##### Table of Contents



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
  Form 10-K
  ANNUAL REPORT PURSUANT TO
    SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT of 1934For the fiscal year ended January 31, 2007
    Commission file number:
    000-50303
 Hayes Lemmerz International,
    Inc.
 (Exact name of Registrant as
    Specified in its Charter)
  Delaware

32-0072578(State or Other Jurisdiction
    of
    Incorporation or Organization)

(I.R.S. Employer
    Identification No.)15300 Centennial Drive,
    Northville, Michigan(Address of Principal
    Executive Offices)

48168(Zip
    Code)   Registrants telephone number, including area code:
 (734) 737-5000
  Securities Registered Pursuant to Section 12(b) of the
    Act:
    Common Stock, par value $0.01 per share
  Name of Each Exchange on which Registered:
    The NASDAQ Stock Market LLC
  Securities Registered Pursuant to Section 12(g) of the
    Act:
    None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  o þ o
  Rule 12b-2 o þ
    þ o
    DOCUMENTS
    INCORPORATED BY REFERENCE
  Document Description

Form 10-K
    PartPortions of the Registrants
    notice of annual meeting of shareholders and proxy statement to
    be filed pursuant to Regulation 14A within 120 days
    after Registrants fiscal year end of January 31, 2007


Part III




---



##### 



HAYES
    LEMMERZ INTERNATIONAL, INC.
  FORM 10-K
    ANNUAL REPORT
  TABLE OF
    CONTENTS
  PagePART IItem 1.

Business


3Item 1A.

Risk
    Factors


11Item 1B.

Unresolved Staff
    Comments


17Item 2.

Properties


18Item 3.

Legal
    Proceedings


18Item 4.

Submission of
    Matters to a Vote of Security Holders


21PART IIItem 5.

Market for
    Registrants Common Equity, Related Stockholder Matters,
    and Issuer Purchases of Equity Securities


21Item 6.

Selected Financial
    Data


23Item 7.

Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


25Item 7A.

Quantitative and
    Qualitative Disclosures about Market Risk


41Item 8.

Financial
    Statements and Supplementary Data


42Item 9.

Changes in and
    Disagreements with Accountants on Accounting and Financial
    Disclosure


93Item 9A.

Controls and
    Procedures


93Item 9B

Other
    Information


94PART IIIItem 10.

Directors and
    Executive Officers of the Registrant


95Item 11.

Executive
    Compensation


95Item 12.

Security Ownership
    of Certain Beneficial Owners and Management and Related
    Stockholder Matters


95Item 13.

Certain
    Relationships and Related Transactions


95Item 14.

Principal
    Accountant Fees and Services


95PART IVItem 15.

Exhibits and
    Financial Statement Schedules


95Signatures


99First Amendment dated as of October 13, 2006Amendment No. 3, Waiver and Consent to Amended and Restated Credit Agreement dated as of 2/9/07Second Amendment dated as of May 27, 2005SubsidiariesConsent of Independent Registered Public Accounting FirmCertification of Curtis J. Clawson, Chairman of the Board, President and Chief Executive Officer, pursuant to Section 302Certification of James A. Yost, Vice President, Finance, and Chief Financial Officer, pursuant to Section 302Certification of Curtis J. Clawson, Chairman of the Board, President and Chief Executive Officer, pursuant to Section 906Certification of James A. Yost, Vice President, Finance, and Chief Financial Officer, pursuant to Section 906   1




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##### Table of Contents



FORWARD-LOOKING
    STATEMENTS
  Unless otherwise indicated, references to we,
    us, or our mean Hayes Lemmerz
    International, Inc., a Delaware corporation, and our
    subsidiaries. References to fiscal year means the
    12-month
    period commencing on February 1st of that year and
    ending January 31st of the following year (e.g.,
    fiscal 2006 means the period beginning February 1, 2006,
    and ending January 31, 2007). This report contains forward
    looking statements with respect to our financial condition,
    results of operations, and business. All statements other than
    statements of historical fact made in this Annual Report on
    Form 10-K
    are forward-looking. Such forward-looking statements include,
    among others, those statements including the words
    expect, anticipate, intend,
    believe, and similar language. These forward looking
    statements involve certain risks and uncertainties. Our actual
    results may differ significantly from those projected in the
    forward-looking statements. Factors that may cause actual
    results to differ materially from those contemplated by such
    forward looking statements include, among others:
    (1) competitive pressure in our industry;
    (2) fluctuations in the price of steel, aluminum, and other
    raw materials; (3) changes in general economic conditions;
    (4) our dependence on the automotive industry (which has
    historically been cyclical) and on a small number of major
    customers for the majority of our sales; (5) pricing
    pressure from automotive industry customers and the potential
    for re-sourcing of business to lower-cost providers;
    (6) changes in the financial markets or our debt ratings
    affecting our financial structure and our cost of capital and
    borrowed money; (7) the uncertainties inherent in
    international operations and foreign currency fluctuations;
    (8) our ability to divest non-core assets and businesses;
    (9) our ability to consummate the previously announced
    Rights Offering; and (10) the risks described in
    Section 1A, Risk Factors. You are cautioned not
    to place undue reliance on the forward-looking statements, which
    speak only as of the date of this Annual Report on
    Form 10-K.
    We have no duty to update the forward looking statements in this
    Annual Report on
    Form 10-K
    and we do not intend to provide such updates.
 2




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##### Table of Contents



PART I  Item 1.
    Business  Business
    Overview and Development
  1
          Segment
    Information
      1 12-month st st
 3




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##### Table of Contents



Automotive
    Wheels Products
    Cast
    Aluminum Wheels for Passenger Cars and Light
    Trucks
  ®
  Europe.
  Customers.
  Competition.
 4




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##### Table of Contents



Manufacturing.
  North America.
  Customers.
  Competition.
  Manufacturing.
  South America, South Africa, and Asia.
  Customers.
  Competition.
  Manufacturing.
  Fabricated
    Wheels for Passenger Cars and Light Trucks
    Europe.
  Customers.
  Competition.
 5




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##### Table of Contents



Manufacturing.
  North America.
  Customers.
  Competition.
  Manufacturing.
  South America.
  Customers.
  Competition.
  Manufacturing.
  Commercial
    Highway Wheels
    Europe.
  Customers.
  Competition.
  Manufacturing.
  North America.
 6




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##### Table of Contents



Customers.
  Competition.
  Manufacturing.
  South America and Asia.
  Customers.
  Competition.
  Manufacturing.
  Components
    Products
    Automotive
    Brake Components
    Customers.
  Competition.
  Manufacturing.
  Powertrain
    Components
    Customers.
  Competition.
 7




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##### Table of Contents



Manufacturing.
  Other
    Cast Aluminum Products
    Material
    Source and Supply
            Intellectual
    Property
   8




---



##### Table of Contents



Seasonality
    Customer
    Dependence
      Backlog
    Competition
    Research
    and Development
    Environmental
    Compliance
   9




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##### Table of Contents



Employees
    Financial
    Information about Geographic Areas
      Year EndedJanuary 31,


January 31,


January 31,2007


2006


2005Revenues:United States

$
562.1


$
595.8


$
569.8Germany


268.7



231.8



198.7Other foreign countries


1,225.4



1,128.9



1,004.9Total

$
2,056.2


$
1,956.5


$
1,773.4     Available
    Information
  Form 10-K, Form 10-Q, Form 8-K,
  Item 1A.
    Risk
    Factors.  Industry
    Risks
  Cyclical
    demand in the automotive industry may adversely affect our
    business.
   10




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##### Table of Contents



We
    depend on a small number of significant customers.
    Our
    customers cost cutting efforts and purchasing practices
    may adversely impact our business.
      We
    operate in the highly competitive automotive supply
    industry.
     11




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##### Table of Contents



Financial
    Risks
  We
    have substantial levels of debt and debt service that will
    divert a significant amount of cash from our business
    operations.
  1 2
  
    requiring a substantial portion of our cash flow from operations
    to be dedicated to debt service and therefore not available for
    our operations, capital expenditures, and future business
    opportunities;
    increasing our vulnerability to a downturn in general economic
    conditions or in our business;
    limiting our ability to adjust to changing market conditions,
    placing us at a competitive disadvantage compared to our
    competitors that have relatively less debt; and
    limiting our ability to obtain additional financing or access
    additional funds under our Credit Facility for capital
    expenditures, working capital, or general corporate purposes.  Restrictions
    and covenants in the indenture governing the Senior Notes and
    the Credit Facility limit our ability to take certain actions
    and may limit access to our revolving credit
    facility.
    
    declare dividends or redeem or repurchase capital stock;
    prepay, redeem, or purchase debt, including the Senior Notes;
    incur liens and engage in sale-leaseback transactions;
    make loans and investments;
    incur additional debt, including borrowings under our Credit
    Facility;
    amend or otherwise alter certain debt documents;
    make capital expenditures;
    engage in mergers, acquisitions, and asset sales;
    enter into transactions with affiliates; and
    alter the business we conduct.     12




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##### Table of Contents



We may
    not generate sufficient cash flow to fund required capital
    expenditures and for that and other reasons we may need
    additional financing in the future, which we may be unable to
    obtain.
    We may
    suffer future asset impairments and other restructuring charges,
    including write downs of goodwill or intangible
    assets.
      Our
    exposure to variable interest rates and foreign currency
    fluctuations may negatively affect our results.
      period-to-period
 13




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We may
    be unable to maintain trade credit with our
    suppliers.
    The
    nature of our business exposes us to product liability, recall,
    and warranty claims and other legal proceedings.
    Our
    pension and other postretirement employee benefits expense could
    materially increase.
      Our
    credit rating has been downgraded and we may experience further
    downgrades in the future, and the cost of amending or
    refinancing our Credit Facility may increase.
    Operational
    Risks
  Increased
    cost of supplies and raw materials, especially steel and iron,
    could affect our financial health.
   14




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##### Table of Contents



Unexpected
    equipment failures, delays in deliveries, or catastrophic loss
    at any of our manufacturing facilities could lead to production
    curtailments or shutdowns.
    We
    have significant international operations that subject us to
    risks not faced by domestic competitors.
    
    agreements may be difficult to enforce and receivables difficult
    to collect through a foreign countrys legal system;
    foreign customers may have longer payment cycles;
    foreign countries may impose additional withholding taxes or
    otherwise tax our foreign income, impose tariffs or adopt other
    restrictions on foreign trade or investment, including foreign
    exchange controls;
    foreign laws or regulations may restrict our ability to
    repatriate cash from foreign operations;
    necessary export licenses or customs clearances may be difficult
    to obtain;
    intellectual property rights may be more difficult to enforce in
    foreign countries;
    political or economic conditions or exposure to local social
    unrest, including any resultant acts of war, terrorism or
    similar events in the countries in which we operate could have
    an adverse effect on our earnings from operations in those
    countries;
    unexpected adverse changes in foreign laws or regulatory
    requirements may occur;
    compliance with a variety of foreign laws and regulations may be
    difficult;
    in certain countries we are subject to nationwide collective
    labor agreements that we did not negotiate;
    labor laws in certain countries may make it more difficult or
    expensive to reduce our labor force in response to reduced
    demand; and 15




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##### Table of Contents




    differing foreign tax structures may subject us to additional
    taxes or affect our ability to repatriate cash from our foreign
    subsidiaries.    We may
    not be able to successfully implement our planned operational
    improvements or realize the benefits of those plans already
    implemented.
    We may
    not be able to timely or successfully launch new
    products.
    Our
    success will depend on our ability to attract and retain
    qualified employees.
    We
    might fail to adequately protect our intellectual property or
    third parties might assert that our technologies infringe on
    their intellectual property.
    Our
    products may be rendered obsolete or less attractive by changes
    in regulatory requirements or competitive
    technologies.
   16




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A high
    percentage of our customers employees and certain of our
    employees are unionized or covered by collective bargaining
    agreements.
    We are
    subject to potential exposure to environmental
    liabilities.
      Item 1B.
    Unresolved
    Staff Comments   17




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##### Table of Contents



Item 2.
    Properties      Owned/Location

Segment

Purpose

LeasedNorth AmericaAkron, OH

Automotive Wheels

Manufacturing

OwnedChihuahua, Mexico

Automotive Wheels

Manufacturing

OwnedGainesville, GA

Automotive Wheels

Manufacturing

OwnedHomer, MI

Components

Manufacturing

OwnedLaredo, TX

Components

Offices and Warehouse

LeasedMonterrey, Mexico

Components

Manufacturing

LeasedNorthville, MI

Other

World Headquarters, R&D

OwnedNuevo Laredo, Mexico

Components

Manufacturing

OwnedSedalia, MO

Automotive Wheels

Manufacturing

OwnedWabash, IN

Components

Manufacturing

OwnedEuropeBarcelona, Spain

Automotive Wheels

Manufacturing

OwnedBergen, Netherlands

Components

Manufacturing

OwnedDello, Italy

Automotive Wheels

Manufacturing

OwnedHoboken, Belgium (2 facilities)

Automotive Wheels and Components

Manufacturing

OwnedKönigswinter, Germany
    (2 facilities)

Automotive Wheels

Manufacturing

OwnedManisa, Turkey (3 facilities)

Automotive Wheels

Manufacturing

OwnedManresa, Spain

Automotive Wheels

Manufacturing

OwnedOstrava, Czech Republic (2
    facilities)

Automotive Wheels

Manufacturing

OwnedTegelen, Netherlands

Components

Manufacturing

OwnedRest of the WorldBangkok, Thailand

Automotive Wheels

Manufacturing

LeasedJohannesburg, S. Africa

Automotive Wheels

Manufacturing

OwnedPune, India

Automotive Wheels

Manufacturing

LeasedSao Paulo, Brazil (2 facilities)

Automotive Wheels

Manufacturing

OwnedYokohama, Japan

Automotive Wheels

Sales Office

Leased   Item 3.
    Legal
    Proceedings   18




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##### Table of Contents



19




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##### Table of Contents



20




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##### Table of Contents



Item 4.
    Submission
    of Matters to a Vote of Security Holders   PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder
    Matters, and Issuer Purchases of Equity Securities  mark-up,
    High


LowFiscal 2006:Fourth quarter

$
5.23


$
1.75Third quarter


3.20



1.64Second quarter


3.38



2.47First quarter


3.75



2.04Fiscal 2005:Fourth quarter

$
4.61


$
2.55Third quarter


7.99



3.42Second quarter


8.37



5.02First quarter


8.04



3.98    21




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##### Table of Contents



Cumulative Total ReturnHayes LemmerzDate

International, Inc.


Peer Group


Nasdaq Composite6/9/03


100.00



100.00



100.007/31/03


124.89



121.41



108.1710/31/03


148.41



129.31



122.681/31/04


167.21



156.41



128.634/30/04


133.97



149.44



120.877/30/04


121.80



140.37



117.9610/29/04


73.93



117.34



123.441/31/05


72.84



115.52



128.584/29/05


48.77



82.19



119.817/29/05


71.21



112.81



136.2110/31/05


35.51



80.53



132.191/31/06


33.88



71.47



143.764/30/06


30.34



58.05



144.807/31/06


23.16



63.09



130.3910/31/06


19.44



58.10



147.551/31/07


41.51



59.73



153.61  22




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##### Table of Contents



Item 6.
    Selected
    Financial Data         23




---



##### Table of Contents



Successor


PredecessorEight


FourYear


Year


Year


Months


Months


YearEnded


Ended


Ended


Ended


Ended


EndedJanuary 31,


January 31,


January 31,


January 31,


May 31,


January 31,2007


2006


2005


2004


2003


2003Income statement data:Net sales

$
2,056.2


$
1,956.5


$
1,773.4


$
1,059.7


$
522.1


$
1,496.6Depreciation and amortization


122.4



135.0



137.9



82.7



35.6



104.2Asset impairments and other
    restructuring charges


43.8



55.5



8.6



28.9



6.0



40.7Goodwill impairments






185.5















Interest expense, net(1)


76.2



65.3



43.6



30.4



15.5



50.5Subsidiary preferred stock dividends






0.8



0.8



0.5







Reorganization items


















45.0



43.6Fresh start accounting adjustments


















(63.1
)


Income tax (benefit) expense


39.2



(1.4
)


16.7



10.7



59.8



2.2Loss from continuing operations
    before cumulative effect of a change in accounting principle and
    extraordinary gain


(119.1
)


(287.1
)


(34.3
)


(27.4
)


(33.2
)


(82.0
)Income (loss) from discontinued
    operations, net of tax of $(0.1), $1.7, $3.0, $0.2, $0.5, and
    $1.4, respectively


(45.4
)


(174.3
)


(30.6
)


(19.1
)


(0.5
)


(194.5
)Loss (gain) on sale of discontinued
    operations, net of tax of $0.0 and $3.8, respectively


(2.4
)


3.9















Cumulative effect of change in
    accounting principle, net of tax of $0.8 and $0.0, respectively










2.6











(358.0
)Extraordinary gain, net of tax of $0


















1,076.7



Net (loss) income

$
(166.9
)

$
(457.5
)

$
(62.3
)

$
(46.5
)

$
1,043.0


$
(634.5
)Balance sheet data:Total assets

$
1,691.2


$
1,799.2


$
2,302.0


$
2,297.7






$
1,846.6DIP facility, bank borrowings and
    current portion of long-term debt(1)


34.6



41.7



11.1



25.5







103.3Long-term debt


659.4



668.7



631.1



752.4







60.9Liabilities subject to compromise






















2,130.9Stockholders equity (deficit)


101.8



183.3



701.3



595.9







(1,074.4
)Per Share Data:Loss from continuing operations
    before cumulative effect of a change in accounting principle and
    extraordinary gain

$
(3.11
)

$
(7.58
)

$
(0.91
)

$
(0.91
)






Net loss

$
(4.36
)

$
(12.07
)

$
(1.66
)

$
(1.55
)






Average number of shares
    outstanding (in thousands)


38,306



37,942



37,605



30,011







     (1)
    
    For the four months ended May 31, 2003 and fiscal year
    ended January 31, 2003, interest expense, net, excludes
    approximately $38.7 million and $117.6 million,
    respectively, of interest expense that would have accrued during
    those periods with respect to certain long-term debt classified
    as liabilities subject to compromise. 24




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##### Table of Contents



Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations    Executive
    Summary
  Company
    Overview
             25




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##### Table of Contents



Results
    of Operations
  Consolidated
    Results  Comparison of Fiscal 2006 to Fiscal
    2005
    2006


2005


$ Change


% ChangeNet sales:Automotive Wheels

$
1,671.6


$
1,594.4


$
77.2



4.8
%Components


384.6



362.1



22.5



6.2
%Total

$
2,056.2


$
1,956.5


$
99.7



5.1
%Gross profit

$
185.6


$
169.0


$
16.6



9.8
%Marketing, general, and
    administrative


137.3



133.9



3.4



2.5
%Amortization of intangible assets


11.1



14.2



(3.1
)


(21.8
)%Asset impairments and other
    restructuring charges


43.8



55.5



(11.7
)


(21.1
)%Goodwill impairment






185.5



(185.5
)


(100.0
)%Other income, net


(13.2
)


(4.9
)


(8.3
)


169.4
%Earnings (loss) from operations


6.6



(215.2
)


221.8



(103.1
)%Interest expense, net


76.2



65.3



10.9



16.7
%Other non-operating expense






0.8



(0.8
)


(100.0
)%Income tax (benefit) expense


39.2



(1.4
)


40.6



(2900.0
)%Minority interest


10.3



7.2



3.1



43.1
%Loss from continuing operations
    before cumulative effect of change in accounting principle


(119.1
)


(287.1
)


168.0



(58.5
)%Loss from discontinued operations,
    net of tax of $(0.1) and $1.7, respectively


(45.4
)


(174.3
)


128.9



(74.0
)%(Loss) gain on sale of
    discontinued operations, net of tax of $0.0 and $3.8,
    respectively


(2.4
)


3.9



(6.3
)


(161.5
)%Net loss

$
(166.9
)

$
(457.5
)

$
290.6



(63.5
)%   Net
    sales
    Gross
    profit
   26




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##### Table of Contents



Marketing,
    general, and administrative
    Asset
    impairments and other restructuring charges
  reduction-in-force
    Goodwill
    impairment
    Interest
    expense, net
    Income
    taxes
    Discontinued
    operations
   27




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##### Table of Contents



Net
    loss
    Segment
    Results  Comparison of Fiscal 2006 to Fiscal
    2005
  Automotive
    Wheels
    2006


2005


$ ChangeNet sales

$
1,671.6


$
1,594.4


$
77.2Asset impairments and other
    restructuring charges:Facility closure costs

$
3.6


$
3.3


$
0.3Impairment of machinery,
    equipment, and tooling


16.8



9.3



7.5Impairment of goodwill






185.5



(185.5
)Severance and other restructuring
    costs


4.1



5.0



(0.9
)Total asset impairments and other
    restructuring charges

$
24.5


$
203.1


$
(178.6
)(Loss) earnings from operations

$
53.3


$
(150.4
)

$
203.7   Net
    sales
    Asset
    impairments and other restructuring charges
     28




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##### Table of Contents



Goodwill
    impairment
    Earnings
    from operations
    Components
    2006


2005


$ ChangeNet sales

$
384.6


$
362.1


$
22.5Asset impairments and other
    restructuring charges:Impairment of land, building,
    machinery, equipment, tooling, and definite lived intangible
    assets


15.6



37.9



(22.3
)Severance and other restructuring
    costs


2.4







2.4Total asset impairments and other
    restructuring charges

$
18.0


$
37.9


$
(19.9
)Loss from operations

$
(26.8
)

$
(35.0
)

$
8.2   Net
    sales
    Asset
    impairments and other restructuring charges
  reduction-in-force
    Loss
    from operations
   29




---



##### Table of Contents



Other
    2006


2005


$ ChangeLoss from operations

$
(19.9
)

$
(29.8
)

$
9.9   Loss
    from operations
    Results
    of Operations
  Consolidated
    Results  Comparison of Fiscal 2005 to Fiscal
    2004
    2005


2004


$ Change


% ChangeNet sales:Automotive Wheels

$
1,594.4


$
1,440.6


$
153.8



10.7
%Components


362.1



332.8



29.3



8.8
%Total

$
1,956.5


$
1,773.4


$
183.1



10.3
%Gross profit

$
169.0


$
186.1


$
(17.1
)


(9.2
)%Marketing, general, and
    administrative


133.9



124.8



9.1



7.3
%Amortization of intangible assets


14.2



12.3



1.9



15.4
%Asset impairments and other
    restructuring charges


55.5



8.6



46.9



545.3
%Goodwill impairment


185.5







185.5



*Other income, net


(4.9
)


(8.6
)


3.7



(43.0
)%(Loss) earnings from operations


(215.2
)


49.0



(264.2
)


(539.2
)%Interest expense, net


65.3



43.6



21.7



49.8
%Other non-operating expense


0.8



1.7



(0.9
)


(52.9
)%Loss on early extinguishment of
    debt






12.2



(12.2
)


(100.0
)%Income tax (benefit) expense


(1.4
)


16.7



(18.1
)


(108.4
)%Minority interest


7.2



9.1



(1.9
)


(20.9
)%Loss from continuing operations
    before cumulative effect of change in accounting principle


(287.1
)


(34.3
)


(252.8
)


737.0
%Loss from discontinued operations,
    net of tax $1.7 and $3.0, respectively


(174.3
)


(30.6
)


(143.7
)


469.6
%Gain on sale of discontinued
    operations, net of tax $3.8 and $0.0, respectively


3.9







3.9



*Cumulative effect of change in
    accounting principle, net of tax of $0.0 and $0.8, respectively






2.6



(2.6
)


(100.0
)%Net loss

$
(457.5
)

$
(62.3
)

$
(395.2
)


634.3
%     *
    
    Percentage cannot be calculated 30




---



##### Table of Contents



Net
    sales
    Gross
    profit
    Marketing,
    general, and administrative
    Asset
    impairments and other restructuring charges
      Goodwill
    impairment
   31




---



##### Table of Contents



Interest
    expense, net
      Income
    taxes
    Discontinued
    operations
        Net
    loss
    Segment
    Results  Comparison of Fiscal 2005 to Fiscal
    2004
  Automotive
    Wheels
    2005


2004


$ ChangeNet sales

$
1,594.4


$
1,440.6


$
153.8Asset impairments and other
    restructuring charges:Facility closure costs

$
3.3


$
4.8


$
(1.5
)Impairment of machinery,
    equipment, and tooling


9.3



2.2



7.1Impairment of goodwill


185.5







185.5Severance and other restructuring
    costs


5.0



1.4



3.6Total asset impairments and other
    restructuring charges

$
203.1


$
8.4


$
194.7(Loss) earnings from operations

$
(150.4
)

$
63.4


$
(213.8
)  32




---



##### Table of Contents



Net
    sales
    Asset
    impairments and other restructuring charges
      Goodwill
    impairment
    Earnings
    from operations
    Components
    2005


2004


$ ChangeNet sales

$
362.1


$
332.8


$
29.3Asset impairments and other
    restructuring charges:Facility closure costs

$



$
(0.2
)

$
0.2Impairment of land, building,
    machinery, equipment, tooling, and definite lived intangible
    assets


37.9







37.9Severance and other restructuring
    costs










Total asset impairments and other
    restructuring charges

$
37.9


$
(0.2
)

$
38.1(Loss) earnings from operations

$
(35.0
)

$
3.6


$
(38.6
)  33




---



##### Table of Contents



Net
    sales
    Asset
    impairments and other restructuring charges
      Loss
    from operations
    Other
    2005


2004


$ ChangeLoss from operations

$
(29.8
)

$
(18.0
)

$
(11.8
)   Loss
    from operations
    Liquidity
    and Capital Resources
  Cash
    Flows
  Operating Activities:
  Investing Activities:
 34




---



##### Table of Contents



Financing Activities:
  Sources
    of Liquidity
      Other
    Liquidity Matters
            Credit
    Ratings
  S&P


MoodysCorporate and bank debt rating


B−



Caa1Senior Note rating


CCC



Caa2  35




---



##### Table of Contents



Postretirement
    Benefits
  FAS 106-2
  Off
    Balance Sheet Arrangements
           36




---



##### Table of Contents



Contractual
    Obligations
    Payment Due by PeriodLess Than


2-3


4-5


After1 Year


Years


Years


5 Years


TotalShort-term borrowings

$
27.9


$



$



$



$
27.9Long-term debt


5.5



324.9



312.9







643.3Mortgage note payable


0.2



21.6











21.8Capital lease obligations


1.0















1.0Operating leases


6.6



6.7



0.9



0.2



14.4Capital expenditures


31.9















31.9United States pension contributions


12.6



16.5



14.9







44.0Total obligations

$
85.7


$
369.7


$
328.7


$
0.2


$
784.3   Other
    Cash Requirements
    Interest

$
70.3Taxes


21.8International pension and other
    post-retirement benefits funding


23.8Restructuring costs


1.0   Other
    Matters
  Inflation
    Critical
    Accounting Estimates
    Asset
    impairment losses and other restructuring
    charges
   37




---



##### Table of Contents



Pension
    and postretirement benefits other than
    pensions
          Goodwill
    impairment testing
    Allowance
    for uncollectible accounts
   38




---



##### Table of Contents



Income
    Taxes
        New
    Accounting Pronouncements
  instrument-by-instrument available-for-sale held-to-maturity
     39




---



##### Table of Contents



40




---



##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosures about Market Risk  Market
    Risks
    Foreign
    Exchange
      Interest
    Rates
    Commodities
   41




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data  HAYES
    LEMMERZ INTERNATIONAL, INC.
  INDEX TO
    FINANCIAL STATEMENTS
  PageReport of
    Independent Registered Public Accounting Firm


43Consolidated
    Statements of Operations


44Consolidated
    Balance Sheets


45Consolidated
    Statements of Cash Flows


46Consolidated
    Statements of Changes in Stockholders Equity


47Notes to
    Consolidated Financial Statements


48  42




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm           Internal Control  Integrated Framework
  Share-Based Payment. Employers Accounting for
    Defined Benefit Pension and Other Postretirement
    Plans  an amendment of FASB No. 87, 88, 106 and
    132(R).
    
    43




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
  Year EndedJanuary 31,


January 31,


January 31,2007


2006


2005(Dollars in millions, except per share amounts)Net sales

$
2,056.2


$
1,956.5


$
1,773.4Cost of goods sold


1,870.6



1,787.5



1,587.3Gross profit


185.6



169.0



186.1Marketing, general, and
    administrative


137.3



133.9



124.8Amortization of intangible assets


11.1



14.2



12.3Asset impairments and other
    restructuring charges


43.8



55.5



8.6Goodwill impairment






185.5



Other income, net


(13.2
)


(4.9
)


(8.6
)Earnings (loss) from operations


6.6



(215.2
)


49.0Interest expense, net


76.2



65.3



43.6Other non-operating expense






0.8



1.7Loss on early extinguishment of
    debt










12.2Loss from continuing operations
    before taxes, minority interest, and cumulative effect of change
    in accounting principle


(69.6
)


(281.3
)


(8.5
)Income tax expense (benefit)


39.2



(1.4
)


16.7Loss from continuing operations
    before minority interest and cumulative effect of change in
    accounting principle


(108.8
)


(279.9
)


(25.2
)Minority interest


10.3



7.2



9.1Loss from continuing operations
    before cumulative effect of change in accounting principle


(119.1
)


(287.1
)


(34.3
)Discontinued operations:Loss from discontinued operations,
    net of tax of ($0.1), $1.7, and $3.0, respectively


(45.4
)


(174.3
)


(30.6
)(Loss) gain on sale of
    discontinued operations, net of tax of $0.0, $3.8, and $0.0,
    respectively


(2.4
)


3.9



Total loss from discontinued
    operations, net of tax


(47.8
)


(170.4
)


(30.6
)Cumulative effect of change in
    accounting principle, net of tax of $0.8










2.6Net loss

$
(166.9
)

$
(457.5
)

$
(62.3
)Loss per common share
    dataBasic and diluted:Loss from continuing operations
    before cumulative effect of change in accounting principle

$
(3.11
)

$
(7.58
)

$
(0.91
)Loss from discontinued operations,
    net of tax


(1.19
)


(4.59
)


(0.82
)(Loss) gain on sale of
    discontinued operations, net of tax


(0.06
)


0.10



Cumulative effect of change in
    accounting principle, net of tax










0.07Net loss

$
(4.36
)

$
(12.07
)

$
(1.66
)Weighted average shares
    outstanding (in millions)


38.3



37.9



37.6    44




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEETS
  January 31,


January 31,2007


2006(Dollars in millions, except share amounts)ASSETSCurrent assets:Cash and cash equivalents

$
38.4


$
42.3Receivables, net of allowance of
    $2.4 million and $4.1 million at January 31, 2007
    and 2006, respectively


258.5



216.5Other receivables


43.2



101.0Inventories


172.8



160.5Deferred tax assets


3.2



3.5Prepaid expenses


12.7



11.8Assets held for sale


51.8



117.5Total current assets


580.6



653.1Property, plant, and equipment, net


680.7



715.4Deferred tax assets


7.5



14.0Goodwill


210.0



197.8Customer relationships, net


107.2



103.7Other intangible assets, net


66.6



76.1Other assets


38.6



39.1Total assets

$
1,691.2


$
1,799.2LIABILITIES AND
    STOCKHOLDERS EQUITYCurrent liabilities:Bank borrowings and other notes

$
27.9


$
25.5Current portion of long-term debt


6.7



16.2Accounts payable and accrued
    liabilities


384.4



345.6Liabilities held for sale


19.9



40.8Total current liabilities


438.9



428.1Long-term debt, net of current
    portion


659.4



668.7Deferred tax liabilities


67.3



62.7Pension and other long-term
    liabilities


366.5



409.2Minority interest


57.3



47.2Commitments and contingencies






Stockholders equity:Preferred stock,
    1,000,000 shares authorized, none issued or outstanding at
    January 31, 2007 or 2006






Common stock, par value
    $0.01 per share:100,000,000 shares
    authorized; 38,470,434 and 37,991,269 issued and outstanding at
    January 31, 2007 and 2006, respectively


0.4



0.4Additional paid in capital


678.6



675.9Accumulated deficit


(733.6
)


(566.3
)Accumulated other comprehensive
    income


156.4



73.3Total stockholders equity


101.8



183.3Total liabilities and
    stockholders equity

$
1,691.2


$
1,799.2    45




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  Year EndedJanuary 31,


January 31,


January 31,2007


2006


2005Cash flows from operating
    activities:Net loss

$
(166.9
)

$
(457.5
)

$
(62.3
)Adjustments to reconcile net loss
    to net cash provided by (used for) operating activities:Net loss from discontinued
    operations


47.8



170.4



30.6(Loss) gain on sale of discontinued
    operations


(2.4
)


3.9



Depreciation and tooling
    amortization


111.3



120.8



125.6Amortization of intangibles


11.1



14.2



12.3Amortization of deferred financing
    fees and accretion of discount


5.7



5.9



3.7Interest income resulting from fair
    value adjustment of Series A Warrants and Series B
    Warrants






(0.5
)


(7.7
)Change in deferred income taxes


5.9



(21.6
)


(9.4
)Asset impairments


32.9



47.2



2.2Goodwill impairment






185.5



Minority interest


10.7



8.0



9.9Equity compensation expense


2.4



2.8



5.5Loss on early extinguishment of debt










12.2(Gain) loss on sale of assets and
    businesses






(9.5
)


0.5Changes in operating assets and
    liabilities that increase (decrease) cash flows:Receivables


(42.2
)


(56.3
)


101.2Other receivables


57.7



(24.0
)


(77.0
)Inventories


(11.2
)


7.9



(2.6
)Prepaid expenses and other


0.3



(5.8
)


(8.4
)Accounts payable and accrued
    liabilities


20.0



(30.3
)


37.4Chapter 11 items:Payments related to Chapter 11
    filings






(0.1
)


(1.5
)Cash provided by (used for)
    operating activities


83.1



(39.0
)


172.2Cash flows from investing
    activities:Purchase of property, plant,
    equipment, and tooling


(80.8
)


(95.2
)


(126.2
)Purchase of businesses, net of cash
    acquired






(4.9
)


Proceeds from disposal of assets
    and businesses


10.2



16.0



0.7Capital contributed by minority
    shareholders


0.4







Cash used for investing activities


(70.2
)


(84.1
)


(125.5
)Cash flows from financing
    activities:Changes in bank borrowings and
    credit facilities


0.6



24.8



(0.7
)Redemption of Senior Notes, net of
    discount and related fees










(96.7
)Redemption of Term Loan B, net
    of related fees






(94.9
)


(16.0
)Proceeds from Term Loan C






150.0



Repayment of long-term debt


(20.2
)


(10.2
)


(17.5
)Dividends to minority shareholders


(1.8
)


(3.6
)


(13.1
)Bank finance fees paid


(2.9
)






Net proceeds from issuance of
    common stock










117.0Cash (used for) provided by
    financing activities


(24.3
)


66.1



(27.0
)Cash flows of discontinued
    operations:Net cash provided by (used for)
    operating activities


11.0



24.9



(7.9
)Net cash provided by (used for)
    investing activities


7.5



23.1



(32.5
)Net cash (used for) provided by
    financing activities


(13.4
)


18.5



Effect of exchange rate changes on
    cash and cash equivalents


2.4



(2.1
)


5.7(Decrease) increase in cash and
    cash equivalents


(3.9
)


7.4



(15.0
)Adjustment for the elimination of
    the one month lag










1.4Cash and cash equivalents at
    beginning of period


42.3



34.9



48.5Cash and cash equivalents at end of
    period

$
38.4


$
42.3


$
34.9    46




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
  AccumulatedOtherPar


Paid in


Accumulated


ComprehensiveShares


Value


Capital


Deficit


Income


Total(Dollars in millions, except share amounts)Balance at January 31, 2004


30,000,000


$
0.3


$
548.2


$
(46.5
)

$
93.9


$
595.9Comprehensive income:Net loss





$



$



$
(62.3
)

$



$
(62.3
)Minimum pension liability
    adjustment, net of tax of $1.4


















(2.2
)


(2.2
)Currency translation adjustment,
    net of tax of $0.3


















47.4



47.4Total comprehensive loss






















(17.1
)Issuance of common stock


7,720,970



0.1



116.9











117.0Shares issued due to vesting of
    restricted stock units


144,992



















Equity compensation expense










5.5











5.5Balance at January 31, 2005


37,865,962


$
0.4


$
670.6


$
(108.8
)

$
139.1


$
701.3Comprehensive income:Net loss





$



$



$
(457.5
)

$



$
(457.5
)Minimum pension liability
    adjustment, net of tax benefit of $4.7


















(7.3
)


(7.3
)Currency translation adjustment,
    net of tax of $7.5


















(56.6
)


(56.6
)Unrealized loss on derivatives


















(1.9
)


(1.9
)Total comprehensive loss






















(523.3
)Shares issued due to vesting of
    restricted stock units


125,307



















Equity compensation expense










5.3











5.3Balance at January 31, 2006


37,991,269


$
0.4


$
675.9


$
(566.3
)

$
73.3


$
183.3Preferred stock dividends declared





$



$



$
(0.4
)

$



$
(0.4
)Comprehensive income:Net loss














(166.9
)






(166.9
)Currency translation adjustment,
    net of tax of $0.8


















44.5



44.5Minimum pension liability
    adjustment, net of tax of $3.1


















4.9



4.9Unrealized loss on derivatives


















(2.5
)


(2.5
)Total comprehensive loss






















(120.0
)Shares issued due to vesting of
    restricted stock units


474,092



















Shares of redeemable preferred
    stock of subsidiary converted into common stock


5,073



















Adjustment resulting from adoption
    of FAS 158, net of tax of $0.7


















36.2



36.2Equity compensation expense










2.7











2.7Balance at January 31, 2007


38,470,434


$
0.4


$
678.6


$
(733.6
)

$
156.4


$
101.8    47




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  Years
    Ended January 31, 2007, 2006, and 2005
  Note 1.
    Description
    of Business  12-month
    Note 2.
    Basis of
    Presentation and Summary of Significant Accounting
    Policies  Basis
    of Presentation
    Summary
    of Significant Accounting Policies
  Principles of Consolidation:
    Cash and Cash Equivalents:
  Accounts Receivable:
 48




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Inventories: first-in,
  Property, Plant, and Equipment:
  Buildings


12-25 yearsMachinery and equipment


1-10 years     Special Tooling:
  Goodwill and Other Intangible Assets:
  Impairment of Long-lived Assets:
  Financial Instruments: 1 2
  .
 49




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
         Pension and Postretirement Benefits Other Than
    Pension:
    90-7,
   50




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Accumulated Other Comprehensive Income:
  Revenue Recognition:
  Research and Development Costs:
  Asset Impairment Losses and Other Restructuring
    Charges:
  Product Warranties:
  Sale of Receivables:
     51




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Foreign Currency
    Translation/Transaction:
  Taxes on Income:
  Taxes Collected from Customers and Remitted to Governmental
    Authorities:
  Reclassifications:
  Weighted Average
    Shares Outstanding:
  January 31,


January 31,2007


2006Basic weighted average shares
    outstanding


38,306



37,942Dilutive effect of options and
    warrants






Diluted weighted average shares
    outstanding


38,306



37,942    52




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Statements of Cash Flows:
  January 31,


January 31,


January 31,2007


2006


2005Supplemental cash flow disclosures:Cash paid for interest

$
70.8


$
58.0


$
51.2Net cash paid for income taxes on
    continuing operations


20.9



27.9



28.0Net cash paid (refund received)
    for income taxes on discontinued operations


0.4



0.9



(0.1
)   Stock-Based Compensation:
      January 31,


January 31,2006


2005Net loss:As reported

$
(457.5
)

$
(62.3
)Stock based compensation cost


(4.0
)


(5.1
)Pro forma

$
(461.5
)

$
(67.4
)Basic and diluted loss per share:As reported

$
(12.07
)

$
(1.66
)Pro forma


(12.16
)


(1.79
)   Note 3.
    Acquisitions
    and Divestitures of Businesses       53




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Note 4.
    Inventories    January 31,


January 31,2007


2006Raw materials

$
39.9


$
37.4Work-in-process


38.5



36.8Finished goods


64.0



58.5Spare parts and supplies


30.4



27.8Total

$
172.8


$
160.5   Note 5.
    Property,
    Plant, and Equipment    January 31,


January 31,2007


2006Land

$
43.0


$
39.4Buildings


195.8



187.4Machinery and equipment


772.9



746.6Capital lease assets






0.11,011.7



973.5Accumulated depreciation


(331.0
)


(258.1
)Property, plant, and equipment, net

$
680.7


$
715.4  54




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year EndedJanuary 31,


January 31,


January 31,2007


2006


2005Depreciation expense

$
100.3


$
108.3


$
110.5Tooling amortization


11.0



12.5



15.1Total

$
111.3


$
120.8


$
125.6   Note 6.
    Assets
    Held for Sale    January 31,


January 31,2007


2006Suspension business

$
49.0


$
113.0Howell, Michigan building


2.8



4.2Lathes






0.3Total

$
51.8


$
117.5     Note 7.
    Discontinued
    Operations       55




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     January 31,


January 31,2007


2006Cash and cash equivalents

$
0.1


$
0.2Receivables


30.0



39.1Inventories


17.5



19.4Prepaid expenses and other assets


1.4



11.6Property, plant, and equipment, net






42.7Total assets held for sale

$
49.0


$
113.0Accounts payable and accrued
    liabilities

$
15.7


$
25.2Other long term liabilities


4.2



15.6Total liabilities held for sale

$
19.9


$
40.8     2006


2005


2004Net sales

$
229.8


$
320.7


$
363.6Loss before income tax expense

$
(47.9
)

$
(180.8
)

$
(29.2
)Income tax expense (benefit)


(0.1
)


0.2



0.6Net loss

$
(47.8
)

$
(181.0
)

$
(29.8
)       January 31,2005Receivables

$
14.6Inventories


7.6Prepaid expenses and other current
    assets


0.5Property, plant and equipment, net


29.2Other assets


0.1Total assets held for sale

$
52.0Accounts payable and accrued
    liabilities

$
10.6Other long term liabilities


1.2Total liabilities held for sale

$
11.8  56




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2005


2004Net sales

$
88.8


$
107.5Income before income tax expense

$
15.9


$
1.6Income tax expense


5.3



2.4Net income

$
10.6


$
(0.8
)   Note 8.
    Goodwill
    and Other Intangible Assets    January 31, 2007


January 31, 2006Weighted


Gross





Net


Gross





NetAverage


Carrying


Accumulated


Carrying


Carrying


Accumulated


CarryingUseful Life


Amount


Amortization


Amount


Amount


Amortization


AmountAmortized intangible assets:Customer relationships


30 years


$
122.6


$
(15.4
)

$
107.2


$
113.9


$
(10.2
)

$
103.7Customer contracts


6 years



25.0



(17.8
)


7.2



23.4



(10.9
)


12.5Unpatented technology


8 years



31.0



(14.6
)


16.4



36.3



(12.7
)


23.615 years


$
178.6


$
(47.8
)

$
130.8


$
173.6


$
(33.8
)

$
139.8Non-amortized
    intangible assets:Tradenames





$
43.0










$
40.0Goodwill





$
210.0










$
197.8       AutomotiveWheels


Components


Other


TotalBalance as of January 31, 2006

$
197.8


$



$



$
197.8Effects of currency translation


14.1











14.1Reclassification


(0.9
)










(0.9
)Income tax adjustments


(1.0
)










(1.0
)Balance as of January 31, 2007

$
210.0


$



$



$
210.0        57




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
       Note 9.
    Other
    Assets    January 31,


January 31,2007


2006Production tooling

$
18.7


$
22.4Unamortized debt issuance costs


13.8



15.5Investments in joint ventures


0.1



0.1Other


6.0



1.1Total

$
38.6


$
39.1   Note 10.
    Accounts
    Payable and Accrued Liabilities    January 31,


January 31,2007


2006Accounts payable

$
258.8


$
217.2Employee costs


75.7



81.7Other accrued liabilities


49.9



46.7Total

$
384.4


$
345.6   Note 11.
    Bank
    Borrowings, Other Notes, and Long-Term Debt   58




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     January 31,


January 31,2007


2006Various foreign bank and
    government loans maturing through 2007, weighted average
    interest rates of 5.4% and 5.6% at January 31, 2007 and
    2006, respectively

$
3.4


$
18.4Term Loan B maturing fiscal
    2009, weighted average interest rate of 8.9% and 7.7% at
    January 31, 2007 and 2006, respectively


327.8



332.3Term Loan C maturing fiscal
    2010, weighted average interest rate of 11.4% and 9.9% at
    January 31, 2007 and 2006, respectively


150.0



150.0101/2% Senior
    Notes due fiscal 2010, net of discount of $0.4 million and
    $0.8 million at January 31, 2007 and 2006, respectively


162.1



161.7Mortgage note payable maturing
    June 3, 2008


21.8



22.0Capital lease obligations


1.0



0.5666.1



684.9Less current portion of long-term
    debt


6.7



16.2Long-term debt, net of current
    portion

$
659.4


$
668.7   The long-term debt repayment
    schedule for the next five fiscal years are as follows (dollars
    in millions):   2007


2008


2009


2010


2011


TotalVarious foreign bank and
    government loans

$
1.0


$
0.8


$
0.8


$
0.8


$



$
3.4Term Loan B


4.5



4.5



318.8











327.8Term Loan C














150.0







150.0101/2% Senior
    Notes














162.1







162.1Mortgage note payable


0.2



21.6















21.8Capital lease obligations


1.0



















1.0$
6.7


$
26.9


$
319.6


$
312.9


$



$
666.1   Credit
    Facility
     59




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
         Senior
    Notes
  1 2 1 2
          Early
    Repayment of Long-Term Debt
     60




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Note 12.
    Pension
    Plans and Postretirement Benefits Other Than Pensions        United States Plans


International PlansPension Benefits


Other Benefits


Pension Benefits2007


2006


2007


2006


2007


2006Change in Benefit
    Obligation:Benefit obligation at beginning of
    year

$
200.6


$
193.8


$
191.8


$
191.8


$
144.6


$
142.2Service cost


1.0



1.0



0.1



0.1



0.8



0.7Interest cost


11.1



10.7



10.6



10.6



6.1



6.6Employee contributions


















0.2



0.2Actuarial loss/(gain)


(7.3
)


13.5



(14.3
)


5.9



(10.8
)


13.4Adjustments


















5.2



Benefits and expenses paid


(16.1
)


(18.4
)


(15.8
)


(16.6
)


(8.5
)


(8.2
)Exchange rate changes


















9.2



(10.3
)Benefit obligation at end of year

$
189.3


$
200.6


$
172.4


$
191.8


$
146.8


$
144.6   61




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  United States Plans


International PlansPension Benefits


Other Benefits


Pension Benefits2007


2006


2007


2006


2007


2006Change in Plan
    Assets:Fair value of plan assets at
    beginning of year

$
136.7


$
123.3


$



$



$
11.1


$
10.5Actual return on plan assets


16.9



20.8











1.1



1.2Company contributions


15.9



11.0











8.6



7.9Employee contributions


















0.2



0.2Adjustments


















2.4



Benefits paid and plan expenses


(16.1
)


(18.4
)










(8.5
)


(8.2
)Exchange rate changes


















(0.3
)


(0.5
)Fair value of plan assets at end
    of year

$
153.4


$
136.7


$



$



$
14.6


$
11.1Funded Status:Funded status of plan

$
(35.9
)

$
(63.9
)

$
(172.4
)

$
(191.8
)

$
(132.2
)

$
(133.5
)Unrecognized net actuarial (gain)
    loss






(1.9
)






(6.7
)






14.8Company contributions


3.1



3.4



3.5



3.2







Net amount recognized

$
(32.8
)

$
(62.4
)

$
(168.9
)

$
(195.3
)

$
(132.2
)

$
(118.7
)Net Liability
    Recognized:Current liabilities


(0.2
)


(15.9
)


(14.9
)


(14.7
)


(7.9
)


Noncurrent liabilities


(32.6
)


(46.5
)


(154.0
)


(180.6
)


(124.3
)


(134.3
)Net amount recognized

$
(32.8
)

$
(62.4
)

$
(168.9
)

$
(195.3
)

$
(132.2
)

$
(134.3
)AOCI Recognized:Net actuarial gain, net of tax


(15.3
)


N/A



(20.7
)


N/A



(0.2
)


N/AMinimum pension liability, net of
    tax


















4.6



9.5Net amount recognized

$
(15.3
)

$



$
(20.7
)

$



$
4.4


$
9.5     United States PlansPension Benefits


Other Benefits2007


2006


2005


2007


2006


2005Components of net periodic
    benefit cost (income):Service cost

$
1.0


$
1.0


$
0.2


$
0.1


$
0.1


$
0.1Interest cost


11.1



10.7



11.2



10.6



10.6



10.7Expected return on plan assets


(10.7
)


(9.4
)


(9.6
)










Net amortization and deferral














(0.2
)






(1.2
)Net benefit cost

$
1.4


$
2.3


$
1.8


$
10.5


$
10.7


$
9.6   62




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  International Plans  Pension Benefits2007


2006


2005Components of net periodic
    benefit cost (income):Service cost

$
0.8


$
0.7


$
0.7Interest cost


6.1



6.6



6.8Expected return on plan assets


(0.5
)


(0.5
)


(2.1
)Net amortization and deferral


0.2



0.1



Net benefit cost

$
6.6


$
6.9


$
5.4     Before





AfterApplication





Applicationof SFAS 158


Adjustments


of SFAS 158Pension liability

$
(370.8
)

$
36.9


$
(333.9
)Deferred tax asset


11.4



(0.7
)


10.7Accumulated other comprehensive
    income


(120.2
)


(36.2
)


(156.4
)     United States Plans


International PlansPension Benefits


Other Benefits


Pension Benefits2007


2006


2007


2006


2007


2006Weighted average
    assumptions:Discount rate


5.75
%


5.75
%


5.75
%


5.75
%


4.21
%


5.00
%Expected return on plan assets


8.25
%


8.00
%


N/A



N/A



5.65
%


6.82
%Rate of compensation increase


N/A



N/A



N/A



N/A



2.75
%


2.50
%   1 2
    Expected
    Return on Assets
   63




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Plan
    Contributions
    Projected
    United States Benefit Payments
    2007


2008


2009


2010


2011


2012  2016


TotalPension plans

$
14.3


$
14.0


$
13.7


$
13.5


$
13.5


$
69.5


$
138.5Health care and life insurance
    benefit plans


14.9



15.1



15.2



15.0



14.7



64.6



139.5   Pension
    Benefit Asset Information
    2006


2005Asset Category:Domestic equity


46.0
%


54.4
%International equity


25.3
%


15.9
%Fixed income


26.3
%


26.8
%Other


2.4
%


2.9
%Total


100.0
%


100.0
%     
    Fixed income investments are oriented toward risk averse,
    investment grade securities. With the exception of
    U.S. Government securities, in which the plan may invest
    the entire fixed income allocation, fixed income investments are
    required to be diversified among individual securities and
    sectors. There is no limit on the maximum maturity of securities
    held. Short sales, margin purchases and similar speculative
    transactions are prohibited.
    Equity investments are diversified among capitalization and
    style and are required to be diversified among industries and
    economic sectors. Limitations are placed on the overall
    allocation to any individual security. Short sales, margin
    purchases, and similar speculative transactions are prohibited.    Policy Target


Policy RangeAsset Class:Domestic equity


45.0
%


35-75
%International equity


25.0
%


25-30
%Fixed income


30.0
%


25-35
%  64




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Medicare
    Prescription Drug, Improvement, and Modernization
    Act
  106-2
  Other
    Benefits
    Note 13.
    Asset
    Impairments and Other Restructuring Charges    AutomotiveWheels


Components


Other


TotalFiscal 2006Facility closure costs

$
3.6


$



$



$
3.6Impairment of land, building,
    machinery, equipment, and tooling


16.8



15.6



0.5



32.9Severance and other restructuring
    costs


4.1



2.4



0.8



7.3Total

$
24.5


$
18.0


$
1.3


$
43.8Fiscal 2005Facility closure costs

$
3.3


$



$



$
3.3Impairment of land, building,
    machinery, equipment, and tooling


9.3



37.9







47.2Severance and other restructuring
    costs


5.0











5.0Total

$
17.6


$
37.9


$



$
55.5 65




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  AutomotiveWheels


Components


Other


TotalFiscal 2004Facility closure costs

$
4.8


$
(0.2
)

$



$
4.6Impairment of machinery,
    equipment, and tooling


2.2











2.2Severance and other restructuring
    costs


1.4







0.4



1.8Total

$
8.4


$
(0.2
)

$
0.4


$
8.6   Asset
    Impairment Losses and Other Restructuring Charges for the Year
    Ended January 31, 2007
    Automotive Wheels:
    Components: reduction-in-force
  Other:
  Asset
    Impairment Losses and Other Restructuring Charges for the Year
    Ended January 31, 2006
    Automotive Wheels:
  Components:
 66




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Asset
    Impairment Losses and Other Restructuring Charges for the Year
    Ended January 31, 2005
    Automotive Wheels:
  Components:
  Other:
  Severance
    and Other Restructuring Accrued Expense
    Cash Paymentsand EffectsJanuary 31,


Amounts


of Foreign


January 31,2006


Accrued


Currency


2007Facility exit costs

$



$
3.6


$
(3.6
)

$
Severance and other restructuring
    charges


0.4



7.3



(6.7
)


1.0$
0.4


$
10.9


$
(10.3
)

$
1.0   Note 14.
    Commitments
    and Contingencies  Legal
    Proceedings
     67




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
             68




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
               69




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   Leases
    Fiscal Year

Capital


Operating2008

$
1.0


$
6.62009






4.32010






2.42011






0.52012 and later years






0.6Total minimum payments required

$
1.0


$
14.4Less amount representing interest


Present value of net minimum
    capital lease payments


1.0Less current installments of
    obligations under capital leases


(1.0
)Obligations under capital leases,
    excluding current installments

$
     Note 15.  Taxes
    on Income
    2006


2005


2004U.S. income

$
(120.2
)

$
(112.9
)

$
(78.4
)Foreign income


48.8



(168.4
)


69.9Total

$
(71.4
)

$
(281.3
)

$
(8.5
)     2006


2005


2004Current:Federal

$
0.2


$
0.2


$
State and local


1.6



1.0



1.3Foreign


31.5



22.8



24.8$
33.3


$
24.0


$
26.1Deferred:Federal

$



$
(6.5
)

$
(1.4
)State and local


0.6



(0.7
)


Foreign


5.3



(18.2
)


(8.0
)5.9



(25.4
)


(9.4
)Income tax (benefit) expense

$
39.2


$
(1.4
)

$
16.7  70




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        2006


2005


2004Federal tax expense (benefit)
    computed at statutory rate

$
(25.0
)

$
(98.4
)

$
(3.0
)Increase (decrease) resulting from:State taxes


1.8



0.5



0.9Goodwill impairment


(0.1
)


69.2



Non-deductible expenses


3.3



2.3



2.5Foreign statutory tax rate
    differential


(22.9
)


(12.0
)


(7.0
)Change in foreign tax rates


0.2



0.4



(0.6
)Tax holidays


(3.1
)


(4.3
)


(5.1
)Loss (gain) on sale of subsidiary
    stock


6.2



(0.6
)


Intercompany financing


(3.0
)


(4.8
)


(4.3
)Tax exempt income


(0.1
)


(0.3
)


(2.8
)Parent taxation of subsidiary
    earnings


1.4



0.8



2.3Change in valuation allowance


80.4



50.5



34.2All other items


0.1



(4.7
)


(0.4
)Income tax (benefit) expense

$
39.2


$
(1.4
)

$
16.7      71




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2006


2005Deferred tax assets attributable
    to:Accrued liabilities

$
19.2


$
22.7Operating loss carryforwards


215.9



173.8Property, plant, and equipment


45.7



40.1Pension


54.3



59.0Inventories


8.4



6.1Other


2.8



8.3Total gross deferred tax assets


346.3



310.0Less valuation allowance


(291.4
)


(236.3
)Net deferred tax assets

$
54.9


$
73.7Deferred tax liabilities
    attributable to:Property, plant, and equipment

$
(43.5
)

$
(48.9
)Intangible assets


(57.2
)


(60.5
)Intercompany notes


(8.3
)


(2.9
)Other


(3.9
)


(7.4
)Total gross deferred tax
    liabilities


(112.9
)


(119.7
)Net deferred tax liabilities

$
(58.0
)

$
(46.0
)     2006


2005Current assets

$
3.2


$
3.5Current liabilities


(1.4
)


(0.8
)Non current assets


7.5



14.0Non current liabilities


(67.3
)


(62.7
)Net deferred tax liabilities

$
(58.0
)

$
(46.0
)        72




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Note 16.
    Investments
    in Joint Ventures    Note 17.
    Stock
    Based Benefit Plans     73




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
           74




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     WeightedNumber of


AverageShares


Exercise PriceOutstanding at January 31,
    2004


1,876,646


$
13.98Granted


150,657



13.11Exercised






Canceled


(183,163
)


13.96Outstanding at January 31,
    2005


1,844,140


$
13.91Granted


78,581



5.88Exercised






Canceled


(200,486
)


13.90Outstanding at January 31,
    2006


1,722,235


$
13.54Granted






Exercised






Canceled


(387,596
)


13.79Outstanding at January 31,
    2007


1,334,639


$
13.47Balance vested at:January 31, 2005


467,861


$
13.97January 31, 2006


1,722,235



13.54January 31, 2007


1,334,639



13.47     Outstanding


ExercisableWeighted


Weighted





WeightedAverage


Average





AverageNumber of Shares


Remaining


Exercise


Number of


ExerciseRange of Exercisable Prices:

Vested


Life


Price


Shares


Price$ 1.89 - $ 3.79


7,945



8.92


$
3.53



7,945


$
3.53$ 3.80 - $ 5.68


29,783



8.30



5.10



29,783



5.10$ 5.69 - $ 7.57


29,301



8.42



7.15



29,301



7.15$ 7.58 - $ 9.47


17,798



7.74



8.51



17,798



8.51$ 9.48 - $11.36


7,786



7.67



10.32



7,786



10.32$11.37 - $13.25


13,627



7.44



13.06



13,627



13.06$13.26 - $15.14


1,206,100



6.52



13.93



1,206,100



13.93$15.15 - $17.04


12,301



3.29



16.07



12,301



16.07$17.05 - $18.93


9,998



6.90



17.60



9,998



17.601,334,639



6.62


$
13.47



1,334,639


$
13.47  75




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    January 31, 2006


January 31, 2005Risk free interest rate


4.06-4.46
%


3.33-4.78
%Expected life


6.0



6.0Expected volatility


49.0
%


49.0
%Expected dividends


0
%


0
%     WeightedAverageNumber


Grant Dateof Shares


Fair ValueOutstanding at January 31,
    2004


1,467,043


$
13.98Granted


100,439



11.74Exercised


(132,872
)


13.94Forfeited


(129,943
)


13.52Outstanding at January 31,
    2005


1,304,667


$
13.86Granted


507,238



6.53Exercised


(281,346
)


9.78Forfeited


(172,854
)


12.49Outstanding at January 31,
    2006


1,357,705


$
12.14Granted


921,500



2.94Exercised


(371,074
)


12.38Forfeited


(231,132
)


12.11Outstanding at January 31,
    2007


1,676,999


$
7.03       Note 18.
    Prior
    Period Accounting Errors     76




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Impact on BasicImpact on


and Diluted NetInterim Period

Net Loss


Loss per SharePredecessorThree Months Ended April 30,
    2003

$
(0.3
)One Month Ended May 31, 2003


Four Months Ended May 31, 2003

$
(0.3
)SuccessorTwo Months Ended July 31, 2003

$
(0.2
)

$
(0.01
)Three Months Ended
    October 31, 2003


(0.3
)


(0.01
)Three Months Ended
    January 31, 2004


(0.3
)


(0.01
)Eight Months Ended
    January 31, 2004

$
(0.8
)

$
(0.03
)Three Months Ended April 30,
    2004

$
(0.3
)

$
(0.01
)Three Months Ended July 31,
    2004


(0.3
)


(0.01
)Three Months Ended
    October 31, 2004


(0.3
)


(0.01
)Three Months Ended
    January 31, 2005


(0.4
)


(0.01
)Year Ended January 31, 2005

$
(1.3
)

$
(0.04
)Three Months Ended April 30,
    2005

$
(0.7
)

$
(0.02
)Three Months Ended July 31,
    2005


3.1



0.08Six Months Ended July 31, 2005

$
2.4


$
0.06       77




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Impact on BasicImpact on


and Diluted NetInterim Period

Net Loss


Loss per SharePredecessorThree Months Ended April 30,
    2003

$
One Month Ended May 31, 2003


(0.1
)Four Months Ended May 31, 2003

$
(0.1
)SuccessorTwo Months Ended July 31, 2003

$
(0.4
)

$
(0.01
)Three Months Ended
    October 31, 2003


(0.1
)


Three Months Ended
    January 31, 2004


(0.3
)


(0.01
)Eight Months Ended
    January 31, 2004

$
(0.8
)

$
(0.02
)   Note 19.
    Minority
    Interest in Equity of Consolidated Subsidiaries        January 31, 2007


January 31, 2006Minority interest in consolidated
    affiliates

$
44.8


$
35.1Minority interest in preferred
    stock


12.5



12.1   Note 20.
    Off
    Balance Sheet Arrangements     78




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          Note 21.  Segment
    Information
         79




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Year EndedJanuary 31,


January 31,


January 31,2007


2006


2005Revenues:Automotive Wheels

$
1,671.6


$
1,594.4


$
1,440.6Components


384.6



362.1



332.8Total

$
2,056.2


$
1,956.5


$
1,773.4Earnings (loss) from
    operations:Automotive Wheels

$
53.3


$
(150.4
)

$
63.4Components


(26.8
)


(35.0
)


3.6Other


(19.9
)


(29.8
)


(18.0
)Total

$
6.6


$
(215.2
)

$
49.0Depreciation and
    amortization:Automotive Wheels

$
99.0


$
105.9


$
110.2Components


18.7



24.4



24.8Other


4.7



4.7



2.9Total

$
122.4


$
135.0


$
137.9Capital expenditures:Automotive Wheels

$
65.4


$
78.6


$
91.6Components


14.4



16.0



25.6Other


1.0



0.6



9.0Total

$
80.8


$
95.2


$
126.2     January 31,


January 31,2007


2006Total assets:Automotive Wheels

$
1,336.6


$
1,247.7Components


192.0



321.5Other


162.6



230.0Total

$
1,691.2


$
1,799.2Goodwill:Automotive Wheels

$
210.0


$
197.8Components






Other






Total

$
210.0


$
197.8  80




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Year EndedJanuary 31,


January 31,


January 31,2007


2006


2005Revenues:United States

$
562.1


$
595.8


$
569.8Germany


268.7



231.8



198.7Other foreign countries


1,225.4



1,128.9



1,004.9Total

$
2,056.2


$
1,956.5


$
1,773.4     Customer
    Concentration
    TotalYear Ended January 31,
    2007Ford Motor Company


18.7
%General Motors Corporation


15.4
%DaimlerChrysler


14.3
%48.4
%Year Ended January 31,
    2006Ford Motor Company


17.8
%General Motors Corporation


16.2
%DaimlerChrysler


13.8
%47.8
%Year Ended January 31,
    2005Ford Motor Company


16.2
%DaimlerChrysler


14.9
%General Motors Corporation


13.5
%44.6
%  81




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Note 22.
    Selected
    Quarterly Financial Data (Unaudited)    Quarter


Quarter


Quarter


QuarterEnded


Ended


Ended


EndedJanuary 31,


October 31,


July 31,


April 30,2007


2006


2006


2006Net sales

$
501.1


$
533.7


$
517.9


$
503.5Gross profit


36.8



50.9



51.0



46.9Loss from continuing operations
    before cumulative effect of change in accounting principle


(58.1
)


(16.0
)


(27.9
)


(17.1
)Net loss


(62.8
)


(59.6
)


(26.9
)


(17.6
)Basic and diluted net loss per
    share from continuing operations before cumulative effect of
    change in accounting principle


(1.51
)


(0.42
)


(0.73
)


(0.45
)Basic and diluted net loss per
    share


(1.64
)


(1.55
)


(0.70
)


(0.46
)   Quarter


Quarter


Quarter


QuarterEnded


Ended


Ended


EndedJanuary 31,


October 31,


July 31,


April 30,2006(1)


2005


2005


2005Net sales

$
464.6


$
520.0


$
477.7


$
494.2Gross profit


29.1



52.1



35.7



52.1Loss from continuing operations
    before cumulative effect of change in accounting principle


(239.4
)


(8.9
)


(31.7
)


(7.1
)Net loss


(366.1
)


(13.4
)


(70.3
)


(7.7
)Basic and diluted net loss per
    share from continuing operations before cumulative effect of
    change in accounting principle


(6.30
)


(0.23
)


(0.84
)


(0.19
)Basic and diluted net loss per
    share


(9.64
)


(0.35
)


(1.85
)


(0.20
)     (1)
    
    The fourth quarter of fiscal 2005 includes:  
    Goodwill impairment of $185.5 million (see Note 8,
    Goodwill and Other Intangible Assets)
    Impairments of $117.1 million for the Suspension business
    (see Note 7, Discontinued Operations)
    Impairments of $32.5 million for international components
    (see Note 13, Asset Impairments and Other
    Restructuring Charges)  Note 23.
    Common
    Stock Offering    Note 24.
    Condensed
    Consolidated Financial Statements   82




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     Guarantor
    and Nonguarantor Financial Statements
   83




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    CONSOLIDATED STATEMENTS OF OPERATIONS
  For the
    Year Ended January 31, 2007
  Guarantor


NonguarantorParent


Issuer


Subsidiaries


Subsidiaries


Eliminations


Total(Dollars in millions)Net sales

$



$
0.3


$
562.9


$
1,532.6


$
(39.6
)

$
2,056.2Cost of goods sold


0.2



18.0



549.3



1,343.1



(40.0
)


1,870.6Gross profit (loss)


(0.2
)


(17.7
)


13.6



189.5



0.4



185.6Marketing, general, and
    administrative






2.6



49.7



85.0







137.3Equity in (earnings) losses of
    subsidiaries and joint ventures


166.7



96.7



(0.8
)






(262.6
)


Asset impairments and other
    restructuring charges






3.3



12.7



27.8







43.8Other (income) expense, net






(5.0
)


0.4



0.4



2.1



(2.1
)(Loss) earnings from operations


(166.9
)


(115.3
)


(48.4
)


76.3



260.9



6.6Interest expense (income), net






49.9



(0.1
)


26.4







76.2(Loss) earnings from continuing
    operations before taxes on income and minority interest


(166.9
)


(165.2
)


(48.3
)


49.9



260.9



(69.6
)Income tax expense






1.5



0.7



37.0







39.2(Loss) earnings from continuing
    operations before minority interest


(166.9
)


(166.7
)


(49.0
)


12.9



260.9



(108.8
)Minority interest














10.3







10.3(Loss) earnings from continuing
    operations


(166.9
)


(166.7
)


(49.0
)


2.6



260.9



(119.1
)(Loss) earnings from discontinued
    operations, net of tax










(51.5
)


3.7







(47.8
)Net (loss) income

$
(166.9
)

$
(166.7
)

$
(100.5
)

$
6.3


$
260.9


$
(166.9
)  84




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    CONSOLIDATED STATEMENTS OF OPERATIONS
  For the
    Year Ended January 31, 2006
  Guarantor


NonguarantorParent


Issuer


Subsidiaries


Subsidiaries


Eliminations


Total(Dollars in millions)Net sales

$



$
3.4


$
610.9


$
1,378.5


$
(36.3
)

$
1,956.5Cost of goods sold


0.2



23.5



588.0



1,212.1



(36.3
)


1,787.5Gross (loss) profit


(0.2
)


(20.1
)


22.9



166.4







169.0Marketing, general, and
    administrative






3.7



52.9



77.3







133.9Equity in losses (earnings) of
    subsidiaries and joint ventures


457.8



400.6



(2.2
)






(856.2
)


Asset impairments and other
    restructuring charges






1.5



17.7



221.8







241.0Other expense (income), net






3.7



(3.4
)


9.0







9.3(Loss) earnings loss from
    operations


(458.0
)


(429.6
)


(42.1
)


(141.7
)


856.2



(215.2
)Interest (income) expense, net


(0.5
)


38.5



0.5



26.8







65.3Other non-operating expense






(0.7
)






1.5







0.8(Loss) earnings from continuing
    operations before taxes on income and minority interest


(457.5
)


(467.4
)


(42.6
)


(170.0
)


856.2



(281.3
)Income tax (benefit) expense






(5.8
)


(0.1
)


4.5







(1.4
)(Loss) earnings from continuing
    operations before minority interest


(457.5
)


(461.6
)


(42.5
)


(174.5
)


856.2



(279.9
)Minority interest














7.2







7.2(Loss) earnings from continuing
    operations


(457.5
)


(461.6
)


(42.5
)


(181.7
)


856.2



(287.1
)(Loss) income from discontinued
    operations, net of tax










(167.8
)


(2.6
)






(170.4
)Net (loss) income

$
(457.5
)

$
(461.6
)

$
(210.3
)

$
(184.3
)

$
856.2


$
(457.5
)  85




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    CONSOLIDATED STATEMENTS OF OPERATIONS
  For the
    Year Ended January 31, 2005
  Guarantor


NonguarantorParent


Issuer


Subsidiaries


Subsidiaries


Eliminations


Total(Dollars in millions)Net sales

$



$
3.1


$
580.4


$
1,217.5


$
(27.6
)

$
1,773.4Cost of goods sold






25.3



543.1



1,046.1



(27.2
)


1,587.3Gross (loss) profit






(22.2
)


37.3



171.4



(0.4
)


186.1Marketing, general, and
    administrative






3.6



52.4



68.8







124.8Equity in losses (earnings) of














subsidiaries and joint ventures


70.0



7.9



(4.0
)






(73.9
)


Asset impairments and other
    restructuring charges






1.0



5.1



2.5







8.6Other (income) expense, net






(1.3
)


(1.2
)


4.7



1.5



3.7(Loss) Earnings from operations


(70.0
)


(33.4
)


(15.0
)


95.4



72.0



49.0Interest (income) expense, net


(7.7
)


23.8



0.4



27.1







43.6Other non-operating expense






0.8







0.9







1.7Loss on early extinguishment of
    debt






12.2















12.2(Loss) Earnings from continuing
    operations before taxes on income and minority interest


(62.3
)


(70.2
)


(15.4
)


67.4



72.0



(8.5
)Income tax expense (benefit)






0.7



(0.8
)


16.8







16.7(Loss) earnings from continuing
    operations before minority interest


(62.3
)


(70.9
)


(14.6
)


50.6



72.0



(25.2
)Minority interest














9.1







9.1Loss from continuing operations
    before cumulative effect of change in accounting principle


(62.3
)


(70.9
)


(14.6
)


41.5



72.0



(34.3
)Income from discontinued
    operations, net of tax










(27.1
)


(3.5
)






(30.6
)Cumulative effect of change in
    accounting principle














2.6







2.6Net (loss) income

$
(62.3
)

$
(70.9
)

$
(41.7
)

$
40.6


$
72.0


$
(62.3
)  86




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    CONSOLIDATED BALANCE SHEETS
  As of
    January 31, 2007
  Guarantor


NonguarantorParent


Issuer


Subsidiaries


Subsidiaries


Eliminations


Total(Dollars in millions)Cash and cash equivalents

$



$
(0.7
)

$
0.5


$
38.6


$



$
38.4Receivables






(80.6
)


60.6



278.5







258.5Other receivables






43.2















43.2Inventories






0.4



48.5



123.9







172.8Prepaid expenses and other






3.1



52.2



12.4







67.7Total current assets






(34.6
)


161.8



453.4







580.6Property, plant, and equipment, net






30.0



123.8



526.9







680.7Goodwill and other assets


102.3



765.0



(115.6
)


381.6



(703.4
)


429.9Total assets

$
102.3


$
760.4


$
170.0


$
1,361.9


$
(703.4
)

$
1,691.2Bank borrowings and other notes

$



$



$



$
27.9


$



$
27.9Current portion of long-term debt






4.6



1.1



1.0







6.7Accounts payable and accrued
    liabilities






48.3



59.8



296.2







404.3Total current liabilities






52.9



60.9



325.1







438.9Long-term debt, net of current
    portion






657.1







2.3







659.4Pension and other long-term
    liabilities






199.5



0.8



233.5







433.8Minority interest






12.5







44.8







57.3Parent loans


0.5



(176.6
)


(20.5
)


199.1



(2.5
)


Common stock


0.4



















0.4Additional paid-in capital


678.6



688.3



525.8



569.1



(1,783.2
)


678.6Retained earnings (accumulated
    deficit)


(733.6
)


(716.4
)


(406.0
)


(115.8
)


1,238.2



(733.6
)Accumulated other comprehensive
    income (loss)


156.4



43.1



9.0



103.8



(155.9
)


156.4Total stockholders equity


101.8



15.0



128.8



557.1



(700.9
)


101.8Total liabilities and
    stockholders equity

$
102.3


$
760.4


$
170.0


$
1,361.9


$
(703.4
)

$
1,691.2  87




---



##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    CONSOLIDATED BALANCE SHEETS
  As of
    January 31, 2006
  Guarantor


NonguarantorParent


Issuer


Subsidiaries


Subsidiaries


Eliminations


Total(Dollars in millions)Cash and cash equivalents

$



$
(4.1
)

$
0.6


$
45.8


$



$
42.3Receivables






(112.1
)


87.5



241.1







216.5Other receivables






101.0















101.0Inventories






1.3



46.8



112.4







160.5Prepaid expenses and other






4.7



117.9



10.2







132.8Total current assets






(9.2
)


252.8



409.5







653.1Property, plant, and equipment, net






34.1



130.7



550.6







715.4Goodwill and other assets


183.5



840.6



(110.3
)


384.5



(867.6
)


430.7Total assets

$
183.5


$
865.5


$
273.2


$
1,344.6


$
(867.6
)

$
1,799.2Bank borrowings and other notes

$



$



$
1.0


$
24.5


$



$
25.5Current portion of long-term debt






4.6







11.6







16.2Accounts payable and accrued
    liabilities






68.7



88.6



229.1







386.4Total current liabilities






73.3



89.6



265.2







428.1Long-term debt, net of current
    portion






661.7



(0.1
)


7.1







668.7Pension and other long-term
    liabilities






236.6



0.6



234.7







471.9Minority interest






12.1







35.1







47.2Parent loans


0.2



(265.3
)


(30.4
)


292.3



3.2



Common stock


0.4



















0.4Additional paid-in capital


675.9



685.6



519.0



570.6



(1,775.2
)


675.9Retained earnings (accumulated
    deficit)


(566.3
)


(549.3
)


(305.5
)


(122.1
)


976.9



(566.3
)Accumulated other comprehensive
    income (loss)


73.3



10.8







61.7



(72.5
)


73.3Total stockholders equity


183.3



147.1



213.5



510.2



(870.8
)


183.3Total liabilities and
    stockholders equity

$
183.5


$
865.5


$
273.2


$
1,344.6


$
(867.6
)

$
1,799.2  88




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##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    CONSOLIDATED STATEMENTS OF CASH FLOWS
  For the
    Year Ended January 31, 2007
  Guarantor


NonguarantorParent


Issuer


Subsidiaries


Subsidiaries


Eliminations


Total(Dollars in millions)Cash flows (used for) provided by
    operating activities

$



$
(52.8
)

$
(14.3
)

$
150.2


$



$
83.1Cash flows from investing
    activities:Purchase of property, plant,
    equipment, and tooling






(1.1
)


(17.4
)


(62.3
)






(80.8
)Proceeds from sale of assets










2.4



7.8







10.2Capital contributed by minority
    shareholders














0.4







0.4Cash used for investing activities






(1.1
)


(15.0
)


(54.1
)






(70.2
)Cash flows from financing
    activities:Changes in bank borrowings and
    credit facilities










(1.0
)


1.6







0.6(Repayment) borrowings of
    long-term debt






(4.6
)


1.1



(16.7
)






(20.2
)Dividends to minority shareholders














(1.8
)






(1.8
)Bank finance fees paid






(2.9
)














(2.9
)Cash (used for) provided by
    financing activities






(7.5
)


0.1



(16.9
)






(24.3
)Increase (decrease) in parent
    loans and advances






64.8



27.8



(92.6
)






Net cash provided by discontinued
    operations










1.3



3.8







5.1Effect of exchange rates on cash
    and cash equivalents














2.4







2.4Increase (decrease) in cash and
    cash equivalents






3.4



(0.1
)


(7.2
)






(3.9
)Cash and cash equivalents at
    beginning of period






(4.1
)


0.6



45.8







42.3Cash and cash equivalents at end
    of period

$



$
(0.7
)

$
0.5


$
38.6


$



$
38.4  89




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##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    CONSOLIDATED STATEMENTS OF CASH FLOWS
  For the
    Year Ended January 31, 2006
  Guarantor


NonguarantorParent


Issuer


Subsidiaries


Subsidiaries


Eliminations


Total(Dollars in millions)Cash flows (used for) provided by
    operating activities

$



$
(113.4
)

$
(30.2
)

$
104.6


$



$
(39.0
)Cash flows from investing
    activities:Purchase of property, plant,
    equipment, and tooling






(0.5
)


(28.6
)


(66.1
)






(95.2
)Purchase of businesses, net of
    cash acquired














(4.9
)






(4.9
)Proceeds from disposal of assets
    and businesses






16.0















16.0Cash used for investing activities






15.5



(28.6
)


(71.0
)






(84.1
)Cash flows from financing
    activities:Changes in bank borrowings and
    credit facility










1.0



23.8







24.8Repayment of Term Loan B, net
    of






















related fees






(94.9
)














(94.9
)Borrowings from Term Loan C






150.0















150.0Repayment of long term debt










(8.3
)


(1.9
)






(10.2
)Dividends paid to minority
    shareholders














(3.6
)






(3.6
)Cash provided by financing
    activities






55.1



(7.3
)


18.3







66.1Increase (decrease) in parent
    loans and advances






8.4



40.7



(49.1
)






Net cash provided by discontinued
    operations






39.6



26.2



0.7







66.5Effect of exchange rates on cash
    and cash equivalents














(2.1
)






(2.1
)Increase in cash and cash
    equivalents






5.2



0.8



1.4







7.4Cash and cash equivalents at
    beginning of period






(9.3
)


(0.2
)


44.4







34.9Cash and cash equivalents at end
    of period

$



$
(4.1
)

$
0.6


$
45.8


$



$
42.3  90




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##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  CONDENSED
    CONSOLIDATED STATEMENTS OF CASH FLOWS
  For the
    Year Ended January 31, 2005
  Guarantor


NonguarantorParent


Issuer


Subsidiaries


Subsidiaries


Eliminations


Total(Dollars in millions)Cash flows (used for) provided by
    operating activities

$



$
(0.9
)

$
10.0


$
163.1


$



$
172.2Cash flows from investing
    activities:Purchase of property, plant,
    equipment, and tooling






(6.5
)


(30.9
)


(88.8
)






(126.2
)Proceeds from sale of assets






0.3



0.4











0.7Cash used for investing activities






(6.2
)


(30.5
)


(88.8
)






(125.5
)Cash flows from financing
    activities:Changes in bank borrowings and
    credit facility














(0.7
)






(0.7
)Net proceeds from issuance of
    common stock


117.0



















117.0Capital contribution


(117.0
)


117.0















Redemption of Senior Notes, net of
    discount and related fees






(96.7
)














(96.7
)Redemption of Term Loan C,
    net of related fees






(16.0
)














(16.0
)Repayment of long-term debt






(4.2
)






(13.3
)






(17.5
)Repayment of notes payable issued
    in connection with purchases of businesses














(13.1
)






(13.1
)Cash provided by (used for)
    financing activities






0.1







(27.1
)






(27.0
)Increase (decrease) in parent
    loans and advances






0.9



57.7



(58.6
)






Net cash used for discontinued
    operations










(36.8
)


(3.6
)






(40.4
)Effect of exchange rates on cash
    and cash equivalents














5.7







5.7Increase (decrease) in cash and
    cash equivalents






(6.1
)


0.4



(9.3
)






(15.0
)Adjustment for the elimination of
    the one month lag














1.4







1.4Cash and cash equivalents at
    beginning of period






(3.2
)


(0.6
)


52.3







48.5Cash and cash equivalents at end
    of period

$



$
(9.3
)

$
(0.2
)

$
44.4


$



$
34.9  91




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##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Note 25.
    Subsequent
    Events  Rights
    Offering
        Sale
    of our Suspension Business
   92




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##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  a.
    Evaluation
    of Disclosure Controls and Procedures    b.
    Managements
    Annual Report on Internal Control over Financial
    Reporting  Rule 13a-15(f).
        c.
    Changes
    in Internal Control Over Financial Reporting    d.
    Report of
    Independent Registered Public Accounting Firm     ,
 93




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##### Table of Contents



Internal Control  Integrated
    Framework
        Internal Control 
    Integrated Framework Internal Control 
    Integrated Framework
    
     Item 9B.
    Other
    Information   94




---



##### Table of Contents



PART III  Item 10.
    Directors
    and Executive Officers of the Registrant    Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    Item 13.
    Certain
    Relationships and Related Transactions    Item 14.
    Principal
    Accountant Fees and Services   PART IV  Item 15.
    Exhibits,
    Financial Statement Schedules  Financial Statement Schedule
      Exhibits
  2
.1

Modified First Amended Joint Plan
    of Reorganization of Hayes Lemmerz International, Inc. and Its
    Affiliated Debtors and Debtors in Possession, as Further
    Modified (incorporated by reference to Exhibit 2.1 to our
    Current Report on
    Form 8-K,
    filed May 21, 2003).2
.2

Agreement and Plan of Merger,
    dated as of June 3, 2003, by and between Hayes Lemmerz
    International, Inc. and HLI Operating Company, Inc.
    (incorporated by reference to Exhibit 2.3 to our Current
    Report on
    Form 8-K
    filed, June 3, 2003).2
.3

Equity Purchase and Commitment
    Agreement, dated as of March 16, 2007, by and between Hayes
    Lemmerz International, Inc. and Deutsche Bank Securities, Inc.
    (incorporated by reference to Exhibit 99.2 to our Current
    Report on
    Form 8-K,
    filed March 16, 2007).3
.1

Certificate of Incorporation of
    HLI Holding Company, Inc., effective as of May 6, 2003
    (incorporated by reference to Exhibit 3.1 to our
    Form 8-A/A,
    filed June 4, 2003).3
.2

Amendment to the Certificate of
    Incorporation of HLI Holding Company, Inc., effective as of
    June 3, 2003 (incorporated by reference to Exhibit 3.2
    to our
    Form 8-A/A,
    filed June 4, 2003).3
.3

By-Laws of Hayes Lemmerz
    International, Inc. (formerly known as HLI Holding Company,
    Inc.), effective as of May 30, 2003 (incorporated by
    reference to Exhibit 3.3 to our
    Form 8-A/A,
    filed June 4, 2003). 95




---



##### Table of Contents



4
.1

Purchase Agreement, dated as of
    May 22, 2003, by and between Hayes Lemmerz International,
    Inc., its subsidiaries named therein, and the Initial Purchasers
    of the $250,000,000 of
    101/2% Senior
    Notes due 2010 to be issued by HLI Operating Company, Inc.
    (incorporated by reference to Exhibit 4.1 to our Quarterly
    Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.2

Indenture, dated as of
    June 3, 2003, regarding $250,000,000 of
    101/2% Senior
    Notes due 2010, by and between HLI Operating Company, certain
    listed Guarantors, and U.S. Bank National Association, as
    Trustee (incorporated by reference to Exhibit 4.2 to our
    Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.3

Form of
    101/2% Senior
    Notes due 2010 (attached as Exhibit A to the Indenture
    filed as Exhibit 4.2 to our Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.4

First Supplemental Indenture,
    dated as of June 19, 2003, by and between HLI Operating
    Company, Inc. certain listed Guarantors, and U.S. Bank
    National Association, as Trustee (incorporated by reference to
    Exhibit 4.2 to our Registration statement
    No. 333-107539
    on
    Form S-4,
    filed on July 31, 2003, as amended).4
.5

Registration Rights Agreement,
    dated as of June 3, 2003, by and between HLI Operating
    Company, Inc. and the Initial Purchasers of the
    101/2% Senior
    Notes due 2010 (incorporated by reference to Exhibit 4.3 to
    our Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.6

Series B Warrant Agreement,
    dated as of June 2, 2003, by and between Hayes Lemmerz
    International, Inc. and Mellon Investor Services LLC, as Warrant
    Agent (incorporated by reference to Exhibit 4.2 to our
    Form 8-A,
    filed June 4, 2003).4
.7

Exchange Agreement, dated as of
    June 3, 2003, by and between Hayes Lemmerz International,
    Inc., HLI Parent Company, Inc. and HLI Operating Company, Inc.
    regarding the Series A Exchangeable Preferred Stock issued
    by HLI Operating Company, Inc. (incorporated by reference to
    Exhibit 4.3 to our Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.8

Registration Rights Agreement,
    dated as of July 1, 2004, by and between Hayes Lemmerz
    International, Inc., and AP Wheels, LLC (incorporated by
    reference to Exhibit 4.9 to our Quarterly Report on
    Form 10-Q
    for the quarterly period ended July 31, 2004, filed
    September 8, 2004).4
.9

Form of Subscription Rights
    Certificate (incorporated by reference to Exhibit 4.1 to
    our Registration Statement on
    Form S-3,
    filed March 16, 2007).4
.10

Form of Registration Rights
    Agreement, dated as of March 16, 2007, by and among Hayes
    Lemmerz International, Inc., Deutsche Bank Securities, Inc., and
    SPCP Group LLC (incorporated by reference to Exhibit 99.2
    to our Current Report on
    Form 8-K,
    filed March 16, 2007).4
.11

Form of Standstill and Director
    Nomination Agreement, to be entered by and between Hayes Lemmerz
    International, Inc. and Deutsche Bank Securities, Inc.
    (incorporated by reference to Exhibit 99.2 to our Current
    Report on
    Form 8-K,
    filed March 16, 2007).4
.12

Form of Standstill and Director
    Nomination Agreement, to be entered by and between Hayes Lemmerz
    International, Inc. and SPCP Group, LLC (incorporated by
    reference to Exhibit 99.2 to our Current Report on
    Form 8-K,
    filed March 16, 2007).10
.1

Form of Severance Agreement, dated
    June 15, 2000, between Hayes and certain of its officers
    (incorporated by reference from our Quarterly Report on
    Form 10-Q
    for the quarter ended October 31, 2000, filed on
    December 15, 2000).10
.2

Amended and Restated Employment
    Agreement between Hayes and Curtis J. Clawson, dated
    September 26, 2001 (incorporated by reference from our
    Quarterly Report on
    Form 10-Q
    for the quarter ended October 31, 2001, filed on
    April 18, 2002).10
.3

Form of Employment Agreement
    between Hayes and certain of its officers (incorporated by
    reference from our Quarterly Report on
    Form 10-Q
    for the quarter ended October 31, 2001, filed on
    April 18, 2002).10
.4

Hayes Lemmerz International, Inc.
    Long Term Incentive Plan (incorporated by reference to
    Exhibit 10.1 to our Registration Statement
    No. 333-110684
    on
    Form S-8,
    filed on November 21, 2003).10
.5

Hayes Lemmerz International, Inc.
    Critical Employee Retention Plan (incorporated by reference to
    Exhibit 10.2 to our Registration Statement
    No. 333-110684
    on
    Form S-8,
    filed on November 21, 2003).10
.6

Form of Directors Indemnification
    Agreement (incorporated by reference to Exhibit 10.49 to
    our Quarterly Report on
    Form 10-Q
    for the quarterly period ended July 31, 2003, filed
    September 15, 2003, as amended). 96




---



##### Table of Contents



10
.7

Amended and Restated Credit
    Agreement, dated as of April 11, 2005 by and among HLI
    Operating Company, Inc., as Borrower, Hayes Lemmerz
    International, Inc., the Lenders and Issuers listed therein,
    Citicorp North America, Inc., as First Lien Agent, Second Lien
    Agent and Collateral Agent, Lehman Commercial Paper, Inc., as
    Syndication Agent, and General Electric Capital Corporation, as
    Documentation Agent (incorporated by reference to
    Exhibit 10.1 to our Current Report on
    Form 8-K
    filed April 14, 2005).10
.8

Amended and Restated Guaranty
    dated as of April 11, 2005, by and among Hayes Lemmerz
    International, Inc., HLI Parent Company, Inc., the other
    Guarantors party thereto, and Citicorp North America, Inc., as
    Collateral Agent (incorporated by reference to Exhibit 10.2
    to the our current Report on
    Form 8-K
    filed April 14, 2005).10
.9

Amended and Restated Pledge and
    Security Agreement dated as of April 11, 2005, among Hayes
    Lemmerz International, Inc., HLI Operating Company, Inc., each
    other grantor from time to time party thereto, and Citicorp
    North America, Inc., as Collateral Agent (incorporated by
    reference to Exhibit 10.3 to the our current Report on
    Form 8-K
    filed April 14, 2005).10
.10

Intercreditor and Collateral
    Agency Agreement dated as of April 11, 2005, among Citicorp
    North America, Inc., as Administrative Agent for the first
    lien lenders, as Administrative Agent for the Term C lenders and
    as Collateral Agent, HLI Operating Company, Inc., Hayes Lemmerz
    International, Inc., and each other grantor party thereto
    (incorporated by reference to Exhibit 10.4 to our current
    Report on
    Form 8-K
    filed April 14, 2005).10
.11

Hayes Lemmerz International, Inc.
    Officer Bonus Plan (incorporated by reference to
    Exhibit 10.1 to our Current Report on
    Form 8-K
    dated June 17, 2005).10
.12

Award Agreement under Hayes
    Lemmerz International, Inc. Officer Bonus Plan (incorporated by
    reference to Exhibit 10.2 to our Current Report on
    Form 8-K
    dated June 17, 2005).10
.13

Amendment No. 1, Waiver and
    Consent to Amended and Restated Credit Agreement dated as of
    October 10, 2005 among HLI Operating Company, Inc., Hayes
    Lemmerz International, Inc. and Citicorp North America, Inc. as
    Administrative Agent on behalf of each Lender executing a
    Lender Consent (incorporated by reference to
    Exhibit 10.23 to our Quarterly Report on
    Form 10-Q
    filed on December 9, 2005).10
.14

Framework Agreement on the Ongoing
    Purchase of Receivables dated as of October 10, 2005 by and
    between Hayes Lemmerz Werke GmbH and MHB Financial Services
    GmbH & Co. KG (incorporated by reference to
    Exhibit 10.24 to our Quarterly Report on
    Form 10-Q
    filed on December 9, 2005).10
.15

Stock Purchase Agreement dated as
    of October 14, 2005 by and among HLI Operating Company,
    Inc., HLI Commercial Highway Holding Company, Inc., and Hayes
    Lemmerz International  Commercial Highway, Inc. and
    Precision Partners Holding Company, as amended by an Amendment
    to Stock Purchase Agreement dated November 11, 2005
    (incorporated by reference to Exhibit 10.25 to our
    Quarterly Report on
    Form 10-Q
    filed on December 9, 2005).10
.16

Amendment No. 2 to Amended
    and Restated Credit Agreement dated as of March 31, 2006
    among HLI Operating Company, Inc., Hayes Lemmerz International,
    Inc., and Citicorp North America, Inc. as Administrative Agent
    on behalf of each lender executing a Lender Consent
    (incorporated by reference to Exhibit 10.1 to our Current
    Report on
    Form 8-K
    filed on April 3, 2006).10
.17

Receivables Financing Agreement,
    dated as of May 30, 2006, among Hayes Funding II,
    Inc., the financial institutions from time to time party thereto
    (Lenders), Citicorp USA, Inc. as the program agent
    for the Lenders and HLI Operating Company, Inc., as servicer
    (incorporated by reference to Exhibit 10.1 to our Current
    Report on
    Form 8-K
    filed on June 5, 2006).10
.18

Originator Purchase Agreement,
    dated as of May 30, 2006, among Hayes Funding I, LLC,
    a Delaware limited liability company and the wholly-owned
    subsidiaries of the Company named therein as Originators
    (incorporated by reference to Exhibit 10.2 to our Current
    Report on
    Form 8-K
    filed on June 5, 2006).10
.19

Secondary Purchase Agreement,
    dated as of May 30, 2006, between Hayes Funding I,
    LLC, a Delaware limited liability company and Hayes
    Funding II, Inc., a Delaware corporation (incorporated by
    reference to Exhibit 10.3 to our Current Report on
    Form 8-K
    filed on June 5, 2006). 97




---



##### Table of Contents



10
.20*

First Amendment dated as of
    October 13, 2006 amending each of (i) Receivables
    Financing Agreement, dated as of May 30, 2006 among Hayes
    Funding II, Inc., the financial institutions from time to
    time party thereto, Citicorp USA, Inc., and HLI Operating
    Company, Inc., (ii) Originator Purchase Agreement, dated as
    of May 30, 2006), among Hayes Funding I, LLC, and the
    wholly-owned subsidiaries of the Company named therein as
    Originators and (iii) Secondary Purchase Agreement, dated
    as of May 30, 2006 among Hayes Funding II, Inc. and
    Hayes Funding I, LLC.10
.21*

Amendment No. 3, Waiver and
    Consent to Amended and Restated Credit Agreement dated as of
    February 9, 2007 among HLI Operating Company, Inc., Hayes
    Lemmerz International, Inc., and Citicorp North America,
    Inc. as Administrative Agent on behalf of each lender executing
    a Lender Consent.10
.22*

Second Amendment dated as of
    May 27, 2005 amending each of (i) Receivables
    Financing Agreement, dated as of May 30, 2006 (as amended
    October 13, 2006) among Hayes Funding II, Inc.,
    the financial institutions from time to time party thereto,
    Citicorp USA, Inc., and HLI Operating Company, Inc.,
    (ii) Originator Purchase Agreement, dated as of
    May 30, 2006 (as amended October 13, 2006), among
    Hayes Funding I, LLC, and the wholly-owned subsidiaries of
    the Company named therein as Originators and
    (iii) Secondary Purchase Agreement, dated as of
    May 30, 2006 (as amended October 13, 2006) among
    Hayes Funding II, Inc. and Hayes Funding I, LLC.14


Code of Ethics (incorporated by
    reference to Exhibit 10.8 to our Annual Report on
    Form 10-K
    filed on April 12, 2004).21


Hayes Subsidiaries.*23


Consent of Independent Registered
    Public Accounting Firm.*24


Powers of Attorney.31
.1

Certification of Curtis J.
    Clawson, Chairman of the Board, President and Chief Executive
    Officer, pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002.*31
.2

Certification of James A. Yost,
    Vice President, Finance, and Chief Financial Officer, pursuant
    to Section 302 of the Sarbanes-Oxley Act of 2002.*32
.1

Certification of Curtis J.
    Clawson, Chairman of the Board, President and Chief Executive
    Officer, Pursuant to 18 U.S.C. Section 1350, as
    Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.*32
.2

Certification of James A. Yost,
    Vice President, Finance, and Chief Financial Officer, Pursuant
    to 18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.*99
.1

Amended and Restated Certificate
    of Incorporation of HLI Operating Company, Inc., effective as of
    May 30, 2003 (incorporated by reference to Exhibit 4.3
    to our Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).     *
    
    Filed electronically herewith. 98




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##### Table of Contents



SIGNATURES      By:
    /s/  JAMES
    A. YOST   Vice President, Finance, and
 Chief Financial Officer
      Signature

Title

Date/s/  CURTIS
    J. CLAWSONCurtis
    J. Clawson

Chairman of the Board of
    Directors
    Chief Executive Officer,
    President and Director/s/  JAMES
    A. YOSTJames
    A. Yost

Vice President, Finance, and 
    Chief Financial Officer/s/  MARK
    A.
    BREBBERMANMark
    A. Brebberman

Corporate Controller/s/  WILLIAM
    C.
    CUNNINGHAM*William
    C. Cunningham

Director/s/  GEORGE
    T. HAYMAKER,
    JR.*George
    T. Haymaker, Jr.

Lead Director/s/  CYNTHIA
    FELDMANN*Cynthia
    Feldmann

Director/s/  MOHSEN
    SOHI*Mohsen
    Sohi

Director/s/  HENRY
    D.G.
    WALLACE*Henry
    D.G. Wallace

Director/s/  RICHARD
    F. WALLMAN*Richard
    F. Wallman

Director/s/  PATRICK
    C. CAULEY*Patrick
    C. CauleyAttorney-in-fact  99




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##### Table of Contents



HAYES
    LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
  SCHEDULE II 
    VALUATION AND QUALIFYING ACCOUNTS
  Year EndingJanuary 31,


January 31,


January 31,Allowance for Doubtful Accounts:

2007


2006


2005(Dollars in millions)Balance at beginning of year

$
4.1


$
4.0


$
5.5Additions charged to costs and
    expenses


0.5



2.3



3.2Deductions


(2.2
)


(2.2
)


(4.7
)Balance at end of year

$
2.4


$
4.1


$
4.0  100




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##### Table of Contents



EXHIBIT INDEX
  2
.1

Modified First Amended Joint Plan
    of Reorganization of Hayes Lemmerz International, Inc. and Its
    Affiliated Debtors and Debtors in Possession, as Further
    Modified (incorporated by reference to Exhibit 2.1 to our
    Current Report on
    Form 8-K,
    filed May 21, 2003).2
.2

Agreement and Plan of Merger,
    dated as of June 3, 2003, by and between Hayes Lemmerz
    International, Inc. and HLI Operating Company, Inc.
    (incorporated by reference to Exhibit 2.3 to our Current
    Report on
    Form 8-K
    filed, June 3, 2003).2
.3

Equity Purchase and Commitment
    Agreement, dated as of March 16, 2007, by and between Hayes
    Lemmerz International, Inc. and Deutsche Bank Securities, Inc.
    (incorporated by reference to Exhibit 99.2 to our Current
    Report on
    Form 8-K,
    filed March 16, 2007).3
.1

Certificate of Incorporation of
    HLI Holding Company, Inc., effective as of May 6, 2003
    (incorporated by reference to Exhibit 3.1 to our
    Form 8-A/A,
    filed June 4, 2003).3
.2

Amendment to the Certificate of
    Incorporation of HLI Holding Company, Inc., effective as of
    June 3, 2003 (incorporated by reference to Exhibit 3.2
    to our
    Form 8-A/A,
    filed June 4, 2003).3
.3

By-Laws of Hayes Lemmerz
    International, Inc. (formerly known as HLI Holding Company,
    Inc.), effective as of May 30, 2003 (incorporated by
    reference to Exhibit 3.3 to our
    Form 8-A/A,
    filed June 4, 2003).4
.1

Purchase Agreement, dated as of
    May 22, 2003, by and between Hayes Lemmerz International,
    Inc., its subsidiaries named therein, and the Initial Purchasers
    of the $250,000,000 of
    101/2% Senior
    Notes due 2010 to be issued by HLI Operating Company, Inc.
    (incorporated by reference to Exhibit 4.1 to our Quarterly
    Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.2

Indenture, dated as of
    June 3, 2003, regarding $250,000,000 of
    101/2% Senior
    Notes due 2010, by and between HLI Operating Company, certain
    listed Guarantors, and U.S. Bank National Association, as
    Trustee (incorporated by reference to Exhibit 4.2 to our
    Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.3

Form of
    101/2% Senior
    Notes due 2010 (attached as Exhibit A to the Indenture
    filed as Exhibit 4.2 to our Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.4

First Supplemental Indenture,
    dated as of June 19, 2003, by and between HLI Operating
    Company, Inc. certain listed Guarantors, and U.S. Bank
    National Association, as Trustee (incorporated by reference to
    Exhibit 4.2 to our Registration statement
    No. 333-107539
    on
    Form S-4,
    filed on July 31, 2003, as amended).4
.5

Registration Rights Agreement,
    dated as of June 3, 2003, by and between HLI Operating
    Company, Inc. and the Initial Purchasers of the
    101/2% Senior
    Notes due 2010 (incorporated by reference to Exhibit 4.3 to
    our Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.6

Series B Warrant Agreement,
    dated as of June 2, 2003, by and between Hayes Lemmerz
    International, Inc. and Mellon Investor Services LLC, as Warrant
    Agent (incorporated by reference to Exhibit 4.2 to our
    Form 8-A,
    filed June 4, 2003).4
.7

Exchange Agreement, dated as of
    June 3, 2003, by and between Hayes Lemmerz International,
    Inc., HLI Parent Company, Inc. and HLI Operating Company, Inc.
    regarding the Series A Exchangeable Preferred Stock issued
    by HLI Operating Company, Inc. (incorporated by reference to
    Exhibit 4.3 to our Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).4
.8

Registration Rights Agreement,
    dated as of July 1, 2004, by and between Hayes Lemmerz
    International, Inc., and AP Wheels, LLC (incorporated by
    reference to Exhibit 4.9 to our Quarterly Report on
    Form 10-Q
    for the quarterly period ended July 31, 2004, filed
    September 8, 2004).4
.9

Form of Subscription Rights
    Certificate (incorporated by reference to Exhibit 4.1 to
    our Registration Statement on
    Form S-3,
    filed March 16, 2007).4
.10

Form of Registration Rights
    Agreement, dated as of March 16, 2007, by and among Hayes
    Lemmerz International, Inc., Deutsche Bank Securities, Inc., and
    SPCP Group LLC (incorporated by reference to Exhibit 99.2
    to our Current Report on
    Form 8-K,
    filed March 16, 2007).4
.11

Form of Standstill and Director
    Nomination Agreement, to be entered by and between Hayes Lemmerz
    International, Inc. and Deutsche Bank Securities, Inc.
    (incorporated by reference to Exhibit 99.2 to our Current
    Report on
    Form 8-K,
    filed March 16, 2007). 101




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##### Table of Contents



4
.12

Form of Standstill and Director
    Nomination Agreement, to be entered by and between Hayes Lemmerz
    International, Inc. and SPCP Group, LLC (incorporated by
    reference to Exhibit 99.2 to our Current Report on
    Form 8-K,
    filed March 16, 2007).10
.1

Form of Severance Agreement, dated
    June 15, 2000, between Hayes and certain of its officers
    (incorporated by reference from our Quarterly Report on
    Form 10-Q
    for the quarter ended October 31, 2000, filed on
    December 15, 2000).10
.2

Amended and Restated Employment
    Agreement between Hayes and Curtis J. Clawson, dated
    September 26, 2001 (incorporated by reference from our
    Quarterly Report on
    Form 10-Q
    for the quarter ended October 31, 2001, filed on
    April 18, 2002).10
.3

Form of Employment Agreement
    between Hayes and certain of its officers (incorporated by
    reference from our Quarterly Report on
    Form 10-Q
    for the quarter ended October 31, 2001, filed on
    April 18, 2002).10
.4

Hayes Lemmerz International, Inc.
    Long Term Incentive Plan (incorporated by reference to
    Exhibit 10.1 to our Registration Statement
    No. 333-110684
    on
    Form S-8,
    filed on November 21, 2003).10
.5

Hayes Lemmerz International, Inc.
    Critical Employee Retention Plan (incorporated by reference to
    Exhibit 10.2 to our Registration Statement
    No. 333-110684
    on
    Form S-8,
    filed on November 21, 2003).10
.6

Form of Directors Indemnification
    Agreement (incorporated by reference to Exhibit 10.49 to
    our Quarterly Report on
    Form 10-Q
    for the quarterly period ended July 31, 2003, filed
    September 15, 2003, as amended).10
.7

Amended and Restated Credit
    Agreement, dated as of April 11, 2005 by and among HLI
    Operating Company, Inc., as Borrower, Hayes Lemmerz
    International, Inc., the Lenders and Issuers listed therein,
    Citicorp North America, Inc., as First Lien Agent, Second Lien
    Agent and Collateral Agent, Lehman Commercial Paper, Inc., as
    Syndication Agent, and General Electric Capital Corporation, as
    Documentation Agent (incorporated by reference to
    Exhibit 10.1 to our Current Report on
    Form 8-K
    filed April 14, 2005).10
.8

Amended and Restated Guaranty
    dated as of April 11, 2005, by and among Hayes Lemmerz
    International, Inc., HLI Parent Company, Inc., the other
    Guarantors party thereto, and Citicorp North America, Inc., as
    Collateral Agent (incorporated by reference to Exhibit 10.2
    to the our current Report on
    Form 8-K
    filed April 14, 2005).10
.9

Amended and Restated Pledge and
    Security Agreement dated as of April 11, 2005, among Hayes
    Lemmerz International, Inc., HLI Operating Company, Inc., each
    other grantor from time to time party thereto, and Citicorp
    North America, Inc., as Collateral Agent (incorporated by
    reference to Exhibit 10.3 to the our current Report on
    Form 8-K
    filed April 14, 2005).10
.10

Intercreditor and Collateral
    Agency Agreement dated as of April 11, 2005, among Citicorp
    North America, Inc., as Administrative Agent for the first lien
    lenders, as Administrative Agent for the Term C lenders and as
    Collateral Agent, HLI Operating Company, Inc., Hayes Lemmerz
    International, Inc., and each other grantor party thereto
    (incorporated by reference to Exhibit 10.4 to our current
    Report on
    Form 8-K
    filed April 14, 2005).10
.11

Hayes Lemmerz International, Inc.
    Officer Bonus Plan (incorporated by reference to
    Exhibit 10.1 to our Current Report on
    Form 8-K
    dated June 17, 2005).10
.12

Award Agreement under Hayes
    Lemmerz International, Inc. Officer Bonus Plan (incorporated by
    reference to Exhibit 10.2 to our Current Report on
    Form 8-K
    dated June 17, 2005).10
.13

Amendment No. 1, Waiver and
    Consent to Amended and Restated Credit Agreement dated as of
    October 10, 2005 among HLI Operating Company, Inc., Hayes
    Lemmerz International, Inc. and Citicorp North America, Inc. as
    Administrative Agent on behalf of each Lender executing a Lender
    Consent (incorporated by reference to Exhibit 10.23 to our
    Quarterly Report on
    Form 10-Q
    filed on December 9, 2005).10
.14

Framework Agreement on the Ongoing
    Purchase of Receivables dated as of October 10, 2005 by and
    between Hayes Lemmerz Werke GmbH and MHB Financial Services
    GmbH & Co. KG (incorporated by reference to
    Exhibit 10.24 to our Quarterly Report on
    Form 10-Q
    filed on December 9, 2005). 102




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##### Table of Contents



10
.15

Stock Purchase Agreement dated as
    of October 14, 2005 by and among HLI Operating Company,
    Inc., HLI Commercial Highway Holding Company, Inc., and Hayes
    Lemmerz International  Commercial Highway, Inc. and
    Precision Partners Holding Company, as amended by an Amendment
    to Stock Purchase Agreement dated November 11, 2005
    (incorporated by reference to Exhibit 10.25 to our
    Quarterly Report on
    Form 10-Q
    filed on December 9, 2005).10
.16

Amendment No. 2 to Amended
    and Restated Credit Agreement dated as of March 31, 2006
    among HLI Operating Company, Inc., Hayes Lemmerz International,
    Inc., and Citicorp North America, Inc. as Administrative Agent
    on behalf of each lender executing a Lender Consent
    (incorporated by reference to Exhibit 10.1 to our Current
    Report on
    Form 8-K
    filed on April 3, 2006).10
.17

Receivables Financing Agreement,
    dated as of May 30, 2006, among Hayes Funding II,
    Inc., the financial institutions from time to time party thereto
    (Lenders), Citicorp USA, Inc. as the program agent
    for the Lenders and HLI Operating Company, Inc., as servicer
    (incorporated by reference to Exhibit 10.1 to our Current
    Report on
    Form 8-K
    filed on June 5, 2006).10
.18

Originator Purchase Agreement,
    dated as of May 30, 2006, among Hayes Funding I, LLC,
    a Delaware limited liability company and the wholly-owned
    subsidiaries of the Company named therein as Originators
    (incorporated by reference to Exhibit 10.2 to our Current
    Report on
    Form 8-K
    filed on June 5, 2006).10
.19

Secondary Purchase Agreement,
    dated as of May 30, 2006, between Hayes Funding I,
    LLC, a Delaware limited liability company and Hayes
    Funding II, Inc., a Delaware corporation (incorporated by
    reference to Exhibit 10.3 to our Current Report on
    Form 8-K
    filed on June 5, 2006).10
.20*

First Amendment dated as of
    October 13, 2006 amending each of (i) Receivables
    Financing Agreement, dated as of May 30, 2006 among Hayes
    Funding II, Inc., the financial institutions from time to
    time party thereto, Citicorp USA, Inc., and HLI Operating
    Company, Inc., (ii) Originator Purchase Agreement, dated as
    of May 30, 2006), among Hayes Funding I, LLC, and the
    wholly-owned subsidiaries of the Company named therein as
    Originators and (iii) Secondary Purchase Agreement, dated
    as of May 30, 2006 among Hayes Funding II, Inc. and
    Hayes Funding I, LLC.10
.21*

Amendment No. 3, Waiver and
    Consent to Amended and Restated Credit Agreement dated as of
    February 9, 2007 among HLI Operating Company, Inc., Hayes
    Lemmerz International, Inc., and Citicorp North America, Inc. as
    Administrative Agent on behalf of each lender executing a Lender
    Consent.10
.22*

Second Amendment dated as of
    May 27, 2005 amending each of (i) Receivables
    Financing Agreement, dated as of May 30, 2006 (as amended
    October 13, 2006) among Hayes Funding II, Inc.,
    the financial institutions from time to time party thereto,
    Citicorp USA, Inc., and HLI Operating Company, Inc.,
    (ii) Originator Purchase Agreement, dated as of
    May 30, 2006 (as amended October 13, 2006), among
    Hayes Funding I, LLC, and the wholly-owned subsidiaries of
    the Company named therein as Originators and
    (iii) Secondary Purchase Agreement, dated as of
    May 30, 2006 (as amended October 13, 2006) among
    Hayes Funding II, Inc. and Hayes Funding I, LLC.14


Code of Ethics (incorporated by
    reference to Exhibit 10.8 to our Annual Report on
    Form 10-K
    filed on April 12, 2004).21


Hayes Subsidiaries.*23


Consent of Independent Registered
    Public Accounting Firm.*24


Powers of Attorney.31
.1

Certification of Curtis J.
    Clawson, Chairman of the Board, President and Chief Executive
    Officer, pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002.*31
.2

Certification of James A. Yost,
    Vice President, Finance, and Chief Financial Officer, pursuant
    to Section 302 of the Sarbanes-Oxley Act of 2002.*32
.1

Certification of Curtis J.
    Clawson, Chairman of the Board, President and Chief Executive
    Officer, Pursuant to 18 U.S.C. Section 1350, as
    Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.* 103




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##### Table of Contents



32
.2

Certification of James A. Yost,
    Vice President, Finance, and Chief Financial Officer, Pursuant
    to 18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002.*99
.1

Amended and Restated Certificate
    of Incorporation of HLI Operating Company, Inc., effective as of
    May 30, 2003 (incorporated by reference to Exhibit 4.3
    to our Quarterly Report on
    Form 10-Q
    for the quarterly period ended April 30, 2003, filed
    June 16, 2003).     *
    
    Filed electronically herewith. 104