Table of Contents

** **

 

** **

**UNITED STATES SECURITIES AND EXCHANGECOMMISSION**

**WASHINGTON,DC  20549**

 

**FORM 10-Q**

 

**(Mark One)**

 

**x****     ****Quarterly Report Pursuantto Section 13 or 15 (d) of the Securities Exchange Act of 1934**

 

**For the quarterly period ended September 30,2010.**

 

**OR**

 

**o****        ****Transition Report Pursuant to Section 13or 15(d) of the Securities Exchange Act of 1934**

 

**For the transition period from                  to                  .**

 

**Commission file number 001-32483**

 

**ACCURIDE CORPORATION**

(Exact Name of Registrant as Specified inIts Charter)

 

| **Delaware**                                | ** ** | **61-1109077**                       |
|---------------------------------------------|------------|--------------------------------------|
| (State or Other Jurisdiction of             |       | (I.R.S. Employer Identification No.) |
| Incorporation or Organization)              |       |                                 |
|                                        |       |                                 |
| **7140 Office Circle, Evansville, IN** | ** ** | **47715**                            |
| (Address of Principal Executive Offices)    |       | (Zip Code)                           |

 

Registrant’sTelephone Number, Including Area Code: **(812)962-5000**

 

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

 

Indicate by check mark whether the registrant hassubmitted electronically and posted on its corporate Web site, if any, everyInteractive Data File required to be submitted and posted pursuant to Rule 405of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (orfor such shorter period that the registrant was required to submit and postsuch files).  Yes o  No o

 

Indicate by check mark whether the registrant is alarge accelerated filer, an accelerated filer, a non-accelerated filer, or asmaller reporting company. See definitions of “large accelerated filer,” “acceleratedfiler” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

| Large Accelerated Filer o |   | Accelerated Filer o         |
|--------------------------------|--------|-----------------------------|
|                           |   |                        |
| Non-Accelerated Filer x        |   | Smaller Reporting Company o |

 

Indicate by check mark whether theregistrant is a shell company (as defined in Rule 12b-2 of the ExchangeAct). Yeso No x

 

Indicate by check mark whether the registrant hasfiled all documents and reports required to be filed by Sections 12, 13 or 15(d)oftheSecuritiesExchangeActof1934subsequenttothedistributionofsecuritiesunderaplanconfirmedbyacourt.YesxNoo

 

As of November 5, 2010, 126,295,024shares of Accuride Corporation common stock, par value $.01 per share, wereoutstanding. 

 

 

 

----

Table of Contents

** **

**ACCURIDECORPORATION**

 

**Table of Contents**

** **
| ** **                                                  | ** **                                                                                  | **Page**   |
|-------------------------------------------------------------|---------------------------------------------------------------------------------------------|------------|
| ** **                                                  | ** **                                                                                  | ** ** |
| **PART I — FINANCIAL INFORMATION** | ** **                                                                                  |
| ** **                                                  | ** **                                                                                  | ** ** |
| Item 1.                                                     | Condensed  Consolidated Financial Statements (Unaudited)                                    |       |
|                                                        |                                                                                        |       |
|                                                        | Condensed Consolidated  Balance Sheets                                                      | 3          |
|                                                        |                                                                                        |       |
|                                                        | Condensed Consolidated  Statements of Operations                                            | 4          |
|                                                        |                                                                                        |       |
|                                                        | Condensed  Consolidated Statements of Stockholders’ Equity (Deficiency)                | 6          |
|                                                        |                                                                                        |       |
|                                                        | Condensed  Consolidated Statements of Cash Flows                                            | 7          |
|                                                        |                                                                                        |       |
|                                                        | Notes to  Condensed Consolidated Financial Statements                                       | 8          |
|                                                        |                                                                                        |       |
| Item 2.                                                     | Management’s  Discussion and Analysis of Financial Condition and Results of Operations | 27         |
|                                                        |                                                                                        |       |
| Item 3.                                                     | Quantitative  and Qualitative Disclosures About Market Risk                                 | 35         |
|                                                        |                                                                                        |       |
| Item 4.                                                     | Controls and Procedures                                                                     | 36         |
|                                                        |                                                                                        |       |
| **PART II  — OTHER INFORMATION**                  |                                                                                        |
| ** **                                                  |                                                                                        |       |
| Item 1.                                                     | Legal Proceedings                                                                           | 36         |
|                                                        |                                                                                        |       |
| Item 6.                                                     | Exhibits                                                                                    | 37         |
|                                                        |                                                                                        |       |
| Signatures                                                  |                                                                                        | 39         |

 

2

----

Table ofContents

 

**Part I.  FINANCIAL INFORMATION**

 

**Item 1.  Financial Statements**

 

**ACCURIDECORPORATION**

**CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)**

 
| ** **                                                                                                                                                                      | ** ** | **Successor**          | ** ** | **Predecessor**       | ** ** |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|------------------------|------------|-----------------------|------------|
| ** **                                                                                                                                                                      | ** ** | **September 30,** | ** ** | **December 31,** | ** ** |
| **(In thousands, except for per share and per share data)**                                                                        | ** ** | **2010**               | ** ** | **2009**              | ** ** |
| **ASSETS**                                                                                                                                                                      |       |                   |       |                  |       |
| CURRENT ASSETS:                                                                                                                                                                 |       |                   |       |                  |       |
| Cash and cash equivalents                                                                                                                                                       |       | $                      | 51,364     |                  | $          | 56,521 |   |
| Customer receivables,  net of allowance for doubtful accounts of $1,547 and $2,329 in 2010 and 2009,  respectively                                                              |       | 98,201                 |       | 60,120                |       |
| Other receivables                                                                                                                                                               |       | 4,997                  |       | 6,181                 |       |
| Inventories                                                                                                                                                                     |       | 64,693                 |       | 50,742                |       |
| Deferred income taxes                                                                                                                                                           |       | 2,811                  |       | 2,811                 |       |
| Income tax receivable                                                                                                                                                           |       | —                 |       | 1,542                 |       |
| Prepaid expenses and  other current assets                                                                                                                                      |       | 4,990                  |       | 21,220                |       |
| Total current assets                                                                                                                                                            |       | 227,056                |       | 199,137               |       |
| PROPERTY, PLANT AND  EQUIPMENT, net                                                                                                                                             |       | 256,980                |       | 229,527               |       |
| OTHER ASSETS:                                                                                                                                                                   |       |                   |       |                  |       |
| Goodwill                                                                                                                                                                        |       | 128,741                |       | 127,474               |       |
| Other intangible  assets, net                                                                                                                                                   |       | 234,518                |       | 89,230                |       |
| Deferred financing  costs, net of accumulated amortization of $285 and $7,360 in 2010 and 2009,  respectively                                                                   |       | 10,583                 |       | 4,282                 |       |
| Other                                                                                                                                                                           |       | 8,534                  |       | 22,020                |       |
| TOTAL                                                                                                                                                                           |       | $                      | 866,412    |                  | $          | 671,670 |   |
| **LIABILITIES  AND STOCKHOLDERS’ EQUITY (DEFICIENCY)**                                                                                                                     |       |                   |       |                  |       |
| CURRENT LIABILITIES:                                                                                                                                                            |       |                   |       |                  |       |
| Accounts payable                                                                                                                                                                |       | $                      | 58,699     |                  | $          | 31,277 |   |
| Accrued payroll and  compensation                                                                                                                                               |       | 18,468                 |       | 14,318                |       |
| Accrued interest  payable                                                                                                                                                       |       | 5,196                  |       | 3,571                 |       |
| Accrued workers  compensation                                                                                                                                                   |       | 7,746                  |       | 7,038                 |       |
| Debt                                                                                                                                                                            |       | —                 |       | 397,472               |       |
| Accrued and other liabilities                                                                                                                                                   |       | 20,046                 |       | 20,609                |       |
| Total current  liabilities                                                                                                                                                      |       | 110,155                |       | 474,285               |       |
| LONG-TERM DEBT                                                                                                                                                                  |       | 587,037                |       | —                |       |
| DEFERRED INCOME TAXES                                                                                                                                                           |       | 13,375                 |       | 14,274                |       |
| NON-CURRENT INCOME  TAXES PAYABLE                                                                                                                                               |       | 8,283                  |       | 7,914                 |       |
| OTHER POSTRETIREMENT  BENEFIT PLAN LIABILITY                                                                                                                                    |       | 74,240                 |       | 61,292                |       |
| PENSION BENEFIT PLAN  LIABILITY                                                                                                                                                 |       | 33,114                 |       | 35,932                |       |
| OTHER LIABILITIES                                                                                                                                                               |       | 5,901                  |       | 4,125                 |       |
| LIABILITIES SUBJECT TO  COMPROMISE                                                                                                                                              |       | —                 |       | 302,114               |       |
| COMMITMENTS AND  CONTINGENCIES (Note 7)                                                                                                                                         |       | —                 |       | —                |       |
| STOCKHOLDERS’ EQUITY  (DEFICIENCY):                                                                                                                                        |       |                   |       |                  |       |
| Predecessor Company  Preferred Stock, $0.01 par value; 5,000,000 shares authorized and 1 issued                                                                                 |       | —                 |       | —                |       |
| Predecessor Company  Common Stock, $0.01 par value; 100,000,000 shares authorized, 48,139,000  shares issued, and 47,562,000 shares outstanding and additional  paid-in-capital |       | —                 |       | 268,582               |       |
| Successor Company  Preferred Stock, $0.01 par value; 100,000,000 shares authorized                                                                                              |       | —                 |       | —                |       |
| Successor Company  Common Stock, $0.01 par value; 800,000,000 shares authorized, 126,295,024  shares issued and outstanding and additional paid-in-capital                      |       | 49,974                 |       | —                |       |
| Predecessor Company  Treasury stock — 76,000 shares at cost in 2009                                                                                                        |       | —                 |       | (751                  | )          |
| Accumulated other  comprehensive income (loss)                                                                                                                                  |       | —                 |       | (48,376               | )          |
| Accumulated deficiency                                                                                                                                                          |       | (15,667                | )          | (447,721              | )          |
| Total stockholders’  equity (deficiency)                                                                                                                                   |       | 34,307                 |       | (228,266              | )          |
| TOTAL                                                                                                                                                                           |       | $                      | 866,412    |                  | $          | 671,670 |   |

 

See notes to unaudited condensed consolidatedfinancial statements.

 

3

----

Table of Contents

 

**ACCURIDE CORPORATION**

**CONDENSED CONSOLIDATEDSTATEMENTS OF OPERATIONS (UNAUDITED)**

 
| ** **                                                        | ** ** | **Successor**                                    | ** ** | **Predecessor**                                  | ** ** |
|-------------------------------------------------------------------|------------|--------------------------------------------------|------------|--------------------------------------------------|------------|
| ** **                                                        | ** ** | **Three Months  Ended  September 30,** | ** ** | **Three Months  Ended  September 30,** | ** ** |
| **(In thousands except per share data)** | ** ** | **2010**                                         | ** ** | **2009**                                         | ** ** |
| ** **                                                        | ** ** | ** **                                       | ** ** | ** **                                       | ** ** |
| NET SALES                                                         |       | $                                                | 205,690    |                                             | $          | 145,209 |   |
| COST OF GOODS SOLD                                                |       | 184,386                                          |       | 143,335                                          |       |
| GROSS PROFIT                                                      |       | 21,304                                           |       | 1,874                                            |       |
| OPERATING EXPENSES:                                               |       |                                             |       |                                             |       |
| Selling, general and  administrative                              |       | 14,854                                           |       | 22,372                                           |       |
| INCOME (LOSS) FROM  OPERATIONS                                    |       | 6,450                                            |       | (20,498                                          | )          |
| OTHER INCOME (EXPENSE):                                           |       |                                             |       |                                             |       |
| Interest income                                                   |       | 65                                               |       | 254                                              |       |
| Interest expense                                                  |       | (10,787                                          | )          | (18,385                                          | )          |
| Unrealized gain on mark  to market valuation of convertible debt  |       | 36,827                                           |       | —                                           |       |
| Other income, net                                                 |       | 2,647                                            |       | 3,231                                            |       |
| INCOME (LOSS) BEFORE  INCOME TAXES                                |       | 35,202                                           |       | (35,398                                          | )          |
| INCOME TAX PROVISION  (BENEFIT)                                   |       | 4,351                                            |       | (2,069                                           | )          |
| NET INCOME (LOSS)                                                 |       | $                                                | 30,851     |                                             | $          | (33,329 | ) |
| Weighted average common  shares outstanding—basic            |       | 126,295                                          |       | 36,368                                           |       |
| Basic income (loss) per  share                                    |       | $                                                | 0.10       |                                             | $          | (0.92 | ) |
| Weighted average common  shares outstanding—diluted          |       | 331,229                                          |       | 36,368                                           |       |
| Diluted loss per share                                            |       | $                                                | (0.01      | )                                                | $          | (0.92 | ) |

 

See notes to unaudited condensed consolidatedfinancial statements.

 

4

----

Table of Contents

 

**ACCURIDE CORPORATION**

**CONDENSED CONSOLIDATED STATEMENTSOF OPERATIONS (UNAUDITED)**

 
| ** **                                                        | ** ** | **Successor**                                                      | ** ** | **Predecessor**                                                 | ** ** |
|-------------------------------------------------------------------|------------|--------------------------------------------------------------------|------------|-----------------------------------------------------------------|------------|
| ** **                                                        | ** ** | **Period from  February 26 to  September 30,** | ** ** | **Period from  January 1 to  February 26,** | ** ** | **Nine Months  Ended  September 30,** | ** ** |
| **(In thousands except per share data)** | ** ** | **2010**                                                           | ** ** | **2010**                                                        | ** ** | **2009** | ** ** |
| ** **                                                        | ** ** | ** **                                                         | ** ** | ** **                                                      | ** ** | ** ** | ** ** |
| NET SALES                                                         |       | $                                                                  | 466,243    |                                                            | $          | 104,059 |   | $ | 423,991 |   |
| COST OF GOODS SOLD                                                |       | 423,520                                                            |       | 99,577                                                          |       | 431,098 |   |
| GROSS PROFIT (LOSS)                                               |       | 42,723                                                             |       | 4,482                                                           |       | (7,107 | ) |
| OPERATING EXPENSES:                                               |       |                                                               |       |                                                            |       |   |   |
| Selling, general and  administrative                              |       | 39,455                                                             |       | 7,595                                                           |       | 47,086 |   |
| INCOME (LOSS) FROM  OPERATIONS                                    |       | 3,268                                                              |       | (3,113                                                          | )          | (54,193 | ) |
| OTHER INCOME (EXPENSE):                                           |       |                                                               |       |                                                            |       |   |   |
| Interest income                                                   |       | 132                                                                |       | 54                                                              |       | 717 |   |
| Interest expense                                                  |       | (24,584                                                            | )          | (7,550                                                          | )          | (47,742 | ) |
| Loss on extinguishment  of debt                                   |       | —                                                             |       | —                                                          |       | (5,389 | ) |
| Unrealized gain on mark  to market valuation of convertible debt  |       | 5,623                                                              |       | —                                                          |       | — |   |
| Other income, net                                                 |       | 4,588                                                              |       | 566                                                             |       | 5,585 |   |
| LOSS BEFORE  REORGANIZATION ITEMS AND INCOME TAXES                |       | (10,973                                                            | )          | (10,043                                                         | )          | (101,022 | ) |
| Reorganization items                                              |       | —                                                             |       | (59,311                                                         | )          | — |   |
| INCOME (LOSS) BEFORE  INCOME TAXES                                |       | (10,973                                                            | )          | 49,268                                                          |       | (101,022 | ) |
| INCOME TAX PROVISION  (BENEFIT)                                   |       | 4,694                                                              |       | (1,534                                                          | )          | (567 | ) |
| NET INCOME (LOSS)                                                 |       | $                                                                  | (15,667    | )                                                               | $          | 50,802 |   | $ | (100,455 | ) |
| Weighted average common  shares outstanding—basic            |       | 126,295                                                            |       | 47,572                                                          |       | 36,197 |   |
| Basic income (loss) per  share                                    |       | $                                                                  | (0.12      | )                                                               | $          | 1.07 |   | $ | (2.78 | ) |
| Weighted average common  shares outstanding—diluted          |       | 126,295                                                            |       | 47,572                                                          |       | 36,197 |   |
| Diluted income (loss)  per share                                  |       | $                                                                  | (0.12      | )                                                               | $          | 1.07 |   | $ | (2.78 | ) |

 

See notes to unaudited condensed consolidatedfinancial statements.

 

5

----

Table of Contents

 

**ACCURIDE CORPORATION**

**CONSOLIDATED STATEMENTS OFSTOCKHOLDERS’ EQUITY (DEFICIENCY) (UNAUDITED)**

 
| **(In thousands)**                                                                   | ** ** | **Comprehensive  Loss** | ** ** | **Common  Stock and  Additional  Paid-in-  Capital** | ** ** | **Treasury  Stock** | ** ** | **Accumulated  Other  Comprehensive  Income (Loss)** | ** ** | **Retained  Earnings  (Deficiency)** | ** ** | **Total  Stockholders’  Equity  (Deficiency)** | ** ** |
|-------------------------------------------------------------------------------------------|------------|-------------------------|------------|-----------------------------------------------------------|------------|---------------------|------------|-----------------------------------------------------------|------------|--------------------------------------|------------|-----------------------------------------------------|------------|
| BALANCE at  January 1, 2010 (Predecessor)                                            |       | —                  |       | $                                                         | 268,582    |                | $          | (751                                                      | )          | $                                    | (48,376    | )                                                   | $          | (447,721 | ) | $ | (228,266 | ) |
| Net loss before  reorganization items                                                     |       | $                       | (8,509     | )                                                         | —     |                | —     |                                                      | —     |                                 | (8,509     | )                                                   | (8,509     | ) |
| Exercise of share-based  awards                                                           |       | —                  |       | 8                                                         |       | —              |       | —                                                    |       | —                               |       | 8                                                   |       |
| Reorganization items                                                                      |       | —                  |       | —                                                    |       | —              |       | —                                                    |       | (25,030                              | )          | (25,030                                             | )          |
| Comprehensive loss                                                                        |       | $                       | (8,509     | )                                                         |       |                |       |                                                      |       |                                 |       |                                                |       |   |
| BALANCE at  February 26, 2010 (Predecessor)                                          |       |                    |       | 268,590                                                   |       | (751                | )          | (48,376                                                   | )          | (481,260                             | )          | (261,797                                            | )          |
| FRESH START  ADJUSTMENTS:                                                                 |       |                    |       |                                                      |       |                |       |                                                      |       |                                 |       |                                                |       |
| Debt discharge — Senior  Subordinated Notes                                          |       | —                  |       | 48,540                                                    |       | —              |       | —                                                    |       | 242,436                              |       | 290,976                                             |       |
| Debt discharge —  Deferred financing fees                                            |       | —                  |       | —                                                    |       | —              |       | —                                                    |       | (3,847                               | )          | (3,847                                              | )          |
| Debt discharge — Sun  Capital Warrant liability                                      |       | —                  |       | —                                                    |       | —              |       | —                                                    |       | 76                                   |       | 76                                                  |       |
| Debt discharge — Term  facility discount                                             |       | —                  |       | —                                                    |       | —              |       | —                                                    |       | (2,974                               | )          | (2,974                                              | )          |
| Issuance of Warrants                                                                      |       | —                  |       | —                                                    |       | —              |       | —                                                    |       | (6,618                               | )          | (6,618                                              | )          |
| Issuance of Notes                                                                         |       | —                  |       | —                                                    |       | —              |       | —                                                    |       | (144,732                             | )          | (144,732                                            | )          |
| BALANCE at  February 26, 2010 (Predecessor)                                          |       |                    |       | 317,130                                                   |       | (751                | )          | (48,376                                                   | )          | (396,919                             | )          | (128,916                                            | )          |
| FRESH START  ADJUSTMENTS:                                                                 |       |                    |       |                                                      |       |                |       |                                                      |       |                                 |       |                                                |       |
| Cancellation of  Predecessor preferred, common and treasury stock                         |       | —                  |       | (317,130                                                  | )          | 751                 |       | —                                                    |       | —                               |       | (316,379                                            | )          |
| Cancellation of  Predecessor accumulated deficit and accumulated other comprehensive loss |       | —                  |       | —                                                    |       | —              |       | 48,376                                                    |       | 396,919                              |       | 445,295                                             |       |
| Issuance of new equity  interests                                                         |       | —                  |       | 49,396                                                    |       | —              |       | —                                                    |       | —                               |       | 49,396                                              |       |
| BALANCE at  February 26, 2010 (Successor)                                            |       | —                  |       | 49,396                                                    |       | —              |       | —                                                    |       | —                               |       | 49,396                                              |       |
| Net loss                                                                                  |       | $                       | (15,667    | )                                                         | —     |                | —     |                                                      | —     |                                 | (15,667    | )                                                   | (15,667    | ) |
| Share-based  compensation expense                                                         |       | —                  |       | 593                                                       |       | —              |       | —                                                    |       | —                               |       | 593                                                 |       |
| Other                                                                                     |       | —                  |       | (15                                                       | )          | —              |       | —                                                    |       | —                               |       | (15                                                 | )          |
| Comprehensive loss                                                                        |       | $                       | (15,667    | )                                                         |       |                |       |                                                      |       |                                 |       |                                                |       |   |
| BALANCE—September 30,  2010 (Successor)                                         |       |                    |       | $                                                         | 49,974     |                | $          | —                                                    |       | $                                    | —     |                                                | $          | (15,667 | ) | $ | 34,307 |   |

 

See notes to unauditedcondensed consolidated financial statements.

 

6

----

Table ofContents

 

**ACCURIDE CORPORATION**

**CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)**

 
| ** **                                                                            | ** ** | **Successor**                                                      | ** ** | **Predecessor**                                                 | ** ** |
|---------------------------------------------------------------------------------------|------------|--------------------------------------------------------------------|------------|-----------------------------------------------------------------|------------|
| ** **                                                                            | ** ** | **Period from  February 26 to  September 30,** | ** ** | **Period from  January 1 to  February 26,** | ** ** | **Nine Months  Ended  September 30,** | ** ** |
| **(In thousands)**                                                               | ** ** | **2010**                                                           | ** ** | **2010**                                                        | ** ** | **2009** | ** ** |
| ** **                                                                            | ** ** | ** **                                                         | ** ** | ** **                                                      | ** ** | ** ** | ** ** |
| CASH FLOWS FROM  OPERATING ACTIVITIES:                                                |       |                                                               |       |                                                            |       |   |   |
| Net income (loss)                                                                     |       | $                                                                  | (15,667    | )                                                               | $          | 50,802 |   | $ | (100,455 | ) |
| Adjustments to  reconcile net income (loss) to net cash used in operating activities: |       |                                                               |       |                                                            |       |   |   |
| Depreciation and  impairment of property, plant and equipment                         |       | 24,246                                                             |       | 6,711                                                           |       | 34,580 |   |
| Amortization — deferred  financing costs and discount amortization               |       | 460                                                                |       | 694                                                             |       | 3,340 |   |
| Amortization — other  intangible assets                                          |       | 6,482                                                              |       | 821                                                             |       | 3,690 |   |
| Loss on extinguishment  of debt                                                       |       | —                                                             |       | —                                                          |       | 5,389 |   |
| Reorganization items                                                                  |       | —                                                             |       | (59,311                                                         | )          | — |   |
| Payments on  reorganization items                                                     |       | —                                                             |       | (12,164                                                         | )          | — |   |
| Loss on disposal of  assets                                                           |       | 51                                                                 |       | 3                                                               |       | 57 |   |
| Provision for deferred  income taxes                                                  |       | 2,179                                                              |       | (1,560                                                          | )          | (136 | ) |
| Non-cash share-based  compensation                                                    |       | 593                                                                |       | —                                                          |       | 249 |   |
| Non-cash change in  market valuation - convertible notes                              |       | (5,623                                                             | )          | —                                                          |       | — |   |
| Non-cash change in  warrant liability                                                 |       | (4,633                                                             | )          | —                                                          |       | (608 | ) |
| Loss on sale of  marketable securities                                                |       | —                                                             |       | —                                                          |       | 1,100 |   |
| Paid-in-kind interest                                                                 |       | 6,161                                                              |       | 1,769                                                           |       | 6,519 |   |
| Changes in certain  assets and liabilities:                                           |       |                                                               |       |                                                            |       |   |   |
| Receivables                                                                           |       | (21,064                                                            | )          | (15,833                                                         | )          | 1,427 |   |
| Inventories and  supplies                                                             |       | (4,954                                                             | )          | (5,736                                                          | )          | 22,464 |   |
| Prepaid expenses and  other assets                                                    |       | (4,398                                                             | )          | 1,051                                                           |       | (5,921 | ) |
| Accounts payable                                                                      |       | (6,068                                                             | )          | 12,931                                                          |       | (26,910 | ) |
| Accrued and other  liabilities                                                        |       | 6,510                                                              |       | (951                                                            | )          | 1,688 |   |
| Net cash used in  operating activities                                                |       | (15,725                                                            | )          | (20,773                                                         | )          | (53,527 | ) |
| CASH FLOWS FROM  INVESTING ACTIVITIES:                                                |       |                                                               |       |                                                            |       |   |   |
| Purchases of property,  plant and equipment                                           |       | (8,148                                                             | )          | (1,457                                                          | )          | (16,122 | ) |
| Sale of marketable  securities                                                        |       | —                                                             |       | —                                                          |       | 3,900 |   |
| Other                                                                                 |       | 13,266                                                             |       | (555                                                            | )          | 213 |   |
| Net cash provided by  (used in) investing activities                                  |       | 5,118                                                              |       | (2,012                                                          | )          | (12,009 | ) |
| CASH FLOWS FROM  FINANCING ACTIVITIES:                                                |       |                                                               |       |                                                            |       |   |   |
| Proceeds from  postpetition senior credit facility                                    |       | 1,850                                                              |       | 309,019                                                         |       | — |   |
| Payment of postpetition  senior credit facility                                       |       | (310,869                                                           | )          | —                                                          |       | — |   |
| Payment of prepetition  senior credit facility                                        |       | —                                                             |       | (305,814                                                        | )          | — |   |
| Proceeds from issuance  of bonds                                                      |       | 301,593                                                            |       | —                                                          |       | — |   |
| Proceeds from  convertible notes                                                      |       | —                                                             |       | 140,000                                                         |       | — |   |
| Payment of  debtor-in-possession borrowing                                            |       | —                                                             |       | (25,000                                                         | )          | — |   |
| Payment of revolving  credit facility                                                 |       | (15,000                                                            | )          | (71,659                                                         | )          | (53,000 | ) |
| Increase in revolving  credit facility                                                |       | 15,000                                                             |       | —                                                          |       | 30,626 |   |
| Deferred financing fees                                                               |       | (10,868                                                            | )          | —                                                          |       | — |   |
| Credit facility  amendment fees                                                       |       | —                                                             |       | —                                                          |       | (10,797 | ) |
| Other                                                                                 |       | (82                                                                | )          | 65                                                              |       | 48 |   |
| Net cash provided by  (used in) financing activities                                  |       | (18,376                                                            | )          | 46,611                                                          |       | (33,123 | ) |
| INCREASE (DECREASE) IN  CASH AND CASH EQUIVALENTS                                     |       | (28,983                                                            | )          | 23,826                                                          |       | (98,659 | ) |
| CASH AND CASH  EQUIVALENTS—Beginning of period                                   |       | 80,347                                                             |       | 56,521                                                          |       | 123,676 |   |
| CASH AND CASH  EQUIVALENTS—End of period                                         |       | $                                                                  | 51,364     |                                                            | $          | 80,347 |   | $ | 25,017 |   |
|                                                                                  |       |                                                               |       |                                                            |       |   |   |
| Supplemental cash flow  information:                                                  |       |                                                               |       |                                                            |       |   |   |
| Cash paid for interest                                                                |       | $                                                                  | 12,782     |                                                            | $          | 9,393 |   | $ | 32,660 |   |
| Cash paid (received)  for income taxes                                                |       | $                                                                  | (1,066     | )                                                               | $          | (826 | ) | $ | 802 |   |
| Non-cash transactions:                                                                |       |                                                               |       |                                                            |       |   |   |
| Purchases of property,  plant and equipment in accounts payable                       |       | $                                                                  | 1,116      |                                                            | $          | — |   | $ | 621 |   |
| Issuance of warrants                                                                  |       | $                                                                  | —     |                                                            | $          | 6,618 |   | $ | 4,655 |   |
| Exercise of warrants                                                                  |       | $                                                                  | —     |                                                            | $          | — |   | $ | 3,985 |   |

 

See notes to unauditedcondensed consolidated financial statements.

 

7

----

Table of Contents

 

**ACCURIDE CORPORATION**

**NOTES TO CONDENSED CONSOLIDATEDFINANCIAL STATEMENTS (UNAUDITED)**

**(AMOUNTS IN THOUSANDS, EXCEPT SHARE AND PER SHAREDATA)**

 

**Note 1 - Summary of SignificantAccounting Policies**

 

***Basis of Presentation*****—The accompanying unaudited condensed consolidated financial statements havebeen prepared in accordance with accounting principles generally accepted inthe United States of America, except that the unaudited condensed consolidatedfinancial statements do not include all of the information and footnotesrequired by accounting principles generally accepted in the United States ofAmerica for complete financial statements. However, in the opinion of Accuride Corporation (“Accuride” or the “Company”),all adjustments (consisting of normal recurring accruals) considered necessaryto present fairly the condensed consolidated financial statements have beenincluded.

 

The results of operations for the periods January 1,2010 through February 26, 2010 for the Predecessor Company and February 26,2010 through September 30, 2010 for the Successor Company are notnecessarily indicative of the results to be expected for the year ending December 31,2010.  The unaudited consolidatedfinancial statements and notes thereto should be read in conjunction with theaudited condensed consolidated financial statements and notes thereto disclosedin Accuride’s Annual Report on Form 10-K for the year ended December 31,2009.

 

Allocations of fair value to tangible andintangible assets, goodwill, pension obligations and deferred taxes are basedupon preliminary valuation information. It is anticipated that all necessary information will be available andthe analysis will be completed during the fourth quarter of 2010.

 

***Chapter 11 Proceedings —***On October 8, 2009, Accuride and its domestic subsidiaries filedvoluntary petitions for relief under Chapter 11 of the Bankruptcy Code with theUnited States Bankruptcy Court for the District of Delaware (the “BankruptcyCourt”).  Prior to filing for bankruptcy, we were in default under our prepetitionsenior credit facility and the indenture governing our prepetition seniorsubordinated notes due to our failure to comply with certain financialcovenants in the prepetition senior credit facility and to make the $11.7million interest payment due August 3, 2009 on our prepetition seniorsubordinated notes.  Beginning in July 2009,we entered into a series of amendments and temporary waivers with our seniorlenders and forbearances with our prepetition noteholders related to thesedefaults, which prevented acceleration of the indebtedness outstanding underthese debt instruments and enabled us to negotiate a financial reorganizationto be implemented through the bankruptcy process with these key constituentsprior to our bankruptcy filing.  On October 7,2009, we entered into restructuring support agreements with the holders ofapproximately 57% of the principal amount of the loans outstanding under ourprepetition senior credit facility and the holders of approximately 70% of theprincipal amount of our prepetition senior subordinated notes, pursuant towhich the parties agreed to support a financial reorganization of Accuride andits domestic subsidiaries consistent with the terms set forth therein.

 

On November 18, 2009, we filed our Joint Planof Reorganization and the related Disclosure Statement with the Bankruptcy Court. All classes of creditors entitled to vote voted to approve thePlan of Reorganization.  A confirmationhearing for the Plan of Reorganization was held beginning on February 17,2010.  At the confirmation hearing, weand all of our constituents reached a settlement to fully resolve all disputesrelated to the Plan of Reorganization and all of our key constituents agreed tosupport the Plan of Reorganization.  On February 18, 2010, the Bankruptcy Courtentered an order confirming the Third Amended Joint Plan of Reorganization,which approved and confirmed the Plan of Reorganization, as modified by theconfirmation order.  On February 26,2010 (the “Effective Date”), the Plan of Reorganization became effectiveand we emerged from Chapter 11bankruptcy proceedings. During the pendency of the bankruptcy, weoperated our business as debtors-in-possession under the jurisdiction of theBankruptcy Court and in accordance with the applicable provisions of theBankruptcy Code.

 

***Financial Statement Presentation***

 

We have prepared the accompanying consolidated financial statements in accordancewith Accounting Standards Codification (“ASC”) 852.  ASC 852 requires that the financialstatements for the periods subsequent to a Chapter 11 filing separatetransactions and events that are directly associated with the reorganizationfrom the ongoing operations of the business. Accordingly, all transactions (including, but not limited to, allprofessional fees, realized gains and losses and provisions for losses)directly associated with the reorganization of the business are reportedseparately in the financial statements as reorganization items, net.  The Predecessor Company recognized thefollowing reorganization income (expense) in our financial statements:

 

8

----

Table ofContents

 
| ** **                                                   | ** ** | **Predecessor**                                                 | ** ** |
|--------------------------------------------------------------|------------|-----------------------------------------------------------------|------------|
| ** **                                                   | ** ** | **Period from  January 1 to  February 26,** | ** ** |
| **(In thousands)**                                      | ** ** | **2010**                                                        | ** ** |
| ** **                                                   | ** ** | ** **                                                      | ** ** |
| Debt discharge — Senior  subordinate notes and interest |       | $                                                               | 242,436    |   |
| Market valuation of  $140 million Convertible Notes          |       | (144,732                                                        | )          |
| Professional fees                                            |       | (25,030                                                         | )          |
| Market valuation of  warrants issued                         |       | (6,618                                                          | )          |
| Deferred financing fees                                      |       | (3,847                                                          | )          |
| Term loan facility  discount                                 |       | (2,974                                                          | )          |
| Other                                                        |       | 76                                                              |       |
| Total                                                        |       | $                                                               | 59,311     |   |

 

***Fresh-Start Reporting***

 

Upon our emergence from Chapter 11 bankruptcyproceedings, we adopted fresh-start accounting in accordance with theprovisions of ASC 852 Reorganizations (“ASC 852”), pursuant to which themidpoint of the range of our reorganization value was allocated to our assetsand liabilities in conformity with the procedures specified by ASC 805, “BusinessCombinations.”

 

The following fresh-start balance sheet illustratesthe financial effects on the Company of the implementation of the Plan ofReorganization and the adoption of fresh-start reporting.  This fresh-start balance sheet reflects theeffect of the consummation of the transactions contemplated in the Plan ofReorganization, including issuance of new indebtedness and repayment andsettlement of old indebtedness.

 

As a result of the adoption of fresh-startreporting, our consolidated statement of financial position and consolidatedstatements of operations subsequent to February 26, 2010, will not becomparable in many respects to our consolidated statement of financial positionand consolidated statements of operations prior to February 26, 2010.  References to “Successor Company” refer toAccuride after February 26, 2010, after giving effect to the applicationof fresh-start reporting.  References to “PredecessorCompany” refer to Accuride prior to February 26, 2010.

 

The allocations of fair value are based uponvaluation information and other studies that have not yet been completed due tothe complexity of the analysis required. It is anticipated that all necessary information will be available andthe analysis will be completed during the fourth quarter of 2010.

 

During the three months ended September 30,2010, significant adjustments related to our fresh-start analysis included anincrease to our pension and other postretirement liabilities of $17.9 millionand a decrease of certain income tax liabilities of $5.2 million.

 

The preliminary effects of the Plan ofReorganization and fresh-start reporting on the Company’s consolidated balancesheet as of February 26, 2010 are as follows:

 

9

----

Table of Contents

 
| ** **                                                  | ** ** | **Fresh-Start Adjustments** | ** ** |
|-------------------------------------------------------------|------------|----------------------------------|------------|
| **(in thousands)**                                     | ** ** | **Predecessor**                  | ** ** | **Debt  Discharge and  Issuance (a)** | ** ** | **Reinstatement  of Liabilities (b)** | ** ** | **Revaluation of  Assets and  Liabilities (c)** | ** ** | **Successor** | ** ** |
| **ASSETS**                                                  |       |                             |       |   |   |   |   |   |   |   |   |
| CURRENT ASSETS                                              |       |                             |       |   |   |   |   |   |   |   |   |
| Cash and cash  equivalents                                  |       | $                                | 34,880     |   | $ | 45,467 |   | $ | — |   | $ | — |   | $ | 80,347 |   |
| Customer receivables,  net                                  |       | 73,636                           |       | — |   | — |   | — |   | 73,636 |   |
| Other receivables                                           |       | 8,498                            |       | — |   | — |   | — |   | 8,498 |   |
| Inventories                                                 |       | 56,639                           |       | — |   | — |   | 3,028 |   | 59,667 |   |
| Deferred income taxes                                       |       | 4,371                            |       | — |   | — |   | (1,836 | ) | 2,535 |   |
| Income tax receivable                                       |       | 720                              |       | — |   | — |   | — |   | 720 |   |
| Prepaid expenses and  other current assets                  |       | 20,518                           |       | — |   | — |   | (16,439 | ) | 4,079 |   |
| Total current assets                                        |       | 199,262                          |       | 45,467 |   | — |   | (15,247 | ) | 229,482 |   |
| PROPERTY, PLANT AND  EQUIPMENT, net                         |       | 224,270                          |       | — |   | — |   | 48,712 | (d) | 272,982 |   |
| Goodwill                                                    |       | 127,474                          |       | — |   | — |   | 1,267 | (d) | 128,741 |   |
| Other intangible  assets, net                               |       | 88,409                           |       | — |   | — |   | 152,591 | (d) | 241,000 |   |
| Deferred financing  fees, net                               |       | 3,847                            |       | (3,847 | ) | — |   | — |   | — |   |
| Other                                                       |       | 22,221                           |       | 66 |   | — |   | (4,190 | )(d) | 18,097 |   |
| TOTAL                                                       |       | $                                | 665,483    |   | $ | 41,686 |   | $ | — |   | $ | 183,133 |   | $ | 890,302 |   |
| **LIABILITIES  AND STOCKHOLDERS’ EQUITY (DEFICIENCY)** |       |                             |       |   |   |   |   |   |   |   |   |
| CURRENT LIABILITIES                                         |       |                             |       |   |   |   |   |   |   |   |   |
| Accounts Payable                                            |       | $                                | 57,074     |   | $ | — |   | $ | 7,978 |   | $ | — |   | $ | 65,052 |   |
| Accrued payroll and  compensation                           |       | 18,058                           |       | — |   | — |   | — |   | 18,058 |   |
| Accrued interest  payable                                   |       | 242                              |       | — |   | — |   | — |   | 242 |   |
| Debt                                                        |       | 399,500                          |       | (399,500 | ) | — |   | — |   | — |   |
| Accrued and other  liabilities                              |       | 27,044                           |       | (1,012 | ) | 346 |   | (854 | )(d) | 25,524 |   |
| Total current liabilities                                   |       | 501,918                          |       | (400,512 | ) | 8,324 |   | (854 | ) | 108,876 |   |
| LONG-TERM DEBT                                              |       | —                           |       | 593,751 |   | — |   | — |   | 593,751 |   |
| DEFERRED INCOME TAXES                                       |       | 14,274                           |       | — |   | — |   | (3,625 | )(d) | 10,649 |   |
| NON-CURRENT INCOME  TAXES PAYABLE                           |       | 7,914                            |       | — |   | — |   | — |   | 7,914 |   |
| OTHER POSTRETIREMENT  BENEFIT PLAN LIABILITY                |       | 61,037                           |       | — |   | — |   | 12,033 | (d) | 73,070 |   |
| PENSION BENEFIT PLAN  LIABILITY                             |       | 35,915                           |       | — |   | — |   | (959 | )(d) | 34,956 |   |
| OTHER LIABILITIES                                           |       | 4,108                            |       | 6,542 |   | 2,814 |   | (1,774 | )(d) | 11,690 |   |
| LIABILITIES SUBJECT TO  COMPROMISE                          |       | 302,114                          |       | (290,976 | ) | (11,138 | ) | — |   | — |   |
| STOCKHOLDERS’ EQUITY  (DEFICIENCY):                    |       |                             |       |   |   |   |   |   |   |   |   |
| Common stock and  Additional Paid-in-Capital                |       | 268,590                          |       | 48,540 |   | — |   | (267,734 | ) | 49,396 |   |
| Treasury stock                                              |       | (751                             | )          | — |   | — |   | 751 |   | — |   |
| Accumulated other  comprehensive loss                       |       | (48,376                          | )          | — |   | — |   | 48,376 |   | — |   |
| Retained earnings  (deficiency)                             |       | (481,260                         | )          | 84,341 |   | — |   | 396,919 |   | — |   |
| Total stockholders’  equity (deficiency)               |       | (261,797                         | )          | 132,881 |   | — |   | 178,312 |   | 49,396 |   |
| TOTAL                                                       |       | $                                | 665,483    |   | $ | 41,686 |   | $ | — |   | $ | 183,133 |   | $ | 890,302 |   |

 

----

| (a)    |   | Included in the debt discharge and issuance is  the receipt of the $140 million aggregate principal amount of convertible  notes (as defined below), which was used to pay off the $71.1 million of  Last-Out-Loans (as defined below) under our prepetition senior credit  facility and our DIP facility (as defined below) of $25.0 million. The net gain  recognized is a result of the discharge of our prepetition senior  subordinated notes of $275.0 million along with interest of $16.0 million  being partially offset by the issuance of the convertible notes and the  corresponding equity received from the Plan of Reorganization. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| (b)    |   | The liabilities subject to compromise other than  debt were reinstated to the appropriate liability classification as part of  the Plan of Reorganization.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| (c)    |   | The allocations of fair value are based upon  preliminary valuation information and other studies that have not yet been  completed due to the complexity of the analysis required. It is anticipated  that all necessary information will be available and the analysis will be  completed during the fourth quarter of 2010. Also included in this column is  the adoption of the new accounting policy for supplies.                                                                                                                                                                                                                            |

 

10

----

Table of Contents

 
| (d) |   | Balances reflect adjustments made based on  updated information pertaining to fair value of tangible and intangible  assets, deferred tax liabilities, goodwill, pension obligations, other  postretirement benefit obligations and other liabilities. |
|-----|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

***PostpetitionCapital Structure***

 

Pursuant to the Plan of Reorganization, asof the Effective Date, our new capital structure consisted of the following:

 

·   *Postpetition Senior Credit Facility* — Our prepetition senior credit facility was amended and restated****to provide for a senior credit facility ofapproximately $311.2 million.  AllLast-Out-Loans under our prepetition senior credit facility were paid in fullon the Effective Date.  On July 29,2010, we refinanced the postpetition senior credit facility and thepostpetition senior credit facility was terminated.

 

·   *7.5% Senior Convertible Notes* — We issued $140 million aggregate principal amount of 7.5% SeniorConvertible Notes due 2020 (the “convertible notes”) pursuant to a rightsoffering.  The first six interest payments on the convertiblenotes will be paid-in-kind (“PIK”) interest. Thereafter, beginning on August 26, 2013, interest on theconvertible notes will be paid in cash.  As of the Effective Date, the initial $140 million principal amount ofconvertible notes was convertible into 186,666,662 shares of our CommonStock.

 

·   *Common Stock and Warrants* — We issued the following equity securities: (i) 98,000,000 sharesof our postpetition common stock, par value $0.01 per share (the “Common Stock”),to holders of our prepetition senior subordinated notes, on a pro rata basis(ii) 25,000,000 shares of Common Stock to the parties backstopping therights offering of convertible notes as payment of their backstop fee,(iii) 2,000,000 shares of Common Stock to holders of our prepetitioncommon stock on a pro rata basis, (iv) warrants to purchase 22,058,824shares of Common Stock (the “Warrants”) to holders of our prepetition commonstock on a pro rata basis and (v) 1,294,882 shares of Common Stock, net ofshares withheld for tax purposes, under our Key Executive Incentive Plan. The Warrants are exercisable at an exercise price of $2.10 per share until February 26,2012.

 

Under the Plan of Reorganization, our prepetitioncommon stock, all other equity interests in Accuride, our prepetition seniorsubordinated notes and the indenture governing our prepetition seniorsubordinated notes were cancelled.  Theholders of these securities received the distributions described above. Allamounts outstanding under the DIP credit facility were also paid in full on theEffective Date and the DIP credit facility was terminated in accordance withits terms.

 

Additionally, pursuant to the Plan ofReorganization, we amended and restated our Certificate of Incorporation andour Bylaws to, among other things, reduce the size of our Board of Directors toseven directors.

 

***Management’s Estimates andAssumptions*****— The preparation of financial statements in conformity with accountingprinciples generally accepted in the United States of America requires managementto make estimates and assumptions that affect the reported amounts of assetsand liabilities and disclosures of contingent assets and liabilities at thedate of the financial statements and the reported amounts of revenues andexpenses during the reporting period. Actual results could differ from those estimates.

 

***Derivative Financial Instruments*** — We use derivative financial instruments as part of our overall riskmanagement strategy as further described under Item 7A of our 2009 AnnualReport on Form 10-K.  The derivativeinstruments used from time to time include interest rate and foreign exchangeinstruments. As of September 30, 2010, there were no derivatives that weredesignated as hedges for financial reporting purposes.

 

***Interest RateInstruments*** — From time to time, weuse interest rate swap agreements as a means of fixing the interest rate onportions of our floating-rate debt.   Theinterest rate swap agreements are not designated as hedges for financial reportingpurposes and are carried in the consolidated financial statements at fairvalue, with all realized and unrealized gains or losses reflected in currentperiod earnings as a component of interest expense.  As of December 31, 2009, we had oneinterest rate swap agreement to exchange, at specified intervals, thedifference between 3.81% from March 2008 through March 2010, and thevariable rate interest amounts calculated by reference to the notionalprincipal amount of $125 million.  As of December 31,2009, we had a liability of $1.1 million included in accrued and otherliabilities on the consolidated balance sheet. On March 10, 2010 we terminated the swap agreement and paid theoutstanding liability.

 

Gains and losses included as a component ofinterest expense for the three and nine months ended September 30, 2009,included realized losses of $1,190 and $3,044, respectively, and unrealizedgains of $906 and $2,287, respectively.

 

11

----

Tableof Contents

 

***Foreign ExchangeInstruments*** — We use foreigncurrency forward contracts and option contracts to limit foreign exchange riskon anticipated but not yet committed transactions expected to be denominated inCanadian dollars. At September 30, 2010, we had no open foreign exchangecontracts.

 

Gains and losses are included as a component ofother income and are not material in 2010. Gains included as a component of other income for the three and ninemonths ended September 30, 2009, included realized gains of $748 and$1,498, respectively and unrealized gains (losses) of ($58) and $104,respectively.

 

***Earnings Per Common Share*** — Basic and diluted earnings (loss) per common share were computed asfollows:

 
| ** **                                                        | ** ** | **Successor**                                    | ** ** | **Predecessor**                                  | ** ** | **Successor**                                                  | ** ** | **Predecessor**                                                 | ** ** |
|-------------------------------------------------------------------|------------|--------------------------------------------------|------------|--------------------------------------------------|------------|----------------------------------------------------------------|------------|-----------------------------------------------------------------|------------|
| ** **                                                        | ** ** | **Three Months  Ended  September 30,** | ** ** | **Three Months  Ended  September 30,** | ** ** | **Period from  February 26  to September  30,** | ** ** | **Period from  January 1 to  February 26,** | ** ** | **Nine Months  Ended  September 30,** | ** ** |
| **(In thousands except per share data)** | ** ** | **2010**                                         | ** ** | **2009**                                         | ** ** | **2010**                                                       | ** ** | **2010**                                                        | ** ** | **2009** | ** ** |
|                                                              |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| **Numerator:**                                                    | ** ** | ** **                                       |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Net income (loss)                                                 |       | $                                                | 30,851     |                                             | $          | (33,329                                                        | )          | $                                                               | (15,667    | ) | $ | 50,802 |   | $ | (100,455 | ) |
| Less: Earnings  allocated to participatingsecurities              |       | (18,511                                          | )          | —                                           |       | —                                                         |       | —                                                          |       | — |   |
| Net income (loss)  available to commonstockholders  - basic       |       | $                                                | 12,340     |                                             | $          | (33,329                                                        | )          | $                                                               | (15,667    | ) | $ | 50,802 |   | $ | (100,455 | ) |
|                                                              |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Net income (loss)                                                 |       | $                                                | 30,851     |                                             | $          | (33,329                                                        | )          | $                                                               | (15,667    | ) | $ | 50,802 |   | $ | (100,455 | ) |
| Effect of dilutive  securities:                                   |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Unrealized gain on mark  to market valuation ofconversion  option |       | (36,827                                          | )          | —                                           |       | —                                                         |       | —                                                          |       | — |   |
| Discount amortization  expense                                    |       | 600                                              |       | —                                           |       | —                                                         |       | —                                                          |       | — |   |
| PIK interest expense                                              |       | 2,661                                            |       | —                                           |       | —                                                         |       | —                                                          |       | — |   |
| Net income (loss)  available to commonstockholders  - diluted     |       | $                                                | (2,715     | )                                                | $          | (33,329                                                        | )          | $                                                               | (15,667    | ) | $ | 50,802 |   | $ | (100,455 | ) |
|                                                              |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| **Denominator:**                                                  |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Weighted average shares  outstanding — Basic                 |       | 126,295                                          |       | 36,368                                           |       | 126,295                                                        |       | 45,572                                                          |       | 36,197 |   |
| Weighted average effect  of dilutive securities:                  |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Convertible notes                                                 |       | 197,013                                          |       | —                                           |       | —                                                         |       | —                                                          |       | — |   |
| PIK notes                                                         |       | 7,388                                            |       | —                                           |       | —                                                         |       | —                                                          |       | — |   |
| Effect of restricted  stock units                                 |       | 533                                              |       | —                                           |       | —                                                         |       | —                                                          |       | — |   |
| Weighted average shares  outstanding - Diluted                    |       | 331,229                                          |       | 36,368                                           |       | 126,295                                                        |       | 45,572                                                          |       | 36,197 |   |
|                                                              |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Basic income (loss) per  common share                             |       | $                                                | 0.10       |                                             | $          | (0.92                                                          | )          | $                                                               | (0.12      | ) | $ | 1.07 |   | $ | (2.78 | ) |
| Diluted income (loss)  per common share                           |       | $                                                | (0.01      | )                                                | $          | (0.92                                                          | )          | $                                                               | (0.12      | ) | $ | 1.07 |   | $ | (2.78 | ) |

 

The computation of dilutive earnings per share forthe three months ended September 30, 2010 did not include warrantsexercisable for 22,058,824 shares of common stock because the effect would beanti-dilutive.  For the period February 26,2010 through September 30, 2010, there were warrants exercisable for22,058,824 shares of common stock, convertible notes exercisable for197,012,809 shares of common stock and convertible notes issued as PIK interestexercisable for 7,387,982 shares of common stock that were not included in thecomputation of diluted earnings per share because the effect would beanti-dilutive.  For the three and ninemonths ended September 30, 2009, there were 544,738 stock options,1,117,113 stock appreciation rights, and a warrant exercisable for 238,728shares that were not included in the computation of diluted earnings per sharebecause the effect would be anti-dilutive.

 

12

----

Table of Contents

 

***Stock-BasedCompensation***—Compensation expense forshare-based compensation programs was recognized as follows:

 
| ** **                                   | ** ** | **Successor**                                    | ** ** | **Predecessor**                                  | ** ** | **Successor**                                                  | ** ** | **Predecessor**                                                 | ** ** |
|----------------------------------------------|------------|--------------------------------------------------|------------|--------------------------------------------------|------------|----------------------------------------------------------------|------------|-----------------------------------------------------------------|------------|
| ** **                                   | ** ** | **Three Months  Ended  September 30,** | ** ** | **Three Months  Ended  September 30,** | ** ** | **Period from  February 26  to September  30,** | ** ** | **Period from  January 1 to  February 26,** | ** ** | **Nine Months  Ended  September 30,** | ** ** |
| **(In thousands)**                      | ** ** | **2010**                                         | ** ** | **2009**                                         | ** ** | **2010**                                                       | ** ** | **2010**                                                        | ** ** | **2009** | ** ** |
|                                         |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Share-based  compensation expense recognized |       | $                                                | 443        |                                             | $          | 125                                                            |       | $                                                               | 593        |   | $ | — |   | $ | 249 |   |
|                                              |            |                                                  |            |                                                  |            |                                                                |            |                                                                 |            |  |  |  |  |  |  |  |

 

On May 18, 2010 the Company authorized1,829,517 shares of Common Stock for issuance pursuant to individual restrictedstock unit agreements with employees of the Company.  The awards granted on May 18, 2010 vestin installments of 33%, 33%, and 34% over a three year period on theanniversary date of the grant.  On August 3,2010 the Company authorized 557,977 shares of Common Stock for issuancepursuant to individual restricted stock unit agreements with directors of theCompany.  The awards granted on August 3,2010 have vesting dates of March 1, 2011 and March 1, 2014 where304,353 and 253,624 shares will vest and be paid, respectively.  As of September 30, 2010, there wasapproximately $2.1 million of unrecognized pre-tax compensation expense relatedto share-based awards not yet vested that will be recognized over aweighted-average period of 1.3 years.

 

***Income Tax***—We compute on a quarterly basis an estimated annual effective tax rateconsidering ordinary income and related income tax expense. Ordinary incomerefers to income (loss) before income tax expense excluding significant,unusual, or infrequently occurring items. The tax effect of an unusual orinfrequently occurring item is recorded in the interim period in which itoccurs. To the extent the Company cannot reliably estimate annual projectedtaxes for a taxing jurisdiction, taxes on ordinary income for such ajurisdiction are reported in the period in which they are incurred, which isthe case for our domestic tax jurisdictions. Other items included in income taxexpense in the periods in which they occur include the cumulative effect ofchanges in tax laws or rates, foreign exchange gains and losses, adjustments touncertain tax positions, and adjustments to our valuation allowance due tochanges in judgment in the realizability of deferred tax assets in futureyears.

 

We have assessed the need to maintain a valuationallowance for deferred tax assets based on an assessment of whether it is morelikely than not that deferred tax benefits will be realized through thegeneration of future taxable income. Appropriate consideration is given to allavailable evidence, both positive and negative, in assessing the need for avaluation allowance. Due to our recent history of U.S. operating and taxablelosses, the inconsistency of these profits, and the uncertainty of ourfinancial outlook, we continue to maintain a full valuation allowance againstour domestic deferred tax assets.

 

***New AccountingPronouncements***

 

In January 2010,the FASB issued ASU 2010-6, “Improving Disclosures about Fair ValueMeasurements,” which requires interim disclosures regarding significanttransfers in and out of Level 1 and Level 2 fair value measurements.Additionally, this ASU requires disclosure for each class of assets andliabilities and disclosures about the valuation techniques and inputs used tomeasure fair value for both recurring and non-recurring fair valuemeasurements. These disclosures are required for fair value measurements thatfall in either Level 2 or Level 3. Further, the ASU requires separatepresentation of Level 3 activity for the fair value measurements. We adoptedthe interim disclosure requirements under this standard during the quarterended March 31, 2010, with the exception of the separate presentation inthe Level 3 activity rollforward, which is not effective until fiscal yearsbeginning after December 15, 2010 and for interim periods within thosefiscal years.

 

**Note 2 — Operational Restructuring**

 

Prior to 2010, in response to the slow commercialvehicle market and the decline of sales, management undertook a review ofcurrent operations that led to a comprehensive restructuring plan. During thattime, we approved a restructuring plan to more appropriately align ourworkforce in response to the relatively slow commercial vehicle market.  Included were actions that were focused onthe consolidation of several of our facilities.

 

Restructuring costs are shown below by reportablesegment of the Predecessor Company:

 

13

----

Table ofContents

 
| ** **                               | ** ** | **January 1, 2010 to  February 26, 2010** | ** ** | **Three Months  Ended September  30,2009** | ** ** | **Nine Months  Ended September  30,2009** | ** ** |
|------------------------------------------|------------|--------------------------------------------------------------------|------------|------------------------------------------------------|------------|-----------------------------------------------------|------------|
| **Wheels**                               |       |                                                               |       |                                                 |       |                                                |       |
| Employee severance  costs                |       | $                                                                  | —     |                                                 | $          | —                                              |       | $ | 643 |   |
| Lease and other  contractual commitments |       | —                                                             |       | —                                               |       | 141                                                 |       |
|                                     |       |                                                               |       |                                                 |       |                                                |       |
| **Components**                           |       |                                                               |       |                                                 |       |                                                |       |
| Employee severance  costs                |       | 186                                                                |       | 88                                                   |       | 130                                                 |       |
| Lease and other  contractual commitments |       | —                                                             |       | —                                               |       | 3,219                                               |       |
|                                     |       |                                                               |       |                                                 |       |                                                |       |
| **Corporate**                            |       |                                                               |       |                                                 |       |                                                |       |
| Employee severance  costs                |       | —                                                             |       | 54                                                   |       | 967                                                 |       |
|                                     |       |                                                               |       |                                                 |       |                                                |       |
| **Total**                                |       | $                                                                  | 186        |                                                 | $          | 142                                                 |       | $ | 5,100 |   |

 

The $0.2 million restructuring expenses recognizedin the period January 1, 2010 to February 26, 2010 was recorded as acomponent of cost of goods sold.  Of the$142 restructuring expenses recognized in the three months ended September 30,2009, $88 was recorded in cost of goods sold and the remaining $54 was recordedin selling, general and administrative operating expenses.  Of the $5.1 million restructuring expensesrecognized in the nine months ended September 30, 2009, $4.1 million wasrecorded in cost of goods sold and the remaining $1.0 million was recorded inselling, general and administrative operating expenses.

 

The following is a reconciliation of the beginningand ending restructuring reserve balances for the periods ended December 31,2009 and September 30, 2010:

 
| ** **                                        | ** ** | **Employee  Severance Costs** | ** ** | **Lease and Other  Contractual Costs** | ** ** | **Total** | ** ** |
|---------------------------------------------------|------------|------------------------------------|------------|-------------------------------------------------------|------------|-----------|------------|
| Balance January 1,  2009                     |       | $                                  | 4,281      |                                                  | $          | —    |       | $ | 4,281 |   |
| Costs incurred and  charged to operating expenses |       | 1,037                              |       | —                                                |       | 1,037     |       |
| Costs incurred and  charged to cost of goods sold |       | 788                                |       | 3,360                                                 |       | 4,148     |       |
| Adjustments (1)                                   |       | —                             |       | 59                                                    |       | 59        |       |
| Costs paid or otherwise  settled                  |       | (5,420                             | )          | (259                                                  | )          | (5,679    | )          |
| Balance at  December 31, 2009                |       | $                                  | 686        |                                                  | $          | 3,160     |       | $ | 3,846 |   |
| Costs incurred and  charged to operating expenses |       | —                             |       | —                                                |       | —    |       |
| Costs incurred and  charged to cost of goods sold |       | 186                                |       | —                                                |       | 186       |       |
| Adjustments (1)                                   |       | —                             |       | 9                                                     |       | 9         |       |
| Costs paid or otherwise  settled                  |       | (293                               | )          | —                                                |       | (293      | )          |
| Balance at  February 26, 2010                |       | $                                  | 579        |                                                  | $          | 3,169     |       | $ | 3,748 |   |
| Costs incurred and  charged to operating expenses |       | 109                                |       | —                                                |       | 109       |       |
| Costs incurred and  charged to cost of goods sold |       | 46                                 |       | —                                                |       | 46        |       |
| Adjustments (1)                                   |       | —                             |       | (2,449                                                | )          | (2,449    | )          |
| Costs paid or otherwise  settled                  |       | (610                               | )          | (720                                                  | )          | (1,330    | )          |
| Balance at  September 30, 2010               |       | $                                  | 124        |                                                  | $          | —    |       | $ | 124 |   |

 

----

(1) Representsaccretion of interest on discounted restructuring liabilities and reduction inliability due to settlement agreement.

 

The remaining accruedliabilities will be paid in 2010.

 

**Note 3 - Inventories**

 

Inventories are stated at the lower of cost ormarket.  We review inventory on hand andwrite down excess and obsolete inventory based on our assessment of futuredemand and historical experience.  Thecomponents of inventory on a FIFO basis are as follows:

 

14

----

Table ofContents

 
| ** **                   | ** ** | **Successor**                    | ** ** | **Predecessor**                 | ** ** |
|------------------------------|------------|----------------------------------|------------|---------------------------------|------------|
| ** **                   | ** ** | **September 30, 2010** | ** ** | **December 31, 2009** | ** ** |
| Raw materials                |       | $                                | 19,164     |                            | $          | 14,432 |   |
| Work in process              |       | 18,273                           |       | 15,566                          |       |
| Finished manufactured  goods |       | 27,256                           |       | 20,744                          |       |
| Total inventories            |       | $                                | 64,693     |                            | $          | 50,742 |   |

 

**Note 4 - Goodwill and Other Intangible Assets**

 

Goodwill and any indefinite-lived intangible assetsare assessed for impairment annually or more frequently if circumstancesindicate impairment may have occurred. The analysis of potential impairment of goodwill requires a two-stepapproach.  The first step is theestimation of fair value of each reporting unit, which is compared to thecarrying value.  If step one indicatesthat impairment potentially exists, the second step is performed to measure theamount of impairment, if any.  Goodwillimpairment exists when the implied fair value of goodwill is less than itscarrying value.

 

The preliminary allocations of fair value to our operatingsegments are based upon preliminary valuation information and have not yet beencompleted due to the complexity of the analysis required.  It is anticipated that the analysis will becompleted during the fourth quarter of 2010. During the period ended September 30, 2010, fair value estimates werecorded for tangible and intangible assets, deferred taxes, pensionobligations, other postretirement benefit obligations and other liabilities,resulted in a $62.7 million change in allocated goodwill.  The changes in goodwill from February 26,2010 to September 30, 2010 are as follows:

 
| ** **                             | ** ** | **Wheels** | ** ** | **Components** | ** ** | **Other** | ** ** | **Corporate** | ** ** | **Total** | ** ** |
|----------------------------------------|------------|------------|------------|----------------|------------|-----------|------------|---------------|------------|-----------|------------|
| Balance as of  February 26, 2010  |       | $          | 131,859    |           | $          | 49,564    |       | $             | 9,991      |      | $          | — |   | $ | 191,414 |   |
| Valuation adjustment                   |       | (60,563    | )          | (3,834         | )          | 1,724     |       | —        |       | (62,673   | )          |
| Balance as of  September 30, 2010 |       | $          | 71,296     |           | $          | 45,730    |       | $             | 11,715     |      | $          | — |   | $ | 128,741 |   |

 

The preliminary value for intangible assets for theSuccessor Company includes $40,900 of technology which will be amortized over15 years, $166,100 of customer relationships which will be amortized over20 years, not deductible for income tax purposes, and $34,000 of tradenames that are not subject to amortization.

 

The changes in the carrying amount of otherintangible assets for the period January 1, 2010 to February 26, 2010by reportable segment for the Predecessor Company, are as follows:

 
| ** **                            | ** ** | **Components** | ** ** | **Other** | ** ** | **Corporate** | ** ** | **Total** | ** ** |
|---------------------------------------|------------|----------------|------------|-----------|------------|---------------|------------|-----------|------------|
|                                  |       |           |       |      |       |          |       |      |       |
| Balance as of  December 31, 2009 |       | $              | 83,045     |      | $          | 5,812         |       | $         | 373        |   | $ | 89,230 |   |
| Amortization                          |       | (726           | )          | (64       | )          | (31           | )          | (821      | )          |
| Balance as of February 26,  2010 |       | $              | 82,319     |      | $          | 5,748         |       | $         | 342        |   | $ | 88,409 |   |

 

The changes in the carrying amount of otherintangible assets for the period February 26, 2010 to September 30,2010 by reportable segment for the Successor Company, are as follows:

 
| ** **                             | ** ** | **Wheels** | ** ** | **Components** | ** ** | **Other** | ** ** | **Total** | ** ** |
|----------------------------------------|------------|------------|------------|----------------|------------|-----------|------------|-----------|------------|
|                                   |       |       |       |           |       |      |       |      |       |
| Balance as of  February 26, 2010  |       | $          | 127,800    |           | $          | 81,100    |       | $         | 36,900     |   | $ | 245,800 |   |
| Valuation adjustment                   |       | (3,300     | )          | (1,700         | )          | 200       |       | (4,800    | )          |
| Amortization                           |       | (3,311     | )          | (2,103         | )          | (1,068    | )          | (6,482    | )          |
| Balance as of  September 30, 2010 |       | $          | 121,189    |           | $          | 77,297    |       | $         | 36,032     |   | $ | 234,518 |   |

 

The summary of goodwill and other intangible assetsis as follows:

 

15

----

Table ofContents

 
| ** **                | ** ** | ** **                 | ** ** | **Successor**                                    | ** ** | **Predecessor**                                 | ** ** |
|---------------------------|------------|----------------------------|------------|--------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                | ** ** | **Weighted**               | ** ** | **As of September 30, 2010** | ** ** | **As of December 31, 2009** | ** ** |
| ** **                | ** ** | **Average  Useful  Lives** | ** ** | **Gross  Amount**                                | ** ** | **Accumulated  Amortization**                   | ** ** | **Carrying  Amount** | ** ** | **Gross  Amount** | ** ** | **Accumulated  Amortization  & Impairment** | ** ** | **Carrying  Amount** | ** ** |
| Goodwill                  |       | —                     |       | $                                                | 128,741    |                                            | $          | — |   | $ | 128,741 |   | $ | 378,804 |   | $ | 251,330 |   | $ | 127,474 |   |
| Other intangible  assets: |       |                       |       |                                             |       |                                            |       |   |   |   |   |   |   |   |   |
| Non-compete agreements    |       | 3.0                        |       | $                                                | —     |                                            | $          | — |   | $ | — |   | $ | 3,160 |   | $ | 2,787 |   | $ | 373 |   |
| Trade names               |       | —                     |       | 34,000                                           |       | —                                          |       | 34,000 |   | 38,080 |   | 30,980 |   | 7,100 |   |
| Technology                |       | 15.0                       |       | 40,900                                           |       | 1,593                                           |       | 39,307 |   | 33,540 |   | 11,279 |   | 22,261 |   |
| Customer relationships    |       | 20.0                       |       | 166,100                                          |       | 4,889                                           |       | 161,211 |   | 71,500 |   | 12,004 |   | 59,496 |   |
|                      |       | 19.0                       |       | $                                                | 241,000    |                                            | $          | 6,482 |   | $ | 234,518 |   | $ | 146,280 |   | $ | 57,050 |   | $ | 89,230 |   |

 

We estimate that aggregate intangible assetamortization expense for the Successor Company will be $9,195 in 2010 and$11,032 in each year beginning 2011 through 2014.

 

**Note 5 - Comprehensive income(loss)**

 

Comprehensive income (loss) for the period issummarized as follows:

 
| ** **                                                             | ** ** | **Successor**                                    | ** ** | **Predecessor**                                  | ** ** | **Successor**                                                  | ** ** | **Predecessor**                                                 | ** ** |
|------------------------------------------------------------------------|------------|--------------------------------------------------|------------|--------------------------------------------------|------------|----------------------------------------------------------------|------------|-----------------------------------------------------------------|------------|
| ** **                                                             | ** ** | **Three Months  Ended  September 30,** | ** ** | **Three Months  Ended  September 30,** | ** ** | **Period from  February 26  to September  30,** | ** ** | **Period from  January 1 to  February 26,** | ** ** | **Nine Months  Ended  September 30,** | ** ** |
| **(In thousands)**                                                | ** ** | **2010**                                         | ** ** | **2009**                                         | ** ** | **2010**                                                       | ** ** | **2010**                                                        | ** ** | **2009** | ** ** |
|                                                                   |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Net income (loss)                                                      |       | $                                                | 30,851     |                                             | $          | (33,329                                                        | )          | $                                                               | (15,667    | ) | $ | 50,802 |   | $ | (100,455 | ) |
| Other comprehensive  income (loss), net of tax:                        |       |                                             |       |                                             |       |                                                           |       |                                                            |       |   |   |
| Foreign currency  translation impact on pension liabilities adjustment |       | (802                                             | )          | (1,347                                           | )          | —                                                         |       | —                                                          |       | (2,036 | ) |
| Total comprehensive  income (loss)                                     |       | $                                                | 30,049     |                                             | $          | (34,676                                                        | )          | $                                                               | (15,667    | ) | $ | 50,802 |   | $ | (102,491 | ) |

 

Included in accumulated other comprehensive loss isthe impact of pension liability fluctuations in the Canadian dollar to U.S.dollar exchange rate related to our Canadian pension plans.

 

**Note 6 - Pension and OtherPostretirement Benefit Plans**

 

Components of netperiodic benefit cost for the periods ended:

 
| ** **                                         | ** ** | **Pension Benefits**                              | ** ** | **Other Benefits**                                | ** ** |
|----------------------------------------------------|------------|--------------------------------------------------------|------------|--------------------------------------------------------|------------|
| ** **                                         | ** ** | **Successor**                                          | ** ** | **Predecessor**                                        | ** ** | **Successor** | ** ** | **Predecessor** | ** ** |
| ** **                                         | ** ** | **Three Months  ended September  30,  2010** | ** ** | **Three Months  ended September  30,  2009** | ** ** | **Three Months  ended  September 30,  2010** | ** ** | **Three Months  ended  September 30,  2009** | ** ** |
| Service cost-benefits  earned during the period    |       | $                                                      | 296        |                                                   | $          | 390 |   | $ | 120 |   | $ | 83 |   |
| Interest cost on  projected benefit obligation     |       | 2,977                                                  |       | 2,962                                                  |       | 1,245 |   | 937 |   |
| Expected return on plan  assets                    |       | (2,918                                                 | )          | (3,238                                                 | )          | — |   | — |   |
| Amortization of net  transition (asset) obligation |       | (4                                                     | )          | 4                                                      |       | — |   | — |   |
| Amortization of prior  service (credit) cost       |       | (101                                                   | )          | 96                                                     |       | 524 |   | (393 | ) |
| Amortization of  (gain)/loss                       |       | (1,179                                                 | )          | 597                                                    |       | 1 |   | (123 | ) |
| Net benefits cost  charged to income               |       | $                                                      | (929       | )                                                      | $          | 811 |   | $ | 1,890 |   | $ | 504 |   |
| Curtailment charge                                 |       | —                                                 |       | 575                                                    |       | — |   | 23 |   |
| Contractual termination  benefits charge           |       | —                                                 |       | 2,376                                                  |       | — |   | — |   |
| Total benefits cost  charged to income             |       | $                                                      | (929       | )                                                      | $          | 3,762 |   | $ | 1,890 |   | $ | 527 |   |

 

16

----

Table ofContents

 
| ** **                                         | ** ** | **Pension Benefits**                                            | ** ** | **Other Benefits**                                               | ** ** |
|----------------------------------------------------|------------|----------------------------------------------------------------------|------------|-----------------------------------------------------------------------|------------|
| ** **                                         | ** ** | **Successor**                                                        | ** ** | **Predecessor**                                                       | ** ** | **Successor** | ** ** | **Predecessor** | ** ** |
| ** **                                         | ** ** | **Period from  February 26  to September  30,  2010** | ** ** | **Period from  January 1 to  February 26,  2010** | ** ** | **Nine  Months  ended  September  30,  2009** | ** ** | **Period from  February 26  to September  30,  2010** | ** ** | **Period from  January 1 to  February 26,  2010** | ** ** | **Nine  Months  ended  September  30,  2009** | ** ** |
| Service cost-benefits  earned during the period    |       | $                                                                    | 824        |                                                                  | $          | 269 |   | $ | 1,135 |   | $ | 241 |   | $ | 61 |   | $ | 238 |   |
| Interest cost on  projected benefit obligation     |       | 6,889                                                                |       | 1,989                                                                 |       | 8,677 |   | 2,517 |   | 642 |   | 2,764 |   |
| Expected return on plan  assets                    |       | (7,328                                                               | )          | (2,245                                                                | )          | (9,215 | ) | — |   | — |   | — |   |
| Amortization of net  transition (asset) obligation |       | —                                                               |       | 2                                                                     |       | 10 |   | — |   | — |   | — |   |
| Amortization of prior  service (credit) cost       |       | —                                                               |       | 53                                                                    |       | 267 |   | — |   | (261 | ) | (1,179 | ) |
| Amortization of  (gain)/loss                       |       | —                                                               |       | 603                                                                   |       | 1,684 |   | — |   | — |   | (379 | ) |
| Net benefits cost  charged to income               |       | $                                                                    | 385        |                                                                  | $          | 671 |   | $ | 2,558 |   | $ | 2,758 |   | $ | 442 |   | $ | 1,444 |   |
| Curtailment charge                                 |       | —                                                               |       | —                                                                |       | 575 |   | — |   | — |   | 23 |   |
| Contractual termination  benefits charge           |       | —                                                               |       | —                                                                |       | 2,376 |   | — |   | — |   | — |   |
| Total benefits cost  charged to income             |       | $                                                                    | 385        |                                                                  | $          | 671 |   | $ | 5,509 |   | $ | 2,758 |   | $ | 442 |   | $ | 1,467 |   |

 

During the three monthsended September 30, 2009, we recorded pre-tax curtailment losses of $3.0million related to reductions of our workforce in our London, Ontario facility.

 

From January 1,2010 to February 26, 2010 and during the period from February 26,2010 to September 30, 2010, contributions of $0.9 million and $6.1 millionhave been made to our sponsored pension plans, respectively.  We presently anticipate contributing anadditional $2.5 million to fund our pension plans during 2010.

 

**Note 7 — Commitments andContingencies**

 

We are from time to time involved in various legalproceedings of a character normally incident to our business. We do not believethat the outcome of these proceedings will have a material adverse effect onour consolidated financial condition or results of our operations.

 

As of September 30, 2010, we had anenvironmental reserve of approximately $1.5 million, related primarily toour foundry operations. This reserve is based on current cost estimates anddoes not reduce estimated expenditures to net present value, but does take intoaccount the benefit of a contractual indemnity given to us by a prior owner ofour wheel-end subsidiary. The failure of the indemnitor to fulfill itsobligations could result in future costs that may be material. Any cashexpenditures required by us or our subsidiaries to comply with applicableenvironmental laws and/or to pay for any remediation efforts will not bereduced or otherwise affected by the existence of the environmental reserve. Wecurrently anticipate spending approximately $0.2 million per year in 2010through 2013 for monitoring the various environmental sites associated with theenvironmental reserve, including attorney and consultant costs for strategicplanning and negotiations with regulators and other potentially responsibleparties, and payment of remedial investigation costs. Based on all of theinformation presently available to us, we believe that our environmentalreserves will be adequate to cover the future costs related to the sitesassociated with the environmental reserves and that any additional costs willnot have a material adverse effect on our financial condition, results ofoperations or cash flows. However, the discovery of additional sites, themodification of existing or the promulgation of new laws or regulations, morevigorous enforcement by regulators, the imposition of joint and severalliability under CERCLA or analogous state laws or other unanticipated eventscould result in a material adverse effect.

 

The final Iron and Steel Foundry National EmissionStandard for Hazardous Air Pollutants, or NESHAP, was developed pursuant toSection 112(d) of the Clean Air Act and requires all major sources ofhazardous air pollutants to install controls representative of maximum achievablecontrol technology.  Based on currentlyavailable information, we do not anticipate ongoing costs regarding compliancewith NESHAP; however, if we are found to be out of compliance with NESHAP, wecould incur liability that could have a material adverse effect on ourbusiness, results of operations, or financial condition.

 

As of September 30, 2010, we had approximately3,022 employees, of which 657 were salaried employees with the remainder paidhourly. Unions represent approximately 1,739 of our employees, which isapproximately 58% of our total employees. We have collective bargainingagreements with several unions, including (1) the United Auto Workers,(2) the International Brotherhood of Teamsters, (3) the UnitedSteelworkers, (4) the International Association of Machinists andAerospace Workers, (5) the National Automobile, Aerospace, Transportation,and General Workers Union of Canada and

 

17

----

Table of Contents

 

(6) El Sindicato Industrial de Trabajadores deNuevo Leon.

 

Each of our unionized facilities has a separatecontract with the union that represents the workers employed at such facility.The union contracts expire at various times over the next few years with theexception of our union contract that covers the hourly employees at ourMonterrey, Mexico, facility, which expires on an annual basis in January unlessotherwise renewed. The 2010 negotiations in Monterrey, Elkhart and Erie havebeen completed.  A new agreement at ourRockford facility was ratified on October 22, 2010.  We have no remaining contracts expiring in2010.

 

**Note 8 — Financial Instruments**

 

We have determined the estimated fair value amountsof financial instruments using available market information and otherappropriate valuation methodologies. However, considerable judgment is requiredin interpreting market data to develop the estimates of fair value.  A fair value hierarchy accounting standardexists for those instruments measured at fair value that distinguishes betweenassumptions based on market data (observable inputs) and our own assumptions(unobservable inputs).  Determining which category an asset orliability falls within the hierarchy requires significantjudgment.  We evaluate our hierarchy disclosures each quarter.

 

The hierarchy consists of three levels:

 
| Level 1 |   | Quoted market prices in active markets for  identical assets or liabilities;                                                              |
|---------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|
| Level 2 |   | Inputs other than Level 1 inputs that are either  directly or indirectly observable; and                                                  |
| Level 3 |   | Unobservable inputs developed using estimates and  assumptions developed by us, which reflect those that a market participant  would use. |

 

The carrying amounts of cash and cash equivalents,trade receivables, and accounts payable approximate fair value because of therelatively short maturity of these instruments. The fair value of debt at December 31, 2009 and September 30,2010 was $400.9 million and $634.9 million, respectively.

 
| ** **                                       | ** ** | **Carrying** | ** ** | **Fair Value** | ** ** |
|--------------------------------------------------|------------|--------------|------------|---------------------|------------|
| **As of September 30, 2010** | ** ** | **Amount**   | ** ** | **Level 1**    | ** ** | **Level 2** | ** ** | **Level 3** | ** ** |
|                                             |       |         |       |                |       |   |   |   |   |
| **Liabilities**                                  | ** ** | ** **   |       |                |       |   |   |   |   |
| Postpetition common  stock warrants              |       | $            | 1,985      |                |       |   |   |   | $ | 1,985 |   |
| Conversion option  within our convertible notes  |       | 165,366      |       |                |       |   |   | 165,366 |   |
|                                                  |            |              |            |                     |            |  |  |  |  |  |  |

 

Fair values relating to derivative financialinstruments reflect the estimated amounts that we would receive or pay toterminate the contracts at the reporting date based on quoted market prices ofcomparable contracts as of the balance sheet date.  Inputs that factor into the valuations forour warrants include the strike price of the warrants ($2.10 per common share),the market price of our common stock per share, dividend yield, volatility,risk-free rate, and the contractual term, which is two years from issuance.  Inputs that factor into the market-basedvaluation model for the conversion option within our convertible notes includethe market price of our common stock per share, volatility, the risk-free rate,and credit spread.

 

The following table summarizes changes in fairvalue of our Level 3 assets and (liabilities) for the periods ended December 31,2009, February 26, 2010, and September 30, 2010:

 
| ** **                          | ** ** | **Marketable  Securities** | ** ** | **Prepetition  Common  Stock  Warrants** | ** ** | **Postpetition  Common  Stock  Warrants** | ** ** | **Conversion  Option within  our Convertible  Notes** | ** ** |
|-------------------------------------|------------|----------------------------|------------|------------------------------------------|------------|-------------------------------------------|------------|-----------------------------------------------------------------|------------|
| Balance at  January 1, 2009    |       | $                          | 5,000      |                                     | —     |                                      | —     |                                                            | —     |   |
| Purchase (issuance) of  securities  |       | —                     |       | $                                        | (4,655     | )                                         | —     |                                                            | —     |   |
| Unrealized gain (loss)  recognized  |       | —                     |       | 594                                      |       | —                                    |       | —                                                          |       |
| Realized loss                       |       | (1,100                     | )          | —                                   |       | —                                    |       | —                                                          |       |
| Net settlements                     |       | (3,900                     | )          | 3,985                                    |       | —                                    |       | —                                                          |       |
| Balance at  December 31, 2009  |       | $                          | —     |                                     | $          | (76                                       | )          | —                                                          |       | — |   |
| Net settlements                     |       | —                     |       | 76                                       |       | —                                    |       | —                                                          |       |
| Issuance of securities              |       | —                     |       | —                                   |       | $                                         | 6,618      |                                                            | $          | 170,989 |   |
| Balance at  February 26, 2010  |       | $                          | —     |                                     | $          | —                                    |       | $                                                               | 6,618      |   | $ | 170,989 |   |
| Unrealized gain                     |       | —                     |       | —                                   |       | (4,633                                    | )          | (5,623                                                          | )          |
| Balance at  September 30, 2010 |       | $                          | —     |                                     | $          | —                                    |       | $                                                               | 1,985      |   | $ | 165,366 |   |

 

18

----

Table ofContents

 

**Note 9 — Segment Reporting**

 

As a part of our continual monitoring of thelong-term economic characteristics, products and production processes, class ofcustomer, and distribution methods of our operating segments, we aggregate ourseven operating segments into three reportable segments shown below.  The accounting policies of the reportablesegments are the same as described in Note 1, Summary of Significant AccountingPolicies.

 

The fair values of our operating segments are basedupon preliminary valuation information which has not yet been completed due tothe complexity of the analysis required. It is anticipated that the analysis will be completed during the fourthquarter of 2010.  Due to the impact ofthis on our reportable segments, the information in the table below should beconsidered preliminary.

 
| ** **                                                        | ** ** | **Successor**                                          | ** ** | **Predecessor**                                        | ** ** | **Successor**                                                        | ** ** | **Predecessor**                                                       | ** ** |
|-------------------------------------------------------------------|------------|--------------------------------------------------------|------------|--------------------------------------------------------|------------|----------------------------------------------------------------------|------------|-----------------------------------------------------------------------|------------|
| **(In thousands except per share data)** | ** ** | **Three Months  Ended  September 30,  2010** | ** ** | **Three Months  Ended  September 30,  2009** | ** ** | **Period from  February 26  to September  30,  2010** | ** ** | **Period from  January 1 to  February 26,  2010** | ** ** | **Nine Months  Ended  September 30,  2009** | ** ** |
|                                                              |       |                                                   |       |                                                   |       |                                                                 |       |                                                                  |       |   |   |
| Net sales:                                                        |       |                                                   |       |                                                   |       |                                                                 |       |                                                                  |       |   |   |
| Wheels                                                            |       | $                                                      | 78,444     |                                                   | $          | 63,504                                                               |       | $                                                                     | 172,270    |   | $ | 38,379 |   | $ | 174,609 |   |
| Components                                                        |       | 107,385                                                |       | 75,412                                                 |       | 250,365                                                              |       | 57,233                                                                |       | 222,535 |   |
| Other                                                             |       | 19,861                                                 |       | 6,293                                                  |       | 43,608                                                               |       | 8,447                                                                 |       | 26,847 |   |
| Consolidated total                                                |       | $                                                      | 205,690    |                                                   | $          | 145,209                                                              |       | $                                                                     | 466,243    |   | $ | 104,059 |   | $ | 423,991 |   |
|                                                              |       |                                                   |       |                                                   |       |                                                                 |       |                                                                  |       |   |   |
| Income (loss) from  operations:                                   |       |                                                   |       |                                                   |       |                                                                 |       |                                                                  |       |   |   |
| Wheels                                                            |       | $                                                      | 10,661     |                                                   | $          | 2,514                                                                |       | $                                                                     | 16,986     |   | $ | 2,663 |   | $ | 5,388 |   |
| Components                                                        |       | (692                                                   | )          | (4,850                                                 | )          | 1,652                                                                |       | (2,250                                                                | )          | (28,395 | ) |
| Other                                                             |       | 5,208                                                  |       | 391                                                    |       | 10,176                                                               |       | 1,662                                                                 |       | 3,636 |   |
| Corporate                                                         |       | (8,727                                                 | )          | (18,553                                                | )          | (25,546                                                              | )          | (5,188                                                                | )          | (34,822 | ) |
| Consolidated total                                                |       | $                                                      | 6,450      |                                                   | $          | (20,498                                                              | )          | $                                                                     | 3,268      |   | $ | (3,113 | ) | $ | (54,193 | ) |

 
| ** **         | ** ** | **Successor**                    | ** ** | **Predecessor**                 | ** ** |
|--------------------|------------|----------------------------------|------------|---------------------------------|------------|
| ** **         | ** ** | **As of**                   | ** ** |
| ** **         | ** ** | **September 30, 2010** | ** ** | **December 31, 2009** | ** ** |
| Total assets:      |       |                             |       |                            |       |
| Wheels             |       | $                                | 445,425    |                            | $          | 265,977 |   |
| Components         |       | 291,721                          |       | 230,618                         |       |
| Other              |       | 72,587                           |       | 29,997                          |       |
| Corporate          |       | 56,679                           |       | 145,078                         |       |
| Consolidated total |       | $                                | 866,412    |                            | $          | 671,670 |   |

 

**Note 10 - Debt**

 

Debt at September 30, 2010, and December 31,2009, consisted of the following:

 
| ** **                                         | ** ** | **Successor**                    | ** ** | **Predecessor**                 | ** ** |
|----------------------------------------------------|------------|----------------------------------|------------|---------------------------------|------------|
| ** **                                         | ** ** | **September 30, 2010** | ** ** | **December 31, 2009** | ** ** |
| ** **                                         | ** ** | **Debt**                         | ** ** | **Subject to  Compromise** | ** ** | **Debt** | ** ** |
| Term Facility —  Non-related Parties          |       | $                                | —     |                            | $          | — |   | $ | 224,560 |   |
| Term Facility — Related  Party Last-Out Loans |       | —                           |       | —                          |       | 79,486 |   |
| Senior Secured Notes                               |       | 301,768                          |       | —                          |       | — |   |
| Senior Subordinated  Notes                         |       | —                           |       | 275,000                         |       | — |   |
| Convertible Notes,  including conversion option    |       | 285,269                          |       | —                          |       | — |   |
| Revolving Credit  Facility                         |       | —                           |       | —                          |       | 71,659 |   |
| Term Facility Discount                             |       | —                           |       | —                          |       | (3,233 | ) |
| Debtors-In-Possession  (“DIP”) Facility  |       | —                           |       | —                          |       | 25,000 |   |
| Total                                              |       | $                                | 587,037    |                            | $          | 275,000 |   | $ | 397,472 |   |

 

19

----

Tableof Contents

 

Pursuant to the Plan of Reorganization, asof the Effective Date, our new capital structure consisted of the following:

 

·*Postpetition Senior Credit Facility*— On the Effective Date of the Plan of Reorganization, we entered into thefifth amendment and restatement to our prepetition senior credit facility (the “postpetitionsenior credit facility”).  As of theEffective Date, under our postpetition senior credit facility Accuride hadoutstanding term loans of $287.0 million and outstanding letters of credit inthe stated amount of $2.0 million and Accuride Canada Inc. had outstanding termloans of $22.0 million.  The interestrate for all loans was, at our option, LIBOR + 6.75% (with a LIBOR floor of3.00%) or Base Rate + 5.75% (with a Base Rate floor of 4.00%).  The maturity for all loans and reimbursementsof draws under the letters of credit was June 30, 2013.

 

With certain exceptions, our postpetition seniorcredit facility required us to prepay loans with (i) 100% of excess cashflow (commencing with the fiscal year ending December 31, 2010), (ii) 100%of net proceeds from asset sales, (iii) 100% of new proceeds from new debtissuances, (iv) 100% of net cash proceeds from equity issuances and (v) 100%of cash received by us from third parties that are holding cash from letters ofcredit that they have drawn.

 

The loans under our postpetition senior creditfacility were secured by, among other things, a lien on substantially all ofour U.S. and Canadian properties, assets and domestic subsidiaries and a pledgeof 65% of the stock of our foreign subsidiaries.

 

·*7.5% Senior Convertible Notes*— On the Effective Date of the Plan of Reorganization, we issued $140.0 millionaggregate principal amount of convertible notes.  The first six interest paymentson the convertible notes will be PIK interest. Thereafter, beginning on August 26, 2013, interest on theconvertible notes will be paid in cash.

 

The convertible notes are convertible into CommonStock at any time beginning on the Effective Date until the second business daypreceding maturity, at an initial conversion rate of 1333.3333 per $1,000principal amount of notes (equivalent to an initial conversion price of $0.75per share of Common Stock).  Theconversion rate is subject to customary adjustments and will also be adjustedto account for PIK interest.  Theadjustment to the conversion rate for convertible notes issued as PIK interestserves to prevent the convertible notes outstanding immediately prior to thePIK interest payment from being diluted by the notes paid as PIK interest.

 

On August 26, 2010,we made a PIK interest payment with respect to the convertible notes byincreasing the principal amount of the notes by $5,250.

 

Pursuant to the terms ofthe indenture, the conversion rate of the convertible notes is adjusted to1407.2343 per $1,000 principal amount of notes (equivalent to a conversionprice of $0.71 per share of common stock).

 

The embedded conversion option is bifurcated andaccounted for separately from the convertible debt.  The conversion option is recorded at fairvalue and presented with the convertible notes on the consolidated balancesheet.  Eachperiod, the conversion option will be recorded at fair value with thecorresponding non-cash gain or loss recognized in our consolidated statementsof operations as a component of other income (expense).  The decrease in fair value from February 26,2010 to September 30, 2010 and for the three months ended September 30,2010 was $5.6 million and $36.8 million, respectively.

 

·*Common Stock and Warrants* — We issued thefollowing equity securities: (i) 98,000,000 shares of Common Stock toholders of our prepetition senior subordinated notes, on a pro rata basis(ii) 25,000,000 shares of Common Stock to the parties backstopping therights offering of convertible notes as payment of their backstop fee,(iii) 2,000,000 shares of Common Stock to holders of our prepetitioncommon stock on a pro rata basis, (iv) Warrants to purchase 22,058,824shares of Common Stock to holders of our prepetition common stock on a pro ratabasis and (v) 1,294,882 shares of Common Stock, net of shares withheld fortax purposes, under our Key Executive Incentive Plan.  The Warrants areexercisable at $2.10 per share until February 26, 2012, when they expire.

 

In accordance withapplicable accounting guidance, the Warrants were recorded as a liability atfair value on the Effective Date.  Eachperiod, the Warrants will be recorded at fair value with the correspondingnon-cash gain or loss recognized in our consolidated statements of operationsas a component of other income (expense).

 

Also under the Plan of Reorganization, our prepetition common stock, all otherequity interests in Accuride, our prepetition senior subordinated notes and theindenture governing our prepetition senior subordinated notes (otherthan for the purposes of allowing holders of the notes to receive distributionsunder the Plan of Reorganization andallowing the trustees to exercise certain rights) were cancelled.  The holders of these securitiesreceived the distributions described above

 

20

----

Table of Contents

 

pursuant to the Plan ofReorganization. All amounts outstanding under the DIP credit facility that wehad entered into to provide financing during the pendency of our bankruptcywere also paid on the Effective Date and the DIP credit facility was terminatedin accordance with its terms.

 

On July 29, 2010, we completed an offering,which we refer to as the “Refinancing”, of $310.0 million aggregate principalamount of senior secured notes and entered into the ABL facility. We used thenet proceeds from the offering of the senior secured notes and borrowings underthe ABL facility to refinance our postpetition senior credit facility.

 

·                  *ABL Credit Agreement*— In connection with the Refinancing, we entered into a new ABL Credit Facility(the “ABL facility”).  The ABL facilityis a senior secured asset based revolving credit facility in an aggregateprincipal amount of up to $75.0 million, with the right, subject tocertain conditions, to increase the availability under the facility by up to$25.0 million in the aggregate (for a total aggregate availability of$100.0 million). The four-year ABL facility matures on July 29, 2014 andprovides for loans and letters of credit in an aggregate amount up to theamount of the facility, subject to meeting certain borrowing base conditions,with sub-limits of up to $10.0 million for swingline loans and $25.0 million tobe available for the issuance of letters of credit.  Loans under the ABL facility initially bearsinterest at an annual rate equal to either LIBOR plus 3.50% or Base Rate plus2.50%, at our option, subject to changes based on our leverage ratio as definedin the ABL facility.

 

We must also pay a commitment fee equal to0.50% per annum to the lenders under the ABL facility if utilization under thefacility exceeds 50.0% of the total commitments under the facility and acommitment fee equal to 0.75% per annum if utilization under the facility isless than or equal to 50.0% of the total commitments under the facility.Customary letter of credit fees are also payable, as necessary.

 

The obligationsunder the ABL facility are secured by (i) first-priority liens onsubstantially all of the Company’s accounts receivable and inventories, subjectto certain exceptions and permitted liens (the “ABL Priority Collateral”) and (ii) second-priorityliens on substantially all of the Company’s owned real property and tangibleand intangible assets other than the ABL Priority Collateral, including all ofthe outstanding capital stock of our domestic subsidiaries, subject to certainexceptions and permitted liens (the “Notes Priority Collateral”).

 

·                  *9.5% Senior Secured Notes* — In connection with the Refinancing, we issued $310.0 millionaggregate principal amount of senior secured notes.  Under the terms of the indenture governingthe senior secured notes, the senior secured notes bear interest at a rate of9.5% per year and mature on August 1, 2018.   Prior to maturity we may redeem the seniorsecured notes on the terms set forth in the indenture governing the seniorsecured notes. The senior secured notes are guaranteed by the Guarantors, andthe senior secured notes and the related guarantees are secured by firstpriority liens on the Notes Priority Collateral and second priority liens onthe ABL Priority Collateral.

 

**Note 11 — Guarantor andNon-guarantor Financial Statements**

 

Prior to the Refinancing, our postpetition seniorcredit facility was secured by, among other things, a lien on substantially allof our U.S. and Canadian properties, assets and domestic subsidiaries (“GuarantorSubsidiaries”) and a pledge of 65% of the stock of our foreign subsidiaries.  Our convertible notes are fully andunconditionally guaranteed, on a joint and several basis, by substantially allof our 100% owned domestic subsidiaries. The non-guarantor subsidiaries are ourforeign subsidiaries.   The followingcondensed financial information illustrates the composition of the combinedGuarantor Subsidiaries:

 

21

----

Table ofContents

 

**CONDENSED CONSOLIDATEDBALANCE SHEET**

 
| ** **                                                  | ** ** | **Successor**                    | ** ** |
|-------------------------------------------------------------|------------|----------------------------------|------------|
| ** **                                                  | ** ** | **September 30, 2010** | ** ** |
| ** **                                                  | ** ** | **Parent**                       | ** ** | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| **ASSETS**                                                  |       |                             |       |   |   |   |   |   |   |   |   |
| Cash and cash  equivalents                                  |       | $                                | 47,801     |   | $ | (2,873 | ) | $ | 6,436 |   | — |   | $ | 51,364 |   |
| Accounts receivable,  net                                   |       | 181,842                          |       | 57,806 |   | 5,936 |   | $ | (142,386 | ) | 103,198 |   |
| Inventories                                                 |       | 20,056                           |       | 39,853 |   | 4,784 |   | — |   | 64,693 |   |
| Other current assets                                        |       | 1,972                            |       | 2,752 |   | 3,077 |   | — |   | 7,801 |   |
| Total current assets                                        |       | 251,671                          |       | 97,538 |   | 20,233 |   | (142,386 | ) | 227,056 |   |
| Property, plant, and  equipment, net                        |       | 41,852                           |       | 163,582 |   | 51,546 |   | — |   | 256,980 |   |
| Goodwill                                                    |       | 15,260                           |       | 83,285 |   | 30,196 |   | — |   | 128,741 |   |
| Intangible assets, net                                      |       | 54,157                           |       | 145,365 |   | 34,996 |   | — |   | 234,518 |   |
| Investments in and  advances to subsidiaries and affiliates |       | 443,643                          |       | — |   | — |   | (443,643 | ) | — |   |
| Other non-current  assets                                   |       | 11,457                           |       | 1,759 |   | 5,901 |   | — |   | 19,117 |   |
| TOTAL                                                       |       | $                                | 818,040    |   | $ | 491,529 |   | $ | 142,872 |   | $ | (586,029 | ) | $ | 866,412 |   |
| **LIABILITIES  AND STOCKHOLDERS’ EQUITY**              |       |                             |       |   |   |   |   |   |   |   |   |
| Accounts payable                                            |       | $                                | 11,893     |   | $ | 38,752 |   | $ | 8,054 |   | — |   | $ | 58,699 |   |
| Accrued payroll and  compensation                           |       | 4,036                            |       | 9,552 |   | 4,880 |   | — |   | 18,468 |   |
| Accrued interest  payable                                   |       | 5,196                            |       | — |   | — |   | — |   | 5,196 |   |
| Accrued and other  liabilities                              |       | 3,961                            |       | 127,068 |   | 39,149 |   | $ | (142,386 | ) | 27,792 |   |
| Total current  liabilities                                  |       | 25,086                           |       | 175,372 |   | 52,083 |   | (142,386 | ) | 110,155 |   |
| Long term debt                                              |       | 587,037                          |       | — |   | — |   | — |   | 587,037 |   |
| Deferred and  non-current income taxes                      |       | 154,535                          |       | (133,999 | ) | 1,122 |   | — |   | 21,658 |   |
| Other non-current  liabilities                              |       | 17,075                           |       | 80,701 |   | 15,479 |   | — |   | 113,255 |   |
| Stockholders’ equity                                   |       | 34,307                           |       | 369,455 |   | 74,188 |   | (443,643 | ) | 34,307 |   |
| TOTAL                                                       |       | $                                | 818,040    |   | $ | 491,529 |   | $ | 142,872 |   | $ | (586,029 | ) | $ | 866,412 |   |

 
| ** **                                                  | ** ** | **Predecessor**                 | ** **    |
|-------------------------------------------------------------|------------|---------------------------------|---------------|
| ** **                                                  | ** ** | **December 31, 2009** | ** **    |
| **(in thousands)**                                     | ** ** | **Parent**                      | ** **    | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| **ASSETS**                                                  |       |                            |          |   |   |   |   |   |   |   |   |
| Cash and cash  equivalents                                  |       | $                               |  53,505  |   | $ |  (1,871 | ) | $ |  4,887 |   | — |   | $ |  56,521 |   |
| Accounts receivable,  net                                   |       | 26,145                          |          | 185,953 |   | 5,831 |   | $ |  (151,628 | ) | 66,301 |   |
| Inventories                                                 |       | 14,870                          |          | 33,963 |   | 2,091 |   | (182 | ) | 50,742 |   |
| Other current assets                                        |       | 6,603                           |          | 12,675 |   | 26,346 |   | (20,051 | ) | 25,573 |   |
| Total current assets                                        |       | 101,123                         |          | 230,720 |   | 39,155 |   | (171,861 | ) | 199,137 |   |
| Property, plant, and  equipment, net                        |       | 34,672                          |          | 154,173 |   | 40,682 |   | — |   | 229,527 |   |
| Goodwill                                                    |       | 66,973                          |          | 52,460 |   | 8,041 |   | — |   | 127,474 |   |
| Intangible assets, net                                      |       | 373                             |          | 88,857 |   | — |   | — |   | 89,230 |   |
| Investments in and  advances to subsidiaries and affiliates |       | 271,863                         |          | — |   | — |   | (271,863 | ) | — |   |
| Other non-current  assets                                   |       | 17,104                          |          | 1,341 |   | 7,857 |   | — |   | 26,302 |   |
| TOTAL                                                       |       | $                               |  492,108 |   | $ |  527,551 |   | $ |  95,735 |   | $ |  (443,724 | ) | $ |  671,670 |   |
| **LIABILITIES  AND STOCKHOLDERS’ EQUITY**              |       |                            |          |   |   |   |   |   |   |   |   |
| Accounts payable                                            |       | $                               |  5,289   |   | $ |  22,206 |   | $ |  3,782 |   | — |   | 31,277 |   |
| Debt                                                        |       | 375,472                         |          | — |   | 22,000 |   | $ |  — |   | 397,472 |   |
| Accrued payroll and  compensation                           |       | 3,006                           |          | 5,885 |   | 5,427 |   | — |   | 14,318 |   |
| Accrued interest  payable                                   |       | 3,067                           |          | — |   | 504 |   | — |   | 3,571 |   |
| Accrued and other  liabilities                              |       | 8,297                           |          | 277,845 |   | 1,977 |   | (260,472 | ) | 27,647 |   |
| Total current  liabilities                                  |       | 395,131                         |          | 305,936 |   | 33,690 |   | (260,472 | ) | 474,285 |   |
| Deferred and  non-current income taxes                      |       | 10,810                          |          | 10,347 |   | 1,031 |   | — |   | 22,188 |   |
| Other non-current  liabilities                              |       | 18,465                          |          | 69,442 |   | 13,442 |   | — |   | 101,349 |   |
| Liabilities subject to  compromise                          |       | 295,968                         |          | 6,146 |   | — |   | — |   | 302,114 |   |
| Stockholders’ equity  (deficiency)                     |       | (228,266                        | )             | 135,680 |   | 47,572 |   | (183,252 | ) | (228,266 | ) |
| TOTAL                                                       |       | $                               |  492,108 |   | $ |  527,551 |   | $ |  95,735 |   | $ |  (443,724 | ) | $ |  671,670 |   |

 

22

----

Table ofContents

 

**CONDENSED CONSOLIDATEDSTATEMENTS OF OPERATIONS**

 
| ** **                                   | ** ** | **Successor**                                                      | ** ** |
|----------------------------------------------|------------|--------------------------------------------------------------------|------------|
| ** **                                   | ** ** | **Three Months Ended September 30, 2010** | ** ** |
| ** **                                   | ** ** | **Parent**                                                         | ** ** | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| Net sales                                    |       | $                                                                  | 90,287     |   | $ | 117,260 |   | $ | 31,218 |   | $ | (33,075 | ) | $ | 205,690 |   |
| Cost of goods sold                           |       | 81,165                                                             |       | 108,694 |   | 27,602 |   | (33,075 | ) | 184,386 |   |
| Gross profit                                 |       | 9,122                                                              |       | 8,566 |   | 3,616 |   | — |   | 21,304 |   |
| Operating expenses                           |       | 11,091                                                             |       | 3,702 |   | 61 |   | — |   | 14,854 |   |
| Income (loss) from  operations               |       | (1,969                                                             | )          | 4,864 |   | 3,555 |   | — |   | 6,450 |   |
| Other income (expense):                      |       |                                                               |       |   |   |   |   |   |   |   |   |
| Interest expense, net                        |       | (10,655                                                            | )          | (32 | ) | (35 | ) | — |   | (10,722 | ) |
| Equity in earnings  (losses) of subsidiaries |       | 7,752                                                              |       | — |   | — |   | (7,752 | ) | — |   |
| Other income (expense),  net                 |       | 38,750                                                             |       | 264 |   | 460 |   | — |   | 39,474 |   |
| Income before and  income taxes              |       | 33,878                                                             |       | 5,096 |   | 3,980 |   | (7,752 | ) | 35,202 |   |
| Income tax provision  (benefit)              |       | 3,027                                                              |       | — |   | 1,324 |   | — |   | 4,351 |   |
| Net income (loss)                            |       | $                                                                  | 30,851     |   | $ | 5,096 |   | $ | 2,656 |   | $ | (7,752 | ) | $ | 30,851 |   |

** **
| ** **                                   | ** ** | **Predecessor**                                                    | ** ** |
|----------------------------------------------|------------|--------------------------------------------------------------------|------------|
| ** **                                   | ** ** | **Three Months Ended September 30, 2009** | ** ** |
| ** **                                   | ** ** | **Parent**                                                         | ** ** | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| Net sales                                    |       | $                                                                  | 73,645     |   | $ | 74,675 |   | $ | 27,213 |   | $ | (30,324 | ) | $ | 145,209 |   |
| Cost of goods sold                           |       | 69,926                                                             |       | 77,909 |   | 25,824 |   | (30,324 | ) | 143,335 |   |
| Gross profit (loss)                          |       | 3,719                                                              |       | (3,234 | ) | 1,389 |   | — |   | 1,874 |   |
| Operating expenses                           |       | 19,128                                                             |       | 3,118 |   | 126 |   | — |   | 22,372 |   |
| Income (loss) from  operations               |       | (15,409                                                            | )          | (6,352 | ) | 1,263 |   | — |   | (20,498 | ) |
| Other income (expense):                      |       |                                                               |       |   |   |   |   |   |   |   |   |
| Interest expense, net                        |       | (17,624                                                            | )          | (40 | ) | (467 | ) | — |   | (18,131 | ) |
| Equity in earnings  (losses) of subsidiaries |       | (3,654                                                             | )          | — |   | — |   | 3,654 |   | — |   |
| Other income (expense),  net                 |       | (153                                                               | )          | 67 |   | 3,317 |   | — |   | 3,231 |   |
| Income (loss) before  income taxes           |       | (36,840                                                            | )          | (6,325 | ) | 4,113 |   | 3,654 |   | (35,398 | ) |
| Income tax provision  (benefit)              |       | (3,511                                                             | )          | — |   | 1,442 |   | — |   | (2,069 | ) |
| Net income (loss)                            |       | $                                                                  | (33,329    | ) | $ | (6,325 | ) | $ | 2,671 |   | $ | 3,654 |   | $ | (33,329 | ) |

 
| ** **                                   | ** ** | **Successor**                                                                        | ** **    |
|----------------------------------------------|------------|--------------------------------------------------------------------------------------|---------------|
| ** **                                   | ** ** | **Period from February 26 to September 30, 2010** | ** **    |
| ** **                                   | ** ** | **Parent**                                                                           | ** **    | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| Net sales                                    |       | $                                                                                    |  212,603 |   | $ |  258,184 |   | $ |  69,217 |   | $ |  (73,761 | ) | $ |  466,243 |   |
| Cost of goods sold                           |       | 202,016                                                                              |          | 233,054 |   | 62,211 |   | (73,761 | ) | 423,520 |   |
| Gross profit                                 |       | 10,587                                                                               |          | 25,130 |   | 7,006 |   | — |   | 42,723 |   |
| Operating expenses                           |       | 30,606                                                                               |          | 8,687 |   | 162 |   | — |   | 39,455 |   |
| Income (loss) from  operations               |       | (20,019                                                                              | )             | 16,443 |   | 6,844 |   | — |   | 3,268 |   |
| Other income (expense):                      |       |                                                                                 |          |   |   |   |   |   |   |   |   |
| Interest expense, net                        |       | (24,222                                                                              | )             | (76 | ) | (154 | ) | — |   | (24,452 | ) |
| Equity in earnings  (losses) of subsidiaries |       | 20,812                                                                               |          | — |   | — |   | (20,812 | ) | — |   |
| Other income (expense),  net                 |       | 10,492                                                                               |          | 428 |   | (709 | ) | — |   | 10,211 |   |
| Income (loss) before  and income taxes       |       | (12,937                                                                              | )             | 16,795 |   | 5,981 |   | (20,812 | ) | (10,973 | ) |
| Income tax provision  (benefit)              |       | 2,730                                                                                |          | — |   | 1,964 |   | — |   | 4,694 |   |
| Net income (loss)                            |       | $                                                                                    |  (15,667 | ) | $ |  16,795 |   | $ |  4,017 |   | $ |  (20,812 | ) | $ |  (15,667 | ) |

 

23

----

Table ofContents

 
| ** **                                                  | ** ** | **Predecessor**                                                                   | ** ** |
|-------------------------------------------------------------|------------|-----------------------------------------------------------------------------------|------------|
| ** **                                                  | ** ** | **Period from January 1 to February 26, 2010** | ** ** |
| ** **                                                  | ** ** | **Parent**                                                                        | ** ** | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| Net sales                                                   |       | $                                                                                 | 47,897     |   | $ | 56,971 |   | $ | 14,011 |   | $ | (14,820 | ) | $ | 104,059 |   |
| Cost of goods sold                                          |       | 45,553                                                                            |       | 54,526 |   | 14,318 |   | (14,820 | ) | 99,577 |   |
| Gross profit (loss)                                         |       | 2,344                                                                             |       | 2,445 |   | (307 | ) | — |   | 4,482 |   |
| Operating expenses                                          |       | 5,327                                                                             |       | 2,216 |   | 52 |   | — |   | 7,595 |   |
| Income (loss) from  operations                              |       | (2,983                                                                            | )          | 229 |   | (359 | ) | — |   | (3,113 | ) |
| Other income (expense):                                     |       |                                                                              |       |   |   |   |   |   |   |   |   |
| Interest expense, net                                       |       | (6,804                                                                            | )          | (21 | ) | (671 | ) | — |   | (7,496 | ) |
| Equity in earnings  (losses) of subsidiaries                |       | (826                                                                              | )          | — |   | — |   | 826 |   | — |   |
| Other income (expense),  net                                |       | 547                                                                               |       | 49 |   | (30 | ) | — |   | 566 |   |
| Income (loss) before  reorganization items and income taxes |       | (10,066                                                                           | )          | 257 |   | (1,060 | ) | 826 |   | (10,043 | ) |
| Reorganization items                                        |       | (59,334                                                                           | )          | 21 |   | 2 |   | — |   | (59,311 | ) |
| Income tax benefit                                          |       | (1,534                                                                            | )          | — |   | — |   | — |   | (1,534 | ) |
| Net income (loss)                                           |       | $                                                                                 | 50,802     |   | $ | 236 |   | $ | (1,062 | ) | $ | 826 |   | $ | 50,802 |   |

 
| ** **                          | ** ** | **Predecessor**                                                   | ** ** |
|-------------------------------------|------------|-------------------------------------------------------------------|------------|
| ** **                          | ** ** | **Nine Months Ended September 30, 2009** | ** ** |
| ** **                          | ** ** | **Parent**                                                        | ** ** | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| Net sales                           |       | $                                                                 | 206,503    |   | $ | 223,045 |   | $ | 68,288 |   | $ | (73,845 | ) | $ | 423,991 |   |
| Cost of goods sold                  |       | 199,800                                                           |       | 239,525 |   | 65,618 |   | (73,845 | ) | 431,098 |   |
| Gross profit (loss)                 |       | 6,703                                                             |       | (16,480 | ) | 2,670 |   | — |   | (7,107 | ) |
| Operating expenses                  |       | 37,440                                                            |       | 9,180 |   | 466 |   | — |   | 47,086 |   |
| Income (loss) from  operations      |       | (30,737                                                           | )          | (25,660 | ) | 2,204 |   | — |   | (54,193 | ) |
| Other income (expense):             |       |                                                              |       |   |   |   |   |   |   |   |   |
| Interest expense, net               |       | (45,373                                                           | )          | (107 | ) | (1,545 | ) | — |   | (47,025 | ) |
| Loss on extinguishment  of debt     |       | (5,389                                                            | )          | — |   | — |   | — |   | (5,389 | ) |
| Equity in earnings of  subsidiaries |       | (21,034                                                           | )          | — |   | — |   | 21,034 |   | — |   |
| Other income (expense),  net        |       | (413                                                              | )          | 221 |   | 5,777 |   | — |   | 5,585 |   |
| Income (loss) before  income taxes  |       | (102,946                                                          | )          | (25,546 | ) | 6,436 |   | 21,034 |   | (101,022 | ) |
| Income tax provision  (benefit)     |       | (2,491                                                            | )          | — |   | 1,924 |   | — |   | (567 | ) |
| Net income (loss)                   |       | $                                                                 | (100,455   | ) | $ | (25,546 | ) | $ | 4,512 |   | $ | 21,034 |   | $ | (100,455 | ) |

 

24

----

Table ofContents

 

**CONDENSED CONSOLIDATEDSTATEMENTS OF CASH FLOWS**

 
| ** **                                                                                           | ** ** | **Successor**                                                                        | ** ** |
|------------------------------------------------------------------------------------------------------|------------|--------------------------------------------------------------------------------------|------------|
| ** **                                                                                           | ** ** | **Period from February 26 to September 30, 2010** | ** ** |
| ** **                                                                                           | ** ** | **Parent  Company**                                                                  | ** ** | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| CASH FLOWS FROM  OPERATING ACTIVITIES:                                                               |       |                                                                                 |       |   |   |   |   |   |   |   |   |
| Net income (loss)                                                                                    |       | $                                                                                    | (15,667    | ) | $ | 16,795 |   | $ | 4,017 |   | $ | (20,812 | ) | $ | (15,667 | ) |
| Adjustments to  reconcile net income (loss) to net cash provided by (used in) operating  activities: |       |                                                                                 |       |   |   |   |   |   |   |   |   |
| Depreciation                                                                                         |       | 5,554                                                                                |       | 15,337 |   | 3,355 |   | — |   | 24,246 |   |
| Amortization — deferred  financing costs                                                        |       | 460                                                                                  |       | — |   | — |   | — |   | 460 |   |
| Amortization — other  intangible assets                                                         |       | 3,311                                                                                |       | 3,171 |   | — |   | — |   | 6,482 |   |
| Loss on disposal of  assets                                                                          |       | 4                                                                                    |       | 25 |   | 22 |   | — |   | 51 |   |
| Deferred income taxes                                                                                |       | 2,179                                                                                |       | — |   | — |   | — |   | 2,179 |   |
| Paid-in-kind interest                                                                                |       | 6,161                                                                                |       | — |   | — |   | — |   | 6,161 |   |
| Non-cash stock-based  compensation                                                                   |       | 593                                                                                  |       | — |   | — |   | — |   | 593 |   |
| Equity in earnings of  subsidiaries and affiliates                                                   |       | (20,812                                                                              | )          | — |   | — |   | 20,812 |   | — |   |
| Non-cash change in  market valuation - convertible notes                                             |       | (5,623                                                                               | )          | — |   | — |   | — |   | (5,623 | ) |
| Non-cash change in  warrant liability                                                                |       | (4,633                                                                               | )          | — |   | — |   | — |   | (4,633 | ) |
| Change in other  operating items                                                                     |       | (19,624                                                                              | )          | (28,367 | ) | 18,017 |   | — |   | (29,974 | ) |
| Net cash provided by  (used in) operating activities                                                 |       | (48,097                                                                              | )          | 6,961 |   | 25,411 |   | — |   | (15,725 | ) |
|                                                                                                 |       |                                                                                 |       |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM  INVESTING ACTIVITIES:                                                               |       |                                                                                 |       |   |   |   |   |   |   |   |   |
| Purchases of property,  plant, and equipment                                                         |       | (1,725                                                                               | )          | (5,808 | ) | (615 | ) | — |   | (8,148 | ) |
| Other                                                                                                |       | 13,028                                                                               |       | 238 |   | — |   | — |   | 13,266 |   |
| Net cash provided by  (used in) investing activities                                                 |       | 11,303                                                                               |       | (5,570 | ) | (615 | ) | — |   | 5,118 |   |
|                                                                                                 |       |                                                                                 |       |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM  FINANCING ACTIVITIES:                                                               |       |                                                                                 |       |   |   |   |   |   |   |   |   |
| Other                                                                                                |       | 3,624                                                                                |       | — |   | (22,000 | ) | — |   | (18,376 | ) |
| Net cash provided by  (used in) financing activities                                                 |       | 3,624                                                                                |       | — |   | (22,000 | ) | — |   | (18,376 | ) |
|                                                                                                 |       |                                                                                 |       |   |   |   |   |   |   |   |   |
| Increase (decrease) in  cash and cash equivalents                                                    |       | (33,170                                                                              | )          | 1,391 |   | 2,796 |   | — |   | (28,983 | ) |
| Cash and cash  equivalents, beginning of period                                                      |       | 80,971                                                                               |       | (4,264 | ) | 3,640 |   | — |   | 80,347 |   |
| Cash and cash  equivalents, end of period                                                            |       | $                                                                                    | 47,801     |   | $ | (2,873 | ) | $ | 6,436 |   | $ | — |   | $ | 51,364 |   |

** **
| ** **                                                                                           | ** ** | **Predecessor**                                                                   | ** ** |
|------------------------------------------------------------------------------------------------------|------------|-----------------------------------------------------------------------------------|------------|
| ** **                                                                                           | ** ** | **Period from January 1 to February 26, 2010** | ** ** |
| ** **                                                                                           | ** ** | **Parent  Company**                                                               | ** ** | **Guarantor  Subsidiaries** | ** ** | **Non-guarantor  Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| CASH FLOWS FROM  OPERATING ACTIVITIES:                                                               |       |                                                                              |       |   |   |   |   |   |   |   |   |
| Net income (loss)                                                                                    |       | $                                                                                 | 50,802     |   | $ | 236 |   | $ | (1,062 | ) | $ | 826 |   | $ | 50,802 |   |
| Adjustments to  reconcile net income (loss) to net cash provided by (used in) operating  activities: |       |                                                                              |       |   |   |   |   |   |   |   |   |
| Depreciation                                                                                         |       | 1,205                                                                             |       | 4,527 |   | 979 |   | — |   | 6,711 |   |
| Amortization — deferred  financing costs                                                        |       | 690                                                                               |       | — |   | 4 |   | — |   | 694 |   |
| Amortization — other  intangible assets                                                         |       | 31                                                                                |       | 790 |   | — |   | — |   | 821 |   |
| Reorganization items                                                                                 |       | (59,334                                                                           | )          | 21 |   | 2 |   | — |   | (59,311 | ) |
| Payments on  reorganization items                                                                    |       | (12,164                                                                           | )          | — |   | — |   | — |   | (12,164 | ) |
| Paid-in-kind interest                                                                                |       | 1,769                                                                             |       | — |   | — |   | — |   | 1,769 |   |
| Loss (gain) on disposal  of assets                                                                   |       | 2                                                                                 |       | 1 |   | — |   | — |   | 3 |   |
| Equity in earnings of  subsidiaries and affiliates                                                   |       | 826                                                                               |       | — |   | — |   | (826 | ) | — |   |
| Deferred income taxes                                                                                |       | (1,560                                                                            | )          | — |   | — |   | — |   | (1,560 | ) |
| Change in other  operating items                                                                     |       | (752                                                                              | )          | (6,636 | ) | (1,150 | ) | — |   | (8,538 | ) |
| Net cash used in  operating activities                                                               |       | (18,485                                                                           | )          | (1,061 | ) | (1,227 | ) | — |   | (20,773 | ) |
|                                                                                                 |       |                                                                              |       |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM  INVESTING ACTIVITIES:                                                               |       |                                                                              |       |   |   |   |   |   |   |   |   |
| Purchases of property,  plant, and equipment                                                         |       | (60                                                                               | )          | (1,377 | ) | (20 | ) | — |   | (1,457 | ) |
| Other                                                                                                |       | (600                                                                              | )          | 45 |   | — |   | — |   | (555 | ) |
| Net cash used in  investing activities                                                               |       | (660                                                                              | )          | (1,332 | ) | (20 | ) | — |   | (2,012 | ) |
|                                                                                                 |       |                                                                              |       |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM  FINANCING ACTIVITIES:                                                               |       |                                                                              |       |   |   |   |   |   |   |   |   |
| Net proceeds from debt  issuance                                                                     |       | 46,611                                                                            |       | — |   | — |   | — |   | 46,611 |   |
| Net cash provided by  financing activities                                                           |       | 46,611                                                                            |       | — |   | — |   | — |   | 46,611 |   |
|                                                                                                 |       |                                                                              |       |   |   |   |   |   |   |   |   |
| Increase (decrease) in  cash and cash equivalents                                                    |       | 27,466                                                                            |       | (2,393 | ) | (1,247 | ) | — |   | 23,826 |   |
| Cash and cash  equivalents, beginning of year                                                        |       | 53,505                                                                            |       | (1,871 | ) | 4,887 |   | — |   | 56,521 |   |
| Cash and cash  equivalents, end of period                                                            |       | $                                                                                 | 80,971     |   | $ | (4,264 | ) | $ | 3,640 |   | $ | — |   | $ | 80,347 |   |

 

25

----

Table of Contents

 
| ** **                                                                                           | ** ** | **Predecessor**                                                   | ** ** |
|------------------------------------------------------------------------------------------------------|------------|-------------------------------------------------------------------|------------|
| ** **                                                                                           | ** ** | **Nine Months Ended September 30, 2009** | ** ** |
| ** **                                                                                           | ** ** | **Parent   Company**                                         | ** ** | **Guarantor   Subsidiaries** | ** ** | **Non-guarantor   Subsidiaries** | ** ** | **Eliminations** | ** ** | **Total** | ** ** |
| CASH FLOWS FROM  OPERATING ACTIVITIES:                                                               |       |                                                              |       |   |   |   |   |   |   |   |   |
| Net income (loss)                                                                                    |       | $                                                                 | (100,455   | ) | $ | (25,546 | ) | $ | 4,512 |   | $ | 21,034 |   | $ | (100,455 | ) |
| Adjustments to  reconcile net income (loss) to net cash provided by (used in) operating  activities: |       |                                                              |       |   |   |   |   |   |   |   |   |
| Depreciation                                                                                         |       | 5,623                                                             |       | 24,659 |   | 4,298 |   | — |   | 34,580 |   |
| Amortization — deferred  financing costs                                                        |       | 3,319                                                             |       | 2 |   | 19 |   | — |   | 3,340 |   |
| Amortization — other  intangible assets                                                         |       | 140                                                               |       | 3,550 |   | — |   | — |   | 3,690 |   |
| Loss on extinguishment  of debt                                                                      |       | 5,389                                                             |       | — |   | — |   | — |   | 5,389 |   |
| Deferred income taxes                                                                                |       | (136                                                              | )          | — |   | — |   | — |   | (136 | ) |
| Change in warrant  liability                                                                         |       | (608                                                              | )          | — |   | — |   | — |   | (608 | ) |
| Paid-in-kind interest                                                                                |       | 6,519                                                             |       | — |   | — |   | — |   | 6,519 |   |
| Loss (gain) on disposal  of assets                                                                   |       | (477                                                              | )          | 242 |   | 292 |   | — |   | 57 |   |
| Equity in earnings of  subsidiaries and affiliates                                                   |       | 21,034                                                            |       | — |   | — |   | (21,034 | ) | — |   |
| Non-cash stock-based  compensation                                                                   |       | 249                                                               |       | — |   | — |   | — |   | 249 |   |
| Change in other  operating items                                                                     |       | 10,436                                                            |       | 6,398 |   | (22,986 | ) | — |   | (6,152 | ) |
| Net cash provided by  (used in) operating activities                                                 |       | (48,967                                                           | )          | 9,305 |   | (13,865 | ) | — |   | (53,527 | ) |
|                                                                                                 |       |                                                              |       |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM  INVESTING ACTIVITIES:                                                               |       |                                                              |       |   |   |   |   |   |   |   |   |
| Purchases of property,  plant, and equipment                                                         |       | (7,390                                                            | )          | (8,401 | ) | (331 | ) | — |   | (16,122 | ) |
| Other                                                                                                |       | 3,900                                                             |       | 213 |   | — |   | — |   | 4,113 |   |
| Net cash used in  investing activities                                                               |       | (3,490                                                            | )          | (8,188 | ) | (331 | ) | — |   | (12,009 | ) |
|                                                                                                 |       |                                                              |       |   |   |   |   |   |   |   |   |
| CASH FLOWS FROM  FINANCING ACTIVITIES:                                                               |       |                                                              |       |   |   |   |   |   |   |   |   |
| Net change in revolving  credit advance                                                              |       | (35,000                                                           | )          | — |   | (8,000 | ) | — |   | (43,000 | ) |
| Other                                                                                                |       | 9,877                                                             |       | — |   | — |   | — |   | 9,877 |   |
| Net cash used in  financing activities                                                               |       | (25,123                                                           | )          | — |   | (8,000 | ) | — |   | (33,123 | ) |
|                                                                                                 |       |                                                              |       |   |   |   |   |   |   |   |   |
| Increase (decrease) in  cash and cash equivalents                                                    |       | (77,580                                                           | )          | 1,117 |   | (22,196 | ) | — |   | (98,659 | ) |
| Cash and cash  equivalents, beginning of year                                                        |       | 95,630                                                            |       | (1,633 | ) | 29,679 |   | — |   | 123,676 |   |
| Cash and cash  equivalents, end of period                                                            |       | $                                                                 | 18,050     |   | $ | (516 | ) | $ | 7,483 |   | $ | — |   | $ | 25,017 |   |

 

**Note 12 — Subsequent Events**

 

**Conversion Offer and Reverse Stock Split**

 

On October 6, 2010, the Company announced thatits Board of Directors approved a conversion offer for all of the Company’s 7.5percent senior convertible notes due 2020 and a 1-for-10 reverse stock split ofthe Company’s common stock. The reverse stock split is subject to stockholderapproval at a special meeting of stockholders, currently scheduled for November18, 2010.

 

In the conversion offer, holders of the Company’s7.5 percent senior convertible notes may elect to convert their convertiblenotes into post-split shares of the Company’s common stock at a conversion rateof 238.2119 post-split shares per $1,000 principal amount of convertible notes.The conversion rate represents approximately 98 percent of the total number ofshares into which the Company expects the convertible notes would beconvertible on February 26, 2013, which is the final PIK interest paymentdate for the convertible notes.

 

The conversion offer is not conditioned oncompletion of the reverse stock split.  Filings subsequent to the reversestock split will include a retrospective application of the impact to sharedata.  The Company launched theconversion offer on October 22, 2010, and announced an intent to modifythe terms of the conversion offer on November 4, 2010.  The Company expects to complete theconversion offer in the fourth quarter of 2010.

 

In accordance with the applicable accountingguidance, the Company expects to recognize a non-cash charge related to theinducement for conversion during the fourth quarter of 2010.  The amount of the charge depends on thenumber of participants and the market share of the common stock of the Company.

 

**Sale of Assets**

 

On November 2, 2010, the Company announced thesale of certain assets related to its Brillion Farm EquipmentTM operating segment to LandollCorporation.

 

26

----

Table of Contents

 

**Item 2.  Management’s Discussion and Analysis ofFinancial Condition and Results of Operations.**

 

The accompanying unaudited condensed interimconsolidated financial statements are prepared in conformity with accountingprinciples generally accepted in the United States of America and suchprinciples are applied on a basis consistent with the information reflected inour Form 10-K for the year ended December 31, 2009 filed with theSecurities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included infinancial statements prepared in accordance with accounting principlesgenerally accepted in the United States of America have been condensed oromitted pursuant to the rules and regulations promulgated by the SEC.  In the opinion of management, the interimfinancial information includes all adjustments and accruals, consisting only ofnormal recurring adjustments and adjustments related to fresh start accountingas noted in Note 1 — Summary of Significant Accounting Policies, which arenecessary for a fair presentation of results for the respective interimperiods.  The results of operations forthe three and nine months ended September 30, 2010 are not necessarilyindicative of the results to be expected for the full fiscal year ending December 31,2010 or any interim period.  Except forthe historical information contained herein, this quarterly report on Form 10-Qcontains forward-looking statements that involve risks and uncertainties.  Our actual results may differ materially fromthose indicated by such forward-looking statements.

 

Overview

 

We are one of the largest manufacturers andsuppliers of commercial vehicle components in North America, offering one ofthe broadest product lines to the commercial vehicle industry. We believe thatwe have the number one or number two market position in a variety of heavy- andmedium-duty commercial vehicle products including: steel wheels, forgedaluminum wheels, brake drums, disc wheel hubs, metal bumpers and seating assemblies.  We market our products under some of the mostrecognized brand names in the industry, including Accuride, Bostrom, Brillion,Fabco, Gunite, Highway Original, and Imperial. We have long-standingrelationships with the leading original equipment manufacturers (“OEMs”) andthe related aftermarket channels in most major segments of the commercialvehicle market, including heavy- and medium-duty trucks, commercial trailers,light trucks, buses, as well as specialty and military vehicles.

 

Our primary product lines are standard equipmentused by a majority of North American heavy- and medium-duty truck OEMs,providing us with a significant competitive advantage. We believe that amajority of all heavy- and medium-duty truck models manufactured in North Americacontain one or more Accuride components.

 

Our diversified customer base includessubstantially all of the leading commercial vehicle OEMs, such as Daimler TruckNorth America, LLC, with its Freightliner and Western Star brand trucks, PACCAR, Inc.,with its Peterbilt and Kenworth brand trucks, Navistar, Inc., with itsInternational brand trucks, and Volvo Truck Corporation, with its Volvo andMack brand trucks.  Our primarycommercial trailer customers include leading commercial trailer OEMs, such as GreatDane Limited Partnership, Wabash National, Inc., Utility Trailer, Inc.,and Polar Tank, LLC.  Our major lighttruck customer is General Motors Corporation. We have built relationships of more than 20 years with many of theseleading OEM customers.  Our productportfolio is supported by strong sales, marketing and design engineeringcapabilities with 17 strategically located, technologically-advancedmanufacturing facilities across the United States, Mexico, and Canada.

 

Recent global market and economic conditions havebeen unprecedented and challenging with tighter credit conditions and recessionin most major economies which have continued into 2010.  As a result of these market conditions, thecost and availability of credit has been and may continue to be adverselyaffected by illiquid credit markets and wider credit spreads.  Concern about the stability of the marketsgenerally and the strength of counterparties specifically has led many lendersand institutional investors to reduce, and in some cases, cease to providecredit to businesses and consumers. These factors have led to a decrease in spending by businesses andconsumers alike. Continued turbulence in the U.S. and international markets andeconomies and prolonged declines in business and consumer spending mayadversely affect our liquidity and financial condition, and the liquidity andfinancial condition of our customers, including our ability to refinancematuring liabilities and access the capital markets to meet liquidity needs.

 

The heavy- and medium-duty truck and commercialtrailer markets and the related aftermarket are the primary drivers of oursales. These markets are, in turn, directly influenced by conditions in theNorth American truck industry generally by conditions in other industries whichindirectly impact the truck industry, such as the home-building industry, andby overall economic growth and consumer spending.  Accordingly, the current economic conditionsdescribed above have led to a severe and ongoing downturn in the North Americantruck and vehicle supply industries, which resulted in a significant decline inour sales volume and necessitated ourbankruptcy filings in October 2009, as described above in Note 1 to ourcondensed consolidated financial statements.  Although current industry forecasts predictan increase in commercial vehicle production in 2010 and continuing into 2011,we cannot accurately predict how prolonged the current downturn may be or thestrength and pace of the recovery.  Thecontinued downturn may lead to further reduced spending and deterioration 

 

27

----

Table of Contents

 

in the North American truck and vehicle supplyindustries for the foreseeable future. Weemerged from bankruptcy with reduced financial leverage and an improved capitalstructure, which we believe will better enable us to operate in this economicenvironment.  However, we continue to bea highly leveraged company, and a delayed****orfailed economic recovery would continue to have a material adverse effect onour business, results of operations and financial condition.

 

Using the commercial vehicle industry productionforecasts by industry experts, we expect results from operations to improve in2010 compared to 2009 due to increased demand for our product, improvedoperational efficiencies, and reduced fees and expenses related to our revisedcapital structure.

 

**Results of Operations**

 

Allocations of fair value to tangible andintangible assets, goodwill, pension obligations and deferred taxes are basedupon preliminary valuation information. It is anticipated that all necessary information will be available andthe analysis will be completed during the fourth quarter of 2010.

 

Inconnection with our emergence from Chapter 11 bankruptcy proceedings andthe adoption of fresh-start accounting, the results of operations for 2010separately present the 2010 Successor Period and the 2010 Predecessor Period.Although the 2010 Successor Period and the 2010 Predecessor Period are distinctreporting periods, the effects of emergence and fresh-start accounting did nothave a material impact on the comparability of our results of operationsbetween the periods. Accordingly, references to 2010 results of operations forthe nine months ended September 30, 2010 combine the two periods in orderto enhance the comparability of such information to the prior year. A summaryof our operating results for the three and nine months ended September 30,2010 and 2009 and as a percentage of net sales is shown below:

 

***Three Months Ended September 30,2010 Compared to the Three Months Ended September 30, 2009***

 
| **(Dollars in thousands)**                | ** ** | **Three Months Ended September 30,  2010** | ** ** | **Three Months Ended September 30,  2009** | ** ** |
|-----------------------------------------------------|------------|-------------------------------------------------|------------|-------------------------------------------------|------------|
| ** **                                          | ** ** | ** **                                      | ** ** | ** **                                      | ** ** | ** ** | ** ** | ** ** | ** ** |
| Net sales:                                          |       |                                            |       |                                            |       |   |   |   |   |
| Wheels                                              |       | $                                               | 78,444     |                                            | 38.1       | % | $ | 63,504 |   | 43.7 | % |
| Components                                          |       | 107,385                                         |       | 52.2                                            | %          | 75,412 |   | 51.9 | % |
| Other                                               |       | 19,861                                          |       | 9.7                                             | %          | 6,293 |   | 4.4 | % |
| Total net sales                                     |       | 205,690                                         |       | 100.0                                           | %          | 145,209 |   | 100.0 | % |
| Gross profit (loss):                                |       |                                            |       |                                            |       |   |   |   |   |
| Wheels                                              |       | 13,709                                          |       | 17.5                                            | %          | 3,817 |   | 6.0 | % |
| Components                                          |       | 1,278                                           |       | 1.2                                             | %          | (2,828 | ) | (3.8 | )% |
| Other                                               |       | 6,727                                           |       | 33.9                                            | %          | 1,296 |   | 20.6 | % |
| Corporate                                           |       | (410                                            | )          | —                                          | %          | (411 | ) | — | % |
| Total gross profit                                  |       | 21,304                                          |       | 10.4                                            | %          | 1,874 |   | 1.3 | % |
| Operating expenses                                  |       | 14,854                                          |       | 7.2                                             | %          | 22,372 |   | 15.4 | % |
| Income (loss) from  operations                      |       | 6,450                                           |       | 3.1                                             | %          | (20,498 | ) | (14.1 | )% |
| Interest (expense), net                             |       | (10,722                                         | )          | (5.2                                            | )%         | (18,131 | ) | (12.5 | )% |
| Non-cash market  valuation — convertible notes |       | 36,827                                          |       | 17.9                                            | %          | — |   | — | % |
| Other income, net                                   |       | 2,647                                           |       | 1.3                                             | %          | 3,231 |   | 2.2 | % |
| Income tax expense  (benefit)                       |       | 4,351                                           |       | 2.1                                             | %          | (2,069 | ) | (1.4 | )% |
| Net income (loss)                                   |       | $                                               | 30,851     |                                            | 15.0       | % | $ | (33,329 | ) | (23.0 | )% |

 

**Net Sales.**  Net sales for the three months ended September 30,2010, were $205.7 million, which was an increase of 41.7%, compared to netsales of $145.2 million for the three months ended September 30,2009.  The increase was due to increasedproduct demand from both our OEM and aftermarket customers.

 

**Gross Profit. **Gross profit increased $19.4 million to$21.3 million for the three months ended September 30, 2010 due to thecontribution from increased net sales, better capacity utilization with highersales volumes and improvements in operating efficiencies.

 

**Interest Expense. **Net interestexpense decreased $7.4 million to $10.7 million for the three monthsended September 30, 2010 from $18.1 million for the three months ended September 30,2009.  This was mostly due to lower debtlevels, which resulted in lower interest expense of approximately $5.9 million.

 

28

----

Table ofContents

 

**Market Valuation — Conversion Option onConvertible Notes. **In connection with accounting guidance following the emergence fromChapter 11, we record the conversion option on our convertible notes at fairvalue.  Due to the decrease in value ofthe conversion option, we recorded income of $36.8 million during the threemonths ended September 30, 2010.  Weexpect these unrealized, non-cash gains or losses to continue as the fair valueof the conversion option fluctuates.

 

**NetIncome. **We had net income of $30.9 million for the threemonths ended September 30, 2010 compared to a net loss of $33.3 millionfor the three months ended September 30, 2009.  The primary reasons for the improvement areimproved gross profit margins related to increased net sales and operatingefficiencies and non-cash market valuation gain for the conversion option onour convertible debt.

 

***Nine Months Ended September 30,2010 Compared to the Nine Months Ended September 30, 2009***

 
| **(In thousands except per share data)** | ** ** | **Nine Months Ended  September 30,  2010** | ** ** | **Nine Months Ended September 30,  2009** | ** ** |
|-------------------------------------------------------------------|------------|-------------------------------------------------|------------|------------------------------------------------|------------|
| ** **                                                        | ** ** | ** **                                      | ** ** | ** **                                     | ** ** | ** ** | ** ** | ** ** | ** ** |
| Net sales:                                                   | ** ** | ** **                                      | ** ** | ** **                                     | ** ** | ** ** | ** ** | ** ** | ** ** |
| Wheels                                                            |       | $                                               | 210,649    |                                           | 37.0       | % | $ | 174,609 |   | 41.2 | % |
| Components                                                        |       | 307,598                                         |       | 53.9                                           | %          | 222,535 |   | 52.5 | % |
| Other                                                             |       | 52,055                                          |       | 9.1                                            | %          | 26,847 |   | 6.3 | % |
| Total net sales                                                   |       | 570,302                                         |       | 100.0                                          | %          | 423,991 |   | 100.0 | % |
| Gross profit (loss):                                              |       |                                            |       |                                           |       |   |   |   |   |
| Wheels                                                            |       | 27,965                                          |       | 13.3                                           | %          | 10,557 |   | 6.0 | % |
| Components                                                        |       | 5,294                                           |       | 1.7                                            | %          | (22,379 | ) | (10.1 | )% |
| Other                                                             |       | 16,167                                          |       | 31.1                                           | %          | 6,663 |   | 24.8 | % |
| Corporate                                                         |       | (2,221                                          | )          | —                                         | %          | (1,948 | ) | — | % |
| Total gross profit  (loss)                                        |       | 47,205                                          |       | 8.3                                            | %          | (7,107 | ) | (1.7 | )% |
| Operating expenses                                                |       | 47,050                                          |       | 8.3                                            | %          | 47,086 |   | 11.1 | % |
| Income (loss) from  operations                                    |       | 155                                             |       | 0.0                                            | %          | (54,193 | ) | (12.8 | )% |
| Interest (expense), net                                           |       | (31,948                                         | )          | (5.6                                           | )%         | (47,025 | ) | (11.1 | )% |
| Loss on extinguishment  of debt                                   |       | —                                          |       | —                                         | %          | (5,389 | ) | (1.3 | )% |
| Non-cash market  valuation — convertible notes               |       | 5,623                                           |       | 1.0                                            | %          | — |   | — | % |
| Other income, net                                                 |       | 5,154                                           |       | 0.9                                            | %          | 5,585 |   | 1.3 | % |
| Reorganization items  (gain)                                      |       | (59,311                                         | )          | (10.4                                          | )%         | — |   | — | % |
| Income tax expense  (benefit)                                     |       | 3,160                                           |       | 0.6                                            | %          | (567 | ) | (0.1 | )% |
| Net income (loss)                                                 |       | $                                               | 35,135     |                                           | 6.2        | % | $ | (100,455 | ) | (23.7 | )% |

 

**Net Sales.**  Combined net sales for the nine months ended September 30,2010, were $570.3 million, which was an increase of 34.5%, compared to netsales of $424.0 million for the nine months ended September 30, 2009.  The increase was due to increased productdemand from both our OEM and aftermarket customers.

 

**Gross Profit. **Gross profit increased $54.3 million to $47.2million for the nine months ended September 30, 2010 due to thecontribution from increased net sales, better capacity utilization with highersales volumes and improvements in operating efficiencies.

 

**Interest Expense. **Net interestexpense decreased $15.1 million to $31.9 million for the nine monthsended September 30, 2010 from $47.0 million for the nine months ended September 30,2009.  This was mostly due to notrecognizing interest related to our prepetition senior subordinated notes thatwere cancelled as part of our Plan of Reorganization and having a reduced netdebt position as a result of our Plan of Reorganization.

 

**Market Valuation — Conversion Option onConvertible Notes. **In connection with accounting guidance following the emergence from Chapter11, we record the conversion option on our convertible notes at fairvalue.  Due to the change in value of theconversion option, we recorded income of $5.6 million during 2010.  We expect these unrealized, non-cash gains orlosses to continue as the fair value of the conversion options fluctuates.

 

**Reorganization Items. **ASC852 requires the recognition of certain transactions directly related to thereorganization as reorganization expense or income in the statement ofoperations. The reorganization gain of $59.3 million for 2010 consisted of$25.0 million professional fees directly related to reorganization and an $84.3million gain on the discharge and issuance of our debt instruments.

 

29

----

Table ofContents

 

**Net Income. **We had net incomeof $35.1 million for the nine months ended September 30, 2010 compared to anet loss of $100.5 million for the nine months ended September 30,2009.  The primary reasons for theimprovement are the improved gross profit on higher sales volumes, the net ofone-time items related to the debt discharge, and the non-cash market valuationincome for the conversion option on our convertible notes.

 

***Changes in Financial Condition***

 

At September 30, 2010, the Successor Companyhad total assets of $866.4 million, as compared to the Predecessor Company’stotal assets of $671.7 million at December 31, 2009.  The $194.7 million, or 29.0%, increase intotal assets primarily resulted from changes from the fair valuation of theCompany’s assets by adopting fresh start accounting in accordance with ASC 852,as well as changes in working capital. We define working capital as current assets (excluding cash and debt)less current liabilities.  During thenine months ended September 30, 2010, property, plant and equipmentincreased by $48.7 million, other intangible assets increased by $152.6million, goodwill increased by $1.3 million and other assets decreased by $4.2million for changes in the allocation of fair values as of February 26,2010.  Since the allocation of fair valueis still preliminary, additional changes are expected in the fourth quarter ofthis year.

 

We use working capital and cash flow measures toevaluate the performance of our operations and our ability to meet ourfinancial obligations. We require working capital investment to maintain ourposition as a leading manufacturer and supplier of commercial vehiclecomponents.  We continue to strive foraligning our working capital investment with our customers’ purchaserequirements and our production schedules.

 

The following table summarizes the major componentsof our working capital as of the periods listed below:

 
| ** **                       | ** ** | **Successor**          | ** ** | **Predecessor**       | ** ** |
|----------------------------------|------------|------------------------|------------|-----------------------|------------|
| ** **                       | ** ** | **September 30,** | ** ** | **December 31,** | ** ** |
| ** **                       | ** ** | **2010**               | ** ** | **2009**              | ** ** |
| Accounts receivable              |       | $                      | 103,198    |                  | $          | 66,301 |   |
| Inventories                      |       | 64,693                 |       | 50,742                |       |
| Deferred income taxes (current)  |       | 2,811                  |       | 2,811                 |       |
| Other current assets             |       | 4,990                  |       | 22,762                |       |
| Accounts payable                 |       | (58,699                | )          | (31,277               | )          |
| Accrued payroll and compensation |       | (18,468                | )          | (14,318               | )          |
| Accrued interest payable         |       | (5,196                 | )          | (3,571                | )          |
| Accrued workers compensation     |       | (7,746                 | )          | (7,038                | )          |
| Other current liabilities        |       | (20,046                | )          | (20,609               | )          |
| Working Capital                  |       | $                      | 65,537     |                  | $          | 65,803 |   |

 

Significant changes in working capital included:

 

·            an increase in accounts receivable of $36.9 million due to thecomparative increase in revenue in the months leading up to the respectiveperiod-end dates;

·            an increase in inventory of $14.0 million due to increase in salesdemand;

·            a decrease in other current assets of $17.8 million due to the adoptionof a new accounting policy for supplies as part of the fresh-start reporting;

·            an increase of accounts payable of $27.4 million primarily due to theincrease in raw material purchases in the months leading up to the respectiveperiod-end dates.

 

**Capital Resources and Liquidity**

 

Our primary sources of liquidity during theperiods January 1, 2010 through February 26, 2010 for the PredecessorCompany and February 26, 2010 through September 30, 2010 for the SuccessorCompany were cash reserves and the debt instruments entered into in connectionwith our emergence from bankruptcy.  Webelieve that cash from operations, existing cash reserves, and availabilityunder our new ABL facility will provide adequate funds for our working capitalneeds, planned capital expenditures and debt service obligations through 2010and the next twelve months.

 

Our ability to fund working capital needs,planned capital expenditures, scheduled debt payments, and to comply with anyfinancial covenants under our new ABL facility, depends on our future operatingperformance and cash flow, which

 

30

----

Table of Contents

 

in turn, are subject to prevailing economicconditions and to financial, business and other factors, some of which arebeyond our control.

 

**Operating Activities**

 

Net cash used in operating activities duringthe nine months ended September 30, 2010 was $36.5 million. The primarydrivers of the use in cash were $12.2 million of cash payments forreorganization items, and $22.4 million of cash payments related to bankruptcy,and $16.1 million of increased working capital assets.  During a period of increasing sales demand,our working capital needs also rise.

 

**Investing Activities**

 

Net cash provided by investing activitiestotaled $3.1 million for the nine months ended September 30, 2010.  During 2010, we had cash inflows of $15.0million related to issuance of letters of credit to replace restricted cashfrom previously drawn letters of credit. Our most significant cash outlays for investing activities are thepurchases of property, plant and equipment. Capital expenditures for 2010 are expected to be approximately $20million, which we expect to fund through existing cash reserves.  Due to the continued challenges facing ourindustry and the economy as a whole, we are managing our capital expendituresvery closely in order to preserve liquidity throughout 2010 while stillmaintaining our production capacity and making investments necessary to meetcompetitive threats and to seize upon growth opportunities.

 

**Financing Activities**

 

Net cash provided by financing activitiestotaled $28.2 million for the nine months ended September 30, 2010.  Included in this amount are the impacts fromthe Plan of Reorganization of satisfying our prepetition senior credit facilityof $305.8 million, our revolving credit facility of $71.7 million, and the DIPfacility of $25.0 million.  Also includedare proceeds from the $140 million aggregate principal amount of convertiblenotes we issued and the $310.5 million postpetition senior credit facility weentered into upon emergence from bankruptcy.

 

As noted below, on July 29, 2010, werefinanced our postpetition senior credit facility using proceeds from the $310million aggregate principle amount of senior secured notes and funds from a newasset based lending credit facility.

 

***Postpetition Senior CreditFacility***

 

On the Effective Date of the Plan ofReorganization, we entered into the fifth amendment and restatement to ourprepetition senior credit facility (the “postpetition senior credit facility”).  As of the Effective Date, under ourpostpetition senior credit facility Accuride had outstanding term loans of$287.0 million and outstanding letters of credit in the stated amount of $2.0million and Accuride Canada Inc. had outstanding term loans of $22.0million.  The interest rate for all loanswas, at our option, LIBOR + 6.75% (with a LIBOR floor of 3.00%) or Base Rate +5.75% (with a Base Rate floor of 4.00%). The maturity for all loans and reimbursements of draws under the lettersof credit was June 30, 2013.

 

On July 29, 2010, as described below under “—Refinancing—TheABL Facility,” we refinanced the postpetition senior credit facility and thepostpetition senior credit facility was terminated.

 

***Postpetition Senior ConvertibleNotes***

 

On the Effective Date, we issued $140 millionaggregate principal amount of convertible notes and entered into the indenturegoverning the convertible notes, dated the Effective Date.  Under the terms of the indenture, theconvertible notes bear interest at a rate of 7.5% per annum and will mature on February 26,2020.  The first six interest paymentswill be payment-in-kind interest. Thereafter, beginning on August 26, 2013, interest on theconvertible notes will be paid in cash.

 

The convertible notes are convertible into CommonStock at any time beginning on the Effective Date until the second business daypreceding maturity, at an initial conversion rate of 1333.3333 per $1,000principal amount of notes (equivalent to an initial conversion price of $0.75per share of Common Stock).  The conversionrate is subject to customary adjustments and will also be adjusted to accountfor PIK interest.  The adjustment to theconversion rate for convertible notes issued as PIK interest serves to preventthe convertible notes outstanding immediately prior to the PIK interest paymentfrom being diluted by the notes paid as PIK interest.

 

On August 26, 2010,we made a PIK interest payment with respect to the convertible notes byincreasing the principal amount of the notes by $5.25 million.  Pursuant to the terms of the indenturegoverning the convertible notes, the 

 

31

----

Table of Contents

 

conversion rate of theconvertible notes was adjusted to 1407.2343 shares of common stock per $1,000principal amount of notes (equivalent to a conversion price of $0.71 per shareof common stock).

 

On October 6, 2010, the Company announced thatits Board of Directors approved a conversion offer for all of the Company’s 7.5percent senior convertible notes due 2020 and a 1-for-10 reverse stock split ofthe Company’s Common Stock.  On October 22, 2010, the Companycommenced the conversion offer and on November 4, 2010, the Companyannounced its intention to amend certain terms of the conversion offer.  In the conversion offer, holders of theCompany’s 7.5% senior convertible notes may elect to convert their convertiblenotes into post-split shares of the Company’s Common Stock at an increasedconversion rate of 238.2119 post-split shares per $1,000 principal amount ofconvertible notes. The conversion rate represents approximately 98 percent ofthe total number of shares into which the Company expects the convertible noteswould be convertible on February 26, 2013, which is the final PIK interestpayment date for the convertible notes. The conversion offer is not conditionedon completion of the reverse stock split, which is expected to be completedprior to completion of the conversion offer.

 

The convertible notes are currently redeemable by theCompany, in whole but not in part, at any time on or after February 26,2013, at a price equal to 100% of the principal amount of the convertible notesto be redeemed, plus any accrued and unpaid interest up to the redemption date;provided, that (i) the Common Stock is listed on a national securitiesexchange, (ii) the average weekly trading volume of the Common Stock asreported by such national securities exchange during the four week period priorto conversion is at least 3.0% of the total number of outstanding shares ofCommon Stock immediately prior to conversion and (iii) for twenty of thepreceding thirty consecutive trading days, the Common Stock has had a closingsale price at least equal to 2.25 times the effective conversion price.  As part of the conversion offer, however, weare soliciting consents to amend the indenture governing the convertible notesto remove these restrictions to our redemption of the convertible notes.

 

**Refinancing**

 

On July 29, 2010, we completed an offering of$310.0 million aggregate principal amount of senior secured notes and enteredinto the ABL facility. We used the net proceeds from the offering of the seniorsecured notes, $15.0 million of borrowings under the ABL facility and cash onhand to refinance our postpetition senior credit facility and to pay relatedfees and expenses (the “Refinancing”).

 

**The ABL Facility**

 

In connection with the Refinancing, weentered into a new ABL Credit Agreement (the “ABL facility”).  The ABL facility is a senior secured assetbased revolving credit facility in an aggregate principal amount of up to$75.0 million, with the right, subject to certain conditions, to increasethe availability under the facility by up to $25.0 million in theaggregate (for a total aggregate availability of $100.0 million). The four-yearABL facility matures on July 29, 2014 and provides for loans and lettersof credit in an aggregate amount up to the amount of the facility, subject tomeeting certain borrowing base conditions, with sub-limits of up to $10.0million for swingline loans and $25.0 million to be available for the issuanceof letters of credit.  Loans under theABL facility initially bears interest at an annual rate equal to either LIBORplus 3.50% or Base Rate plus 2.50%, at our option, subject to changes based onour leverage ratio as defined in the ABL facility.

 

We must also pay a commitment fee equal to0.50% per annum to the lenders under the ABL facility if utilization under thefacility exceeds 50.0% of the total commitments under the facility and acommitment fee equal to 0.75% per annum if utilization under the facility isless than or equal to 50.0% of the total commitments under the facility.Customary letter of credit fees are also payable, as necessary.

 

The obligations under the ABL facility aresecured by (i) first-priority liens on substantially all of the Company’saccounts receivable and inventories, subject to certain exceptions andpermitted liens (the “ABL Priority Collateral”) and (ii) second-priorityliens on substantially all of the Company’s owned real property and tangibleand intangible assets other than the ABL Priority Collateral, including all ofthe outstanding capital stock of our domestic subsidiaries, subject to certainexceptions and permitted liens (the “Notes Priority Collateral”).

 

**Senior Secured Notes**

 

Also in connection the Refinancing, we issued$310.0 million aggregate principal amount of senior secured notes.  Under the terms of the indenture governingthe senior secured notes, the senior secured notes bear interest at a rate of9.5% per year and mature on August 1, 2018.  Prior to maturity we may redeem the seniorsecured notes on the terms set forth in 

 

32

----

Table of Contents

 

the indenture governing the senior secured notes.The senior secured notes are guaranteed by the Guarantors, and the seniorsecured notes and the related guarantees are secured by first priority liens onthe Notes Priority Collateral and second priority liens on the ABL PriorityCollateral.

 

**Restrictive Debt Covenants.**  Our credit documents****(theABL facility and the indentures governing the convertible notes and the seniorsecured notes) contain operating covenants that limit the discretion ofmanagement with respect to certain business matters.  These covenants place significantrestrictions on, among other things, the ability to incur additional debt, topay dividends, to create liens, to make certain payments and investments and tosell or otherwise dispose of assets and merge or consolidate with otherentities.  In connection with theconversion offer, however, we are soliciting consents to remove substantiallyall of the operating covenants in the indenture governing the convertiblenotes.  In addition, the ABL facilitycontains a financial covenant which requires us to maintain a fixed chargecoverage ratio during any compliance period, which is anytime when the excessavailability is less than or equal to the greater of $10.0 million or 15percent of the total commitment under the ABL facility.  Due to the amount of our excess availability(as calculated under the ABL facility), the Company is not currently in acompliance period and we do not have to maintain a fixed charge coverage ratio,although this is subject to change.

 

We continue to operate in a challenging economicenvironment and our ability to maintain liquidity and comply with our debtcovenants may be affected by economic or other conditions that are beyond ourcontrol and which are difficult to predict.  The 2010 production forecastsby ACT Publications for the significant commercial vehicle markets that weserve, as of October 10, 2010, are as follows:

 
| North American  Class 8 |   | 149,237 |   |
|------------------------------|--------|---------|--------|
| North American Classes  5-7  |   | 109,307 |   |
| U.S. Trailers                |   | 114,990 |   |

 

Based on the these production builds, weexpect to comply with any financial covenants we may become subject to andbelieve that our liquidity will be sufficient to fund currently anticipatedworking capital, capital expenditures, and debt service requirements for atleast the next twelve months.  However, if our net sales are significantlyless than expectations, given the volatility and the calendarization of theproduction builds as well as the other markets that we serve, or due to thechallenging credit markets, we could violate any such financial covenants orhave insufficient liquidity.  In the event of noncompliance, we wouldpursue an amendment or waiver.  However, no assurances can be given that thoseforecasts will be accurate.

 

**Off-Balance SheetArrangements. **We do not currently have any off-balance sheet arrangements that have orare reasonably likely to have a material current or future effect on ourfinancial condition, revenues or expenses, results of operations, liquidity,capital expenditures or capital resources. From time to time we may enter into operating leases, letters of credit,or take-or-pay obligations related to the purchase of raw materials that wouldnot be reflected in our balance sheet.

 

**Recent Developments**

 

***New AccountingPronouncements***

 

In January 2010,the FASB issued ASU 2010-6, “Improving Disclosures about Fair ValueMeasurements,” which requires interim disclosures regarding significanttransfers in and out of Level 1 and Level 2 fair value measurements.Additionally, this ASU requires disclosure for each class of assets andliabilities and disclosures about the valuation techniques and inputs used tomeasure fair value for both recurring and non-recurring fair value measurements.These disclosures are required for fair value measurements that fall in eitherLevel 2 or Level 3. Further, the ASU requires separate presentation of Level 3activity for the fair value measurements. We adopted the interim disclosurerequirements under this standard during the quarter ended March 31, 2010,with the exception of the separate presentation in the Level 3 activityrollforward, which is not effective until fiscal years beginning after December 15,2010 and for interim periods within those fiscal years.

 

**Critical AccountingPolicies and Estimates. **We have made a number of estimates and assumptions relating to thereporting of results of operations and financial position in the preparation ofour financial statements in conformity with accounting principles generallyaccepted in the United States of America. Actual results could differ significantly from those estimates underdifferent assumptions and conditions.  Weincluded in our Form 10-K for the year ended December 31, 2009 adiscussion of our most critical accounting policies, which are those that havea material impact on our financial condition or operating performance andrequire management’s most difficult, subjective and complex judgments, often asa result of the need to make estimates about the effect of matters that areinherently uncertain.  Upon our emergencefrom Chapter 11 

 

33

----

Table of Contents

 

bankruptcy proceedings, we adoptedfresh-start accounting in accordance with the provisions of ASC 852Reorganizations (“ASC 852”), which requires significant estimates andassumptions related to the fair value of our assets and liabilities.  The allocations of fair value are based uponpreliminary valuation information and analysis that have not yet beencompleted.  It is anticipated that allnecessary information will be available and our analysis will be completed duringthe fourth quarter of 2010.

 

*Cautionary Statements RegardingForward-Looking Statements*

 

In this report, we have made various statementsregarding current expectations or forecasts of future events, which speak onlyas of the date the statements, are made. These statements are “forward-looking statements” within the meaning ofthat term in Section 27A of the Securities Act of 1933 and Section 21Eof the Securities Exchange Act of 1934. Forward-looking statements are also made from time-to-time in pressreleases and in oral statements made by the officers of Accuride.  Forward-looking statements are identified bythe words “estimate,” “project,” “anticipate,” “will continue,” “will likelyresult,” “expect,” “intend,” “believe,” “plan,” “predict” and similarexpressions.  Forward looking statementsalso include, but are not limited to, statements regarding commercial vehiclemarket recovery, projections of revenue, income, loss, or working capital,capital expenditure levels, ability to mitigate rising raw material coststhrough increases in selling prices, plans for future operations, financingneeds, the ultimate outcome and impact of any litigation against Accuride, thesufficiency of our capital resources and plans and assumptions relating to theforegoing.

 

Such forward-looking statements are based onassumptions and estimates, which although believed to be reasonable, may turnout to be incorrect.  Therefore, unduereliance should not be placed upon these estimates and statements.  We cannot assure that any of thesestatements, estimates, or beliefs will be realized and actual results maydiffer from those contemplated in these “forward-looking statements.”  We undertake no obligation to publicly updateany forward-looking statements, whether as a result of new information, futureevents, or otherwise.  You are advised toconsult further disclosures we may make on related subjects in our filings withthe SEC.  In addition to other factorsdiscussed in this report, some of the important factors that could cause actualresults to differ materially from those discussed in the forward-lookingstatements include, without limitation, the following:

 

·                  current economic conditions, including those related to the creditmarkets and the commercial vehicle industry, may have a material adverse effecton our business and results of operations;

·                  we rely on, and make significant operational decisions based in partupon, industry data and forecasts that may prove to be inaccurate;

·                  the failure to realize cost savings under our cost restructuring plancould adversely affect our business;

·                  we are dependent on sales to a small number of our major customers andon our status as standard supplier on certain truck platforms of each of ourmajor customers;

·                  increased cost or reduced supply of raw materials and purchasedcomponents may adversely affect our business, results of operations orfinancial condition;

·                  our business is affected by the seasonality and regulatory nature of theindustries and markets that we serve;

·                  cost reduction and quality improvement initiatives by original equipmentmanufacturers could have a material adverse effect on our business, results ofoperations or financial condition;

·                  we operate in highly competitive markets;

·                  we face exposure to foreign business and operational risks includingforeign exchange rate fluctuations and if we were to experience a substantialfluctuation, our profitability may change;

·                  we may not be able to continue to meet our customers’ demands for ourproducts and services;

·                  equipment failures, delays in deliveries or catastrophic loss at any ofour facilities could lead to production or service curtailments or shutdowns;

·                  we may incur potential product liability, warranty and product recallcosts;

·                  work stoppages or other labor issues at our facilities or at ourcustomers’ facilities could have a material adverse effect on our operations;

·                  we are subject to a number of environmental rules and regulationsthat may require us to make substantial expenditures;

·                  we might fail to adequately protect our intellectual property, or thirdparties might assert that our technologies infringe on their intellectualproperty;

·                  litigation against us could be costly and time consuming to defend;

·                  substantially all the members of our Board of Directors have beenassociated with the Company for a relatively short period of time;

·                  if we fail to retain our executive officers, our business could beharmed;

·                  we have entered into typical severance arrangements with certain of oursenior management employees, which may result in certain costs associated withstrategic alternatives;

 

34

----

Table ofContents

 

·                  our products may be rendered obsolete or less attractive by changes inregulatory, legislative or industry requirements;

·                  our strategic initiatives may be unsuccessful, may take longer thananticipated, or may result in unanticipated costs;

·                  our substantial leverage and significant debt service obligations couldhave a material adverse effect on our financial condition or our ability tofulfill our obligations and make it more difficult for us to fund ouroperations;

·                  despite our substantial leverage, we and our subsidiaries will be ableto incur more indebtedness, which could further exacerbate the risk immediatelydescribed above, including our ability to service our indebtedness;

·                  servicing our indebtedness will require a significant amount of cash andour ability to generate cash depends on many factors beyond our control; and

·                  we are subject to a number of restrictive covenants, which, if breached,may restrict our business and financing activities.

 

For further information, refer to the businessdescription and additional risk factors sections included in our Form 10-Kfor the year ended December 31, 2009, as filed with the SEC.

 

**Item 3. Quantitative andQualitative Disclosures about Market Risk**

 

In the normal course of doing business, we areexposed to risks associated with changes in foreign exchange rates, rawmaterial/commodity prices, and interest rates. We use derivative instruments to manage these exposures.  The objectives for holding derivatives are tominimize the risks using the most effective methods to eliminate or reduce theimpacts of these exposures.

 

**Foreign Currency Risk**

 

Certain forecasted transactions, assets, andliabilities are exposed to foreign currency risk. We monitor our foreigncurrency exposures to maximize the overall effectiveness of our foreigncurrency derivatives. The principal currency of exposure is the Canadiandollar. From time to time, we use foreign currency financial instruments tooffset the impact of the variability in exchange rates on our operations, cashflows, assets and liabilities. At September 30, 2010, we had no openforeign exchange contracts.

 

Foreign currency derivative contracts provide onlylimited protection against currency risks. Factors that could impact theeffectiveness of our currency risk management programs include accuracy ofsales estimates, volatility of currency markets and the cost and availabilityof derivative instruments.

 

The counterparty to the foreign exchange contractsis a financial institution with an investment grade credit rating. The use offorward contracts protects our cash flows against unfavorable movements inexchange rates, to the extent of the amount under contract.

 

**Raw Material/Commodity Price Risk**

 

We rely upon the supply of certain raw materialsand commodities in our production processes, and we have entered into firmpurchase commitments for certain metals and natural gas. Additionally, fromtime to time, we use commodity price swaps and futures contracts to manage thevariability in certain commodity prices on our operations and cash flows. At September 30,2010, we had no open commodity price swaps or futures contracts.

 

**Interest Rate Risk**

 

We use long-term debt as a primary source ofcapital. The following table presents the principal cash repayments and relatedweighted average interest rates by maturity date for our long-term fixed-ratedebt and other types of long-term debt at September 30, 2010:

 
| **(Dollars in thousands)** | ** ** | **2010** | ** ** | **2011** | ** ** | **2012** | ** ** | **2013** | ** ** | **2014** | ** ** | **Thereafter** | ** ** | **Total** | ** ** | **Fair  Value** | ** ** |
|--------------------------------------|------------|----------|------------|----------|------------|----------|------------|----------|------------|----------|------------|----------------|------------|-----------|------------|-----------------|------------|
| Long-term Debt:                      |       |     |       |     |       |     |       |     |       |     |       |           |       |      |       |            |       |
| Fixed  Rate                          |       | —   |       | —   |       | —   |       | —   |       | —   |       | $              | 455,250    |      | $          | 455,250         |       | $ | 634,874 |   |
| Average  Rate                        |       | —   |       | —   |       | —   |       | —   |       | —   |       | 8.86           | %          | 8.86      | %          |            |       |
| Variable  Rate                       |       | —   |       |     | —     |     |       | —   |       |     | —     |           | $          | —    |       |            | —     |   | $ | — |   | $ | — |   |
| Average  Rate                        |       | —   |       | —   |       | —   |       | —   |       | —   | %          | —         |       | —    | %          |            |       |
|                                      |            |          |            |          |            |          |            |          |            |          |            |                |            |           |            |                 |            |  |  |  |  |  |  |  |

 

The carrying value of our $145.3 millionaggregate principal amount of convertible notes is disclosed on our condensedconsolidated balance sheet at $285.3 million, which considers the fair value ofthe conversion option and accrued 

 

35

----

Table of Contents

 

PIK interest, as of September 30,2010.  The table above represents theface value of the debt instrument with a fixed rate of interest of 7.5%.

 

We have used interest rate swaps to alterinterest rate exposure between fixed and variable rates on a portion of ourlong-term debt.  As of December 31,2009, we had one interest rate swap agreement to exchange, at specifiedintervals, the difference between 3.81% from March 2008 through March 2010,and the variable rate interest amounts calculated by reference to the notionalprincipal amount of $125 million.  As of December 31,2009, we had a liability of $1.1 million included in accrued and otherliabilities on the consolidated balance sheet. On March 10, 2010 we terminated the swap agreement and paid theoutstanding liability.

 

**Item 4. Controls and Procedures**

 

We maintain disclosure controls and procedures thatare designed to ensure that information required to be disclosed in ourExchange Act reports is recorded, processed, summarized and reported within thetime periods specified in the SEC’s rules and forms, and that suchinformation is accumulated and communicated to our management, including ourChief Executive Officer and Chief Financial Officer, as appropriate, to allowtimely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures,management recognized that any controls and procedures, no matter how well designedand operated, can provide only reasonable assurance of achieving the desiredcontrol objectives, and management is required to apply its judgment inevaluating the cost-benefit relationship of possible controls and procedures.

 

As required by SEC Rule 13a-15(b), we carriedout an evaluation, under the supervision and with the participation of theCompany’s management, including our Chief Executive Officer and Chief FinancialOfficer, of the effectiveness of the design and operation of our disclosurecontrols and procedures as of the end of the period covered by thisreport.  Based on that evaluation, ourChief Executive Officer and Chief Financial Officer concluded that ourdisclosure controls and procedures were effective at the reasonable assurance level.

 

***Changes in Internal Control OverFinancial Reporting.***  There have been no changes to our internalcontrols over financial reporting that have materially affected or arereasonably likely to materially affect our internal control over financialreporting.

 

**PART II.  OTHER INFORMATION**

 

**Item 1.  Legal Proceedings**

 

Neither Accuride nor any of our subsidiaries is aparty to any legal proceeding which, in the opinion of management, would have amaterial adverse effect on our business or financial condition.  However, we from time-to-time are involved inordinary routine litigation incidental to our business, including actionsrelated to product liability, contractual liability, intellectual property,workplace safety and environmental claims. We establish reserves for matters in which losses are probable and canbe reasonably estimated.  While webelieve that we have established adequate accruals for our expected futureliability with respect to our pending legal actions and proceedings, we cannotassure you that our liability with respect to any such action or proceedingwould not exceed our established accruals. Further, we cannot assure that litigation having a material adverseaffect on our financial condition will not arise in the future.

 

**Item 1A.**

 

***Our Common Stock would be diluted by the conversionof our convertible notes in the conversion offer.***

 

As of November 5, 2010, 126,295,024 shares ofour Common Stock were outstanding.  Inaddition, we had $145,250,001 aggregate principal amount outstanding ofconvertible notes subject to our ongoing conversion offer.  If the conversion offer is completed, itwould have a substantial dilutive effect on our Common Stock.  For example, if 100% of the outstandingconvertible notes are converted in the conversion offer, we would issueapproximately 346.0 million shares of Common Stock to converting noteholders(not taking into account the proposed reverse stock split), and if 50.1% of theconvertible notes are converted in the conversion offer, we would issueapproximately 173.3 million shares of Common Stock to converting noteholders(not taking into account the proposed reverse stock split).

 

36

----

Table ofContents

 

**Item 6.  Exhibits**

 
| **Exhibit No.** | ** ** | ** ** | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|----------------------|------------|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                 |       |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 2.1                  |       | —     | Agreement and Plan of Merger, dated as of  December 24, 2004, by and among Accuride Corporation, Amber Acquisition  Corp., Transportation Technologies Industries, Inc., certain signing  stockholders and the Company Stockholders Representatives. Previously filed  as an exhibit to the Form 8-K filed on December 30, 2004 and  incorporated herein by reference.                                                                                                                            |
| 2.2                  |       | —     | Amendment to Agreement and Plan of Merger, dated  as of January 28, 2005, by and among Accuride Corporation, Amber  Acquisition Corp., Transportation Technologies Industries, Inc. certain  signing stockholders and the Company Stockholders Representatives. Previously  filed as an exhibit to the Form 8-K filed on February 4, 2005 and  incorporated herein by reference.                                                                                                                  |
| 2.3                  |       | —     | Third Amended Joint Plan of Reorganization for  Accuride Corporation, et al. Previously filed as an exhibit to the  Form 8-K filed on February 22, 2010, and incorporated herein by  reference.                                                                                                                                                                                                                                                                                                             |
| 2.4                  |       | —     | Confirmation Order for Third Amended Plan of  Reorganization. Previously filed as an exhibit to the Form 8-K filed on  February 22, 2010, and incorporated herein by reference.                                                                                                                                                                                                                                                                                                                             |
| 3.1                  |       | —     | Amended and Restated Certificate of Incorporation  of Accuride Corporation. Previously filed as an exhibit to the Form 8-K  (Acc. No. 0001104659-10-012168) filed on March 4, 2010, and  incorporated herein by reference.                                                                                                                                                                                                                                                                             |
| 3.2                  |       | —     | Amended and Restated Bylaws of Accuride  Corporation. Previously filed as an exhibit to the Form 8-K (Acc.  No. 0001104659-10-012168) filed on March 4, 2010, and incorporated  herein by reference.                                                                                                                                                                                                                                                                                                   |
| 4.1                  |       | —     | Indenture, dated as of February 26, 2010, by  and among Accuride Corporation, Accuride Corporation’s direct and indirect  domestic subsidiaries and Wilmington Trust FSB, with respect to $140.0  million aggregate principal amount of 71/2% Senior Convertible Notes due 2020. Previously filed as an exhibit  to the Form 8-K filed on March 4, 2010 (Acc.  No. 0001104659-10-012168) and incorporated herein by reference.                                                               |
| 4.2                  |       | —     | Registration Rights Agreement, dated  February 26, 2010, by and between Accuride Corporation and each of the  Holders party thereto. Previously filed as an exhibit to the Form 8-K  (Acc. No. 0001104659-10-012168) filed on March 4, 2010 and  incorporated herein by reference.                                                                                                                                                                                                                |
| 4.3                  |       | —     | Bond Guaranty Agreement dated as of March 1,  1999 by Bostrom Seating, Inc. in favor of NBD Bank as Trustee.  Previously filed as an exhibit to Amendment No. 1 filed on  February 23, 2005 to the Form S-1 effective April 25, 2005  (Reg. No. 333-121944) and incorporated herein by reference.                                                                                                                                                                                  |
| 4.4                  |       | —     | Indenture, dated July 29, 2010, by and among  Accuride Corporation, Accuride Corporation’s domestic subsidiaries,  Wilmington Trust FSB, as trustee, and Deutsche Bank Trust Company Americas,  as notes priority collateral agent, registrar and paying agent, with respect  to $310.0 million aggregate principal amount of 91/2% First Priority Senior Secured Notes due 2018.  Previously filed as an exhibit to Form 8-K  filed on August 2, 2010 and incorporated herein by reference. |
| 4.5                  |       | —     | Form of 91/2% First Priority Senior Secured Notes due 2018 (included in  Exhibit 4.4).  Previously filed as  an exhibit to Form 8-K filed on August 2, 2010 and incorporated  herein by reference.                                                                                                                                                                                                                                                                                           |
| 4.6                  |       | —     | Registration Rights Agreement, dated  July 29, 2010, by and between Accuride Corporation and each of the  Holders party thereto.  Previously  filed as an exhibit to Form 8-K filed on August 2, 2010 and  incorporated herein by reference.                                                                                                                                                                                                                                                      |
| 4.7                  |       | —     | Intercreditor Agreement, dated July 29, 2010,  between Deutsche Bank Trust Company Americas, as initial ABL agent, and  Deutsche Bank Trust Company Americas, as Senior Secured Notes Collateral  Agent, and acknowledged by Accuride Corporation and its domestic  subsidiaries.  Previously filed as an  exhibit to Form 8-K filed on August 2, 2010 and incorporated herein  by reference.                                                                                                     |
| 10.1                 |       | —     | ABL Credit Agreement, dated July 29, 2010,  by and among Accuride Corporation, Accuride Corporation’s domestic  subsidiaries, Deutsche Bank Securities Inc., Credit Suisse Securities (USA)  LLC, Deutsche Bank Trust Company Americas, Sun Trust Bank, Wells Fargo  Capital Finance, LLC, and the initial lenders named therein.  Previously filed as an exhibit to Form 8-K  filed on August 2, 2010 and incorporated herein by reference.                                                 |
| 10.2*                |       | —     | Accuride Corporation 2010 Incentive Award  Plan.  Previously filed as an exhibit  to Form S-8 filed on August 3, 2010 and incorporated herein by  reference.                                                                                                                                                                                                                                                                                                                                           |
| 10.3*                |       | —     | Form of Accuride Corporation 2010 Initial  Grant Restricted Stock Unit Award to be entered into by Accuride Corporation  and individual directors of Accuride Corporation.  Previously filed as an exhibit to Form S-8  filed on August 3, 2010 and incorporated herein by reference.                                                                                                                                                                                                             |
| 10.4*                |       | —     | Form of Accuride Corporation 2010 Annual  Grant Restricted Stock Unit Award to be entered into by Accuride Corporation  and individual directors of Accuride Corporation.  Previously filed as an exhibit to Form S-8  filed on August 3, 2010 and incorporated herein by reference.                                                                                                                                                                                                              |
| 31.1†           |       | —     | Section 302 Certification of William M.  Lasky in connection with the Quarterly Report of Form 10-Q on Accuride  Corporation for the period ended September 30, 2010.                                                                                                                                                                                                                                                                                                                                  |
| 31.2†           |       | —     | Section 302 Certification of James H.  Woodward, Jr. in connection with the Quarterly Report on Form 10-Q  of Accuride Corporation for the period ended September 30, 2010.                                                                                                                                                                                                                                                                                                                       |

 

37

----

Table of Contents

 
| 32.1†† |   | — | Certifications Pursuant to Section 1350 of  Chapter 63 of Title 18 of the United States Code. |
|------------------|--------|--------|----------------------------------------------------------------------------------------------------|

 

----

†              Filedherewith

 

††            Furnishedherewith

 

*              Managementcontract or compensatory agreement

 

38

----

Table ofContents

 

**SIGNATURES**

 

Pursuant to the requirements of the SecuritiesExchange Act of 1934, the registrant has duly caused this report to be signedon its behalf by the undersigned thereunto duly authorized.

 

 
| ACCURIDE CORPORATION                              |   |                  |
|---------------------------------------------------|--------|-----------------------|
|                                              |   |                  |
| /s/ WILLIAM M. LASKY                              | Dated: | November 9, 2010 |
| William M. Lasky                                  |   |                  |
| President and Chief Executive Officer             |   |                  |
| (Principal Executive Officer)                     |   |                  |
|                                              |   |                  |
|                                              |   |                  |
| /s/ JAMES H. WOODWARD, Jr.                   | Dated: | November 9, 2010 |
| James H. Woodward, Jr.                       |   |                  |
| Senior Vice President and Chief Financial Officer |   |                  |
| (Principal Financial Officer)                     |   |                  |
|                                              |   |                  |
|                                              |   |                  |
| /s/ GREGORY A. RISCH                              | Dated: | November 9, 2010 |
| Gregory A. Risch                                  |   |                  |
| Vice President and Chief Accounting Officer       |   |                  |
| (Principal Accounting Officer)                    |   |                  |

 

39

----