##### Table of Contents



Form 10-Q
 SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2005
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from ___to ___
 Commission file number 1-12733
 TOWER AUTOMOTIVE, INC.
  Delaware
    
    41-1746238(State or other jurisdiction of
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 27175 Haggerty Road
Novi, Michigan
    
    48377(Address of principal executive offices)
    
    (Zip Code)
 (248) 675-6000
 Not Applicable
  Yes þ
    
    No o
  Yes þ
    
    No o
  Yes o
    
    No þ




---



Tower Automotive, Inc.
 Form 10-Q
 Table of Contents
 PART I Financial InformationItem 1. Financial Statements:Condensed Consolidated Balance Sheets (unaudited) at March 31, 2005 and
December 31, 2004Condensed Consolidated Statements of Operations (unaudited) for the
Three Months Ended March 31, 2005 and 2004Condensed Consolidated Statements of Cash Flows (unaudited) for the
Three Months Ended March 31, 2005 and 2004Notes to Condensed Consolidated Financial Statements (unaudited)Item 2. Managements Discussion and Analysis of Financial
Condition and Results of OperationsItem 3. Quantitative and Qualitative Disclosures About Market Risk
See Market Risk section of Part I, Item 2Item 4. Controls and ProceduresPART II Other InformationItem 1. Legal ProceedingsItem 6. ExhibitsSignaturesSection 302 Certification of Chief Executive OfficerSection 302 Certification of Chief Financial OfficerSection 906 Certification of Chief Executive OfficerSection 906 Certification of Chief Financial Officer




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##### Table of Contents



PART 1   FINANCIAL INFORMATION
 
 ITEM 1. Financial Statements.
 TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (Amounts in thousands  unaudited)
 March 31, 2005
    
    
    December 31, 2004ASSETSCurrent assets:Cash and cash equivalents
    
    $
    35,598
    
    
    $
    149,101Accounts receivable
    
    
    528,912
    
    
    
    346,031Inventories
    
    
    161,366
    
    
    
    159,034Prepaid tooling and other
    
    
    127,118
    
    
    
    124,938Total current assets
    
    
    852,994
    
    
    
    779,104Property, plant and equipment, net
    
    
    1,161,655
    
    
    
    1,205,640Investments in joint ventures
    
    
    216,144
    
    
    
    227,740Goodwill
    
    
    166,985
    
    
    
    174,563Other assets, net
    
    
    152,187
    
    
    
    173,727Total assets
    
    $
    2,549,965
    
    
    $
    2,560,774LIABILITIES AND STOCKHOLDERS DEFICITCurrent liabilities not subject to compromise:Current maturities of long-term debt and capital lease obligations
    
    $
    139,828
    
    
    $
    133,156Accounts payable
    
    
    327,216
    
    
    
    638,118Accrued liabilities
    
    
    307,360
    
    
    
    286,262Total current liabilities
    
    
    774,404
    
    
    
    1,057,536Liabilities subject to compromise
    
    
    1,127,364
    
    
    
    Non-current liabilities not subject to compromise:Long-term debt, net of current maturities
    
    
    105,662
    
    
    
    1,239,562Debtor-in-Possession borrowings
    
    
    510,738
    
    
    
    Convertible senior debentures
    
    
    
    
    
    
    121,723Obligations under capital leases, net of current maturities
    
    
    34,689
    
    
    
    36,823Other non-current liabilities
    
    
    222,738
    
    
    
    226,062Total non-current liabilities
    
    
    873,827
    
    
    
    1,624,170Stockholders deficit:Preferred stock
    
    
    
    
    
    
    Common stock
    
    
    666
    
    
    
    666Additional paid-in-capital
    
    
    681,284
    
    
    
    681,084Retained deficit
    
    
    (814,554
    )
    
    
    (715,754
    )Deferred compensation plans
    
    
    (7,510
    )
    
    
    (7,636
    )Accumulated other comprehensive loss
    
    
    (36,192
    )
    
    
    (29,968
    )Treasury stock
    
    
    (49,324
    )
    
    
    (49,324
    )Total stockholders deficit
    
    
    (225,630
    )
    
    
    (120,932
    )Total liabilities and stockholders deficit
    
    $
    2,549,965
    
    
    $
    2,560,774
  1




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##### Table of Contents



TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 (Amounts in thousands, except per share amounts  unaudited)
 Three Months Ended March 31,2005
    
    
    2004Revenues
    
    $
    915,880
    
    
    $
    781,236Cost of sales
    
    
    851,089
    
    
    
    720,591Gross profit
    
    
    64,791
    
    
    
    60,645Selling, general and administrative expenses
    
    
    43,206
    
    
    
    34,154Restructuring and asset impairment charges, net
    
    
    31,895
    
    
    
    (5,607
    )Operating income (loss)
    
    
    (10,310
    )
    
    
    32,098Interest expense, net (contractual interest of $55,967 in
2005)
    
    
    43,670
    
    
    
    31,470Chapter 11 and related reorganization items
    
    
    41,622
    
    
    
    Income (loss) before provision for income taxes, equity
in earnings of joint ventures, minority interest, and gain
on sale of joint venture
    
    
    (95,602
    )
    
    
    628Provision (benefit) for income taxes
    
    
    6,125
    
    
    
    478Income (loss) before equity in earnings of joint
ventures, minority interest, and gain on sale of joint
venture
    
    
    (101,727
    )
    
    
    150Equity in earnings of joint ventures, net of tax
    
    
    4,263
    
    
    
    3,447Minority interest, net of tax
    
    
    (1,334
    )
    
    
    (1,311
    )Gain on sale of joint venture, net of tax
    
    
    
    
    
    
    9,732Net income(loss)
    
    $
    (98,798
    )
    
    $
    12,018Basic earnings (loss) per share
    
    $
    (1.68
    )
    
    $
    0.21Weighted average basic shares outstanding
    
    
    58,648
    
    
    
    57,342Diluted earnings (loss) per share
    
    $
    (1.68
    )
    
    $
    0.21Weighted average diluted shares outstanding
    
    
    58,648
    
    
    
    58,110
  2




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TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Amounts in thousands  unaudited)
 Three Months Ended March 31,2005
    
    
    2004OPERATING ACTIVITIES:Net income (loss)
    
    $
    (98,798
    )
    
    $
    12,018Adjustments required to reconcile net loss to net cash
provided by (used in) operating activities:Chapter 11 and related reorganization items, net
    
    
    38,188
    
    
    
    Non-cash restructuring and impairment
    
    
    32,095
    
    
    
    (6,276
    )Depreciation
    
    
    43,591
    
    
    
    38,357Deferred income tax provision (benefit)
    
    
    2,343
    
    
    
    (4,104
    )Gain on sale of joint venture investment
    
    
    
    
    
    
    (9,732
    )Equity in earnings of joint ventures, net
    
    
    (4,263
    )
    
    
    (3,447
    )Change in working capital and other operating items
    
    
    (190,011
    )
    
    
    (89,700
    )Net cash used in operating activities
    
    
    (176,855
    )
    
    
    (62,884
    )INVESTING ACTIVITIES:Capital expenditures
    
    
    (31,977
    )
    
    
    (53,186
    )Divestitures and other
    
    
    
    
    
    
    54,595Acquisitions
    
    
    
    
    
    
    (21,299
    )Net cash used in investing activities
    
    
    (31,977
    )
    
    
    (19,890
    )FINANCING ACTIVITIES:Proceeds from borrowings
    
    
    16,151
    
    
    
    14,630Repayments of borrowings
    
    
    (433,435
    )
    
    
    (14,409
    )Proceeds from DIP credit facility borrowings
    
    
    623,738
    
    
    
    Repayments of DIP credit facility borrowings
    
    
    (111,125
    )
    
    
    Net cash provided by financing activities
    
    
    95,329
    
    
    
    221NET CHANGE IN CASH AND CASH EQUIVALENTS
    
    
    (113,503
    )
    
    
    (82,553
    )Cash and cash equivalents, beginning of period
    
    
    149,101
    
    
    
    160,899CASH AND CASH EQUIVALENTS, END OF PERIOD
    
    $
    35,598
    
    
    $
    78,346Supplemental Cash Flow Information:Interest paid, net of amounts capitalized
    
    $
    13,074
    
    
    $
    29,118Income taxes paid (refunded)
    
    $
    (295
    )
    
    $
    (863
    )
  3




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TOWER AUTOMOTIVE, INC. AND SUBSIDIARIES
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 (UNAUDITED)
 1. Basis of Presentation
     2. Chapter 11 Reorganization Proceedings
  4




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Financial Statement Classification
   5




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March 31, 2005Debt:5.75% Convertible senior debentures
    
    $
    125,000Due to Tower Automotive Capital Trust
    
    
    258,7509.25% Senior Euro notes
    
    
    195,55512% Senior notes
    
    
    258,000Total debt
    
    
    837,305Accounts payable
    
    
    260,689Accrued interest on debt subject to compromise
    
    
    21,128Accrued liabilities
    
    
    3,616Executory contracts
    
    
    4,626Consolidated liabilities subject to compromise
    
    
    1,127,364Inter-company payable to non-Debtor subsidiaries
    
    
    16,363Total liabilities subject to compromise
    
    $
    1,143,727
  Three Months EndedMarch 31, 2005Professional fees directly related to the filing
    
    $
    12,194Key employee retention costs
    
    
    36Write off of deferred financing costs
    
    
    29,135Estimated executory contract rejection damages
    
    
    208Other expenses directly attributable to the
Companys reorganization
    
    
    49Total
    
    $
    41,622
  6




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Debtors Financial Statements
  Debtors Condensed Consolidated Balance Sheet
Debtors-in-Possession
 March 31, 2005ASSETSCurrent Assets:Cash and cash equivalents
    
    $
    2,705Accounts receivable, net
    
    
    293,044Inventories
    
    
    84,067Prepaid tooling and other
    
    
    40,028Total current assets
    
    
    419,844Property, plant and equipment, net
    
    
    645,399Investments in subsidiaries
    
    
    403,537Inter-company receivables
    
    
    412,200Other assets, net
    
    
    108,739Total assets
    
    $
    1,989,719LIABILITIES AND STOCKHOLDERS DEFICITCurrent Liabilities Not Subject to Compromise:Current maturities of long-term debt and capital lease obligations
    
    $
    5,331Accounts payable
    
    
    99,564Accrued liabilities
    
    
    214,976Total current liabilities
    
    
    319,871Liabilities subject to compromise
    
    
    1,143,727Non-Current Liabilities Not Subject to Compromise:Long-term debt, net of current maturities
    
    
    57,125DIP borrowings
    
    
    510,738Other noncurrent liabilities
    
    
    183,888Total noncurrent liabilities
    
    
    751,751Total stockholders deficit
    
    
    (225,630
    )Total liabilities and stockholders deficit
    
    $
    1,989,719
 7




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Debtors Condensed Consolidated Statement of Operations
Debtors-in-Possession
 Three MonthsEnded March31, 2005Revenues
    
    $
    577,617Cost of sales
    
    
    545,144Gross profit
    
    
    32,473Selling, general and administrative expenses
    
    
    28,782Restructuring and asset impairment charges, net
    
    
    31,895Chapter 11 and related reorganization items
    
    
    41,622Operating loss
    
    
    (69,826
    )Interest expense, net
    
    
    40,560Inter-company interest income
    
    
    (5,890
    )Loss before provision for income taxes, equity
in earnings of joint ventures and equity in earnings
of non-Debtor subsidiaries
    
    
    (104,496
    )Provision for income taxes
    
    
    3,251Loss before equity in earnings of joint
ventures and equity in earnings of non-Debtor
subsidiaries
    
    
    (107,747
    )Equity in earnings (loss) of joint ventures, net of tax
    
    
    (89
    )Equity in earnings of non-Debtor subsidiaries
    
    
    9,038Net loss
    
    $
    (98,798
    )
 8




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Debtors Condensed Consolidated Statement of Cash Flows
 Debtors-in-Possession
 Three MonthsEnded March 31,2005OPERATING ACTIVITIES:Net loss
    
    $
    (98,798
    )Adjustments required to reconcile net loss to net
cash provided by (used in) operating activities:Chapter 11 and related reorganization expenses
    
    
    38,188Non-cash restructuring and impairment
    
    
    32,095Depreciation
    
    
    27,040Equity in earnings of non-Debtor subsidiaries
    
    
    (9,038
    )Equity in earnings of joint ventures, net
    
    
    89Change in working capital and other operating items
    
    
    (173,864
    )Net cash used in operating activities
    
    
    (184,288
    )INVESTING ACTIVITIES:Capital expenditures
    
    
    (6,760
    )Net cash used in investing activities
    
    
    (6,760
    )FINANCING ACTIVITIES:Repayments of pre-petition borrowings
    
    
    (425,941
    )Proceeds from DIP borrowings
    
    
    623,738Repayments of DIP borrowings
    
    
    (111,125
    )Net cash provided by financing activities
    
    
    86,672NET CHANGE IN CASH AND CASH EQUIVALENTS
    
    
    (104,376
    )Cash and cash equivalents, beginning of period
    
    
    107,081CASH AND CASH EQUIVALENTS, END OF PERIOD
    
    $
    2,705
 3. Inventories
  March 31,
    
    
    December 31,2005
    
    
    2004Raw materials
    
    $
    85,314
    
    
    $
    91,220Work in process
    
    
    32,096
    
    
    
    26,820Finished goods
    
    
    43,956
    
    
    
    40,994$
    161,366
    
    
    $
    159,034
 9




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4. Debt
 Chapter 11 Impact
      DIP Financing
    10




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Back-Stop Agreement
   Debt Classified as Not Subject to Compromise
  Interest Rate Swap Contracts
   5. Accounts Receivable Securitization Facilities
  11




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6. Income Taxes
   7. Stockholders Deficit
 Earnings (Loss) Per Share
  Three Months EndedMarch 31,2005
    
    
    2004Net income (loss)  basic and diluted
    
    $
    (98,798
    )
    
    $
    12,018Weighted average number of common shares outstanding
    
    
    58,648
    
    
    
    57,342Dilutive effect of stock options
    
    
    
    
    
    
    768Weighted average number of diluted shares
outstanding
    
    
    58,648
    
    
    
    58,110Basic earnings (loss) per share
    
    $
    (1.68
    )
    
    $
    0.21Diluted earnings (loss) per share
    
    $
    (1.68
    )
    
    $
    0.21
 12




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Stock-Based Compensation
   For the three months ended March 31,2005
    
    
    2004Net income (loss), as reported
    
    $
    (98,798
    )
    
    $
    12,018Add: Stock   based employee compensation
included in reported net income (loss), net
of tax related effects
    
    
    274
    
    
    
    299Deduct: Total stock-based employee
compensation (expense) income determined
under fair value based method for all awards,
net of related tax effects
    
    
    112
    
    
    
    (595
    )Pro Forma
    
    $
    (98,412
    )
    
    $
    11,722Basic earnings (loss) per share as reported
    
    $
    (1.68
    )
    
    $
    0.21Pro Forma
    
    
    (1.68
    )
    
    
    0.20Diluted earnings (loss) per share as reported
    
    $
    (1.68
    )
    
    $
    0.21Pro forma
    
    
    (1.68
    )
    
    
    0.20
   8. Acquisitions
  13




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9. Investments in Joint Ventures
   10. Retirement Plans
  Pension Benefits
    
    
    Other Benefits2005
    
    
    2004
    
    
    2005
    
    
    2004Service cost
    
    $
    1,720
    
    
    $
    2,140
    
    
    $
    200
    
    
    $
    94Interest cost
    
    
    3,790
    
    
    
    3,626
    
    
    
    2,065
    
    
    
    1,935Expected return on plan assets
    
    
    (3,672
    )
    
    
    (3,045
    )
    
    
    
    
    
    
    Amortization of transition assets
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    Amortization of prior service cost
    
    
    1,231
    
    
    
    1,054
    
    
    
    
    
    
    
    Amortization of net losses
    
    
    1,027
    
    
    
    941
    
    
    
    3,230
    
    
    
    1,495Net periodic benefit cost
    
    $
    4,096
    
    
    $
    4,715
    
    
    $
    5,495
    
    
    $
    3,524
   14




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11. Segment Information
   NorthAmerica
    
    
    International
    
    
    TotalThree months ended March 31, 2005:Revenues
    
    $
    589,608
    
    
    $
    326,272
    
    
    $
    915,880Operating income (loss)
    
    
    (29,851
    )
    
    
    19,541
    
    
    
    (10,310
    )Restructuring and asset impairment charge
    
    
    31,895
    
    
    
    
    
    
    
    31,895Total assets
    
    $
    1,419,893
    
    
    $
    1,130,072
    
    
    $
    2,549,965Three months ended March 31, 2004:Revenues
    
    $
    533,881
    
    
    $
    247,355
    
    
    $
    781,236Operating income
    
    
    15,357
    
    
    
    16,741
    
    
    
    32,098Total assets
    
    $
    1,886,526
    
    
    $
    980,789
    
    
    $
    2,867,315
  InternationalBalance at December 31, 2004
    
    $
    174,563Currency translation adjustment
    
    
    (7,578
    )Balance at March 31, 2005
    
    $
    166,985
 12. Restructuring and Asset Impairment Charges
  15




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Severance
    
    
    Other Costs
    
    
    TotalBalance at December 31, 2004
    
    $
    2,615
    
    
    $
    4,349
    
    
    $
    6,964Cash usage
    
    
    (636
    )
    
    
    
    
    
    
    (636
    )Non-cash charges and revisions of estimates
    
    
    (1,031
    )
    
    
    (4,349
    )
    
    
    (5,380
    )Balance at March 31, 2005
    
    $
    948
    
    
    $
    
    
    
    $
    948
   13. Comprehensive Income (Loss)
  For the three months ended March 31,2005
    
    
    2004Net income (loss)
    
    $
    (98,798
    )
    
    $
    12,018Change in cumulative translation adjustment
    
    
    (7,951
    )
    
    
    (7,678
    )Unrealized gain (loss) on qualifying cash
flow hedges, net of tax $- and $384,
respectively
    
    
    1,727
    
    
    
    746Comprehensive income (loss)
    
    $
    (105,022
    )
    
    $
    5,086
 14. Commitments and Contingencies
 Environmental Matters
   16




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Litigation
    Key Employee Retention Plan Agreements
    15. Subsequent Events
 Exit or Disposal Activities
  17




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16. Recently Issued Accounting Prouncements
   18




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17. Consolidating Guarantor and Non-Guarantor Financial Information
  19




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TOWER AUTOMOTIVE, INC.
 Consolidating Balance Sheets at March 31, 2005
 (Amounts in thousands  unaudited)
 Non-Guarantor
    
    
    Non-GuarantorR.J. Tower
    
    
    Parent
    
    
    Guarantor
    
    
    Restricted
    
    
    UnrestrictedCorporation
    
    
    Guarantor
    
    
    Companies
    
    
    Companies
    
    
    Companies
    
    
    Eliminations
    
    
    ConsolidatedAssetsCurrent assets:Cash and cash equivalents
    
    $
    2,643
    
    
    $
    
    
    
    $
    61
    
    
    $
    32,520
    
    
    $
    374
    
    
    $
    
    
    
    $
    35,598Accounts receivable
    
    
    14,912
    
    
    
    
    
    
    
    278,131
    
    
    
    209,084
    
    
    
    26,785
    
    
    
    
    
    
    
    528,912Inventories
    
    
    
    
    
    
    
    
    
    
    84,068
    
    
    
    61,615
    
    
    
    15,683
    
    
    
    
    
    
    
    161,366Prepaid tooling and other
    
    
    4,812
    
    
    
    
    
    
    
    35,216
    
    
    
    65,283
    
    
    
    21,807
    
    
    
    
    
    
    
    127,118Total current assets
    
    
    22,367
    
    
    
    
    
    
    
    397,476
    
    
    
    368,502
    
    
    
    64,649
    
    
    
    
    
    
    
    852,994Property, plant and equipment, net
    
    
    850
    
    
    
    
    
    
    
    644,548
    
    
    
    317,405
    
    
    
    198,852
    
    
    
    
    
    
    
    1,161,655Investments in and advances to (from) affiliates
    
    
    815,263
    
    
    
    165,459
    
    
    
    (618,057
    )
    
    
    (195,991
    )
    
    
    34
    
    
    
    49,436
    
    
    
    216,144Goodwill
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    166,985
    
    
    
    
    
    
    
    
    
    
    
    166,985Other assets, net
    
    
    21,275
    
    
    
    
    
    
    
    87,282
    
    
    
    25,521
    
    
    
    18,109
    
    
    
    
    
    
    
    152,187$
    859,755
    
    
    $
    165,459
    
    
    $
    511,249
    
    
    $
    682,422
    
    
    $
    281,644
    
    
    $
    49,436
    
    
    $
    2,549,965Liabilities and Stockholders Investment (Deficit)Current liabilities:Current maturities of long-term debt and capital lease
obligations
    
    $
    
    
    
    $
    
    
    
    $
    5,331
    
    
    $
    23,682
    
    
    $
    110,815
    
    
    $
    
    
    
    $
    139,828Accounts payable
    
    
    1,484
    
    
    
    
    
    
    
    98,080
    
    
    
    177,067
    
    
    
    50,585
    
    
    
    
    
    
    
    327,216Accrued liabilities
    
    
    32,532
    
    
    
    
    
    
    
    180,493
    
    
    
    84,172
    
    
    
    10,163
    
    
    
    
    
    
    
    307,360Total current liabilities
    
    
    34,016
    
    
    
    
    
    
    
    283,904
    
    
    
    284,921
    
    
    
    171,563
    
    
    
    
    
    
    
    774,404Liabilities subject to compromise
    
    
    474,704
    
    
    
    391,089
    
    
    
    261,571
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,127,364Non-Current Liabilities Not Subject to Compromise:Long-term debt, net of current maturities
    
    
    
    
    
    
    
    
    
    
    57,125
    
    
    
    10,540
    
    
    
    37,997
    
    
    
    
    
    
    
    105,662Debtor-in-possession borrowings, net of current maturities
    
    
    510,738
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    510,738Obligations under capital leases, net of current maturities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    34,689
    
    
    
    
    
    
    
    
    
    
    
    34,689Other noncurrent liabilities
    
    
    41,366
    
    
    
    
    
    
    
    141,870
    
    
    
    31,473
    
    
    
    8,029
    
    
    
    
    
    
    
    222,738Total noncurrent liabilities
    
    
    552,104
    
    
    
    
    
    
    
    198,995
    
    
    
    76,702
    
    
    
    46,026
    
    
    
    
    
    
    
    873,827Stockholders investment (deficit)
    
    
    (201,069
    )
    
    
    (225,630
    )
    
    
    (233,221
    )
    
    
    320,799
    
    
    
    64,055
    
    
    
    49,436
    
    
    
    (225,630
    )$
    859,755
    
    
    $
    165,459
    
    
    $
    511,249
    
    
    $
    682,422
    
    
    $
    281,644
    
    
    $
    49,436
    
    
    $
    2,549,965
 20




---



##### Table of Contents



TOWER AUTOMOTIVE, INC.
 Consolidating Statement of Operations for the Three Months Ended March 31, 2005
 (Amounts in thousands  unaudited)
 Non-Guarantor
    
    
    Non-GuarantorR.J. Tower
    
    
    Parent
    
    
    Guarantor
    
    
    Restricted
    
    
    UnrestrictedCorporation
    
    
    Guarantor
    
    
    Companies
    
    
    Companies
    
    
    Companies
    
    
    Eliminations
    
    
    ConsolidatedRevenues
    
    $
    
    
    
    $
    
    
    
    $
    577,616
    
    
    $
    242,824
    
    
    $
    95,440
    
    
    $
    
    
    
    $
    915,880Cost of sales
    
    
    (1,542
    )
    
    
    
    
    
    
    547,577
    
    
    
    215,770
    
    
    
    89,284
    
    
    
    
    
    
    
    851,089Gross profit
    
    
    1,542
    
    
    
    
    
    
    
    30,039
    
    
    
    27,054
    
    
    
    6,156
    
    
    
    
    
    
    
    64,791Selling, general and administrative expenses
    
    
    (4,212
    )
    
    
    
    
    
    
    32,994
    
    
    
    11,587
    
    
    
    2,837
    
    
    
    
    
    
    
    43,206Restructuring and asset impairment charge
    
    
    105
    
    
    
    
    
    
    
    31,790
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    31,895Operating income (loss)
    
    
    5,649
    
    
    
    
    
    
    
    (34,745
    )
    
    
    15,467
    
    
    
    3,319
    
    
    
    
    
    
    
    (10,310
    )Interest expense, net
    
    
    36,376
    
    
    
    2,221
    
    
    
    1,960
    
    
    
    1,368
    
    
    
    1,745
    
    
    
    
    
    
    
    43,670Chapter 11 and related reorganization items
    
    
    41,622
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    41,622Income (loss) before provision for income taxes, equity
in earnings of joint ventures and minority interest
    
    
    (72,349
    )
    
    
    (2,221
    )
    
    
    (36,705
    )
    
    
    14,099
    
    
    
    1,574
    
    
    
    
    
    
    
    (95,602
    )Provision (benefit) for income taxes
    
    
    
    
    
    
    
    
    
    
    1,297
    
    
    
    4,340
    
    
    
    488
    
    
    
    
    
    
    
    6,125Income (loss) before equity in earnings of joint ventures
and minority interest
    
    
    (72,349
    )
    
    
    (2,221
    )
    
    
    (38,002
    )
    
    
    9,759
    
    
    
    1,086
    
    
    
    
    
    
    
    (101,727
    )Equity earnings in joint ventures and subsidiaries, net
    
    
    (24,228
    )
    
    
    (96,577
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    125,068
    
    
    
    4,263Minority interest, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,334
    )
    
    
    
    
    
    
    
    
    
    
    (1,334
    )Net income (loss)
    
    $
    (96,577
    )
    
    $
    (98,798
    )
    
    $
    (38,002
    )
    
    $
    8,425
    
    
    $
    1,086
    
    
    $
    125,068
    
    
    $
    (98,798
    )
 21




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##### Table of Contents



TOWER AUTOMOTIVE, INC.
 Consolidating Statements of Cash Flows for the Three Months Ended March 31, 2005
 (Amounts in thousands  unaudited)
 Non-Guarantor
    
    
    Non-GuarantorR. J. Tower
    
    
    Parent
    
    
    Guarantor
    
    
    Restricted
    
    
    UnrestrictedCorporation
    
    
    Guarantor
    
    
    Companies
    
    
    Companies
    
    
    Companies
    
    
    Eliminations
    
    
    ConsolidatedOPERATING ACTIVITIES:Net income (loss)
    
    $
    (96,577
    )
    
    $
    (98,798
    )
    
    $
    (38,002
    )
    
    $
    8,425
    
    
    $
    1,086
    
    
    $
    125,068
    
    
    $
    (98,798
    )Adjustments required to reconcile net income to
net cash provided by (used in) operating activitiesChapter 11 and related reorganization expenses, net
    
    
    38,188
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    38,188Non-cash restructuring charge
    
    
    
    
    
    
    
    
    
    
    32,095
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    32,095Depreciation
    
    
    83
    
    
    
    
    
    
    
    26,956
    
    
    
    11,507
    
    
    
    5,045
    
    
    
    
    
    
    
    43,591Deferred income tax provision (benefit)
    
    
    
    
    
    
    
    
    
    
    (2,265
    )
    
    
    2,344
    
    
    
    2,264
    
    
    
    
    
    
    
    2,343Equity in earnings of joint ventures, net
    
    
    (4,263
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,263
    )Changes in working capital and other operating items
    
    
    (33,647
    )
    
    
    2,445
    
    
    
    (10,505
    )
    
    
    (11,154
    )
    
    
    (12,082
    )
    
    
    (125,068
    )
    
    
    (190,011
    )Net cash provided by (used in) operating activities
    
    
    (96,216
    )
    
    
    (96,353
    )
    
    
    8,279
    
    
    
    11,122
    
    
    
    (3,687
    )
    
    
    
    
    
    
    (176,855
    )INVESTING ACTIVITIES:Capital expenditures, net
    
    
    
    
    
    
    
    
    
    
    (6,760
    )
    
    
    (19,421
    )
    
    
    (5,796
    )
    
    
    
    
    
    
    (31,977
    )Other, net
    
    
    (96,353
    )
    
    
    96,353
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net cash provided by (used in) investing activities
    
    
    (96,353
    )
    
    
    96,353
    
    
    
    (6,760
    )
    
    
    (19,421
    )
    
    
    (5,796
    )
    
    
    
    
    
    
    (31,977
    )FINANCING ACTIVITIES:Proceeds from pre-petition borrowings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,541
    
    
    
    10,610
    
    
    
    
    
    
    
    16,151Repayments of pre-petition borrowings
    
    
    (425,000
    )
    
    
    
    
    
    
    (941
    )
    
    
    (6,670
    )
    
    
    (824
    )
    
    
    
    
    
    
    (433,435
    )Proceeds from DIP credit facility
    
    
    623,738
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    623,738Repayments of DIP credit facility borrowings
    
    
    (111,125
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (111,125
    )Net cash provided by (used for) financing activities
    
    
    87,613
    
    
    
    
    
    
    
    (941
    )
    
    
    (1,129
    )
    
    
    9,786
    
    
    
    
    
    
    
    95,329NET CHANGE IN CASH AND CASH EQUIVALENTS
    
    
    (104,956
    )
    
    
    
    
    
    
    578
    
    
    
    (9,428
    )
    
    
    303
    
    
    
    
    
    
    
    (113,503
    )CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
    
    
    107,599
    
    
    
    
    
    
    
    (517
    )
    
    
    41,948
    
    
    
    71
    
    
    
    
    
    
    
    149,101CASH AND CASH EQUIVALENTS, END OF PERIOD
    
    $
    2,643
    
    
    $
    
    
    
    $
    61
    
    
    $
    32,520
    
    
    $
    374
    
    
    $
    
    
    
    $
    35,598
 22




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##### Table of Contents



TOWER AUTOMOTIVE, INC.
 Consolidating Balance Sheets at December 31, 2004
 (Amounts in thousands)
 Non-Guarantor
    
    
    Non-GuarantorR.J. Tower
    
    
    Parent
    
    
    Guarantor
    
    
    Restricted
    
    
    UnrestrictedCorporation
    
    
    Guarantor
    
    
    Companies
    
    
    Companies
    
    
    Companies
    
    
    Eliminations
    
    
    ConsolidatedAssetsCurrent assets:Cash and cash equivalents
    
    $
    107,599
    
    
    $
    
    
    
    $
    (517
    )
    
    $
    41,948
    
    
    $
    71
    
    
    $
    
    
    
    $
    149,101Accounts receivable
    
    
    47,373
    
    
    
    
    
    
    
    70,636
    
    
    
    188,352
    
    
    
    39,670
    
    
    
    
    
    
    
    346,031Inventories
    
    
    (372
    )
    
    
    
    
    
    
    75,469
    
    
    
    72,050
    
    
    
    11,887
    
    
    
    
    
    
    
    159,034Prepaid tooling and other
    
    
    4,427
    
    
    
    
    
    
    
    54,618
    
    
    
    53,947
    
    
    
    11,946
    
    
    
    
    
    
    
    124,938Total current assets
    
    
    159,027
    
    
    
    
    
    
    
    200,206
    
    
    
    356,297
    
    
    
    63,574
    
    
    
    
    
    
    
    779,104Property, plant and equipment, net
    
    
    601
    
    
    
    
    
    
    
    690,646
    
    
    
    319,785
    
    
    
    194,608
    
    
    
    
    
    
    
    1,205,640Investments in joint ventures
    
    
    227,740
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    227,740Investments in and advances to (from) affiliates
    
    
    526,173
    
    
    
    255,049
    
    
    
    (453,177
    )
    
    
    (216,603
    )
    
    
    4,278
    
    
    
    (115,720
    )
    
    
    Goodwill
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    174,563
    
    
    
    
    
    
    
    
    
    
    
    174,563Other assets, net
    
    
    37,307
    
    
    
    5,410
    
    
    
    90,194
    
    
    
    28,616
    
    
    
    12,200
    
    
    
    
    
    
    
    173,727$
    950,848
    
    
    $
    260,459
    
    
    $
    527,869
    
    
    $
    662,658
    
    
    $
    274,660
    
    
    $
    (115,720
    )
    
    $
    2,560,774Liabilities and Stockholders Investment (Deficit)Current liabilities:Current maturities of long-term debt and capital lease
obligations
    
    $
    3,750
    
    
    $
    
    
    
    $
    6,271
    
    
    $
    24,460
    
    
    $
    98,675
    
    
    $
    
    
    
    $
    133,156Accounts payable
    
    
    29,052
    
    
    
    
    
    
    
    366,329
    
    
    
    184,876
    
    
    
    57,861
    
    
    
    
    
    
    
    638,118Accrued liabilities
    
    
    70,421
    
    
    
    918
    
    
    
    143,643
    
    
    
    57,941
    
    
    
    13,339
    
    
    
    
    
    
    
    286,262Total current liabilities
    
    
    103,223
    
    
    
    918
    
    
    
    516,243
    
    
    
    267,277
    
    
    
    169,875
    
    
    
    
    
    
    
    1,057,536Non-Current Liabilities:Long-term debt, net of current maturities
    
    
    874,358
    
    
    
    258,750
    
    
    
    57,126
    
    
    
    11,855
    
    
    
    37,473
    
    
    
    
    
    
    
    1,239,562Convertible senior debenture
    
    
    
    
    
    
    121,723
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    121,723Obligations under capital leases, net of current maturities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    36,472
    
    
    
    351
    
    
    
    
    
    
    
    36,823Other noncurrent liabilities
    
    
    40,001
    
    
    
    
    
    
    
    149,776
    
    
    
    30,956
    
    
    
    5,329
    
    
    
    
    
    
    
    226,062Total noncurrent liabilities
    
    
    914,359
    
    
    
    380,473
    
    
    
    206,902
    
    
    
    79,283
    
    
    
    43,153
    
    
    
    
    
    
    
    1,624,170Stockholders investment (deficit)
    
    
    (66,734
    )
    
    
    (120,932
    )
    
    
    (195,276
    )
    
    
    316,098
    
    
    
    61,632
    
    
    
    (115,720
    )
    
    
    (120,932
    )$
    950,848
    
    
    $
    260,459
    
    
    $
    527,869
    
    
    $
    662,658
    
    
    $
    274,660
    
    
    $
    (115,720
    )
    
    $
    2,560,774
 23




---



##### Table of Contents



TOWER AUTOMOTIVE, INC.
 Consolidating
Statement of Operations for the Three Months Ended March 31,
2004

(Amounts in thousands  unaudited)
 Non-Guarantor
    
    
    Non-GuarantorR.J. Tower
    
    
    Parent
    
    
    Guarantor
    
    
    Restricted
    
    
    UnrestrictedCorporation
    
    
    Guarantor
    
    
    Companies
    
    
    Companies
    
    
    Companies
    
    
    Eliminations
    
    
    ConsolidatedRevenues
    
    $
    
    
    
    $
    
    
    
    $
    524,823
    
    
    $
    189,125
    
    
    $
    67,288
    
    
    $
    
    
    
    $
    781,236Cost of sales
    
    
    (2,739
    )
    
    
    
    
    
    
    495,377
    
    
    
    166,503
    
    
    
    61,450
    
    
    
    
    
    
    
    720,591Gross profit
    
    
    2,739
    
    
    
    
    
    
    
    29,446
    
    
    
    22,622
    
    
    
    5,838
    
    
    
    
    
    
    
    60,645Selling, general and administrative expenses
    
    
    (8,415
    )
    
    
    
    
    
    
    30,382
    
    
    
    9,595
    
    
    
    2,592
    
    
    
    
    
    
    
    34,154Restructuring and asset impairment charge
    
    
    217
    
    
    
    
    
    
    
    (5,824
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,607
    )Operating income
    
    
    10,937
    
    
    
    
    
    
    
    4,888
    
    
    
    13,027
    
    
    
    3,246
    
    
    
    
    
    
    
    32,098Interest expense, net
    
    
    21,250
    
    
    
    7,191
    
    
    
    (519
    )
    
    
    1,581
    
    
    
    1,967
    
    
    
    
    
    
    
    31,470Income (loss) before provision for income taxes, equity
in earnings of joint ventures and minority interest
    
    
    (10,313
    )
    
    
    (7,191
    )
    
    
    5,407
    
    
    
    11,446
    
    
    
    1,279
    
    
    
    
    
    
    
    628Provision (benefit) for income taxes
    
    
    (3,242
    )
    
    
    (2,445
    )
    
    
    1,838
    
    
    
    3,892
    
    
    
    435
    
    
    
    
    
    
    
    478Income (loss) before equity in earnings of joint ventures
and minority interest
    
    
    (7,071
    )
    
    
    (4,746
    )
    
    
    3,569
    
    
    
    7,554
    
    
    
    844
    
    
    
    
    
    
    
    150Equity earnings in joint ventures and subsidiaries, net
    
    
    14,103
    
    
    
    16,764
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (27,420
    )
    
    
    3,447Minority interest, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,311
    )
    
    
    
    
    
    
    
    
    
    
    (1,311
    )Gain on sale of joint venture, net
    
    
    9,732
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,732Net income (loss)
    
    $
    16,764
    
    
    $
    12,018
    
    
    $
    3,569
    
    
    $
    6,243
    
    
    $
    844
    
    
    $
    (27,420
    )
    
    $
    12,018
 24




---



##### Table of Contents



TOWER AUTOMOTIVE, INC.
 Consolidating
Statements of Cash Flows for the Three Months Ended March 31,
2004

(Amounts in thousands  unaudited)
 Non-Guarantor
    
    
    Non-GuarantorR. J. Tower
    
    
    Parent
    
    
    Guarantor
    
    
    Restricted
    
    
    UnrestrictedCorporation
    
    
    Guarantor
    
    
    Companies
    
    
    Companies
    
    
    Companies
    
    
    Eliminations
    
    
    ConsolidatedOPERATING ACTIVITIES:Net income (loss)
    
    $
    16,764
    
    
    $
    12,018
    
    
    $
    3,569
    
    
    $
    6,243
    
    
    $
    844
    
    
    $
    (27,420
    )
    
    $
    12,018Adjustments required to reconcile net income to
net cash provided by (used in) operating activitiesNon-cash restructuring and asset impairment reversal
    
    
    
    
    
    
    
    
    
    
    (6,276
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,276
    )Depreciation
    
    
    65
    
    
    
    
    
    
    
    23,917
    
    
    
    10,185
    
    
    
    4,190
    
    
    
    
    
    
    
    38,357Deferred income tax provision (benefit)
    
    
    (2,217
    )
    
    
    
    
    
    
    (279
    )
    
    
    (1,858
    )
    
    
    250
    
    
    
    
    
    
    
    (4,104
    )Gain on sale of joint venture investment
    
    
    (9,732
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9,732
    )Equity in earnings of joint ventures, net
    
    
    (3,447
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,447
    )Changes in working capital and other operating items
    
    
    (5,338
    )
    
    
    (2,499
    )
    
    
    (105,026
    )
    
    
    4,381
    
    
    
    10,850
    
    
    
    7,932
    
    
    
    (89,700
    )Net cash provided by (used in) operating activities
    
    
    (3,905
    )
    
    
    9,519
    
    
    
    (84,095
    )
    
    
    18,951
    
    
    
    16,134
    
    
    
    (19,488
    )
    
    
    (62,884
    )INVESTING ACTIVITIES:Capital expenditures, net
    
    
    (608
    )
    
    
    
    
    
    
    (32,875
    )
    
    
    (16,031
    )
    
    
    (3,672
    )
    
    
    
    
    
    
    (53,186
    )Divestitures and other
    
    
    44,626
    
    
    
    (9,519
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,488
    
    
    
    54,595Acquisitions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21,299
    )
    
    
    
    
    
    
    (21,299
    )Net cash provided by (used in) investing activities
    
    
    44,018
    
    
    
    (9,519
    )
    
    
    (32,875
    )
    
    
    (16,031
    )
    
    
    (24,971
    )
    
    
    19,488
    
    
    
    (19,890
    )FINANCING ACTIVITIES:Proceeds from borrowings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,378
    
    
    
    11,252
    
    
    
    
    
    
    
    14,630Repayment of debt
    
    
    
    
    
    
    
    
    
    
    (881
    )
    
    
    (9,188
    )
    
    
    (4,340
    )
    
    
    
    
    
    
    (14,409
    )Net cash provided by (used for) financing activities
    
    
    
    
    
    
    
    
    
    
    (881
    )
    
    
    (5,810
    )
    
    
    6,912
    
    
    
    
    
    
    
    221NET CHANGE IN CASH AND CASH EQUIVALENTS
    
    
    40,113
    
    
    
    
    
    
    
    (117,851
    )
    
    
    (2,890
    )
    
    
    (1,925
    )
    
    
    
    
    
    
    (82,553
    )CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
    
    
    
    
    
    
    
    
    
    
    118,352
    
    
    
    40,419
    
    
    
    2,128
    
    
    
    
    
    
    
    160,899CASH AND CASH EQUIVALENTS, END OF PERIOD
    
    $
    40,113
    
    
    $
    
    
    
    $
    501
    
    
    $
    37,529
    
    
    $
    203
    
    
    $
    
    
    
    $
    78,346
 25




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
 Going Concern
  Overview
      26




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##### Table of Contents



Results of Operations
 Three Months Ended March 31, 2005 Compared to the Three Months Ended March 31, 2004
 Revenues
 27




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##### Table of Contents



Gross Profit and Gross Margin.
 Selling, General and Administrative Expenses.
 Interest Expense, Net.
 Chapter 11 and Related Reorganization Items.
 Provision for Income Taxes.
 Equity in Earnings of Joint Ventures, Net of Tax.
 28




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##### Table of Contents



Minority Interest, Net of Tax.
 Gain on Sale of Joint Venture, Net of Tax.
 Net Income (Loss).
 Restructuring and Asset Impairment
   Liquidity and Capital Resources
    29




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##### Table of Contents



30




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##### Table of Contents



Chapter 11 Impact
     DIP Financing
      31




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##### Table of Contents



Contractual Obligations and Commercial Commitments
   Payments Due by PeriodLess than
    
    
    
    
    
    
    
    
    
    
    AfterContractual Obligations
    
    Total
    
    
    1 Year
    
    
    1- 3 Years
    
    
    4- 5 Years
    
    
    5 YearsLong-term debt (1)
    
    $
    945,751
    
    
    $
    124,622
    
    
    $
    63,764
    
    
    $
    416,881
    
    
    $
    340,484DIP Agreement
    
    
    510,738
    
    
    
    
    
    
    
    510,738
    
    
    
    
    
    
    
    
  (1)
    
    Includes liabilities subject to compromise.
 Market Risk
      32




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##### Table of Contents



Opportunities
  Disclosure Regarding Forward-Looking Statements
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk.
  
 Item 4. Controls and Procedures.
  33




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##### Table of Contents



§
    
    Assure that payments of pre-petition liabilities subsequent to the bankruptcy filing
were made in accordance with the approved motions by the Bankruptcy Court;§
    
    Assure that pre-petition liabilities are adequately segregated from post-petition
liabilities; and§
    
    Assure that the Companys financial statements comply with Statement of Position 90-7,
Financial Reporting by Entities in Reorganization Under the Bankruptcy Code.
 
 PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings.
   
 Item 6. Exhibits.
 31.1
    
    Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.31.2
    
    Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.32.1
    
    Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.32.2
    
    Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
 34




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##### Table of Contents



TOWER AUTOMOTIVE, INC.RegistrantDate: October 3, 2005
    
    /s/ Christopher T. HattoChristopher T. HattoChief Accounting Officer
 35




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##### Table of Contents



Exhibit Index
 ExhibitNumber
    
    Description31.1
    
    Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.31.2
    
    Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.32.1
    
    Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.32.2
    
    Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
 36