we will be begin issuing shares upon completion of this offering. The number of shares reserved~~ for ~~issuance under~~ the ~~purchase~~twelve ~~plan~~months ~~will~~ended December 31, ~~be subject to an annual increase on the first day of each fiscal year equal to the lowest of: 750~~2003,~~000~~ ~~shares;~~over ~~2.5~~90% of our ~~outstanding~~net ~~stock~~sales onwas ~~that~~derived ~~date;~~from ~~or such lesser amount as may be determined by~~ our ~~board~~medical ofdevice ~~directors~~customers.

Our strategy ~~purchase~~is ~~plan~~to ~~will~~focus beon ~~administered~~the bytop ~~our~~15 ~~board~~medical ofdevice ~~directors~~companies, orwhich bywe abelieve ~~committee~~represent ~~appointed~~a bysubstantial ~~our board~~portion of ~~directors~~the overall market opportunity. ~~The~~For ~~purchase~~the ~~plan~~twelve ~~permits~~months anended December 31, ~~eligible~~2003, ~~employee~~on toa ~~purchase~~pro ~~our~~forma ~~common~~basis, ~~stock~~these ~~through~~top ~~payroll~~15 ~~deductions~~medical ofdevice upcompanies toaccounted 10for approximately 60% of ~~his~~our ornet ~~her~~sales. ~~compensation~~In orparticular, ~~such~~Johnson & ~~other~~Johnson ~~amount~~and asBoston ~~the~~Scientific each ~~persons~~accounted ~~administering~~for more than 10% of our net sales for the ~~plan~~twelve ~~may~~months ~~determine~~ended December 31, 2003 on a pro forma basis. ~~Employees are~~We ~~eligible~~provide a multitude of products and services to ~~participate~~our incustomers ~~this~~across their ~~purchase~~various ~~plan~~divisions. ifBoston ~~they~~Scientific ~~are~~recently ~~customarily~~informed ~~employed~~us that it intends to transfer a number of products currently assembled by us to its own assembly operation in 2005 and the first half of 2006.

We also have established customer relationships with companies outside of the medical device market. Our industrial customers service the electronic, computer, industrial equipment and consumer markets. We provide them with high quality, complex components for use in high density discharge lamps, fiber optics, motion sensors and power generation.

atInternational ~~least 20 hours per week and more than five months in any calendar year and only to the extent that they do not own more than 5% of our outstanding shares.~~ Operations

~~Unless~~ On ~~our~~a ~~board~~pro offorma ~~directors or the committee administering the plan determines otherwise~~basis, ~~this~~we ~~purchase~~receive ~~plan~~approximately ~~will~~14% ~~be implemented in a series~~ of ~~consecutive~~ ~~offering~~our ~~periods,~~net ~~each~~sales ~~approximately~~from ~~six~~international ~~months in duration~~sales. ~~Offering~~There ~~periods~~are ~~will~~additional ~~begin~~risks onassociated ~~the~~with ~~first~~our ~~trading~~international ~~day~~sales than onwith ordomestic ~~after~~sales, ~~May~~including 1those resulting ~~and~~from ~~November~~currency 1fluctuations, ofduties ~~every year~~ and ~~terminate~~taxation, onforeign ~~the~~legal ~~last~~and ~~trading~~regulatory ~~day in the period six months later~~requirements, ~~provided~~ ~~that~~changing ~~the~~labor ~~first~~conditions ~~offering~~and ~~period~~longer ~~will~~payment ~~commence~~cycles. onFor ~~the~~a ~~effective~~description ~~date~~ of ~~this~~our ~~offering~~international ~~and~~sales, see ~~will~~Note 15 ~~end~~to onour ~~April~~Consolidated ~~30,~~Financial ~~2002,~~Statements orincluded ~~the~~in ~~last~~this ~~trading day prior thereto~~prospectus.

IfInformation we are acquired and the successor corporation does not assume all outstanding options under this purchase plan, then the offering and purchase periods then in progress may be shortened so that all options will be automatically exercised immediately prior to the date of acquisition. Technology

~~The~~ We ~~price~~plan atto ~~which common~~install ~~stock~~the ~~will~~Oracle be11i ~~purchased~~enterprise ~~under~~resource ~~this~~planning, ~~purchase~~or ~~plan~~ERP, issystem ~~equal~~across toour atfacilities. ~~least~~MedSource ~~85%~~has ofcompleted the ~~fair~~implementation ~~market value~~ of the ~~common~~full ~~stock~~ERP application onat ~~the~~five ~~first~~facilities ~~day~~and ofhas implemented the ~~applicable~~Oracle ~~offering~~financial ~~period~~reporting orand onorder ~~the~~management ~~last~~system ~~day~~at all of its facilities. We intend to expand the ~~applicable~~rollout ~~purchase~~of ~~period~~the ERP, ~~whichever~~financial isreporting ~~lower~~and order management system across our facilities. ~~Employees~~We ~~may~~believe ~~end~~our ~~their~~ERP ~~participation~~platform and related information technology systems will enable us to better serve our customers by aiding us in predicting customer demand, taking advantage of economies of scale, providing greater flexibility to move product design between sites and improving the ~~offering~~accuracy ~~period~~of atcapturing ~~any~~and ~~time~~estimating our manufacturing and engineering costs. In addition, we utilize computer aided design, or CAD, and ~~participation~~computer ~~automatically~~aided ~~ends~~manufacturing, onor ~~termination~~CAM, ofsoftware ~~employment~~at our facilities. We expect these systems to provide several key benefits to us, our customers and our suppliers.

Our board of directors may not, without the adversely affected optionee’s prior written consent, amend, modify or terminate this purchase plan at any time if the amendment, modification or termination would impair the rights of plan participants. This purchase plan will terminate in November 30, 2011, unless terminated earlier in accordance with its provisions. Quality

~~Employment~~ Due ~~Arrangements~~to the patient-critical and highly regulated nature of the products our customers provide, strong quality systems are an important factor in our customers' selection of a strategic manufacturing partner. In order for our customers to outsource manufacturing to us, our quality program must meet or exceed customer requirements.

~~Upon~~ Our Quality aManagement ~~change~~System ofis ~~control,~~based on the ~~options~~standards ~~held~~developed by ~~our~~the ~~executive~~International ~~officers~~Organization ~~will~~for ~~become immediately~~Standardization ~~exercisable~~(ISO). asThe tostandards ~~50%~~are ofknown ~~the~~as ~~total~~ISO ~~shares~~9001 ~~subject~~or toISO ~~the~~13485. ~~options,~~These standards ~~including~~specify ~~any~~the ~~portion~~requirements ~~already~~necessary ~~then~~for ~~exercisable.~~a Inquality ~~addition,~~management ~~some~~system orto ~~all~~consistently ofprovide ~~the~~product ~~options~~that ~~held~~meets byor ~~each~~exceeds ofcustomer ~~Messrs~~requirements. ~~Effress,~~Also ~~Caffarelli,~~included ~~Croteau,~~are ~~Ellerkamp,~~requirements ~~McWhorter,~~for ~~Polumbo~~processes ~~and~~for ~~Snider~~continual ~~will~~improvement ~~become~~of ~~immediately~~the ~~exercisable~~system. inOur ~~full~~facilities inare ~~the~~registered ~~event~~to ofISO a9001 ~~change~~or ofISO ~~control~~13485. atCompliance ato ~~specified~~ISO ~~minimum~~Standards ~~price~~is ~~per~~assessed ~~share~~by ofindependent ~~our~~audits ~~common~~from ~~stock.~~accredited ~~Further,~~third-party ~~some~~auditors orand through ~~all~~internal and customer audits of the ~~options~~quality ~~held~~system byat each facility. The majority of ~~these~~our ~~executive~~facilities ~~officers~~are ~~will~~registered ~~become immediately~~with ~~exercisable~~the inFDA ~~full~~and inare ~~the~~subject ~~event~~to ~~that~~inspection ~~their~~at ~~employment~~any istime ~~terminated~~for ~~without~~compliance ~~cause~~with the ~~following~~Quality ~~any~~System ~~change~~Regulation, ofor ~~control~~"QSR, and other FDA regulatory requirements.

We are ~~have~~continuing ~~entered~~to ~~into~~deploy anour ~~employment~~"zero ~~agreement~~defects" ~~with~~program ~~Mr.~~throughout ~~Effress~~the company. ~~The~~In ~~agreement~~addition ~~provides~~to ~~for~~compliance ato ~~base~~the ~~salary~~international ofstandards ~~$275~~mentioned above,~~000,~~ ~~with~~the azero ~~bonus~~defects ~~opportunity~~program ofdrives quality atimprovement ~~least~~by ~~50%~~utilizing ofsix ~~his~~sigma ~~base salary at target performance~~principles. ~~Mr.~~The ~~Effress~~principles isof ~~subject~~the tosix ~~a noncompetition~~signa ~~covenant~~methodology ~~during~~(Define, ~~his~~Measure, ~~employment~~Analyze, ~~with~~Improve us and ~~for~~Control) ~~one~~allow ~~year~~the ~~after~~sources ~~termination~~ of ~~his~~variation ~~employment.~~in ~~Although~~a ~~Mr.~~process ~~Effress~~to ~~is an “at will” employee~~be identified, wesystematically ~~have~~reduced ~~agreed~~and controlled to ~~pay~~maintain ~~him~~the upimprovements. toThe ~~one~~zero ~~year~~defects ofprogram ~~his~~will ~~base~~become ~~salary~~the ifsingle wequality ~~terminate~~system ~~him without~~for ~~cause~~our company.

WeSupply have entered into an employment agreement with Mr. Caffarelli. The agreement provides for a base salary of $225,000, with a bonus opportunity of at least 50% of his base salary at target performance. Mr. Caffarelli is subject to a noncompetition covenant during his employment with us and for one year after termination of his employment. Although Mr. Caffarelli is an “at will” employee, we have agreed to pay him up to one year of his base salary if we terminate him without cause. Arrangements

We have ~~entered~~established ~~into~~relationships anwith ~~employment~~many ~~agreement~~of ~~with~~our ~~Mr.~~materials ~~Drill~~providers. ~~The agreement~~However, ~~which~~most ~~expires~~of inthe ~~April~~raw ~~2002,~~materials ~~provides~~that ~~for~~are aused ~~base~~in ~~salary~~our ofproducts ~~$225,000,~~are ~~with~~subject anto fluctuations ~~annual~~in ~~bonus~~market ~~determined~~price. byIn ~~our~~particular, ~~board~~the prices of ~~directors.~~stainless ~~Mr.~~steel, ~~Drill~~titanium ~~is subject~~and toplatinum ahave ~~noncompetition~~historically ~~covenant~~fluctuated, ~~during~~and ~~his~~the ~~employment~~prices ~~with~~that uswe ~~and~~pay for athese ~~period~~materials, ~~of time~~and, ~~not~~in tosome ~~exceed~~cases, their ~~one year~~availability, ~~during~~are ~~which~~dependent weupon ~~pay~~general ~~him~~market ~~severance~~conditions. ~~equal~~In tomost ~~his~~cases ~~base~~we ~~salary,~~have ~~less~~pass-through ~~any~~pricing ~~amount~~arrangements hewith ~~receives~~our ~~from~~customers athat ~~new~~purchase ~~employer~~precious metal components.

~~We have entered into an employment agreement with Mr. Ellerkamp. The agreement provides for a~~ When ~~base~~manufacturing ~~salary~~and ofassembling ~~$178~~medical devices,~~750,~~ ~~with~~we amay ~~bonus~~subcontract ~~opportunity~~manufacturing ofservices atthat ~~least~~we ~~50%~~cannot ofperform ~~his base salary at target performance~~in-house. ~~Mr.~~As ~~Ellerkamp~~we isprovide ~~subject~~our tocustomers ~~a noncompetition covenant during his employment~~ with usa ~~and for one year after termination of his employment.~~fully ~~Although~~integrated ~~Mr.~~supply ~~Ellerkamp~~chain ~~is an “at will” employee~~solution, we ~~have~~will ~~agreed~~continue to ~~pay~~rely ~~him~~on upthird-party tosuppliers, ~~six~~subcontractors ~~months~~and ofoutside ~~his~~sources ~~base~~for ~~salary~~components ifor services that we ~~terminate~~cannot ~~him~~provide ~~without~~through ~~cause~~our internal resources.

We have entered into an employment agreement with Mr. McWhorter. The agreement provides for a base salary of $225,000, with a bonus opportunity of at least 50% of his base salary at target performance. Mr. McWhorter To isdate ~~subject to a noncompetition covenant during his employment with us and for one year after termination of his employment. Although Mr. McWhorter is an “at will” employee,~~ we have ~~agreed~~not toexperienced ~~pay~~any ~~him~~material updifficulty toobtaining ~~one~~necessary ~~year~~raw ofmaterials ~~his~~or ~~base~~subcontractor ~~salary if we terminate him without cause~~services.

WeIntellectual have entered into an employment agreement with Mr. Polumbo. The agreement, which expires in April 2002, provides for a base salary of $190,000, with an annual bonus determined by our board of directors. Mr. Polumbo is subject to a noncompetition covenant during his employment with us and for a period of time, not to exceed one year, during which we pay him severance equal to his base salary, less any amount he receives from a new employer. Property

~~Business~~ The ~~Conduct~~products ~~Policy~~that we manufacture are made to order based on the customers' specifications and may be designed using our design and engineering services. Our customers retain ownership of and the rights to their products' design while we generally retain the rights to any of our proprietary manufacturing processes.

~~All~~ We continue ofto ~~our~~develop ~~employees,~~intellectual ~~including~~property in the ~~aforementioned~~areas ~~executives,~~of ~~are~~process ~~required~~engineering asand amaterials ~~condition~~development for the purpose of ~~employment~~internal toproprietary ~~read~~utilization. ~~and~~The ~~sign~~intellectual property developed helps enhance our ~~business conduct~~production ~~policy~~capabilities ~~which~~and ~~includes~~improve ~~acceptable~~margins ~~behaviors~~in ~~regarding~~our ~~conflict~~manufacturing ofprocesses ~~interest,~~while ~~lawsuits~~providing ~~and~~a ~~government~~competitive ~~investigations,~~differentiator. ~~anti-trust,~~Examples ~~equal~~of ~~employment~~technologies ~~opportunity,~~developed ~~electronic~~include ~~mail,~~micro profile grinding and ~~safety~~polymer ~~and~~micro ~~health~~tube manufacturing.

~~Employees~~ We also ~~are~~continue ~~required~~to develop intellectual property for the purpose of licensing this technology to ~~read~~our ~~and~~medical ~~sign~~device acustomers. ~~confidentiality~~Use ~~agreement~~of these technologies by our medical device customers in their finished design, ~~which~~component ~~includes~~or ~~non-disclosure~~material ~~and~~solution ~~non-solicitation~~results ~~requirements~~in asadditional aroyalty ~~condition~~revenues. Examples of such technology include device patents for catheter based technology such as ~~employment~~gastrointestinal catheters and variable stiffness catheters.

~~Cash~~ In addition, ~~Incentive~~we ~~Plans~~are a party to several license agreements with third parties pursuant to which we have obtained, on varying terms, non-exclusive rights to patents held by third parties in connection with precision metal injection manufacturing technology.

Our management bonus plan provides for annual bonus awards to eligible employees if company-wide target performance is achieved. Awards are based on achievement of pre-determined financial and operational objectives. The plan may be changed or discontinued at the sole discretion of the board. Competition

We Our ~~are~~existing ~~also~~or ~~implementing~~potential acompetitors ~~variable~~include ~~compensation~~suppliers ~~plan~~with todifferent ~~cover~~subsets ~~all~~of our manufacturing capabilities, suppliers that concentrate on niche markets, and ~~employees~~suppliers that have, are developing, or may in the future develop, broad manufacturing capabilities and related services. We compete for new business at all ~~locations~~phases of the product lifecycle, which includes development of new products, the redesign of existing products and transfer of mature product lines to outsourced manufacturers. Competition is generally based on reputation, quality, delivery, responsiveness, breadth of capabilities, including design and engineering support, price, customer relationships, and increasingly the ability to provide complete supply chain management rather than individual components.

~~Limitation~~ We believe that the medical device engineering and manufacturing services industry is highly fragmented with over 3,000 companies that have limited manufacturing capabilities and limited sales and marketing expertise. Many of ~~Liability~~these 3,000 companies have less than $5.0 million in annual revenues from medical device companies. We believe that very few companies offer the scope of manufacturing capabilities and ~~Indemnification~~services ~~Matters~~that we provide to medical device companies, however, we may compete in the future against companies that assemble broad manufacturing capabilities and related services. We compete with different companies depending on the type of product or service offered or the geographic area served. We are not aware of a single competitor that operates in all of our target markets or offers the same range of products and services that we offer.

~~Our~~ In addition, ~~certificate~~many of ~~incorporation limits the liability of~~ our ~~stockholders,~~customers ~~directors~~also ~~and~~have ~~officers to~~ the ~~maximum~~capability ~~extent~~to ~~permitted~~manufacture bysimilar ~~Delaware~~products ~~law.~~in ~~Delaware law provides that a director of a corporation will not be personally liable for monetary damages for breach of fiduciary duty as a director~~house, ~~except~~if ~~for~~they ~~liability:~~so choose.

r for any breach of the director’s duty of loyalty to us or our stockholders;

r for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;

r under Delaware law regarding unlawful dividends and stock purchases; or

r for any transaction from which the director derived an improper personal benefit.

AsGovernment permitted by Delaware law, our certificate of incorporation and bylaws provide that we must indemnify our stockholders, directors, officers, employees and agents to the fullest extent permitted by Delaware law. We have obtained directors’ and officers’ insurance to cover our directors, officers and some of our employees for certain liabilities. We believe that these indemnification provisions and agreements and this insurance are necessary to attract and retain qualified directors and officers. The limitation of liability and indemnification provisions in our certificate of incorporation and bylaws may discourage stockholders from bringing a lawsuit against directors for breach of their fiduciary duty. They may also reduce the likelihood of derivative litigation against directors and officers, even though an action, if successful, might benefit us and other stockholders. Furthermore, a stockholder’s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against directors and officers as required by these indemnification provisions. Regulation

Our business is subject to governmental requirements, including those federal, state and local environmental laws and regulations governing the emission, discharge, use, storage and disposal of hazardous materials and the remediation of contamination associated with the release of these materials at or from our facilities or off-site disposal locations. Many of our manufacturing processes involve the use and subsequent regulated disposal of hazardous materials. We monitor our compliance with all federal and state environmental regulations, and have in the past paid civil penalties and taken corrective measures for violations of environmental laws. To date, such matters have not had a material adverse impact on our business or financial condition. We cannot assure you, however, that such matters will not have a material impact on us in the future.

In several instances, we and certain MedSource subsidiaries have entered into settlements arising from alleged liability as potentially responsible parties for the off-site disposal or treatment of hazardous substances. None of those settlements exceeded $100,000 and none have had a material adverse impact on our business or financial condition.

Environmental laws have been interpreted to impose strict, joint and several liability on owners and operators of contaminated facilities and parties that arrange for the off-site disposal or treatment of hazardous materials. Pursuant to such laws in 2001, the United States Environmental Protection Agency, or EPA, approved a Final Design Submission submitted by UTI Pennsylvania, a wholly owned subsidiary of the Company, to the EPA in respect of a July 1988 Administrative Consent Order issued by the EPA. The Administrative Consent Order alleged that hazardous substances had been released into the environment from UTI Pennsylvania's Collegeville, Pennsylvania plant and required UTI Pennsylvania to study and, if necessary, remediate the groundwater and soil beneath and around the plant. Since that time, UTI Pennsylvania has implemented and is operating successfully a contamination treatment system approved by the EPA. MedSource's subsidiaries also operate or formerly operated facilities located on properties where environmental contamination may have occurred or be present.

At September 30, 2004, we recorded a long-term liability of $8.7 million related to the potential MedSource remediation and the Collegeville remediation. At December 31, 2003, we recorded a long-term liability of $4.0 million related to the Collegeville remediation. The increase in the liability relates to the MedSource acquisition. We have prepared estimates of our potential liability for these properties, if any, based on available information. Changes in EPA standards, improvement in cleanup technology and discovery of additional information, however, could affect the estimated costs associated with these matters in the future.

We are a medical device and component engineering and manufacturing services provider. Some of the products that we manufacture may be considered by the FDA to be finished medical devices. The manufacturing processes used in the production of these finished medical devices are subject to FDA regulatory-inspection, and must comply with FDA regulations, including its Quality System Regulation, or QSR. The QSR requires manufacturers of finished medical devices to follow elaborate design, testing, control, documentation and other quality assurance procedures during the finished device manufacturing process. The QSR governs manufacturing activities broadly defined to include activities such as product design, manufacture, testing, packaging, labeling, distribution and installation. Some of our customers may also require by contractual agreement that we comply with the QSR when manufacturing their device components. Our FDA registered facilities are subject to FDA inspection at any time for compliance with the QSR and other FDA regulatory requirements. Failure to comply with these regulatory requirements may result in civil and criminal enforcement actions, including financial penalties, seizures, injunctions and other measures. In some cases, failure to comply with the QSR could prevent or delay our customers from gaining approval to market their products. Our products must also comply with state and foreign regulatory requirements.

~~CERTAIN~~ In addition, ~~TRANSACTIONS~~the FDA and state and foreign governmental agencies regulate many of our customers' products as medical devices. FDA approval/clearance is required for those products prior to commercialization in the U.S., and approval of regulatory authorities in other countries may also be required prior to commercialization in those jurisdictions. Moreover, in the event that we build or acquire additional facilities outside the U.S., we will be subject to the medical device manufacturing regulations of those countries. Our Mexico facility must comply with U.S. FDA regulations, which we believe are more stringent than the local regulatory requirements our facility must also comply with. Some other countries may rely upon compliance with U.S. regulations or upon ISO certification as sufficient to satisfy certain of their own regulatory requirements for a product or the manufacturing process for a product.

~~Formation~~ In ~~Transactions~~order to comply with regulatory requirements, our customers may wish to audit our operations to evaluate our quality systems. Accordingly, we routinely permit audits by our customers.

~~In connection with our formation in March 1999:~~ Facilities

r As wea ~~issued~~result ~~292,941.18~~of ~~shares~~our completion of ~~our~~the ~~Series~~MedSource Bacquisition, ~~preferred~~we ~~stock~~have to23 Jleased facilities and five owned facilities.H. ~~Whitney~~Our ~~III~~principal executive office is located at 200 West 7th Avenue, ~~L.P.~~Collegeville, anPennsylvania. ~~affiliate~~We ofbelieve ~~Whitney~~that &our ~~Co.,~~current afacilities 5%are ~~stockholder,~~adequate for ~~aggregate~~our ~~consideration~~operations. ofCertain ~~$21.5~~information ~~million;~~about our facilities is set forth below:

r we issued 7,058.82 shares of our Series B preferred stock to Whitney Strategic Partners III, L.P., an affiliate of Whitney & Co., for aggregate consideration of $0.5 million;

Location		Approximate Square Footage	Own/Lease
Arvada, Colorado		45,000	Lease
Brimfield, Massachusetts		30,000	Own
Brooklyn Park, Minnesota		74,000	Lease
Collegeville, Pennsylvania		180,000	Own
Corry, Pennsylvania		67,000	Lease
El Paso, Texas		40,000	Lease
Englewood, Colorado		36,000	Lease
Laconia, New Hampshire		41,000	Lease
Minneapolis, Minnesota		7,000	Lease
Navojoa, Mexico		38,000	Lease
Newton, Massachusetts		65,000	Lease
Norwell, Massachusetts		39,000	Lease
Orchard Park, New York		41,000	Lease
Pittsburgh, Pennsylvania		35,000	Own
Salem, Virginia		64,000	Lease
Santa Clara, California		10,000	Lease
South Plainfield, New Jersey		6,000	Lease
Tehachapi, California		31,000	Lease
Trenton, Georgia		16,000	Lease
Trenton, Georgia		32,500	Own
Upland, California		50,000	Lease
Watertown, Connecticut		44,000	Lease
Wheeling, Illinois		55,000	Own
Wheeling, Illinois		35,000	Lease
Aura, Germany		61,000	Lease
Galway, Ireland		11,000	Lease
Juarez, Mexico		101,000	Lease
Manchester, England		10,000	Lease

	Total	1,264,500

r we issued a note and 48,750 shares of our Series Z preferred stock to J.H. Whitney Mezzanine Fund, L.P., an affiliate of Whitney & Co., for aggregate consideration of $15.0 million;

r we issued an aggregate of 452,650 shares of our common stock to Richard Effress, our Chairman of the Board and Chief Executive Officer, for aggregate consideration of $0.2 million; and

r we issued an aggregate of 2,374,280 shares of our common stock to William J. Kidd, a director and 5% stockholder, his wife and various trusts for the benefit of his immediate family members for aggregate consideration of $1.2 million.

At the same time that we issued the Series B preferred stock described above to the affiliates of Whitney & Co., Richard Effress and William J. Kidd, among others, entered into a share transfer agreement with those affiliates of Whitney & Co. The share transfer agreement provides that we:

r sell all or substantially all of our assets;

r liquidate;

r undergo a change in control; or

r complete an initial public offering of common stock that provides us with net proceeds of at least $40.0 million;

then, in each instance, Mr. Effress, Mr. Kidd and others may be required by the affiliates of Whitney & Co. to transfer to them a number of shares of common stock that, when added to the number of shares of Series B preferred stock owned by them (on an as-converted basis) would give the affiliates of Whitney & Co., a specified internal rate of return. In no event will Mr. Effress, Mr. Kidd and others transfer more than 1,500,000 shares of common stock to the affiliates of Whitney & Co. pursuant to the prior sentence. Based on an assumed initial public offering price of $ per share, no transfer of shares will be required. The share transfer agreement will terminate following completion of this offering.

Series C Preferred Stock

In October 2000, we issued an aggregate of:

r 35,000 shares of our Series C preferred stock to The 1818 Fund III, L.P., a 5% stockholder, for aggregate consideration of $35.0 million;

r 500 shares of our Series C preferred stock to a limited partnership controlled by Ross Manire, a director, for aggregate consideration of $0.5 million;

r 200 shares of our Series C preferred stock to John Galiardo, a director, for aggregate consideration of $0.2 million;

r 537.5 shares of our Series C preferred stock to Richard Effress, our Chairman of the Board and Chief Executive Officer, for aggregate consideration of $0.5 million;

r 3,255 shares of our Series C preferred stock to William J. Kidd, a director and 5% stockholder, his wife and a trust for his benefit for aggregate consideration of $3.3 million.

~~In June 2001, we issued we issued an aggregate of 300 shares of our Series C preferred stock to a corporation controlled by Joseph Ciffolillo, a director, for aggregate consideration of $0.3 million.~~ Employees

~~Series~~ As Eof ~~Preferred~~September 30, ~~Stock~~2004, we had 3,950 employees. We also employ a number of temporary employees to assist with various projects. Other than some employees at our facility in Aura, Germany, our employees are not represented by any union. We have never experienced a work stoppage or strike and believe that we have good relationships with our employees.

InLegal ~~December 2001, we issued an aggregate of:~~ Proceedings

r From ~~500~~time ~~shares~~to time, we are involved in legal proceedings in the ordinary course of our ~~Series~~business. EWe ~~preferred~~are ~~stock,~~not ~~together~~currently ~~with~~involved ~~warrants~~in ~~initially~~any ~~exercisable~~pending tolegal ~~purchase~~proceedings that anwe ~~aggregate~~believe ofcould ~~16,667~~have ~~shares~~a ofmaterial adverse effect on our ~~common~~financial ~~stock,~~position toor ~~Ross~~results ~~Manire,~~of aoperations. ~~director,~~Please see "Government Regulation" above for ~~aggregate~~a ~~consideration~~description of ~~$0.5~~certain ~~million;~~environmental ~~and~~remediation matters which are incorporated by reference herein.

r 1,435 shares of our Series E preferred stock, together with warrants initially exercisable to purchase an aggregate of 47,833 shares of our common stock, to William J. Kidd, a director and 5% stockholder, his wife and certain trusts for the benefit of his children, for aggregate consideration of $1.4 million.

We used the proceeds of the issuance of our Series E preferred stock and warrants to finance our acquisition of HV Technologies.

At the same time we issued our Series E preferred stock, we obtained the consent of certain affiliates of Whitney & Co. to complete our acquisition of HV Technologies and changed some of the covenants to which we were subject under an agreement we had with those affiliates. In connection with that consent, we paid Whitney Mezzanine Fund a fee of $37,500, and we increased by $0.8 million the amount payable by us to Whitney Mezzanine Fund upon redemption of our 12.5% senior subordinated notes.

Certain Services

Kidd & Company has agreed to perform management and acquisition-related services for us until March 2006. In exchange for these services, we paid Kidd & Company a $2.0 million fee at inception and have agreed to pay an annual fee equal to $1.0 million plus a percentage of the aggregate consideration paid by us in future acquisitions. We have also agreed to reimburse Kidd & Company for the reasonable out-of-pocket costs and expenses that it incurs, and will indemnify Kidd & Company and its agents for damages that they suffer, in connection with providing these services. We paid Kidd & Company fees of $1.1 million under these agreements during our year ended June 30, 2001. Kidd & Company has agreed to terminate these agreements in exchange for a cash payment of $2.0 million upon completion of this offering.

Whitney Mezzanine Management Company, LLC, an affiliate of Whitney & Co., has also agreed to perform management services for us until March 2006. In exchange for these services, we have agreed to pay Whitney Mezzanine Management Company an annual fee equal to the sum of $0.4 million plus a percentage of the aggregate consideration paid by us in connection with future acquisitions. We have also agreed to reimburse Whitney Mezzanine Management Company for the reasonable out-of-pocket costs and expenses that it incurs, and will indemnify Whitney Mezzanine Management Company and its agents for damages that they suffer, in connection with providing these services. We paid Whitney Mezzanine Management Company fees of $0.5 million under this agreement during our year ended June 30, 2001. Whitney Mezzanine Management Company has agreed to terminate this agreement in exchange for a cash payment of $0.9 million upon completion of this offering.

Other Transactions

We lease one of our facilities from an entity controlled by the father of Wayne Kelly, a director. For the year ended June 30, 2001, our rent payments under the lease were approximately $0.4 million, and we expect to pay a similar amount in our fiscal year ending June 30, 2002.

We have also entered into registration rights agreements with some of our principal stockholders as described under “Description of Capital Stock — Registration Rights Agreements.”

~~PRINCIPAL~~ ~~AND~~ ~~SELLING STOCKHOLDERS~~ MANAGEMENT

~~The~~Directors ~~following~~and ~~table~~Executive ~~sets forth information regarding the beneficial ownership of the Company’s common stock as of January 15, 2002 by:~~ Officers

r Shown ~~each~~below ~~person~~are orthe ~~group~~names, ofages ~~affiliated~~and ~~persons~~positions ~~that~~of ~~beneficially~~our ~~owns~~and ~~more~~Accellent's ~~than~~executive 5%officers ofand ~~our~~directors: ~~outstanding common stock;~~

r each of our directors;

Name	Age	Position
Ron Sparks	49	President, Chief Executive Officer and Director
Stewart A. Fisher	43	Chief Financial Officer, Executive Vice President, Treasurer and Secretary
Gary D. Curtis	48	Executive Vice President, Sales and Marketing*
Jeffrey M. Farina	47	Vice President, Engineering*
Thomas F. Lemker	56	Vice President of Finance*, Assistant Secretary and Assistant Treasurer
Bruce L. Rogers(1)	41	Chairman of the Board*, Vice President, Assistant Secretary and Director
H. Stephen Cookston(1)	56	Director
Avinash A. Kenkare(2)	42	Director
William Landman(1)	51	Director
Larry G. Pickering(2)	61	Director
Eric M. Pollock(1)	41	Director
Daniel J. Pulver(2)	35	Director
T. Quinn Spitzer, Jr.(1)	54	Director

*: Denotes positions held only with Accellent.
(1): KRG/CMS L.P. appointee.
(2): DLJ Merchant Banking Buyers appointee.

r Ron ~~each~~Sparks ofhas served as our ~~executive~~and ~~officers~~Accellent's ~~named~~President, Chief Executive Officer and Director since September, 2003. Prior to joining us, Mr. Sparks most recently served from 1998 to 2003 as President of Smith & Nephew, Inc., Endoscopy Division, a subsidiary of Smith & Nephew plc, which is in the ~~Summary~~principal business ~~Compensation~~of ~~Table;~~design, manufacture and sales of endoscopic medical devices to healthcare professionals. Prior to that appointment, he served from 1995 to 1998 as President of the Wound Management Division, which is in the principal business of design, manufacture and sales of advanced wound care products to healthcare professionals. In addition, he was a member of the Group Executive Committee of Smith & Nephew plc, having been appointed in 1999. Mr. Sparks is a graduate of the University of Massachusetts and INSEAD in Fountainebleau, France.

r Stewart ~~all~~A. ofFisher has served as our ~~directors~~and Accellent's Chief Financial Officer, Executive Vice President, Treasurer and ~~executive~~Secretary ~~officers~~since October, as2001. Prior to joining us, Mr. Fisher was Chief Financial Officer and Vice President of GenTek, Inc., a ~~group~~global manufacturer of telecommunications equipment and other industrial products from April 2000 to September 2001. Mr. Fisher was Chief Financial Officer and Vice President of The General Chemical Group, a predecessor company to GenTek, Inc., from April 1999 to March 2000. GenTek, Inc. filed for bankruptcy under Chapter 11 of the United States Bankruptcy Code on October 11, 2002, more than one year after Mr. Fisher resigned from GenTek, Inc. to join us. Earlier in his career, Mr. Fisher was a Manager of Corporate Finance and Capital Markets in the Treasurer's Office of General Motors Corporation. Mr. Fisher holds a B.S.

Unless otherwise indicated below, the address for each listed director and executive officer is MedSource Technologies, Inc., 110 Cheshire Lane, Suite 100, Minneapolis, Minnesota 55305. We have determined beneficial ownership in accordance with the rules of the SEC and, as a result, include voting and investment power with respect to shares. To our knowledge, except under applicable community property laws or as otherwise indicated, the persons named in the table have sole voting and sole investment control with respect to all shares shown as beneficially owned. The percentage of ownership of common stock for each stockholder is based on 16,688,654 shares of our common stock outstanding as of January 15, 2002, assuming the conversion of all outstanding convertible preferred stock and the exercise of the warrant described in the first paragraph after the table under “Summary — The Offering” on page 5. The number of shares of our common stock outstanding used in calculating the percentage for each listed person includes the shares of our common stock underlying the options and warrants held by that person that are exercisable within 60 days following January 15, 2002. The number of shares of our common stock outstanding as of January 15, 2002 is subject to adjustment as described in the second paragraph under the caption “Description of Capital Stock — General.”

		Percentage of Shares Beneficially Owned
Beneficial Owner	Number of Shares Beneficially Owned	Before Offering		After Offering
Richard Effress(a)(b)	641,443	3.8	%	%
Jim Drill(c)	75,000	*
Bill Ellerkamp(d)	20,000	*
Ralph Polumbo(e)	40,000	*
Rich Snider(f)	40,000	*
Joseph Ciffolillo(g)	21,016	*
John Galiardo(b)(h)	27,559	*
Wayne Kelly(i)	48,432	*
William J. Kidd(b)(j)(k)(l)	1,768,306	10.6
T. Michael Long(m)	2,526,045	15.1
Ross Manire(b)(l)(n)(o)	62,082	*
Funds affiliated with Whitney & Co.(p)(q)	3,487,500	20.9
177 Broad Street Stamford, Connecticut 06901
The 1818 Fund III, L.P.(b)(r)	2,526,045	15.1
59 Wall Street New York, New York 10005
All directors and executive officers as a group (8 persons)(b)(s)	5,260,228	30.8
Selling stockholders(t):
Whitney Mezzanine Fund, L.P.(q)	487,500	2.9
177 Broad Street Stamford, Connecticut 06901
German American Capital Corporation(u)	162,500	*
31 West 52nd Street New York, New York 10019

*degree in ~~Represents~~accounting, ~~less~~summa ~~than~~

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