UNITED
      STATES SECURITIES AND EXCHANGE COMMISSION


Washington,
      D.C. 20549


**Form
      10-K**


**(Mark
      One)**


**[X]**    **ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(** d **)** **OF
      THE SECURITIES EXCHANGE ACT OF 1934**





**For
      the fiscal year ended December 31, 2005**


**or**





**[
      ]**    **TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(** d **)** **OF
      THE SECURITIES EXCHANGE ACT OF 1934**





**333-114467**


*(Commission
      File Number)*





**Viasystems,
      Inc.**


*(Exact
      name of registrant as specified in its charter)*





**Delaware**
            **43-1777252***(State
                or other jurisdiction*
            *(I.R.S.
                Employer**of
                incorporation or organization)*
            *Identification
                No.)*





**101
      South Hanley Road**


**St.
      Louis, Missouri 63105**


**(314)
      727-2087**


*(Address,
      including zip code, and telephone number, including*


*area
      code, of registrant's principal executive offices)*





Securities
      registered pursuant to Section 12(b) of the Act: **None**


Securities
      registered pursuant to Section 12(g) of the Act: **None**





Indicate
      by check mark if the registrant is a well-known seasoned issuer, as defined
      in
      Rule 405 of the Securities Act. Yes [ ] No [X]





Indicate
      by check mark if the registrant is not required to file reports pursuant to
      Section 13 or Section 15(d) of the Act. Yes [X] No [ ]





Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the
      preceding 12 months (or for such shorter period that the registrant was required
      to file such reports) and (2) has been subject to such filing requirements
      for
      the past 90 days. Yes [X] No [ ]





Indicate
      by check mark if disclosure of delinquent filers pursuant to Item 405 of
      Regulation S-K is not contained herein, and will not be contained, to the best
      of registrant's knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-K or any amendment to
      this
      Form 10-K. [X]





Indicated
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Securities Exchange Act
      of 1934. (Check one):





Large
      Accelerated Filer [ ]   Accelerated
      Filed [ ]   Non-Accelerated
      Filer [X]





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Securities Exchange Act of 1934). Yes [ ] No [X]





No
      established published trading market exists for the common stock, par value
      $.01
      per share, of Viasystems, Inc. All of the 1,000 outstanding shares of common
      stock, par value $.01 per share, of Viasystems, Inc. are held by Viasystems
      Group, Inc.




Indicate
      the number of shares outstanding of each of the registrant’s classes of common
      stock, as of the latest practicable date.


**Class**
            **Outstanding
                at**
              **March
                31, 2006**Common
                Stock
            1,000





Indicate
      by check mark whether the Registrant has filed all documents and reports
      required to be filed by Section 12, 13, or 15(d) of the Securities Exchange
      Act
      of 1934 subsequent to the distribution of securities under a plan confirmed
      by a
      court Yes [X ] No [ ]





**Documents
      incorporated by reference: None**













**PART
      I**





**CAUTIONARY
      STATEMENTS CONCERNING**


**FORWARD-LOOKING
      STATEMENTS**





*Statements
      made in this Annual Report on Form 10-K (“Report”) include the use of “we” and
“our”, which unless specified otherwise refers collectively to Viasystems, Inc.
      (“Viasystems”) and its subsidiaries. Additionally, reference to “Group” refers
      to Viasystems’ holding company parent Viasystems Group, Inc.*





We
      have
      made forward-looking statements in this Report, including those made in the
      sections entitled “Risk Factors” and "Management's Discussion and Analysis of
      Financial Condition and Results of Operations," that are based on our
      management's beliefs and assumptions and on information currently available
      to
      our management. Forward-looking statements include information concerning our
      possible or assumed future results of operations, business strategies, financing
      plans, competitive position, potential growth opportunities and effects of
      competition. Forward-looking statements include all statements that are not
      historical facts and can be identified by the use of forward-looking terminology
      such as the words "believes," "expects," "anticipates," "intends," "plans,"
      "estimates" or other similar expressions.





Forward-looking
      statements involve risks, uncertainties and assumptions. Actual results may
      differ materially from those expressed in these forward-looking statements.
      You
      should not put undue reliance on any forward-looking statements. We do not
      have
      any intention or obligation to update forward-looking statements after we file
      this Report.





You
      should understand that many important factors could cause our results to differ
      materially from those expressed in forward-looking statements. These factors
      include, but are not limited to, fluctuations in our operating results and
      customer orders, our competitive environment, our reliance on our largest
      customers, risks associated with our international operations, our ability
      to
      protect our patents and trade secrets, environmental laws and regulations,
      our
      substantial indebtedness and our ability to comply with the terms thereof,
      control by our largest stockholders and other factors.








**ITEM
      1.*****Business***





**General**





We
      are a
      leading worldwide provider of complex multi-layer printed circuit boards (PCBs),
      wire harnesses and electro-mechanical solutions (EMS). The products we
      manufacture include, or can be found in, a wide array of products including
      automotive dash panels and control modules, major household appliances, data
      networking equipment, telecommunications switching equipment and a variety
      of
      complex medical and technical instruments. We currently have 12 manufacturing
      facilities, including 11 manufacturing sites in China and Mexico to take
      advantage of low cost, high quality manufacturing environments. In addition,
      in
      order to support our customers’ local needs we have maintained engineering and
      customer service centers in the Netherlands, Canada, England, China, Mexico
      and
      the United States.





We
      are a
      supplier to over 200 manufacturers of original equipment in numerous end
      markets, including industry leaders Alcatel SA, Bosch Group, Delphi Corporation,
      AB Electrolux, EMC Corporation, General Electric Company, Huawei Technologies
      Co
      Ltd., KIS Photo-Me Group, Lucent Technologies, Inc., Maytag Corporation, Otis
      Elevator Company, Rockwell Automation, Inc., Siemens AG, Sun Microsystems,
      Inc.,
      Tellabs, Inc. and Whirlpool Corporation. We have also forged strategic alliances
      with leading contract manufacturers such as Celestica, Inc. and Solectron
      Corporation. We supply PCBs to our contract manufacturing partners through
      these
      strategic alliances.





**Our
      Development**





Viasystems
      is a wholly owned subsidiary of Viasystems Group, Inc.. Group was formed in
      1996
      by Hicks, Muse, Tate & Furst Incorporated) under the name Circo Craft
      Holding Company to create a preferred global manufacturing provider to leading
      original equipment manufacturers through acquisitions of PCB fabricators and
      backpanel assemblers. In August 1996, Circo Craft Holding Company changed
      its name to CC Canada Holding Company and then back to Circo Craft Holding
      Company in September 1996. Circo Craft Holding Company had no operations
      prior to its first acquisition in October 1996, when it changed its name to
      Circo Technologies, Inc. In January 1997, Circo Technologies, Inc. changed
      its
      name to Viasystems Group, Inc. We were formed on April 2, 1997. On April 10,
      1997, Viasystems Group, Inc. contributed all of the capital stock of its
      then existing subsidiaries to us. Currently, Viasystems Group, Inc. remains
      as our parent holding company.





From
      1997
      through 2001, we expanded rapidly through the acquisitions of several businesses
      throughout Europe and North America. During that time, we expanded our business
      model to include full systems assemblies, wire harnesses and cable assemblies.
      In addition, in late 1999, we purchased our first business based in China and
      expanded our product offering in China by acquisition through 2001.





In
      early
      2001, the telecommunications and networking industries began a significant
      business downturn caused in the decline in capital spending related to such
      industry. The decline in capital spending in the telecommunications and
      networking industry was exacerbated by excess inventories for such industries
      within the contract manufacturing supply chain as the five largest contract
      manufacturers collectively experienced a reported 138% increase in inventories
      during 2000.





The
      major
      appliance wire harness business was generally unaffected by the economic
      recession which commenced in 2001. The wire harness business is driven primarily
      by sales of household major appliances which in turn are primarily driven by
      consumer replacement purchases due to product obsolescence.





Since
      April 2001, we have conducted an extensive review of our operations and closed
      or sold 24 under-performing or non-strategic facilities. During that time,
      we
      streamlined our business to focus on PCBs, wire harnesses and electro-mechanical
      solutions, and we significantly diversified our end markets and customer base.
      In 2003, we completed a reorganization that has enabled us to improve our asset
      base, profitability, operating flexibility and balance sheet and to reduce
      our
      debt levels.





In
      2004,
      we continued to further our strategy of expanding our capacity and manufacturing
      capabilities in low cost jurisdictions by our $60.0 million investment in our
      China PCB operations. Additionally, we continued to diversify our customer
      base
      and to streamline operations in our high cost manufacturing areas.





In
      2005,
      in furtherance of our low cost manufacturing strategy, we closed all of our
      remaining western world printed circuit board facilities located in Canada
      and
      the Netherlands. Certain equipment from the closed facilities was transferred
      to
      our China PCB operations as we continued the move to low cost areas in the
      world. In order to support our customers’ local needs, we maintain engineering
      and customer service centers in the Netherlands, Canada, England, China, Mexico
      and the United States.





On
      June
      6, 2005, we announced that we were engaged in the process of exploring a range
      of strategic alternatives related to our wire harness business, including the
      possible sale of such business. On March 21, 2006, we entered into an agreement
      to sell our wire harness business to Electrical Components International
      Holdings Company (“ECI”), a newly formed affiliate of Francisco Partners, L.P.,
      a private equity firm for approximately $320 million. The sale, which is subject
      to certain conditions, is expected to be consummated by the end of the second
      calendar quarter 2006. See “Management’s Discussion and Analysis of Financial
      Condition and Results of Operations - Recent Developments”.





We
      are
      headquartered in St. Louis, Missouri. The mailing address for our headquarters
      is 101 South Hanley Road, Suite 400, St. Louis, Missouri 63105, and our
      telephone number at that location is (314) 727-2087. We can also be reached
      at
      our web site www.viasystems.com .
      Upon
      written request, a copy of this Form 10-K will be provided to any senior
      subordinated noteholder. In addition, copies of our filings are available on
      the
      SEC website at www.sec.gov.





**Our
      Industries**





*Printed
      Circuit Boards -* PCBs
      serve as the foundation of almost all electronic equipment, providing the
      circuitry and mounting surfaces necessary to interconnect discrete electronic
      components, including integrated circuits, capacitors and resistors. PCBs
      consist of a pattern of electrical circuitry etched from copper and laminated
      to
      a board made of insulating material, thereby providing electrical
      interconnection between the components mounted onto it.





*Wire
      Harnesses and Cable Assemblies* ***-*** Wire
      harnesses and cable assemblies are used in a variety of products to connect
      the
      motors, pumps, switches and other control devices to a central point at which
      power is delivered.





*Electro-Mechanical
      Solutions* ***-*** Companies
      that provide electro-mechanical solutions offer a wide variety of products
      and
      services, primarily including assembly of backplanes, custom and standard metal
      enclosures and racks, "box build" systems integration and assembly, final
      product testing and fulfillment.





**Our
      Business Strategy**





We
      believe we are well positioned for growth in sales and operating income through
      a strategy based on the following:





*Maintain
      Diverse End Market Mix* ***-*** Due
      to a
      dramatic economic downturn during 2001 and 2002 in the telecommunications and
      networking industries, we expanded our offerings into the automotive, consumer
      and industrial/instrumentation markets. Our sales to each of these segments,
      both in absolute dollars as well as percentage of sales, have grown in recent
      years. For the four year period from 2002 to 2005, we increased our net sales
      in
      the automotive, consumer and industrial/instrumentation markets by 35.9%, 35.5%
      and 50.3%, respectively. In order to reduce our exposure and reliance on
      unpredictable end markets and to provide alternative growth paths, we intend
      to
      continue to maintain our focus on a diverse mix of end markets.





*Expand
      Manufacturing Capabilities in Low Cost Locations* ***-*** To
      meet
      our customers' demands for high quality, low cost products and services, we
      have
      and will continue to invest in facilities and equipment in low cost locations.
      For the year ended December 31, 2005, approximately 95.0% of our net
      sales were generated from products produced in our operations in China and
      Mexico. We will continue to develop our best-in-class technology and
      manufacturing process in our low cost locations. In 2006, our wire harness
      business will open a new facility in Futian, China in order to serve our
      customers’ growing production needs in China. We believe our ability to leverage
      our advanced technology and manufacturing capabilities across our organization
      in our low cost locations will enable us to grow revenues, improve profitability
      and effectively meet our customers' requirements for high quality, low cost
      products and services.




*Enhance
      Our Strong Customer Relationships* ***-*** We
      are
      focused on expanding our business with existing customers by leveraging our
      history of quality, high levels of customer service and operational excellence,
      all of which provide us with the opportunity to bid for additional programs
      from
      the strong position of a preferred provider. In addition, we have forged
      strategic alliances with leading contract manufacturers such as Celestica,
      Inc.
      and Solectron Corporation. These types of alliances provide us access to
      additional PCB sales opportunities and provide our strategic partners the
      ability to market a fully integrated product offering. Our management team
      has
      created a culture that is focused on providing customers with high-quality
      service and technical support, and this is reflected in our continuing ability
      to obtain new business and expand our current customer
      relationships.





*Expand
      Our Relationships with Existing Customers Through Cross-Selling* ***-*** Building
      on our broad product offering, we pursue cross-selling opportunities with our
      existing base of customers. We leverage our PCB capabilities to provide our
      customers with an integrated manufacturing solution that can range from
      fabrication of bare PCBs to final system assembly and test. We intend to
      continue to leverage our customer relationships to expand the products we sell
      to our customers.





*Concentrate
      on High Value-Added Products and Services* ***-*** We
      focus
      on providing electro-mechanical solutions to leading manufacturers of advanced
      electronics products that generally require custom designed, more complex
      products and short lead-time manufacturing services. These products are
      typically lower volume, higher margin products. We differentiate ourselves
      from
      many of our global competitors by not participating directly in programs for
      high volume, low margin products such as cell phone handsets, personal computers
      or peripherals and consumer electronics.





*Focus
      on Operational Excellence* ***-*** We
      continuously implement strategic initiatives designed to improve product quality
      while reducing manufacturing costs. We continue to focus on opportunities to
      improve operating income, including: (1) streamlining of marketing and
      general and administrative overhead; (2) continued implementation of lean
      manufacturing and Six Sigma initiatives; (3) efficient investment in new
      equipment and technologies and the upgrading of existing equipment; and
      (4) continued improvement of our internal controls and centralization of
      certain aspects of our accounting and finance functions. Our management team
      is
      focused on maximizing our current asset base to improve our operational
      efficiency while also adapting to the needs of our customers and the
      market.





**Markets
      and Customers**





We
      provide products and services to more than 200 manufacturers of original
      equipment. We believe our position as a strategic supplier of printed circuit
      boards, wire harnesses and electro-mechanical solutions, fosters close
      relationships with our customers. These relationships have resulted in
      additional growth opportunities as we have expanded our capabilities and
      capacity to meet our customers' wide range of needs.





The
      following table shows our net sales as a percentage by principal end-user
      markets we serve:





**Year
                Ended****December 31,****Markets**
            
            **2003**
            
            **2004**
            
            **2005**Consumer
            
            
            32.1
            %
            
            31.9
            %
            
            33.2
            %Automotive
            
            
            24.2
            
            
            23.2
            
            
            24.0Telecommunications
            
            
            19.7
            
            
            22.5
            
            
            19.1Industrial
                & Instrumentation/Other
            
            
            9.9
            
            
            10.5
            
            
            13.4Computer/Datacommunications
            
            
            14.1
            
            
            11.9
            
            
            10.3Total
                Net Sales
            
            
            100.0
            %
            
            100.0
            %
            
            100.0
            %





Although
      we seek to diversify our customer base, a small number of customers are
      responsible for a significant portion of our net sales. For the years ended
      December 31, 2003, 2004 and 2005, sales to our 10 largest customers
      accounted for approximately 72.4%, 72.1% and 73.1% of our net sales,
      respectively, and sales to our largest customer, General Electric Company,
      represented approximately 12.1%, 11.3% and 13.2% of our net sales,
      respectively.





On
      March
      21, 2006, we entered into an agreement to sell our wire harness business. See
      “Management’s Discussion and Analysis of Financial Condition and Results of
      Operations—Recent Developments”. If we exclude the sales from our wire harness
      business for the year ended December 31, 2005, sales to our top 10
      customers would account for 71.9% of our net sales, and sales to each of our
      top
      4 customers (which would no longer include General Electric Company), each
      would
      exceed 10% of our net sales.





**Manufacturing
      Services**





Our
      offering of manufacturing services includes the following:





*Design
      and Prototyping Services* ***-*** We
      provide comprehensive front-end engineering services, including custom enclosure
      design, circuit board layout and related design services leading to efficient
      manufacturing and delivery. We offer quick-turn prototyping, which is the rapid
      production of a new product sample. Our quick-turn prototype service allows
      us
      to provide small test quantities to our customers' product development groups.
      Our participation in product design and prototyping allows us to reduce our
      customers' manufacturing costs and their time-to-market and time-to-volume.
      These services enable us to strengthen our relationships with customers that
      require advanced engineering services. In addition, by working closely with
      customers throughout the development and manufacturing process, we often gain
      insight into their future product requirements.





*Printed
      Circuit Board and Backpanel Fabrication* ***-*** Printed
      circuit boards are platforms that connect semiconductors and other electronic
      components. Backpanels connect printed circuit boards. We manufacture
      multi-layer printed circuit boards and backpanels on a low-volume, quick-turn
      basis, as well as on a high-volume production basis. In recent years, the trend
      in the electronics industry has been to increase the speed and performance
      of
      components while reducing their size. Semiconductor designs are currently so
      complex that they often require printed circuit boards with many layers of
      narrow, tightly spaced wiring. These advancements in component technologies
      have
      driven the change in printed circuit board design to higher density printed
      circuits.





*Wire
      Harnesses and Cable Assemblies* ***-*** A
      wire
      harness and cable assembly is an assembly of wires with connectors and terminals
      attached to their ends that transmits electricity between two or more points.
      We
      are one of the leading suppliers of wire harnesses and cable assemblies for
      use
      in household appliances. Due to the similarity in the process technology used
      in
      the manufacture of wire harnesses and cable assemblies for many other products
      and in the manufacture of wire harnesses for use in household appliances, we
      strive to leverage this expertise to enhance the value of the products and
      services we supply to our customers in the other industries. On March 21, 2006,
      we entered into an agreement to sell ourwire harness business. See “Management’s
      Discussion and Analysis of Financial Condition and Results of Operations—Recent
      Developments”.





*Backpanel
      Assembly* ***-*** We
      provide backpanel assemblies, which are manufactured by mounting interconnect
      devices, integrated circuits and other electronic components on a bare
      backpanel. This process differs from that used to provide printed circuit board
      assemblies primarily because of the larger size of the backpanel and the more
      complex placement techniques that must be used with higher layer count printed
      circuits. We also perform functional and in-circuit testing on assembled
      backpanels.





*Printed
      Circuit Board Assembly* ***-*** As
      a
      complement to our electro-mechanical solutions offering, we manufacture printed
      circuit board assemblies. Generally, we do not produce printed circuit board
      assemblies separately, but rather we integrate them with other components as
      part of a full electro-mechanical solution. In addition, we offer testing of
      assembled printed circuit boards and testing of all of the functions of the
      completed product, and we work with our customers to develop product-specific
      test strategies. Our test capabilities include manufacturing defect analysis,
      in-circuit tests, functional tests and environmental stress tests of board
      or
      system assemblies.





*Custom
      Enclosures* ***-*** We
      specialize in the manufacture of custom designed chassis and enclosures
      primarily used in the electronics, telecommunications, industrial and computer
      industries. As a fully integrated supply chain partner with expertise in design,
      rapid prototyping, manufacturing, packaging and logistics, we provide our
      customers with reduced manufacturing costs and shortened time to market
      throughout a product's life cycle.





*Full
      System Assembly and Test* ***-*** We
      provide full system assembly services to customers from our facilities in China
      and Mexico. These services require sophisticated logistics capabilities and
      supply chain management capabilities to procure components rapidly, assemble
      products, perform complex testing and deliver products to end users around
      the
      world. Our full system assembly services involve combining custom metal
      enclosures and a wide range of subassemblies, including printed circuit board
      assembly. We also employ advanced test techniques to various subassemblies
      and
      final end products. Increasingly, customers require custom, build-to-order
      system solutions with very short lead times. We are focused on exploiting this
      trend through our advanced supply chain management capabilities.





*Packaging
      and Global Distribution* ***-*** We
      offer
      our customers flexible, just-in-time and build-to-order delivery programs,
      allowing product shipments to be closely coordinated with customers' inventory
      requirements. Increasingly, we ship products directly into customers'
      distribution channels or directly to the end-user.





*After-Sales
      Support* ***-*** We
      offer
      a wide range of after-sales support services. This support can be tailored
      to
      meet customer requirements, including field failure analysis, product upgrades,
      repair and engineering change management.





*Supply
      Chain Management* ***-*** Effective
      management of the supply chain is critical to the success of customers as it
      directly impacts the time required to deliver product to market and the capital
      requirements associated with carrying inventory. Our global supply chain
      organization works with customers and suppliers to meet production requirements
      and procure materials. We utilize our enterprise resource planning systems
      to
      optimize inventory management.





**Sales
      and Marketing**





We
      focus
      on developing close relationships with our customers at the earliest development
      and design phases and continuing throughout all stages of production. We
      identify, develop and market new technologies that benefit our customers and
      position us as a preferred product or service provider.





We
      market
      our products through our own sales and marketing organization and through
      relationships with sales representatives around the world. This global sales
      organization is structured to ensure global account coverage by
      industry-specific teams of account managers. As of December 31, 2005, we
      employed approximately 156 sales and marketing employees, of which 97 are direct
      sales representatives strategically located throughout North America, Europe
      and
      Asia. Each customer segment marketing team shares support staff of sales
      engineers, program managers, technical service personnel and customer service
      organizations to ensure high-quality, customer-focused service. The global
      marketing organization further supports the sales organization through market
      research, market development and communications.





**Manufacturing
      and Engineering**





We
      produce highly complex, technologically advanced multi-layer and standard
      technology printed circuit boards, backpanel assemblies, printed circuit board
      assemblies, wire harnesses and custom cable assemblies, custom enclosures and
      full systems that meet increasingly tight tolerances and specifications demanded
      by customers. Multi-layering, which involves placing multiple layers of
      electronic circuitry on a single printed circuit board or backpanel, expands
      the
      number of circuits and components that can be contained on the interconnect
      product and increases the operating speed of the system by reducing the distance
      that electrical signals must travel. Increasing the density of the circuitry
      in
      each layer is accomplished by reducing the width of the circuit tracks and
      placing them closer together on the printed circuit board or backpanel.
      Interconnect products having narrow, closely spaced circuit tracks are known
      as
      fine line products. Today, we are capable of efficiently producing commercial
      quantities of printed circuit boards with up to 48 layers and circuit track
      widths as narrow as three one-thousandths of an inch. We have the capability
      to
      produce printed circuit boards with up to 62 layers and circuit track widths
      as
      narrow as three one-thousandths of an inch. The manufacture of complex
      multi-layer interconnect products often requires the use of sophisticated
      circuit interconnections between layers, called blind or buried vias, and
      adherence to strict electrical characteristics to maintain consistent circuit
      transmission speeds, referred to as controlled impedance. These technologies
      require very tight lamination and etching tolerances and are especially critical
      for printed circuit boards with ten or more layers.





The
      manufacture of printed circuit boards involves several steps: etching the
      circuit image on copper-clad epoxy laminate, pressing the laminates together
      to
      form a panel; drilling holes and depositing copper or other conductive material
      to form the interlayer electrical connections; and cutting the panels to shape.
      Advanced interconnect products may also require additional critical steps,
      including dry film imaging, photoimageable soldermask processing, computer
      controlled drilling and routing, automated plating, and various surface
      finishes. Tight process controls are required throughout the manufacturing
      process to achieve critical electrical properties, such as controlled impedance.
      The manufacturing of printed circuit boards used in backpanel assemblies
      requires specialized expertise and equipment because of the larger size of
      the
      backpanel relative to other printed circuit boards and the increased number
      of
      holes for component mounting.





The
      manufacture of wire harnesses involves four steps: (1) insulated copper
      wire is fed through cutting machines that are programmed to cut wire to a
      specific length, strip the end of the wire and attach terminals or connectors;
      (2) the lengths of wire are spliced or joined together and additional
      connectors and/or terminals are attached; (3) the cut and spliced wires are
      brought to the assembly area where assembly boards are used to guide employees
      on the placement of designated wires; and (4) each assembled harness is
      tested for continuity and analyzed by a trained inspector. Every assembly board
      is equipped with 100% continuity testers that are designed into the board.
      These
      testers will pinpoint any defective circuits for repair or rework. On March
      21,
      2006, we entered into an agreement to sell our wire harness business. See
“Management’s Discussion and Analysis of Financial Condition and Results of
      Operations—Recent Developments”.





The
      manufacture of printed circuit board assemblies involves the attachment of
      various electronic components, such as integrated circuits, capacitors,
      microprocessors and resistors to printed circuit boards. The manufacture of
      backpanel assemblies involves attachment of electronic components, including
      printed circuit boards, integrated circuits and other components, to the
      backpanel, which is a large printed circuit board. We use surface mount,
      pin-through hole and press fit technologies in backpanel assembly. We also
      assemble higher-level sub-systems and full systems incorporating printed circuit
      boards and complex electromechanical components.





We
      also
      provide computer-aided testing of printed circuit boards, sub-systems and full
      systems, which contributes significantly to our ability to deliver high quality
      products on a consistent basis. We test boards and system level assemblies
      to
      verify that all components have been properly inserted and that the electrical
      circuits are complete. Further functional tests determine if the board or system
      assembly is performing to customer specifications.





**Quality
      Standards**





Our
      quality systems are defect prevention based, customer focused and compliant
      to
      international standards. All of our facilities are compliant or certified to
      ISO
      9001:2000 which specifies requirements that focus on the effectiveness of the
      quality management system in meeting customer requirements. In addition to
      ISO
      9001:2000, we have facilities that are certified to QS 9000, TL 9000 and TS
      16949.





Our
      facilities are also compliant to industry and regulatory requirements including
      Bellcore and, Underwriters Laboratories (UL). These requirements include
      quality, manufacturing process controls, manufacturing documentation and
      supplier certification of raw materials.





**Supplier
      Relationships**





We
      order
      materials and components based on purchase orders, forecasts and demand patterns
      of our customers and seek to minimize our inventory of materials or components
      that are not identified for use in filling specific orders or specific customer
      contracts. We continue to work with our suppliers to develop just-in-time supply
      systems which reduce inventory carrying costs, and contract globally, where
      appropriate, to leverage our purchasing volumes. We also certify our suppliers
      and potential suppliers on the basis of quality, on-time delivery, costs,
      technical capability, and potential technical advancement. Shortages of raw
      materials such as laminates, a principal material used in our PCB operations,
      have occurred in the past and may occur in the future. Prices for raw copper,
      a
      principal material used in our printed circuit boards, have risen over the
      past
      several months. Raw material or component shortages or price fluctuations such
      as these could have an adverse effect on our results of operations.








**Competition**





Our
      industry is a highly competitive industry, and we believe our markets are highly
      fragmented. We face competition from numerous local, regional and a number
      of
      large international providers of PCBs, wire harnesses and electro-mechanical
      solutions. Our primary direct competitors are Flextronics Corporation,
      Sanmina-SCI Corp., Nanya Technology Corp., Merix Corporation, Compeq
      Manufacturing Co Ltd, Kingboard Chemical Holdings Ltd, and Noma Corporation
      (a
      division of Gentek). Some of our primary competitors may be less
      highly-leveraged, may have greater access to financial or other resources or
      may
      have lower cost operations allowing them to be better able to withstand adverse
      market conditions. We believe that competition in the market segments we serve
      is based on product quality, responsive customer service and support, and price,
      in part, because the cost of many of the products manufactured by us is usually
      low relative to the total cost of the equipment and because product reliability
      and prompt delivery are of greater importance to our customers.





**International
      Operations**





As
      of
      December 31, 2005, we had 11 manufacturing facilities located outside the
      United States, with sales offices throughout Europe and Asia Pacific. Our
      international operations account for approximately 95.0% of our 2005 net sales.
      We believe that our global presence is important as it allows us to provide
      consistent, quality products on a cost effective and timely basis to our
      multinational customers worldwide. We rely heavily on our international
      operations and are subject to risks generally associated with operating in
      foreign countries, including price and exchange controls, fluctuations in
      currency exchange rates and other restrictive actions that could have a material
      affect on our results of operations, financial condition and cash
      flows.





**Environmental**





Some
      of
      our operations are subject to federal, state, local and foreign environmental
      laws and regulations, which govern, among other things, the discharge of
      pollutants into the air and water, as well as the handling, storage, manufacture
      and disposal of, or exposure to, solid and hazardous wastes, and occupational
      safety and health. We believe that we are in material compliance with applicable
      environmental laws and the costs of compliance with such current or proposed
      environmental laws and regulations will not have a material adverse effect
      on
      us. We have facilities that are certified to ISO 14001. Further, we are not
      a
      party to any current claim or proceeding and we are not aware of any threatened
      claim or proceeding under environmental laws that could, if adversely decided,
      reasonably be expected to have a material adverse effect on us. Accordingly,
      we
      do not believe that any of these matters are reasonably likely to have a
      material adverse effect on our business, results of operations, financial
      condition, prospects and ability to service debt. However, there can be no
      assurance that any material environmental liability will not arise in the future
      such as due to a change in the law or the discovery of currently unknown
      conditions.








**Employees**





As
      of
      December 31, 2005, we had 25,738 employees. Of these
      employees, 23,870 were involved in manufacturing, 1,373 in engineering, 156
      in sales and marketing, and 339 in accounting and administrative capacities.
      No
      employees were represented by a union pursuant to a collective bargaining
      agreement. We have not experienced any labor problems resulting in a work
      stoppage or work slowdown, and believe we have good relations with our
      employees. Completion of the sale of our wire harness business will result
      in a
      headcount reduction of 7,096 employees.





**Intellectual
      Property**




We
      have
      developed expertise and techniques that we use in the manufacture of printed
      circuit boards, wire harnesses and electro-mechanical solutions. Research,
      development and engineering expenditures for the creation and application of
      new
      products and processes were approximately $2.9 million, $3.3 million and
      $4.1 million for the years ended December 31, 2003, 2004 and 2005,
      respectively. We believe many of our processes related to the manufacture of
      printed circuit boards are proprietary, including our ability to manufacture
      large perimeter, thick, high-layer count backpanels. Generally, we rely on
      common law trade secret protection and on confidentiality agreements with our
      employees to protect our secrets and techniques. We own 122 **** patents
      (including pending patents), but believe that patents have not historically
      constituted a significant form of intellectual property rights in our industry.
      Our patents begin to expire in 8 years, with no patents expiring
      within the next two years. The
      expiration of any of these patents is not expected to have a material adverse
      effect on our ability to operate.





**Backlog**





We
      estimate that our backlog of unfilled orders as of December 31, 2004
      and 2005 was approximately $167.8 million and $193.9 million, respectively.
      Included in the December 31, 2005 backlog is $71.2 million related to the
      wire harness business. On March 21, 2006, we entered into an agreement to sell
      our wire harness business harness business. See “Management’s Discussion and
      Analysis of Financial Condition and Results of Operations—Recent Developments”.
      The increase in backlog from December 31, 2004 was due to increased
      customer demand at our Asian printed circuit board facilities and at our
      Chinese electro-mechanical solutions facilities. Because unfilled orders may
      be
      cancelled prior to delivery, the backlog outstanding at any point in time is
      not
      necessarily indicative of the level of business to be expected in the ensuing
      period.





**Segments**





We
      have
      determined that there are four reportable segments under the provisions of
      Statement of Financial Accounting Standards No. 131, including (i) China Printed
      Circuit Boards, (ii) North America Printed Circuit Boards, (iii) European
      Printed Circuit Boards and (iv) Assembly, which includes our wire harness
      business. See discussion of our segments in Note 16 to our consolidated
      financial statements.





**Item
      1A. Risk Factors**





Our
      business, financial condition, operating results and cash flows can be impacted
      by a number of factors, including, but not limited to those set forth below,
      any
      one of which could cause our actual results to vary materially from recent
      results or from our anticipated future results. For a discussion identifying
      additional risk factors and important factors that could cause actual results
      to
      differ materially from those anticipated, see the discussion in “Cautionary
      Statements Concerning Forward Looking Statements” in this Form 10-K and in
“Management’s Discussion and Analysis of Financial Condition and Results of
      Operations” and “Notes to Consolidated Financial Statements” in our 2005 Annual
      Report in this Form 10-K.





***Risks
      Relating to Our Businesses***





***We
      emerged from a chapter 11 bankruptcy reorganization, have a history of
      losses and may not become profitable.*** ****




We
      emerged from bankruptcy on January 31, 2003 and have a history of losses and
      cannot assure you that we will grow or achieve and maintain profitability in
      the
      near future, or at all. We emerged from our chapter 11 bankruptcy
      reorganization on January 31, 2003, approximately four months after filing
      a voluntary petition for bankruptcy reorganization. Prior to our reorganization,
      we incurred net losses of $259.2 million in 2002, $587.0 million in
      2001 and $136.0 million in 2000. After we emerged from bankruptcy, we
      incurred a net loss of $164.3 in 2003, a net profit of $5.7 in 2004 and a net
      loss of $84.5 in 2005. If we cannot achieve and maintain profitability, the
      value of our enterprise may decline. The holders of our common stock did not
      receive any distributions as such in connection with our
      reorganization.




***We
      have a substantial amount of debt and may be unable to service or refinance
      this
      debt, which could have negative consequences on our business in the
      future.***




As
      of
      December 31, 2005, our total outstanding indebtedness is approximately
      $462.5 million, with an additional $50.7 million available under the
      revolving portion of our senior credit facility. Our total interest expense
      for
      the year ended December 31, 2005 was approximately $40.8 million. As of
      December 31, 2005, our total consolidated stockholder’s deficit was
      $5.0 million.




This
      high
      level of debt could have negative consequences the Company. For example, it
      could:




•
              result
                  in our inability to comply with the financial and other restrictive
                  covenants in our senior credit facility, which, among other things,
                  require us to maintain specified financial ratios and limit our
                  ability to
                  incur debt and sell assets, which could in turn result in an event
                  of
                  default that, if not cured or waived, could have a material adverse
                  effect
                  on our operations;•
              increase
                  our vulnerability to adverse industry and general economic conditions;•
              require
                  us to dedicate a substantial portion of our cash flow from operations
                  to
                  make scheduled principal payments on our debt, thereby reducing
                  the
                  availability of our cash flow for working capital, capital investments
                  and
                  other business activities;•
              limit
                  our ability to obtain additional financing to fund future working
                  capital,
                  capital investments and other business activities;•
              limit
                  our ability to refinance our indebtedness on terms that are commercially
                  reasonable or at all;•
              expose
                  us to the risk of interest rate fluctuations to the extent we pay
                  interest
                  at variable rates on the debt;•
              limit
                  our flexibility to plan for, and react to, changes in our business
                  and our
                  industry; and•
              place
                  us at a competitive disadvantage relative to our less leveraged
                  competitors.




***We
      may experience fluctuations in our operating results and, because many of our
      operating costs are fixed, even small revenue shortfalls can have a
      disproportionate effect on our operating results.***




Our
      operating results may vary significantly for a variety of reasons,
      including:




●  overall
      economic conditions in the electronics industry;




●  pricing
      pressures;




●  timing
      of
      orders from and shipments to major customers;




●  our
      capacity relative to the volume of orders;




●  expenditures
      in anticipation of future sales;




●  expenditures
      or write offs related to acquisitions;




●  start-up
      expenses relating to new manufacturing facilities; and




●  variations
      in product mix.




Because
      a
      significant portion of our operating expenses are fixed, even a relatively
      small
      revenue shortfall can have a disproportionate effect on our results of
      operations. In addition, our historical results of operations may not be
      indicative of the results to be expected for any future period as a result
      of
      unanticipated revenue shortfalls.




***A
      significant portion of our net sales is based on transactions with our largest
      customers; if we lose any of these customers, our sales could decline
      significantly.***




For
      the
      years ended December 31, 2003, 2004 and 2005, sales to our 10 largest
      customers accounted for approximately 72.4%, 72.1% and 73.1% of our net sales,
      respectively, and sales to our largest customer, General Electric Company,
      represented approximately 12.1%, 11.3% and 13.2% of our net sales, respectively.




Although
      we cannot assure you that our principal customers will continue to purchase
      products from us at past levels, we expect a significant portion of our net
      sales will continue to be concentrated within a small number of customers.
      Although we have an exclusive supply agreement with General Electric Company
      which remains in effect through December 2009, there may be circumstances that
      would allow General Electric Company to terminate the supply agreement or
      purchase required quantities from other suppliers if we fail to perform.
      Additionally, an extraordinary change in the major appliance business of General
      Electric Company could cause them to reduce their purchases from us under the
      supply agreement. The loss of, or significant curtailment of purchases by,
      General Electric Company or one of our other principal customers could have
      a
      material adverse effect on our net sales.




On
      March 21, 2006, we entered into an agreement to sell our wire harness
      business. See “Management’s Discussion and Analysis of Financial Condition and
      Results of Operations—Recent Developments”. If we exclude the sales from our
      wire harness business for the year ended December 31, 2005, sales
      to our top 10 customers would account for 71.9% of our net sales to
      each of our top 4 customers (which would no longer include General
      Electric Company) would exceed 10% of our net sales.




***A
      significant portion of our business is conducted in foreign countries, exposing
      us to additional risks that may not exist in the United
      States.*** ****




International
      manufacturing operations represent the majority of our business, and sales
      to
      foreign destinations represent a significant portion of our net sales. We expect
      net sales from foreign markets to continue to represent a significant portion
      of
      our total net sales. In addition, upon completion of the sale of our wire
      harness business, our business will be more highly concentrated in China, which
      may increase our exposure in this regard. Outside the Unites States, we operate
      facilities in Mexico and China.




Our
      international operations are subject to a number of potential risks in addition
      to the risks of our domestic operations. Such risks include, among others:




•
              inflation
                  or changes in political and economic conditions;•
              unstable
                  regulatory environments;•
              changes
                  in import and export duties;•
              domestic
                  and foreign customs and tariffs;•
              potentially
                  adverse tax consequences;•
              trade
                  restrictions;•
              restrictions
                  on the transfer of funds into or out of a country;•
              labor
                  unrest;•
              logistical
                  and communications challenges;•
              difficulties
                  associated with managing a large organization spread throughout
                  various
                  countries;•
              differing
                  protection of intellectual property and trade secrets; and•
              other
                  restraints and burdensome taxes.




These
        factors may have an adverse effect on our international operations, or on
        the
        ability of our international operations to repatriate earnings to us, in
        the
        future.


***There
      may be shortages of, or price fluctuations with respect to, raw materials which
      would cause us to curtail our manufacturing or incur higher than expected
      costs.*** ****




We
      purchase the raw materials we use in producing our products and providing our
      services and we may be required to bear the risk of raw material price
      fluctuations. In addition, shortages of raw materials such as laminates, a
      principal raw material used in our PCB operations, have occurred in the past
      and
      may occur in the future. Prices for copper, a principal material used in our
      printed circuit boards, have risen over the past several months. Raw material
      or
      component shortages or price fluctuations such as these could have an adverse
      effect on our results of operations.




***We
      are subject to currency fluctuations, which may affect our cost of goods sold
      and operating margins.*** ****




A
      significant portion of our costs, including payroll and rent, are denominated
      in
      foreign currencies. Changes in exchange rates between other currencies and
      the
      U.S. dollar will affect our cost of goods sold and operating margins. And
      could have an adverse effect on our results of operations.




***Oil
      prices may fluctuate, which would increase our cost to manufacture
      goods*** .




We
      generate our own energy in certain of our manufacturing facilities using diesel
      generators and we will be required to bear the increased cost of generating
      energy if the cost of oil increases. Prices for diesel fuel have risen
      substantially over the past several months. Continued price increases for diesel
      fuel would increase our cost and could have an adverse effect on our results
      of
      operations.




***The
      printed circuit board, wire harness and cable assembly and electro-mechanical
      solutions industries are highly competitive and we may not be able to compete
      effectively in all or any one of them.*** ****




The
      printed circuit board industry is highly competitive, with multiple global
      competitors and hundreds of regional and local manufacturers. The wire harness
      and cable assembly business is also highly competitive, with multiple regional
      competitors including established manufacturers of wire harnesses and cable
      assemblies for other industries, such as automotive. The electro-mechanical
      solutions industry is also highly competitive, with competitors on the global,
      regional and local levels and relatively low barriers to entry. In all these
      industries, we could experience increased future competition resulting in price
      reductions, reduced margins or loss of market share. Any of these could have
      an
      adverse effect on our operating results or financial condition. In addition,
      some of our principal competitors may be less highly-leveraged, may have greater
      access to financial or other resources, may have lower cost operations and
      may
      be better able to withstand adverse market conditions.




***We
      generally do not obtain long-term volume purchase commitments from customers,
      and, therefore, cancellations, reductions in production quantities and delays
      in
      production by our customers could adversely affect our operating
      results.*** ****




We
      generally do not obtain firm, long-term purchase commitments from our customers.
      Customers may cancel their orders, reduce production quantities or delay
      production for a number of reasons. Many of our customers have over the past
      several years experienced significant decreases in demand for their products
      and
      services. The uncertain economic conditions in several of the markets in which
      our customers operate have prompted some of our customers to cancel orders,
      delay the delivery of some of the products that we manufacture or place purchase
      orders for fewer products than we previously anticipated. In addition, our
      products and the manufacturing processes we use to produce them are often highly
      complex and therefore may at times contain manufacturing defects. If we were
      to
      manufacture and deliver products to our customers that contain defects, whether
      caused by a design, manufacturing or component failure, or deficiencies in
      our
      manufacturing processes, this may result in delayed shipments to our customers
      and reduced or cancelled customer orders. If these defects or deficiencies
      were
      significant, our business reputation may also be damaged, which could lead
      to
      additional customer cancellations or non-renewals. Even when our customers
      are
      contractually obligated to purchase products from us, we may be unable or,
      for
      other business reasons, choose not to enforce our contractual rights.
      Cancellations, reductions or delays of orders by customers could:




•
              adversely
                  affect our operating results by reducing the volumes of products
                  that we
                  manufacture for our customers;•
              delay
                  or eliminate recoupment of our expenditures for inventory purchased
                  in
                  preparation for customer orders; and•
              lower
                  our asset utilization, which would result in lower gross margins.




***We
      rely on the stability of the automotive industry for a significant portion
      of
      our sales.***




A
      significant portion of our sales are to customers within the automotive
      industry. For the periods ending December 31, 2003, 2004 and 2005, sales to
      customers in the automotive industry represented approximately 24.2%, 23.2%
      and
      24.0% of our net sales, respectively. If there was a destabilization of the
      automotive industry or a market shift away from our automotive customers, it
      may
      have an adverse effect on our results of operations.





***We
      rely on the cyclical telecommunications networking industries; accordingly,
      the
      economic downturn in these industries has had, and may continue to have, a
      material adverse effect on our ability to forecast demand and production and
      to
      meet desired sales levels.*** ****





A
      large
      percentage of our business is conducted with customers who are in the
      telecommunications and networking industries. These industries are characterized
      by intense competition, relatively short product life cycles and significant
      fluctuations in product demand. These industries are heavily dependent on the
      end markets they serve and therefore can be affected by the demand patterns
      of
      those markets. If there were to be a weakness in these industries, it would
      likely have a material adverse effect on our operating results.





***The
      completion of the sale of the wire harness business could expose us to the
      volatility of our other end markets.***





The
      wire
      harness business accounts for a substantial amount of our sales attributable
      to
      the consumer end market. Upon the completion of the sale of the wire harness
      business, our business will have less end market diversification. This change
      in
      end market diversification could result in greater exposure to the volatility
      of
      the other end markets we serve. If there was a downturn in one of the other
      end
      markets we serve, it may have an adverse effect on our results of operations.





***The
      electronics manufacturing services industry is subject to rapid technological
      change; our failure to respond timely or adequately to those changes may render
      our existing technology less competitive or obsolete, and our operating results
      may suffer.*** ****





The
      market for our products and services is characterized by rapidly changing
      product platforms based on technology and continuing process development. The
      success of our business will depend in large part upon our ability to maintain
      and enhance our technological capabilities, develop and market products and
      services that meet changing customer needs, and successfully anticipate or
      respond to technological product platforms changes on a cost-effective and
      timely basis. There can be no assurance that we will effectively respond to
      the
      technological product requirements of the changing market, including having
      sufficient cash flow to make additional capital expenditures that may be
      required as a result of those changes. To the extent we are unable to respond
      to
      such technological product requirements, our operating results may suffer.





***Our
      senior credit facility and the indenture for our senior subordinated notes
      impose restrictions that may restrict our ability to operate our
      business.*** ****





Our
      senior credit facility and the indenture for our senior subordinated notes
      contain covenants that restrict our ability to, among other things, incur
      additional debt, pay dividends, make investments, enter into transactions with
      affiliates, merge or consolidate with other entities and sell all or
      substantially all of our assets. Additionally, we are required by our senior
      credit facility to maintain certain financial ratios. A breach of any of these
      covenants could result in a default under the senior credit facility or the
      indenture, which could allow the lenders or the noteholders to declare all
      amounts outstanding under the senior credit facility or the indenture
      immediately due and payable. If we are unable to repay outstanding borrowings
      when due, the lenders will have the right to proceed against the collateral
      granted to them under the senior credit facility, including our capital stock.
      We may also be prevented from taking advantage of business opportunities that
      arise because of the limitations imposed on us by the restrictive covenants
      under the senior credit facility and the indenture.





***We
      are controlled by affiliates of Hicks, Muse, Tate & Furst,
      Incorporated, whose interests may be different than
      yours.*** ****




Approximately
        44.3% of the common stock of Viasystems Group, Inc., our parent company,
        is
        controlled by affiliates of Hicks, Muse, Tate & Furst, Incorporated
        (“HMTF”). In addition, a stockholders agreement among Viasystems Group, Inc.,
        affiliates of HMTF and other existing holders of our common stock provides
        that
        we and those stockholders have agreed to take all actions necessary, including
        voting the shares held by those stockholders, to elect five designees of
        HMTF to
        our board of directors. Accordingly, HMTF controls the election of a majority
        of
        our board of directors and the approval or disapproval of certain other matters
        requiring stockholder approval and, as a result, has significant influence
        over
        the direction of our management and policies. Using this influence, HMTF
        may
        take actions or make decisions that are not in the same interests of our
        other
        stockholders. In addition, HMTF is in the business of making investments
        in
        companies and may from time to time acquire and hold interests in businesses
        that compete directly or indirectly with us or otherwise have business
        objectives that are not aligned with our business objectives.




***We
      are a holding company with no operations of our own and depend on our
      subsidiaries for cash.*** ****





Although
      our operations are conducted through our subsidiaries, none of our subsidiaries
      are obligated to make funds available to us for payment on our indebtedness
      or
      to pay dividends on our capital stock. Accordingly, our ability to distribute
      dividends to our stockholder is dependent on the earnings and the distribution
      of funds from our subsidiaries. The terms of our senior credit facility and
      the
      indenture governing our senior subordinated notes significantly restrict our
      subsidiaries from paying dividends and otherwise transferring assets to us.
      Furthermore, our subsidiaries are permitted under the terms of our senior credit
      facility and other indebtedness to incur additional indebtedness that may
      severely restrict or prohibit the making of distributions, the payment of
      dividends or the making of loans by our subsidiaries to us.





***We
      are subject to environmental laws and regulations that expose us to potential
      financial liability.*** ****





Our
      operations are regulated under a number of federal, state, local and foreign
      environmental laws and regulations, which govern, among other things, the
      discharge of hazardous materials into the air and water as well as the handling,
      storage and disposal of, or exposure to, hazardous materials and occupational
      health and safety. Violations of these laws can lead to material liability,
      fines or penalties. Compliance with these environmental laws is a major
      consideration in the fabrication of printed circuit boards because metals and
      other hazardous materials are used in the manufacturing process. In addition,
      it
      is possible that in the future new or more stringent requirements could be
      imposed. Various federal, state, local and foreign laws and regulations impose
      liability on current or previous real property owners or operators for the
      cost
      of investigating, cleaning up or removing contamination caused by hazardous
      or
      toxic substances at the property. In addition, because we are a generator of
      hazardous wastes, we, along with any other person who arranges for the disposal
      of those wastes, may be subject to potential financial exposure for costs
      associated with the investigation and remediation of sites at which such
      hazardous waste has been disposed, if those sites become contaminated. Liability
      may be imposed without regard to legality of the original actions and without
      regard to whether we knew of, or were responsible for, the presence of such
      hazardous or toxic substances, and we could be responsible for payment of the
      full amount of the liability, whether or not any other responsible party is
      also
      liable.





***As
      a U.S. corporation with international operations, we are subject to the
      Foreign Corrupt Practices Act and a determination that we violated this act
      may
      affect our business and operations adversely.*** ****





As
      a
      U.S. corporation, we and our subsidiaries are subject to the regulations
      imposed by the Foreign Corrupt Practices Act, or the FCPA, which generally
      prohibits U.S. companies and their intermediaries from making improper
      payments to foreign officials for the purpose of obtaining or keeping business.
      Any determination that we or any of our subsidiaries have violated the FCPA
      could have a material adverse effect on us.





***We
      may be required to recognize additional impairment charges.***





Pursuant
      to GAAP, we are required to periodically assess our goodwill, intangibles and
      other long-lived assets to determine if they are impaired. Disruptions to our
      business, end market conditions and protracted economic weakness, unexpected
      significant declines in operating results of reporting units, divestitures
      and
      market capitalization declines may result in additional charges for goodwill
      and
      other asset impairments. Future impairment charges could substantially affect
      our reported earnings in the periods of such charges. In addition, such charges
      would reduce our consolidated net worth and our shareholder’s equity, increasing
      our debt-to-total-capitalization ratio. Such reduction in consolidated net
      worth
      and increase in debt as a percentage of total capitalization could result in
      a
      default under our senior credit facility.





***We
      are subject to litigation that could adversely affect our operating
      results.***





If
      we
      became the subject of legal proceedings, our results may be affected by the
      outcome of such proceedings and other contingencies that cannot be predicted
      with certainty. When appropriate and as required by GAAP, we estimate material
      loss contingencies and establish reserves based on our assessment of
      contingencies where liability is deemed probable and reasonably estimable in
      light of the facts and circumstances known to us at a particular point in time.
      Subsequent developments in legal proceedings may affect our assessment and
      estimates of the loss contingency recorded as a liability or as a reserve
      against assets in our financial statements and could result in an adverse effect
      on our results of operations in the period in which a liability would be
      recognized or cash flows for the period in which damages would be paid. For
      a
      description of current legal proceedings, see “Legal Proceedings”.








***Degrading
      of our debt ratings would adversely affect us.***





Certain
      degrading by Moody's and S&P could make it more difficult for us to obtain
      new financing if we so choose.





**Item
      1B. Unresolved Staff Comments**





Not
      Applicable.





**ITEM
      2.*****Properties***





In
      addition to our executive offices in St. Louis, Missouri, as of
      December 31, 2005, we operate 12 principal manufacturing and 3 principal
      distribution facilities, located in 3 different countries with a total area
      of
      approximately 5.1 million square feet. All of our domestic owned properties
      are
      pledged to secure our indebtedness under our senior credit facility. Our leased
      properties are leased for terms ranging from one to ten years. The leases for
      our Qingdao, China and two of our Juarez, Mexico properties will expire within
      the next two years. We anticipate that we will be able to renew those leases
      on
      terms that are not materially different than the current terms.





Listed
      below are the principal manufacturing facilities we operated as of
      December 31, 2005:




**Location**
              **Size**
                **(Appx.**
                **Sq.
                  Ft.)**
              **Type**
                **of**
                **Interest**
              **Description
                  of Primary Products****United
                  States**Milwaukee,
                  Wisconsin
              305,000
              Leased
              Custom
                  metal enclosure fabrication**Mexico**Juarez,
                  Mexico
              69,000
              Leased
              Backpanel
                  assembly and full system assemblyJuarez,
                  Mexico (1)
              178,000
              Leased
              Wire
                  harness and cable assembly and subassemblyJuarez,
                  Mexico (1)
              54,000
              Leased
              Wire
                  harness and cable assemblyChihuahua,
                  Mexico (1)
              282,000
              Owned
              Wire
                  harness and cable assemblyChihuahua,
                  Mexico (1)
              253,000
              Leased
              Wire
                  harness and cable assembly**Asia**Guangzhou,
                  China (2)
              2,250,000
              Owned
              Printed
                  circuit board fabrication and wire harnessZhongshan,
                  China
              799,000
              Owned
              Printed
                  circuit board fabricationShanghai,
                  China
              430,000
              Owned
              Backpanel
                  assembly, custom metal enclosure fabrication, and full system
                  assemblyShenzhen,
                  China
              286,000
              Leased
              Full
                  system assembly/custom metal enclosure fabricationQingdao,
                  China
              54,000
              Leased
              Full
                  system assembly/cable
                  assembly




Listed
      below are the principal distribution facilities we operated as of
      December 31, 2005:




**Location**
              **Size**
                **(Appx.**
                **Sq.
                  Ft.)**
              **Type**
                **of**
                **Interest**
              **Description
                  of Primary Product Distributed****United
                  States**El
                  Paso, Texas (1)
              96,000
              Leased
              Wire
                  harnesses and cable assembliesEl
                  Paso, Texas
              8,000
              Leased
              Electromechanical
                  solutions, backpanel assembly and full system assembly**Asia**Hong
                  Kong
              53,000
              Owned
              PCBs,
                  backpanel assemblies, full system assemblies, and wire harnesses
                  and cable
                  assemblies


__________





(1)  This
      facility would be included in the sale of our wire harness business to
      Electrical Components International Holdings Company. See “Management’s
      Discussion and Analysis of Financial Condition and Results of Operations—Recent
      Developments”.





(2)  In
      Guangzhou, we have a campus which we consider as two separate facilities. One
      facility is dedicated to printed circuit board fabrication (2,180,000 sq. ft.)
      and the other to wire harness production (70,000 sq. ft.). The wire harness
      production, which would be included in the sale of our wire harness business
      to
      Electrical Components International Holdings Company, will move to a newly
      leased facility that is currently under construction in Futian, China during
      the
      third quarter of 2006.





In
      addition to the facilities listed above, at December 31, 2005, we
      maintained several engineering, customer service, sales and marketing and other
      facilities throughout North America, Europe and Asia, all of which are
      leased.





**ITEM
      3.*****Legal
      Proceedings*******





On
      October 1, 2002, we and Group filed voluntary petitions for relief under
      chapter 11 of the United States Bankruptcy Code in the United States
      Bankruptcy Court for the Southern District of New York seeking court
      supervision of our restructuring efforts and confirmation of our plan of
      reorganization. The plan of reorganization was confirmed on January 14,
      2003 and we emerged from bankruptcy on January 31, 2003.





We
      have
      certain bankruptcy claims that remain unsettled and are subject to ongoing
      negotiations and litigation. The aggregate amount of the outstanding claims
      is
      $1.0 million. To the extent that these claims become allowed claims, the payment
      of these claims will be funded by the issuance of subordinated promissory notes
      pursuant to the terms of the plan of reorganization.





We
      are
      presently involved in various legal proceedings arising in the ordinary course
      of our business operations, including employment matters and contract claims
      as
      well as in connection with the Chapter 11 claims reconciliation process
      described above. We believe that any liability with respect to these proceedings
      will not be material in the aggregate to our consolidated financial position,
      results of operations or cash flow.





**ITEM
      4.*****Submission
      Of Matters To A Vote Of Security Holders*******





No
      matters were submitted to a vote of security holders in the fourth quarter
      of
      2005.





**PART
      II**





**ITEM
      5.*****Market
      For The Registrant's Common Stock And Related Stockholder
      Matters.***





All
      of
      our outstanding common stock is held by Group, and accordingly, there is no
      established public trading market for our common stock. We have paid no
      dividends since inception, and our ability to pay dividends is limited by the
      terms of certain agreements related to our indebtedness.





**ITEM
      6.*****Selected
      Financial Data*******





The
      selected financial and other data below for the years ended December 31,
      2001, 2002, 2003, 2004 and 2005, present consolidated financial information
      of
      Viasystems and its Subsidiaries and have been derived from our audited
      consolidated financial statements.





You
      should read the selected historical consolidated financial data set forth below
      in conjunction with "Management's Discussion and Analysis of Financial Condition
      and Results of Operations" and our consolidated financial statements and the
      notes thereto included elsewhere in this document.




**Year
                  Ended December 31,****2001**
              
              **2002**
              
              **2003**
              
              **2004**
              
              **2005**(in
                  thousands)**Statement
                  of Operations Data:**Net
                  sales
              
              $
              1,206,536
              
              $
              864,047
              
              $
              751,483
              
              $
              901,363
              
              $
              948,518Cost
                  of goods sold
              
              
              1,042,886
              
              
              697,802
              
              
              597,546
              
              
              728,249
              
              
              788,840Selling,
                  general and administrative expenses
              
              
              96,838
              
              
              88,160
              
              
              64,119
              
              
              77,977
              
              
              81,924Stock
                  compensation expense (1)
              
              
              —
              
              
              —
              
              
              1,383
              
              
              3,837
              
              
              6,793Depreciation
              
              
              79,718
              
              
              74,221
              
              
              66,070
              
              
              48,232
              
              
              51,586Amortization
              
              
              46,574
              
              
              16,344
              
              
              3,065
              
              
              1,570
              
              
              1,436Write-off
                  of amounts due from affiliates (2)
              
              
              144,099
              
              
              —
              
              
              —
              
              
              —
              
              
              —Restructuring
                  and impairment loss (3)
              
              
              152,265
              
              
              52,697
              
              
              66,199
              
              
              1,013
              
              
              27,934Goodwill
                  impairment (4)
              
              
              129,109
              
              
              36,710
              
              
              22,697
              
              
              —
              
              
              —Loss
                  (gain) on dispositions of businesses and joint venture interest,
                  net (5)
              
              
              —
              
              
              85,531
              
              
              1,226
              
              
              (465
              )
              
              —Operating
                  (loss) income
              
              
              (484,953
              )
              
              (187,418
              )
              
              (70,822
              )
              
              40,950
              
              
              (9,995
              )Interest
                  expense, net
              
              
              97,174
              
              
              81,898
              
              
              29,729
              
              
              37,818
              
              
              40,760Amortization
                  of deferred financing costs
              
              
              4,013
              
              
              4,955
              
              
              104
              
              
              1,305
              
              
              1,613Reorganization
                  items:Reorganization
                  expenses (reversals) (6)
              
              
              —
              
              
              22,537
              
              
              55,255
              
              
              (9,776
              )
              
              —Loss
                  from debt forgiveness (7)
              
              
              —
              
              
              —
              
              
              1,517
              
              
              —
              
              
              —Other
                  expense (income), net
              
              
              879
              
              
              (900
              )
              
              6,882
              
              
              (987
              )
              
              12,896(Loss)
                  income before income taxes
              
              
              (587,019
              )
              
              (295,908
              )
              
              (164,309
              )
              
              12,590
              
              
              (65,264
              )Income
                  taxes
              
              
              —
              
              
              —
              
              
              —
              
              
              6,842
              
              
              15,965Net
                  (loss) income
              
              $
              (587,019
              )
              $
              (295,908
              )
              $
              (164,309
              )
              $
              5,748
              
              $
              (81,229
              )Deficiency
                  of earnings to cover fixed charges (8)
              
              $
              (587,019
              )
              $
              (295,908
              )
              $
              (164,309
              )
              $
              (36,049
              )
              $
              (65,264
              )**Balance
                  Sheet Data (as****of
                  end of period):**Cash
                  and cash equivalents
              
              $
              34,202
              
              $
              83,060
              
              $
              62,676
              
              $
              112,891
              
              $
              35,923Working
                  capital (9)
              
              
              122,054
              
              
              (383,521
              )
              
              111,573
              
              
              151,478
              
              
              91,735Total
                  assets
              
              
              988,045
              
              
              777,530
              
              
              694,335
              
              
              750,409
              
              
              713,944Total
                  debt, including current maturities
              
              
              1,040,919
              
              
              1,125,189
              
              
              456,243
              
              
              465,555
              
              
              462,535Stockholder's
                  (deficit) equity
              
              
              (310,324
              )
              
              (584,709
              )
              
              2,480
              
              
              56,534
              
              
              (1,728
              )


__________


*(1)*
            In
                connection with the reorganization, we terminated our 1997 and 2001
                stock
                option plans and adopted our 2003 stock option plan. The options
                we have
                issued under the 2003 stock option plan have a fixed exercise price
                of
                $12.63 per share and vest one-third at the grant date, one-third
                on the
                24-month anniversary of the grant date, and one-third on the 36-month
                anniversary of the grant date. As a result of the termination of
                the 1997
                and 2001 stock option plans and the adoption of the 2003 stock option
                plan, under provision of FIN No. 44,*Accounting
                for Certain Transactions Involving Stock Compensation an Interpretation
                of
                APB Opinion No. 25*,
                certain options issued under the 2003 stock option plan are treated
                as
                “variable” options. As a result we recorded non-cash compensation expense
                of $1,383 for the twelve months ended December 31, 2003. Effective
                January 1, 2004, we adopted SFAS No. 123,*Accounting
                for Stock-Based Compensation.*




(2)
            In
                2000, we transferred nine European printed circuit board facilities
                to
                European PCB Group in consideration of subordinated notes payable
                to us.
                Represents charges relating to the write-off of such subordinated
                notes
                due from European PCB Group. European PCB Group has disposed of
                substantially all of its assets and is in the process of being liquidated.
                Accordingly, we compared the carrying amounts to the undiscounted
                expected
                future cash flows and concluded the amounts due were
                impaired.




(3)
            Represents
                impairment losses related to the write-off of long-lived assets in
                accordance with Statement of Financial Accounting Standards No. 121,
                "Accounting for the impairment of long-lived assets and for long-lived
                assets to be disposed of" and Statement of Financial Accounting Standards
                No. 144 "Accounting for the impairment or disposal of long-lived
                assets,"
                as applicable. In addition, due to the industry downturn, numerous
                restructuring charges were taken to downsize and close facilities.
                See
                "Management's Discussion and Analysis of Financial Condition and
                Results
                of Operations — Restructuring, Impairment Charges and Losses on Disposal
                of Business" and Note 11 in the accompanying notes to the consolidated
                financial statements.




(4)
            The
                goodwill impairment recognized in 2001 is attributable to $129,100
                of
                goodwill impairment related to certain EMS acquisitions which were
                deemed
                impaired when assessing the carrying value of long-lived assets.
                The
                goodwill impairment recognized in 2002 is attributable to $13,400
                of
                goodwill impairment recognized in our North American PCB reporting
                unit,
                $10,100 goodwill impairment recognition in our Asian EMS reporting
                unit
                and a $13,200 recognition of goodwill impairment in our North American
                EMS
                reporting unit. The goodwill impairment recognized in 2003 is attributable
                to $22,700 goodwill impairment recognition in our European PCB
                facility.




(5)
            During
                2002, in connection with the continued economic downturn, we sold
                six
                businesses, including our joint venture interest, and finalized the
                dispositions of several closed facilities. See "Management's Discussion
                and Analysis of Financial Condition and Results of Operations —
                Restructuring, Impairment Charges and Losses on Dispositions of
                Businesses" and Note 11 in the accompanying notes to the consolidated
                financial statements.




(6)
            Reorganization
                expenses consisted primarily of professional and bank fees and expenses
                related to the issuance of a promissory note to the Secretary of
                State for
                Trade and Industry of the United Kingdom incurred in conjunction
                with the
                reorganization. In May 2004, this promissory note was discharged in
                full as a result of proceeds received by the Secretary of State for
                Trade
                and Industry of the United Kingdom from the liquidation of Viasystems
                Tyneside Limited, resulting in a gain of
                $9,817.




(7)
            In
                connection with the reorganization, we recorded a loss from debt
                forgiveness of $1,517 in respect to allowed senior subordinated note
                claims.




(8)
            For
                purposes of calculating the deficiency of earnings to cover fixed
                charges,
                "earnings" represent earnings before income taxes plus fixed charges.
                "Fixed charges" consist of interest on all indebtedness, amortization
                of
                deferred financing costs and the portion (approximately 1/3) of rental
                expenses that management believes is representative of the interest
                component of rent expense.




(9)
            Working
                capital for the year ended December 31, 2002 includes $526,000 of
                long-term debt classified as currently due in connection with the
                reorganization. Excluding this amount, working capital for the year
                ended
                December 31, 2002 would have been
                $142,500.




**ITEM
      7.*****Management's
      Discussion And Analysis Of Financial Condition And Results Of
      Operations***





*The
      following discussion and analysis of our financial condition and results of
      operations covers certain periods prior to our emergence from bankruptcy on
      January 31, 2003. Accordingly, the discussion and analysis of historical periods
      prior to that date does not reflect our new capital structure. You should read
      the following discussion of our financial condition and results of operations
      with "Selected Financial Data" and our consolidated financial statements and
      related notes included elsewhere in this document. This discussion contains
      forward-looking statements about our markets, the demand for our products and
      services and our future results. We based these statements on assumptions that
      we consider reasonable. Actual results may differ materially from those
      suggested by our forward-looking statements for various reasons including those
      discussed in Part I “Cautionary Statements Concerning Forward-Looking
      Statements”.*





**General**





We
      are a
      leading worldwide provider of complex multi-layer printed circuit boards (PCBs),
      wire harnesses and electro-mechanical solutions (EMS). The products we
      manufacture include, or can be found in, a wide array of products including
      automotive dash panels and control modules, major household appliances, data
      networking equipment, telecommunications switching equipment and a variety
      of
      complex medical and technical instruments. We currently have 12 manufacturing
      facilities, including 11 manufacturing sites in China and Mexico to take
      advantage of low cost, high quality manufacturing environments. In addition,
      in
      order to support our customers’ local needs we have maintained engineering and
      customer service centers in the Netherlands, Canada, England, China, Mexico
      and
      the United States.





We
      are a
      supplier to over 200 manufacturers of original equipment in numerous end
      markets, including industry leaders Alcatel SA, Bosch Group, Delphi Corporation,
      AB Electrolux, EMC Corporation, General Electric Company, Huawei Technologies
      Co
      Ltd., KIS Photo-Me Group, Lucent Technologies, Inc., Maytag Corporation, Otis
      Elevator Company, Rockwell Automation, Inc., Siemens AG, Sun Microsystems,
      Inc.,
      Tellabs, Inc., and Whirlpool Corporation. We have also forged strategic
      alliances with leading contract manufacturers such as Celestica, Inc. and
      Solectron Corporation. We supply PCBs to our contract manufacturing partners
      through these strategic alliances.





**Recent
      Developments**





On
      March
      21, 2006, we entered into an agreement to sell our wire harness business to
      Electrical Components International Holdings Company (“ECI”), a newly formed
      affiliate of Francisco Partners, L.P., a private equity firm. Under the terms
      of
      the stock purchase agreement, ECI will purchase all of the outstanding capital
      stock of Wire Harness Industries, Inc., the entity through which we conduct
      the
      wire harness business, for approximately $320 million. The closing, which is
      subject to certain conditions, including obtaining regulatory and third party
      consents or approvals, is expected to be consummated by the end of the second
      calendar quarter 2006.





The
      sale
      will result in the disposition of most of our operations in Mexico and a small
      portion of our China operations, and will result in the reduction of our
      employee head count, as of December 31, 2005, from 25,738 to 18,642. Set
      forth below is summary balance sheet and income statement data (in thousands)
      for the wire harness business for the three years ended December 31,
      2005.





2004
            
            2005Total
                assets
            
            
            
            
            $
            124,417
            
            $
            127,903Total
                liabilities
            
            
            
            
            
            62,015
            
            
            64,6452003
            
            
            2004
            
            
            2005Net
                sales
            
            $
            233,861
            
            $
            271,328
            
            $
            295,704Operating
                income
            
            
            25,046
            
            
            38,673
            
            
            36,951Income
                before income taxes
            
            
            24,597
            
            
            38,656
            
            
            37,162





The
      estimated net cash proceeds from the sale of our wire harness business of
      approximately $310 million will be applied to the repayment of all of our
      outstanding bank debt, with the remainder to be held for reinvestment in our
      ongoing businesses.





**Critical
      Accounting Policies and Estimates**





Our
      discussion and analysis of our financial condition and results of operations
      are
      based upon our consolidated financial statements, which have been prepared
      in
      accordance with GAAP. The preparation of these financial statements requires
      us
      to make estimates, assumptions and judgments that affect the reported amounts
      of
      assets, liabilities, net sales and expenses and related disclosure of contingent
      assets and liabilities. On an on-going basis we evaluate our estimates,
      including: allowance for bad debts; valuation and recoverability of inventory;
      amortization periods; recoverability of long-term assets, intangible assets
      and
      goodwill; income taxes; and litigation. We base our estimates on historical
      experience and on various other assumptions which we believe to be reasonable
      under the circumstances, the results of which form the basis for making
      judgments about the carrying values of assets and liabilities that are not
      readily apparent from other sources. Actual results may differ from these
      estimates under different assumptions or conditions.





***Revenue
      Recognition***





The
      Company recognizes revenue when all of the following criteria are satisfied:
      persuasive evidence of an arrangement exists; risk of loss and title transfer
      to
      the customer; the price is fixed and determinable; and collectibility is
      reasonably assured. Sales and related costs of goods sold are included in income
      when goods are shipped to the customer in accordance with the delivery terms,
      except in the case of vendor managed inventory arrangements, whereby sales
      and
      the related costs of goods sold are included in income when possession of goods
      is taken by the customer. All services are performed prior to invoicing
      customers for any products manufactured by the Company. Reserves for product
      returns are recorded based on historical trend rates at the time of
      sale.





***Accounts
      Receivable***





Accounts
      receivable balances represent customer trade receivables generated from the
      Company’s operations. To reduce the potential for credit risk, the Company
      evaluates the collectibility of customer balances based on a combination of
      factors but does not generally require significant collateral. The Company
      regularly analyzes significant customer balances, and, when it becomes evident
      a
      specific customer will be unable to meet its financial obligations to the
      Company for reasons including, but not limited to, bankruptcy filings or
      deterioration in the customer’s operating results or financial position, a
      specific allowance for doubtful accounts is recorded to reduce the related
      receivable to the amount that is believed reasonably collectible. The Company
      also records an allowance for doubtful accounts for all other customers based
      on
      a variety of factors including the length of time the receivables are past
      due,
      the financial health of the customer and historical experiences. If
      circumstances related to specific customers change, estimates of the
      recoverability of receivables could be further adjusted.







***Inventories***





Inventories
      are stated at the lower of cost (valued using the first-in, first-out (FIFO)
      or
      last-in, first-out (LIFO) method) or market. Cost includes raw materials, labor
      and manufacturing overhead. LIFO is utilized for certain wire harness and
      assembly inventories. For the years ended December 31, 2004 and 2005, the
      percentage of consolidated net inventories valued at LIFO was 32% and 31%,
      respectively. (See Note 21 Subsequent Events.)





Inventories
      would have decreased by approximately $4,454 and $4,266 at December 31,
      2004 and 2005, respectively, had the FIFO method been used to determine
      purchased inventory cost of all inventories. During 2005, certain inventory
      quantity reductions caused a liquidation of LIFO inventory values. The
      liquidation increased net loss by $275 (net of $0.00 income taxes).





***Valuation
      of Goodwill and other Intangible Assets***





We
      assess
      the impairment of goodwill and other indefinite lived intangible assets
      annually, and whenever events or changes in circumstances indicate that the
      carrying value may not be recoverable. Factors we consider important that could
      trigger an impairment review include, but are not limited to, the
      following:





•
      significant underperformance relative to historical or projected future
      operating results;





•
      significant changes in the manner of our use of the acquired assets or the
      strategy for our overall business; and





•
      significant negative industry or economic trends.





When
      we
      determine that the carrying value of goodwill and other intangible assets may
      not be recoverable based upon the existence of one or more of the above
      indicators of impairment, we measure any impairment based on a projected
      discounted cash flow method using a discount rate determined by us to be
      commensurate with the risk inherent in our current business model.





For
      the
      year ended 2003, we recognized impairment in our European PCB reporting unit
      of
      $22.7 million. For the years ended December 31, 2004 and 2005, we
      recognized no goodwill impairment.





***Income
      Taxes***





We
      record
      a valuation allowance to reduce our deferred tax assets to the amount that
      we
      believe is more likely than not to be realized. While we have considered future
      taxable income and ongoing prudent, feasible tax planning strategies in
      assessing the need for the valuation allowance, in the event we were to
      determine that we would not be able to realize all or part of our net deferred
      tax assets in the future, an adjustment to the net deferred tax assets would
      be
      charged to income in the period such determination was made. Similarly, should
      we determine that we would be able to realize our deferred tax assets in the
      future in excess of its net recorded amount, an adjustment to the net deferred
      tax asset would increase income in the period such determination was
      made.





For
      the
      years ended December 31, 2003, 2004 and 2005, we had a valuation allowance
      of $707.3 million, $398.9 million and $466.1 million, respectively.





***Foreign
      Currency Risk***





We
      conduct our business in various regions of the world, and export and import
      products to and from several countries. Our operations may, therefore, be
      subject to volatility because of currency fluctuations. A significant portion
      of
      our expenses and some of our sales are frequently denominated in local
      currencies, and results of operations may be affected adversely as currency
      fluctuations affect our product prices and operating costs or those of our
      competitors. From time to time, we enter into foreign exchange forward contracts
      to minimize the short-term impact of foreign currency fluctuations. We do not
      engage in hedging transactions for speculative investment reasons. Our hedging
      operations historically have not been material, and gains or losses from these
      operations have not been material to our cash flows, financial position or
      results from operations. There can be no assurance that our hedging operations
      will eliminate or substantially reduce risks associated with fluctuating
      currencies.








**Restructuring,
      Impairment Charges and Losses on the Dispositions of
      Businesses**





In
      2003,
      our facility in Portland, Oregon was sold and three facilities were either
      downsized or incurred impairment charges (Montreal, Canada (2 facilities),
      Echt,
      the Netherlands, Coventry, England, and Richmond, Virginia) at a cost of $7.8
      million.





In
      2004,
      two facilities were downsized and incurred restructuring and impairment charges
      (Montreal, Canada and Echt, the Netherlands) at a cost of $6.4
      million.





In
      2005,
      four facilities were closed and incurred restructuring and impairment charges
      (Montreal, Canada (2 facilities), Echt, the Netherlands and Mishawaka,
      Indiana).





Below
      is
      a table summarizing restructuring and impairment charges and losses on the
      dispositions of businesses for the years ended December 31, 2003, 2004 and
      2005. A detailed discussion of these restructuring and impairment charges and
      losses on the disposals of business is set forth in our consolidated financial
      statements and the notes thereto included elsewhere in this
      document.




**Year
                  Ended****December 31,****2003**
              
              **2004**
              
              **2005****(in
                  thousands)****Restructuring
                and Impairment Charges**Personnel
                  and services
              
              $
              827
              
              $
              2,057
              
              $
              23,378Lease
                  and other collateral commitments
              
              
              —
              
              
              (5,861
              )
              
              2,733Other
              
              
              —
              
              
              253
              
              
              —Asset
                  impairments
              
              
              65,372
              
              
              4,564
              
              
              1,823Total
              
              $
              66,199
              
              $
              1,013
              
              $
              27,934




**The
      Reorganization**





The
      telecommunications and networking industries experienced a dramatic economic
      downturn during 2001 and 2002, which had a significant adverse impact on our
      sales and cash flow, and ultimately impeded our ability to service our long-term
      debt. As a consequence, after reviewing our business and prospects, our board
      of
      directors concluded that the long-term interests of our business and of our
      creditors and equity holders would be best served by a consensual restructuring
      implemented under chapter 11 of the Bankruptcy Code for the purpose of reducing
      our debt and strengthening our balance sheet. On October 1, 2002, we filed
      a
      consensual pre-packaged plan of reorganization under chapter 11 of the
      Bankruptcy Code, which was confirmed on January 14, 2003, and was consummated
      on
      January 31, 2003. In connection with our reorganization, we extinguished
      approximately $716.6 million of indebtedness in exchange for 4.3 million shares
      of Group senior convertible preferred stock with an aggregate liquidation
      preference of $53.7 million, 1.2 million shares of Group junior preferred stock
      with an aggregate liquidation preference of $120.1 million and 20.7 million
      shares of Group common stock. Also in connection with our reorganization, all
      of
      the then outstanding Group preferred stock and common stock was cancelled,
      in
      the case of the preferred stock, in exchange for warrants to purchase Group
      common stock.





Our
      senior secured indebtedness was restructured in connection with our
      reorganization under a new senior credit facility providing for term loans
      of
      approximately $447.9 million (subsequently paid down in 2003; with the issuance
      of the $200 million 101⁄2% Senior Subordinated Notes) and revolving credit loans
      of approximately $51.3 million. See Note 10 in the accompanying notes to the
      consolidated financial statements.








**Results
      of Operations**





The
      following table sets forth statement of operations data expressed as a
      percentage of net sales for the periods indicated:





**Year
                Ended December 31,****2003**
            
            **2004**
            
            **2005**Net
                sales
            
            
            100.0
            %
            
            100.0
            %
            
            100.0
            %Operating
                expenses:Cost
                of goods sold
            
            
            79.5
            
            
            80.8
            
            
            83.2Selling,
                general and administrative expenses
            
            
            8.5
            
            
            8.7
            
            
            8.6Stock
                compensation expense
            
            
            0.2
            
            
            0.4
            
            
            0.7Depreciation
            
            
            8.8
            
            
            5.4
            
            
            5.4Amortization
                of intangible assets
            
            
            0.4
            
            
            0.2
            
            
            0.2Restructuring
                and impairment charge
            
            
            8.8
            
            
            0.1
            
            
            2.9Goodwill
                impairment
            
            
            3.0
            
            
            0.0
            
            
            0.0Loss
                (gain) on dispositions of assets, net
            
            
            0.2
            
            
            (0.1
            )
            
            0.0Operating
                (loss) income
            
            
            (9.4
            )
            
            4.5
            
            
            (1.0
            )Other
                expenses:Interest
                expense, net
            
            
            4.0
            
            
            4.2
            
            
            4.3Amortization
                of deferred financing costs
            
            
            0.0
            
            
            0.1
            
            
            0.2Reorganization
                expenses (reversals)
            
            
            7.4
            
            
            (1.1
            )
            
            0.0Loss
                from debt forgiveness
            
            
            0.2
            
            
            0.0
            
            
            0.0Other
                expense (income), net
            
            
            0.9
            
            
            (0.1
            )
            
            1.4(Loss)
                Income before income taxes
            
            
            (21.9
            )
            
            1.4
            
            
            (6.9
            )Income
                taxes
            
            
            0.0
            
            
            0.8
            
            
            1.7Net
                (loss) income
            
            
            (21.9
            )%
            
            0.6
            %
            
            (8.6
            )%





***Year
      Ended December 31, 2004 Compared to Year Ended December 31,
      2005***





Net
      sales
      for the year ended December 31, 2005 were $948.5 million, representing a
      $47.1 million, or 5.2% increase, over net sales for the year ended
      December 31, 2004. This increase was primarily a result of the installation
      of additional capacity in our China printed circuit board operations and
      increased market share with certain customers.





Sales
      of
      printed circuit boards produced in China, including sales to our own assembly
      operations, increased by approximately $76.2 million, or 22.2%, as a result
      of
      increased demand from certain existing customers, our migration of business
      from
      western world manufacturing sites and the installation of additional capacity.
      Sales of our assembly services and products increased by approximately $9.5
      million, or 1.9%, due to increased market share with select customers that
      purchase our wire harnesses and cable assemblies, in addition to increased
      customer demands for existing and new programs within our Asian
      electro-mechanical solutions facilities.





On
      February 25, 2005, we announced our intent to close our North American and
      European printed circuit board facilities located in Montreal, Canada and Echt,
      the Netherlands, respectively, and final product shipments from both sites
      were
      made early in the third quarter of 2005. For the year ended December 31,
      2005, sales of printed circuit boards produced in our western world operations
      totaled $36.7 million compared to $75.4 million for the year ended
      December 31, 2004, representing a decrease of $38.7 million, or 51.3%. On
      March 21, 2006, we entered into an agreement to sell our wire harness business.
      For the year ended December 31, 2005, sales of the wire harness business
      were $295.7 million compared to $271.3 million for the year ended
      December 31, 2004, representing an increase of $24.4 million, or 9.0%. If
      we had excluded the western world printed circuit board facilities and the
      wire
      harness business from sales for the years ended December 31, 2004 and 2005,
      we would have reported net sales of $554.7 million and $616.1 million,
      respectively. Excluding the western world printed circuit board operations
      and
      the wire harness business, our sales increased $61.4 million, or 11.1% for
      the
      year ended December 31, 2005 compared to the year ended December 31,
      2004.





Cost
      of
      goods sold for the year ended December 31, 2005 was $788.8 million, or 83.2%
      of
      net sales, compared to $728.2 million or 80.8% of net sales for the year ended
      December 31, 2004. As a percent of net sales, direct and indirect labor costs
      decreased by approximately 0.8% for the year ended December 31, 2005,
      compared to 2004, in large part as a result of our transfer of production from
      western world sites to our lower cost sites in China. However, our labor cost
      savings were more than offset by net increases in direct and indirect materials
      costs as a percentage of net sales of approximately 3.0% for the year ended
      December 31, 2005 compared to 2004. The change in materials costs as a percent
      of net sales related primarily (approximately 2.4%) to commodity costs for
      petroleum products and metals used in our manufacturing processes, and in part
      (approximately 0.6%) to increased scrap experience and materials losses
      resulting from our site closures and production transfers during
      2005.





Selling,
      general and administrative expenses for the year ended December 31, 2005
      increased by $3.9 million, from $78.0 million for the year ended
      December 31, 2004, to $81.9 million for the year ended December 31,
      2005. As a percent of sales, these cost decreased 0.1%. The dollar increase
      was
      primarily due to increased freight costs of $4.1 million, regular inflation
      of
      $2.3 million, Sarbanes-Oxley Section 404 preparation costs of $1.7 million
      and
      other costs of $0.4 million, partially offset by a lower incentive compensation
      expense of $4.4 million.





Stock
      compensation expense (non-cash) increased by $3.0 million, from $3.8 million
      for
      the year ended December 31, 2004to $6.8 million for the year ended
      December 31, 2005. The difference in the expense recognized is attributable
      to when options were issued under the 2003 stock option plan, as compared to
      when options vest.





Depreciation
      and amortization increased $3.2 million, from $49.8 million for the year ended
      December 31, 2004, to $53.0 million for the year ended December 31,
      2005. The increase is attributable to additional capital investment in property,
      plant and equipment in our China printed circuit board facilities over recent
      periods partially offset by reductions in depreciation at our closed western
      world printed circuit board operations.





Restructuring
      and impairment expenses totaled $27.9 million for the year ended
      December 31, 2005. For a more detailed analysis of these activities, see
      Note 11 in the accompanying notes to the consolidated financial
      statements.





Interest
      expense increased $3.0 million, from $37.8 million for the year ended
      December 31, 2004, to $40.8 million for the year ended December 31,
      2005. The increase is due to the full year effect of the additional debt
      associated with the third amendment to the 2003 Credit Agreement and increased
      interest rates over the year ended December 31, 2004.





Amortization
      of deferred financing costs increased $0.3 million for the year ended
      December 31, 2005, compared to the year ended December 31, 2004. This
      increase was due to the amortization of deferred financing fees incurred with
      cost associated with the October 7, 2004 and the April 22, 2005 amendments
      to
      the credit agreement.





Other
      expense (income), net for the year ended December 31, 2005 is made up of
      a) $10.9 million of a net translation adjustment transferred as a
      result of the reversal of cumulative translation adjustments required in
      connection with the liquidation of foreign investments (from the closure of
      the
      Montreal, Canada and Echt, the Netherlands printed circuit board operations),
      b) $1.5 million related to the monitoring and oversight agreement (see
      Note 20 in the accompanying notes to the Financial Statements),
      c) $0.7 million of foreign currency translation and d) ($0.3) of
      other.





Income
      taxes for the year ended December 31, 2005 were $16.0 million compared to
      $6.8 million for the year ended December 31, 2004. This relates primarily
      to provisions for foreign tax requirements measured as of December 31,
      2005.





***Year
      Ended December 31, 2003 Compared to Year Ended December 31,
      2004***





Net
      sales
      for the year ended December 31, 2004 were $901.4 million, representing a
      $149.9 million, or 19.9% increase, from the year ended December 31, 2003.
      The increase was primarily a result of the overall market recovery and increased
      market share with select customers. Sales of China printed circuit boards
      increased $55.9 million, or 19.4%, as a result of greater product demand and
      the
      installation of additional capacity. Sales of western world printed circuit
      boards decreased $7.2 million, or 6.8% due to reduced market demand in the
      western world printed circuit board market primarily as a result of
      migration of manufacturing to China. Sales of Assembly increased $90.0 million,
      or 29.3% due to greater product demand and additional product wins. The future
      mix of business is dependent upon available capacity, demand for our customer’s
      end products and individual program wins across all customers.





Cost
      of
      goods sold for the year ended December 31, 2004 was $728.2 million, or
      80.8% of net sales, compared to $597.5 million, or 79.5% of net sales, for
      the
      year ended December 31, 2003. Cost of goods sold as a percent of net sales
      increased primarily as a result of higher printed circuit board material
      costs, higher scrap rates in our western world printed circuit
      board fabrication facilities and the negative effect of the strengthening
      of the Canadian Dollar and Euro.





Selling,
      general and administrative expenses for the year ended December 31, 2004
      increased by $13.9 million, from $64.1 million for the year ended
      December 31, 2003, to $78.0 million for the year ended December 31,
      2004. These costs increased due to the overall growth of the
      Company.





Depreciation
      and amortization decreased $19.3 million, from $69.1 million for the year ended
      December 31, 2003, to $49.8 million for the year ended December 31,
      2004. This decrease was primarily due to the fixed asset impairments we
      recognized during 2003 from the application of SFAS 144.





Interest
      expense increased $8.1 million, from $29.7 million for the year ended
      December 31, 2003, to $37.8 million for the year ended December 31,
      2004. This increase in interest expense was due to our increased indebtedness
      with the issuance of the senior subordinated notes due 2011 in late 2003 and
      partially offset by our ability to negotiate lower interest rates on our senior
      credit facility.





Amortization
      of deferred financing costs increased $1.2 million for the year ended
      December 31, 2004, compared to the year ended December 31, 2003. This
      increase was due to the amortization of deferred financing fees incurred with
      the issuance of the senior subordinated notes due 2001.





**Cash
      Flow**





Net
      cash
      provided by operating activities was $11.6 million for the year ended
      December 31, 2005, compared to net cash provided by operating activities of
      $65.9 million for the year ended December 31, 2004. The change in operating
      cash flow was primarily due to the increase in restructuring and impairment
      charges from the closure of our western world printed circuit board operations
      and the increases in material costs, energy costs and
      shipping costs.





Net
      cash
      used in investing activities was $85.0 million for the year ended
      December 31, 2005, compared to $71.9 million for the year ended
      December 31, 2004 The increase in 2005 is attributable to the Company’s
      capital expansion in China.





Net
      cash
      used by financing activities was $3.2 million for the year ended
      December 31, 2005, compared to net cash provided in financing activities of
      $56.4 million for the year ended December 31, 2004. The net cash used by
      financing activities for the year ended December 31, 2005, was primarily
      related to the scheduled principal payments under the 2003 Credit Agreement
      while the net cash provided by financing activities for the year ended
      December 31, 2004, related principally to equity proceeds from the sale of
      additional shares of Group’s common stock that was contributed to us and
      additional proceeds from amending the 2003 Credit Agreement.





**Financing
      Arrangements**





Concurrently
      with the consummation of our reorganization, we entered into a credit agreement
      among JPMorgan Chase Bank, as administrative agent, and the several banks and
      financial institutions party thereto, which provides for a senior credit
      facility consisting of a $69.4 million three-and-one-half year amortizing
      tranche A term loan facility (subsequently paid down in 2003, with the issuance
      of the $200 million 101⁄2% Senior Subordinated Notes), a $378.5 million,
      five-and-one-half year amortizing tranche B term loan facility (subsequently
      paid down in 2003; see below) and a five year revolving credit facility in
      an
      amount of $51.3 million (including, as a sub-facility of the revolving credit
      facility, a $15 million letter of credit facility).





In
      December 2003, we completed an offering of $200 million of 101⁄2% Senior
      Subordinated Notes due 2011. The proceeds from this offering were used to repay
      in full approximately $69.4 million outstanding under the tranche A term loan
      facility and to repay approximately $136.1 million of the tranche B term loan
      facility. In connection with the consummation of the debt offering, we were
      able
      to amend the terms of our senior credit facility.





On
      October 7, 2004, Group, as guarantor, and Viasystems, as borrower, amended
      the
      2003 Credit Agreement to provide for a new $265 million term loan facility
      (new
“Tranche B Term Loan”). The proceeds from the New Tranche B Term Loan were used
      to extinguish the net remaining balance then outstanding under the original
      Tranche B Term Loan.





On
      October 7, 2004, Group completed a Rights Offering whereby Group sold 5,555,555
      shares of common stock at $9.00 per share to current holders of Group’s common
      stock. The proceeds, net of issuance costs, of $47.1 million, were contributed
      to the Company. The proceeds from this offering were used for general working
      capital purposes and in the expansion of our printed circuit board operations
      in
      China.





In
      conjunction with the Company’s plan of reorganization approved by the Bankruptcy
      Court, a £12 million (approximately $18 million) loan guaranteed by the Company
      was cancelled and in exchange the Department of Trade and Industry (the “DTI”)
      received a note (the “DTI Note”) in an amount equal to £9 million with interest
      payable semi-annually in cash on a current basis at an annual interest rate
      of
      three percent for periods up to September 30, 2008 and at an annual interest
      rate equal to the Bank of England Base Rate plus two percent for periods
      thereafter and principal payments from December 31, 2008 through
      December 31, 2010. In May 2004, the DTI Note was discharged in full as a
      result of proceeds received by the DTI from the liquidation of Viasystems
      Tyneside Limited, resulting in a gain of $9,798.





On
      April
      22, 2005, we executed a fourth amendment of our 2003 Credit Agreement. This
      amendment, among other items, provides an add-back of up to $26.1 million of
      cash restructuring charges in the definition of EBITDA (as defined in the 2003
      Credit Agreement). In addition, the amendment allows us to exclude the operating
      results of Echt and Canada from our covenant calculations.





In
      the
      first quarter of 2006, we borrowed an additional $20 million from our revolving
      credit facility under the 2003 Credit Agreement for general operating purposes
      bringing our current borrowings, as of March 31, 2006, pursuant to the 2003
      Credit Agreement to $282.4 million.





On
      March
      21, 2006, we entered into an agreement to sell our wire harness business to
      Electrical Components International Holdings Company (“ECI”), a newly formed
      affiliate of Francisco Partners, L.P., a private equity firm. Under the terms
      of
      the stock purchase agreement, ECI will purchase all of the outstanding capital
      stock of Wire Harness Industries, Inc., the entity through which we conduct
      the
      wire harness business, for approximately $320 million, subject to a working
      capital adjustment and certain other adjustments. The closing, which is subject
      to certain conditions, including obtaining regulatory and third party consents
      or approvals, is expected to be consummated by the end of the second calendar
      quarter 2006.





The
      estimated net cash proceeds from the sale of our wire harness business of
      approximately $310 million will be applied to the repayment of all of our
      outstanding bank debt, with the remainder to be held for reinvestment in our
      ongoing businesses.





**Off
      Balance Sheet Arrangements**





None.





**Liquidity**





We
      had
      cash and cash equivalents at December 31, 2004 and December 31, 2005,
      of $112.9 million and $35.9 million, respectively. We had no outstanding balance
      under our revolving credit facility at December 31, 2004 or
      December 31, 2005. In the first quarter of 2006, we borrowed $20
      million from our revolving credit facility under the 2003 Credit Agreement
      for
      general operating purposes bringing our current borrowings, as of March 31,
      2006, pursuant to the 2003 Credit Agreement to $282.4 million.




We
      anticipate making capital expenditures of approximately $80 to $85 million
      (of
      which approximately $14 million relates to the wire harness business in 2006.)
      We believe that cash flow from operations, cash proceeds from property held
      for
      sale, available cash on hand and the cash available from our revolving credit
      facility and cash proceeds from the sale of the wire harness business will
      be
      sufficient to fund our capital expenditures and other currently anticipated
      cash
      needs. The estimated net cash proceeds from the sale of our wire harness
      business of approximately $310 million will be first applied to the repayment
      of
      all of our outstanding bank debt with the remainder to be held for reinvestment
      in our ongoing businesses. We anticipate that we will enter into a new or
      amended credit facility to provide us with liquidity for operational
      flexibility.





Our
      ability to meet our cash needs through cash generated by our operating
      activities will depend on the demand for our products, as well as general
      economic, financial, competitive and other factors, many of which are beyond
      our
      control. We cannot assure you, however, that our business will generate
      sufficient cash flow from operations, that currently anticipated cost savings
      and operating improvements will be realized on schedule or that future
      borrowings will be available to us under our senior credit facility and our
      ability to raise third party financing in an amount sufficient to enable us
      to
      pay our indebtedness or to fund our other liquidity needs. We may need to
      refinance all or a portion of our indebtedness.





The
      following table provides our material debt, capital lease and operating lease
      payments as of December 31, 2005:





**Contractual
                Obligation**
            
            **Total**
            
            **Less
                Than**
              **1
                year**
            
            **1
                — 3**
              **years**
            
            **3
                — 5**
              **years**
            
            **More
                Than**
              **5
                years****(in
                millions)**Senior
                credit facility(a)
            
            $
            262.4
            
            $
            2.7
            
            $
            5.3
            
            $
            254.4
            
            $
            —Interest
                on senior credit facility(b)
            
            
            92.6
            
            
            23.4
            
            
            46.3
            
            
            22.9
            
            
            —Senior
                subordinated notes
            
            
            200.0
            
            
            —
            
            
            —
            
            
            —
            
            
            200.0Interest
                on senior subordinated notes
            
            
            105.9
            
            
            21.0
            
            
            42.0
            
            
            42.0
            
            
            0.9Capital
                lease and other payments
            
            
            0.2
            
            
            0.2
            
            
            —
            
            
            —
            
            
            —Operating
                leases
            
            
            53.2
            
            
            12.0
            
            
            14.6
            
            
            10.3
            
            
            16.3Restructuring
                payments
            
            
            6.1
            
            
            4.7
            
            
            0.8
            
            
            0.4
            
            
            0.2Total
                contractual obligations
            
            $
            720.4
            
            $
            64.0
            
            $
            109.0
            
            $
            330.0
            
            $
            217.4





(a)
            In
                the first quarter of 2006, we borrowed $20 million from our revolving
                credit facility under the 2003 Credit Agreement bringing our current
                borrowings, as of March 31, 2006, pursuant to the 2003 Credit Agreement
                to
                $282.4 million. The revolving portion of the 2003 Credit Agreement
                expires
                in January 2008; however, we expect that upon the consummation of
                the sale
                of our wire harness business, all outstanding balances of the 2003
                Credit
                Agreement will be paid off.





(b)
            Assuming
                a 9.0% interest rate.





**Net
      Operating Losses**





For
      United States federal income tax purposes we had net operating loss
      carryforwards, or NOLs, amounting to approximately $803.3 million as of
      December 31, 2005. These NOLs expire in 2019 through 2025 if not utilized
      before then to offset taxable income. Section 382 of the Internal Revenue Code
      of 1986, as amended, and regulations issued thereunder impose limitations on
      the
      ability of corporations to use NOLs if the corporation experiences more that
      a
      50% change in ownership during certain periods. We believe an ownership change
      occurred in January 2003 in connection with the reorganization. As a
      consequence, the utilization of our NOLs is limited pursuant to Section 382
      to
      approximately $19.7 million per year, with any unused portion carried over
      to
      succeeding years. Further changes in ownership in future periods could
      substantially restrict our ability to utilize our tax net operating loss
      carryforwards. In addition, as of December 31, 2005 we had NOLs of $23.8
      million in Hong Kong, $0.3 million in China, $27.6 million in the United
      Kingdom, $68.9 million in Luxembourg, $128.3 million in Canada and $15.9 million
      in the Netherlands. These NOLs carry forward indefinitely, except for the
      Canadian NOLs which expire in 2007 through 2012.





**Backlog**





We
      estimate that our backlog of unfilled orders as of December 31, 2004 and
      2005 was approximately $167.8 million and $193.9 million, respectively. Included
      in the December 31, 2005, backlog is $71.2 million related to the wire
      harness business. On March 21, 2006, we entered into an agreement to sell our
      wire harness business. See “Management’s Discussion and Analysis of Financial
      Condition and Results of Operations—Recent Developments”. The increase in
      backlog from December 31, 2004, was due to increased customer demand at our
      Asian printed circuit board facilities and at our Chinese
      electro-mechanical solutions facilities. Because unfilled orders may be
      cancelled prior to delivery, the backlog outstanding at any point in time is
      not
      necessarily indicative of the level of business to be expected in the ensuing
      period.





***Recently
      Issued Accounting Pronouncements***





In
      June
      2005, the FASB issued SFAS No. 154, *Accounting
      Changes and Error Corrections; a replacement of APB Opinion No. 20 and SFAS
      No.
      3* .
      SFAS
      No. 154, among other items, requires an entity to provide specific details
      in
      the footnotes to the financial statements when an entity has a change in
      accounting principle, change in accounting estimate or correction of an error
      in
      previously issued financial statements. Adoption of SFAS No. 154 is required
      for
      all fiscal years beginning after December 15, 2005, with early adoption
      permitted. The Company does not expect the adoption of SFAS No. 154 to have
      an
      impact on the Company’s consolidated financial position, results of operations
      or cash flows.





In
      March
      2005, the FASB issued Staff Position (“FSP”) No. FIN 46(R)-5. FSP No. FIN
      46(R)-5 addresses whether a reporting enterprise should consider whether it
      holds an implicit variable interest in a variable interest entity (“VIE”) or
      potential VIE when specific conditions exist. The Company does not have
      interests in structures commonly referred to as VIEs. Adoption of FSP No.
      FIN46(R)-5 is required for all fiscal years beginning after June 15, 2005,
      with
      early adoption permitted. Adoption of FSP No. FIN 46(R)-5 will not have an
      impact on the Company’s consolidated financial position, results of operations
      or cash flows.





In
      March
      2005, the SEC issued Staff Accounting Bulletin (“SAB”) No. 107. SAB No. 107
      expresses views of the staff regarding the interaction between SFAS No. 123(R)
      (revised 2004), *Share-Based
      Payment* and
      certain SEC rules and regulations. In particular, SAB No. 107 provides guidance
      related to share-based payment transactions with non-employees, the transition
      from nonpublic to public entity status, valuation methods, the accounting for
      certain redeemable financial instruments issued under share-based payment
      arrangements, the classification of compensation expense and non-GAAP financial
      measures. The Company adopted the provisions of SFAS No. 123 on January 1,
      2004.
      Adoption of SAB No. 107 is required for all fiscal years beginning after
      December 15, 2005, with early adoption permitted. The Company is evaluating
      what
      effect the adoption of SFAS No. 123(R) or SAB No. 107 will have on its
      consolidated financial position, results of operations or cash
      flows.





Financial
      Accounting Standards Board (FASB) Interpretation No. 47, *Accounting
      for Conditional Asset Retirement Obligations* (as
      interpretation of FASB Statement No. 143) was issued in March 2005. This
      Interpretation provides clarification with respect to the timing of liability
      recognition for legal obligations associated with the retirement of tangible
      long-lived assets when the timing and/or method of settlement of the obligation
      is conditional on a future event. This Interpretation requires that the fair
      value of a liability for a conditional asset retirement obligation be recognized
      in the period in which it occurred if a reasonable estimate of fair value can
      be
      made. We have determined that conditional legal obligations do not exist for
      any
      of our worldwide owned and leased facilities. This is primarily due to our
      large
      international presence (95.0% of net sales) being in the low cost areas of
      the
      world, whereby, the local jurisdictions do not have the environment laws and
      regulations that pertain to our facilities and manufacturing
      operations.





In
      November 2004 (revised in December 2004), the FASB issued SFAS No. 151, *Inventory
      Costs -- an amendment of ARB No. 43, Chapter 4* to be
      effective for inventory costs incurred during fiscal years beginning after
      June
      15, 2005, with early adoption permitted. SFAS No. 151 amends the guidance in
      Accounting Research Bulleting (“ARB”) No. 43, Chapter 4, “Inventory Pricing,” to
      clarify the accounting for abnormal amounts of idle facility expense, freight,
      handling costs, and wasted material (spoilage). Paragraph 5 of ARB 43, Chapter
      4, previously stated that “. . . under some circumstances, items such as idle
      facility expense, excessive spoilage, double freight, and rehandling costs
      may
      be so abnormal as to require treatment as current period charges. . . .” SFAS
      No. 151 requires those items be recognized as current period charges regardless
      of whether they meet the criterion of “so abnormal.” In addition, FAS No. 151
      requires the allocation of fixed production overheads to the costs of conversion
      be based on the normal capacity of the production facilities. SFAS No. 51 shall
      be effective for inventory costs incurred during fiscal years beginning after
      June 15, 2005. Earlier application is permitted for inventory costs incurred
      during fiscal years beginning after November 2004. The adoption of SFAS No.
      151
      will not have an impact on the financial position or results of operations,
      as
      the Company does not have any “abnormal” costs that are currently included in
      inventory.





**Related
      Party Transactions**





***Purchases
      from International Wire Group, Inc.***





In
      March 2000, we acquired the wire harness business of International Wire
      Group, Inc. (“International Wire”), which at the time was an affiliate of HMTF.
      Our wire harness operations, in accordance with a supply agreement entered
      into
      in connection with our acquisition of the wire harness business, purchased
      an
      aggregate of $42.1 million of insulated wire products from International Wire
      in
      the year ended December 31, 2005. The terms of the supply agreement are
      consistent with terms prevailing in an arms length transaction. The negotiated
      terms of the supply agreement include the pricing, purchase commitment, payment,
      quality and liability terms. On December 31, 2005, the supply agreement
      with International Wire expired by its terms. On March 21, 2006, we entered
      into
      an agreement to sell our wire harness business. See “Management’s Discussion and
      Analysis of Financial Condition and Results of Operations—Recent
      Developments”.




Mr.
      Hamwee and Mr. Cummings, both members of our board of directors, are affiliates
      of GSCP (NJ), Inc. (“GSC”). GSC owns 27.0% of Group’s outstanding common stock
      and 16.9% of International Wire Mr. Hamwee is a member of the Board of Directors
      of International Wire. As of November 2004, HMTF was no longer affiliated with
      International Wire.




Under
      the
      terms of the purchase agreement, International Wire agreed to indemnify us
      for
      various matters associated with the pre-acquisition operations of the wire
      harness business, including product liability claims related to hose assemblies
      manufactured by one of the acquired companies through 1997. Certain claims
      have
      been asserted against International Wire by insurers as subrogees of their
      insured homeowners with respect to property damages arising from the failure
      of
      allegedly defective washing machine hose assemblies manufactured by one of
      the
      acquired companies. International Wire and its insurers to date have defended
      and/or settled all such claims consistent with their indemnity obligations.
      International Wire filed for protection under chapter 11 of the U.S. Bankruptcy
      Code on March 24, 2004. On August 5, 2004, International Wire’s plan of
      reorganization was confirmed and on October 20, 2004, International Wire emerged
      from bankruptcy. Under the terms of International Wire’s plan of reorganization,
      it assumed the obligations under its indemnity to us. While International Wire
      has advised us that it believes that it will be financially capable of honoring
      any further claims, there can be no assurance of the foregoing, in which case
      insurers could potentially assert claims directly against one of the acquired
      companies.




***Monitoring
      and Oversight Agreement***




We
        entered into a ten-year monitoring and oversight agreement with an affiliate
        of
        HMTF, effective as of January 31, 2003. Under the monitoring and oversight
        agreement, we are required to pay HMTF an annual fee, payable quarterly,
        for
        oversight and monitoring services equal to the lesser of (1) 2% of its
        consolidated EBITDA for such year and (2) $1.5 million. The fee is payable
        for
        the preceding year following the completion of the audited financial statements
        for the preceding year, provided that HMTF may elect to defer the payment
        of
        their fees, in which case these amounts will become due and payable at such
        time
        as HMTF elects to require the payment of these obligations. The monitoring
        and
        oversight agreement makes available the resources of HMTF concerning a variety
        of financial and operational matters. Historically, these services have been
        provided not only by Mr. Furst and Mr. Rosen, outside the scope of their
        duties
        as our directors, but also from numerous other principals and employees of
        HMTF.
        Mr. Furst and Mr. Rosen are each principals of HMTF. HMTF has performed various
        monitoring and oversight services, including providing input in management’s
        establishment of our financial and strategic acquisition plans. HMTF monitors
        the viability and implementation of our strategic plan through actions such
        as
        review of monthly financial data, management briefings and facility visits.
        HMTF
        is also entitled to reimbursement for any expenses incurred by it in connection
        with rendering services under the monitoring and oversight agreement. In
        addition, we have agreed to indemnify HMTF, its affiliates, and their respective
        directors, officers, controlling persons, agents and employees from and against
        all claims, liabilities, losses, damages, expenses and fees and disbursements
        of
        counsel related to or arising out of or in connection with the services rendered
        by HMTF under the monitoring and oversight agreement and not resulting primarily
        from the bad faith, gross negligence, or willful misconduct of
        HMTF.










**ITEM
      7A.*****Quantitative
      And Qualitative Disclosures About Market Risk*******





*Interest
      Rate Risk*





At
      December 31, 2004 and 2005, approximately $265.0 million and $262.4
      million, respectively, of our long-term debt, bore interest at variable rates.
      Accordingly, our earnings and cash flow are affected by changes in interest
      rates. Assuming the current level of borrowings at variable rates and assuming
      a
      two percentage point increase in the average interest rate under these
      borrowings, it is estimated that our interest expense for the year ended
      December 31, 2004 and 2005, would have increased by approximately $5.3 and
      $5.2 million, respectively. In the event of an adverse change in interest rates,
      management would likely take actions that would mitigate our exposure to
      interest rate risk; however, due to the uncertainty of the actions that would
      be
      taken and their possible effects, this analysis assumes no such action. Further,
      this analysis does not consider the effects of the change in the level of
      overall economic activity that could exist in such an environment.





*Foreign
      Currency Risk*





We
      conduct our business in various regions of the world, and export and import
      products to and from several countries. Our operations may, therefore, be
      subject to volatility because of currency fluctuations. A significant portion
      of
      our expenses and some of our sales are frequently denominated in local
      currencies, and results of operations may be affected adversely as currency
      fluctuations affect our product prices and operating costs or those of our
      competitors. From time to time, we enter into foreign exchange forward contracts
      to minimize the short-term impact of foreign currency fluctuations. We do not
      engage in hedging transactions for speculative investment reasons. Our hedging
      operations historically have not been material, and gains or losses from these
      operations have not been material to our cash flows, financial position or
      results from operations. There can be no assurance that our hedging operations
      will eliminate or substantially reduce risks associated with fluctuating
      currencies.





**ITEM
      8.*****Financial
      Statements*******





**Index
      To Financial Statements And Schedule**





**Viasystems,
                Inc. & Subsidiaries**
              Report
                of Independent Registered Public
                Accounting Firm
            31Consolidated
                Balance Sheets as
                of
              December 31,
                2004 and
                2005
            32Consolidated
                Statements of Operations for the
                years ended
              December 31,
                2003, 2004 and
                2005
            33Consolidated
                Statements of Stockholder’s
                Equity (Deficit) for the years ended
              December 31,
                2003, 2002 and 2005
            34Consolidated
                Statements of Cash Flows for
                the years ended
              December 31,
                2003, 2004 and 2005
            35Notes
                to Consolidated Financial
                Statements
            36Schedule
                II -- Valuation and Qualifying
                Accounts
            75








*Report
      Of Independent Registered Public Accounting
      Firm*





To
      the
      Board of Directors and Stockholder of Viasystems, Inc.:





In
      our
      opinion, the consolidated financial statements listed in the accompanying index
      present fairly, in all material respects, the financial position of Viasystems,
      Inc. and its subsidiaries as of December 31, 2005 and December 31,
      2004, and the results of their operations and their cash flows for each of
      the
      three years in the period ended December 31, 2005 in conformity with
      accounting principles generally accepted in the United States of America. In
      addition, in our opinion, the financial statement schedule listed in the
      accompanying index presents fairly, in all material respects, the information
      set forth therein when read in conjunction with the related consolidated
      financial statements. These financial statements and financial statement
      schedule are the responsibility of the Company's management. Our responsibility
      is to express an opinion on these financial statements and financial statement
      schedule based on our audits. We conducted our audits of these statements in
      accordance with the standards of the Public Company Accounting Oversight Board
      (United States). Those standards require that we plan and perform the audit
      to
      obtain reasonable assurance about whether the financial statements are free
      of
      material misstatement. An audit includes examining, on a test basis, evidence
      supporting the amounts and disclosures in the financial statements, assessing
      the accounting principles used and significant estimates made by management,
      and
      evaluating the overall financial statement presentation. We believe that our
      audits provide a reasonable basis for our opinion.











PricewaterhouseCoopers
      LLP


Dallas,
      Texas








March
      29,
      2006








**Viasystems,
      Inc. & Subsidiaries**





**Consolidated
      Balance Sheets**





**Year
                Ended**
              **December 31,****2004**
            
            **2005**ASSETS**(In
                thousands)**Current
                assets:Cash
                and cash equivalents
            
            $
            112,891
            
            $
            35,923Accounts
                receivable, net of allowance for doubtful accounts
              of
                $13,827 and $10,732, respectively
            
            
            140,618
            
            
            141,890Inventories
            
            
            103,904
            
            
            105,953Property
                held for sale
            
            
            6,913
            
            
            16,583Prepaid
                expenses and other
            
            
            14,807
            
            
            22,687Total
                current assets
            
            
            379,133
            
            
            323,036Property,
                plant and equipment, net
            
            
            233,764
            
            
            255,654Deferred
                financing costs, net
            
            
            8,931
            
            
            7,699Goodwill
            
            
            109,980
            
            
            110,238Intangible
                assets, net
            
            
            9,985
            
            
            8,836Other
                assets
            
            
            8,616
            
            
            8,481Total
                assets
            
            $
            750,409
            
            $
            713,944LIABILITIES
                AND STOCKHOLDER’S EQUITY (DEFICIT)Current
                liabilities:Accounts
                payable
            
            $
            151,247
            
            $
            159,269Accrued
                and other liabilities
            
            
            68,542
            
            
            68,489Income
                taxes payable
            
            
            4,937
            
            
            715Current
                maturities of long-term debt
            
            
            2,929
            
            
            2,828Total
                current liabilities
            
            
            227,655
            
            
            231,301Deferred
                taxes
            
            
            2,321
            
            
            8,653Accrued
                income taxes
            
            
            ―
            
            
            14,289Long-term
                debt, less current maturities
            
            
            462,626
            
            
            459,707Other
                non-current liabilities
            
            
            1,273
            
            
            1,722Total
                liabilities
            
            
            693,875
            
            
            715,672Commitments
                and contingencies
              Stockholder’s
                equity (deficit)Common
                stock, $0.01 par value, 1,000 shares authorized, issued and
                outstanding
            
            
            ―
            
            
            ―Paid-in
                capital
            
            
            2,426,794
            
            
            2,433,587Accumulated
                deficit
            
            
            (2,356,426
            )
            
            (2,437,655
            )Accumulated
                other comprehensive (loss) income
            
            
            (13,834
            )
            
            2,340Total
                stockholder’s equity (deficit)
            
            
            56,534
            
            
            (1,728
            )Total
                liabilities and stockholder’s equity (deficit)
            
            $
            750,409
            
            $
            713,944





The
      accompanying notes are an integral part of the consolidated financial
      statements.





**Viasystems,
      Inc. & Subsidiaries**





**Consolidated
      Statements of
      Operations**








**Year
                Ended December 31,****2003**
            
            **2004**
            
            **2005****(In
                thousands)**Net
                sales
            
            $
            751,483
            
            $
            901,363
            
            $
            948,518Operating
                expenses:Cost
                of goods sold, exclusive of items shown separately below
            
            
            597,546
            
            
            728,249
            
            
            788,840Selling,
                general and administrative
            
            
            64,119
            
            
            77,977
            
            
            81,924Stock
                compensation expense
            
            
            1,383
            
            
            3,837
            
            
            6,793Depreciation
            
            
            66,070
            
            
            48,232
            
            
            51,586Amortization
            
            
            3,065
            
            
            1,570
            
            
            1,436Restructuring
                and impairment charges
            
            
            66,199
            
            
            1,013
            
            
            27,934Goodwill
                impairment
            
            
            22,697
            
            
            —
            
            
            —Loss
                (gain) on dispositions of businesses, net
            
            
            1,226
            
            
            (465
            )
            
            —Operating
                (loss) income
            
            
            (70,822
            )
            
            40,950
            
            
            (9,995
            )Other
                expenses (income):Interest
                expense, net
            
            
            29,729
            
            
            37,818
            
            
            40,760Amortization
                of deferred financing costs
            
            
            104
            
            
            1,305
            
            
            1,613Reorganization
                items:Reorganization
                expenses (reversals)
            
            
            55,255
            
            
            (9,776
            )
            
            —Loss
                from debt forgiveness
            
            
            1,517
            
            
            —
            
            
            —Other
                expense (income), net
            
            
            6,882
            
            
            (987
            )
            
            12,896(Loss)
                income before income taxes
            
            
            (164,309
            )
            
            12,590
            
            
            (65,264
            )Income
                taxes
            
            
            —
            
            
            6,842
            
            
            15,965Net
                (loss) income
            
            $
            (164,309
            )
            $
            5,748
            
            $
            (81,229
            )





The
      accompanying notes are an integral part of the consolidated financial
      statements.





**Viasystems,
      Inc. & Subsidiaries**





**Consolidated
      Statements of Stockholder’s Equity
      (Deficit) and Comprehensive Income (Loss)**








**Common**
              **Stock**
            
            **Paid-in**
              **Capital**
            
            **Accumulated**
              **Deficit**
            
            **Accumulated**
              **and
                Other**
              **Comprehensive**
              **Income
                (Loss)**
            
            **Total****(In
                thousands)**Balance
                at December 31, 2002
            
            
            
            
            $
            $1,634,512
            
            $
            (2,197,865
            )
            $
            (21,356
            )
            $
            (584,709
            )Comprehensive
                loss:Net
                loss
            
            
            —
            
            
            —
            
            
            (164,309
            )
            
            —
            
            
            (164,309
            )Foreign
                currency translation adjustments,
              net
                of taxes of $0
            
            
            —
            
            
            —
            
            
            —
            
            
            11,969
            
            
            11,969Total
                comprehensive loss
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (152,340
            )Capital
                contribution by Group
            
            
            —
            
            
            738,146
            
            
            —
            
            
            —
            
            
            738,146Stock
                compensation expense
            
            
            —
            
            
            1,383
            
            
            —
            
            
            —
            
            
            1,383Balance
                at December 31, 2003
            
            $
            —
            
            $
            2,374,041
            
            $
            (2,362,174
            )
            $
            (9,387
            )
            $
            2,480Comprehensive
                income:Net
                income
            
            
            —
            
            
            —
            
            
            5,748
            
            
            —
            
            
            5,748Foreign
                currency translation adjustments,
              net
                of taxes of $0
            
            
            —
            
            
            —
            
            
            —
            
            
            (4,447
            )
            
            (4,447
            )Total
                comprehensive income
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            1,301Capital
                contribution by Group
            
            
            —
            
            
            48,916
            
            
            —
            
            
            —
            
            
            48,916Stock
                compensation expense
            
            
            —
            
            
            3,837
            
            
            —
            
            
            —
            
            
            3,837Balance
                at December 31, 2004
            
            $
            —
            
            $
            2,426,794
            
            $
            (2,356,426
            )
            $
            (13,834
            )
            $
            56,534Comprehensive
                income:Net
                loss
            
            
            —
            
            
            —
            
            
            (81,229
            )
            
            —
            
            
            (81,229
            )Change
                in fair value of derivatives
            
            
            —
            
            
            —
            
            
            —
            
            
            75
            
            
            75Foreign
                currency translation adjustments,
              net
                of taxes of $0
            
            
            —
            
            
            —
            
            
            —
            
            
            16,099
            
            
            16,099Total
                comprehensive loss
            
            
            
            
            
            
            
            
            
            
            
            
            
            
            (65,055
            )Stock
                compensation expense
            
            
            —
            
            
            6,793
            
            
            —
            
            
            —
            
            
            6,793Balance
                at December 31, 2005
            
            $
            —
            
            $
            2,433,587
            
            $
            (2,437,655
            )
            $
            2,340
            
            $
            (1,728
            )





The
      accompanying notes are an integral part of the consolidated financial
      statements.








**Viasystems,
      Inc. & Subsidiaries**





**Consolidated
      Statements of Cash
      Flows**


**Year
                Ended December 31,****2003**
            
            **2004**
            
            **2005****(In
                thousands)**Cash
                flows from operating activities:Net
                (loss) income
            
            $
            (164,309
            )
            $
            5,748
            
            $
            (81,229
            )Adjustments
                to reconcile net (loss) income to net cashprovided
                by operating activities:Depreciation
                and amortization
            
            
            69,135
            
            
            49,802
            
            
            53,022Translation
                adjustment, net
            
            
            —
            
            
            —
            
            
            10,923Non-cash
                stock option compensation charge
            
            
            1,383
            
            
            3,837
            
            
            6,793Deferred
                taxes
            
            
            1,725
            
            
            4,565
            
            
            3,739Impairment
                of assets
            
            
            65,372
            
            
            4,564
            
            
            1,823Amortization
                of deferred financing costs
            
            
            104
            
            
            1,305
            
            
            1,613Loss
                on sale of property, plant and equipment
            
            
            31
            
            
            931
            
            
            711Gain
                from sale of North Tyneside facility
            
            
            —
            
            
            (9,789
            )
            
            —Loss
                (gain) on dispositions of businesses
            
            
            1,226
            
            
            (465
            )
            
            —Write-off
                of deferred financing fees, premium and
              discount
                related to debt forgiveness
            
            
            53,203
            
            
            —
            
            
            —Goodwill
                impairment
            
            
            22,697
            
            
            —
            
            
            —Loss
                from debt forgiveness
            
            
            1,517
            
            
            —
            
            
            —Change
                in assets and liabilities, net of acquisitions:Accounts
                receivable
            
            
            (14,058
            )
            
            (4,665
            )
            
            (1,568
            )Inventories
            
            
            (10,150
            )
            
            (15,221
            )
            
            (1,230
            )Prepaid
                expenses and other
            
            
            (10,912
            )
            
            20,070
            
            
            (3,139
            )Intercompany
                receivable with Viasystems Group, Inc.
            
            
            4,551
            
            
            (6,087
            )
            
            (143
            )Accounts
                payable and accrued and other liabilities
            
            
            33,136
            
            
            13,660
            
            
            10,854Income
                taxes payable
            
            
            (6,241
            )
            
            (2,338
            )
            
            9,477Net
                cash provided by operating activities
            
            
            48,410
            
            
            65,917
            
            
            11,646Cash
                flows from investing activities:Capital
                expenditures
            
            
            (47,506
            )
            
            (72,006
            )
            
            (85,032
            )Sale
                of property, plant and equipment
            
            
            620
            
            
            73
            
            
            10Sale
                of businesses and joint venture interest
            
            
            (138
            )
            
            —
            
            
            —Net
                cash used in investing activities
            
            
            (47,024
            )
            
            (71,933
            )
            
            (85,022
            )Cash
                flows from financing activities:Repayment
                of amounts due under credit facilities
            
            
            (205,500
            )
            
            (243,260
            )
            
            (2,650
            )Financing
                fees and other
            
            
            (6,334
            )
            
            (1,430
            )
            
            (321
            )Repayment
                of other long-term and capital lease obligations
            
            
            (144
            )
            
            (273
            )
            
            (274
            )Proceeds
                from issuance of long-term debt under credit facilities
            
            
            —
            
            
            265,000
            
            
            —Capital
                contributed by Group
            
            
            102
            
            
            48,916
            
            
            —Repayment
                of amounts due under note due to the Department of
              Trade
                and Industry
            
            
            (3,127
            )
            
            (12,549
            )
            
            —Proceeds
                from issuance of long-term debt under senior
              subordinated
                notes
            
            
            200,000
            
            
            —
            
            
            —Net
                cash (used in) provided by financing activities
            
            
            (15,003
            )
            
            56,404
            
            
            (3,245
            )Effect
                of exchange rate changes on cash and cash equivalents
            
            
            (6,767
            )
            
            (173
            )
            
            (347
            )Net
                change in cash and cash equivalents
            
            
            (20,384
            )
            
            50,215
            
            
            (76,968
            )Cash
                and cash equivalents at beginning of year
            
            
            83,060
            
            
            62,676
            
            
            112,891Cash
                and cash equivalents at end of year
            
            $
            62,676
            
            $
            112,891
            
            $
            35,923





The
      accompanying notes are an integral part of the consolidated financial
      statements.





**Viasystems,
      Inc. & Subsidiaries**





**Notes
      to Consolidated Financial
      Statements**


**(In
      thousands)**





**1.
      Basis of Presentation and Summary of Significant Accounting
      Policies**





Viasystems,
      Inc. (“Viasystems” or the “Company”), a wholly owned subsidiary of Viasystems
      Group, Inc., (“Group”), was formed on April 2, 1997. On April 10, 1997, Group
      contributed to Viasystems all of the capital of its then existing subsidiaries.
      Prior to the contribution of capital by Group, Viasystems had no operations
      of
      its own. The consolidated financial statements included herein present the
      results of operations of Viasystems and its subsidiaries. As used herein, the
      “Company” refers to Viasystems and its subsidiaries subsequent to the capital
      contribution by Group and to Group and its subsidiaries prior to such capital
      contribution.




***Nature
      of Business***





The
      Company is a leading worldwide provider of complex multi-layer printed circuit
      boards, wire harnesses and electro-mechanical solutions. The Company conducts
      its operations in two primary segments, (i) printed circuit board
      manufacturing and (ii) assembly. Its products are used in a wide range of
      applications, including automotive dash panels and control modules, major
      household appliances, data networking equipment, telecommunications switching
      equipment and complex medical and technical instruments.




***Principles
      of Consolidation***





The
      accompanying consolidated financial statements include the accounts of the
      Company. All material intercompany balances and transactions have been
      eliminated in consolidation.




***Reclassifications***




The
      accompanying consolidated balance sheet contains certain reclassifications
      to
      conform with the presentation used in the current period. These
      reclassifications of prior period balances include $6,913 of “property held for
      sale” that was previously included in “other assets, net”.




***Cash
      and Cash Equivalents***





The
      Company considers investments purchased with an original maturity of three
      months or less to be cash equivalents.




***Foreign
      Currency Translation***





The
      assets and liabilities of foreign subsidiaries using the local currency as
      their
      functional currency are translated to U.S. dollars based on current exchange
      rates, and any resulting translation adjustments are included in Accumulated
      other comprehensive (loss) income. The accumulated other comprehensive (loss)
      income amount also reflects foreign currency exchange rate changes related
      to
      certain qualifying assets and liabilities (deemed long-term in nature)
      denominated in currencies other than an entity’s functional currency. The net
      translation adjustment for the year ended December 31, 2005 was $16,099
      (net of tax of $0.0). An adjustment of $10,923 reflects amounts transferred
      to
      other expense as a result of the reversal of cumulative translation adjustments
      required in connection with the liquidation of foreign investments (from the
      closure of the Montreal, Canada and Echt, the Netherlands printed circuit board
      operations). The remaining $5,176 was the result of currency rate changes during
      the year.




Also
      included in the net income are the gains and losses arising from transactions
      denominated in a currency other than the functional currency of a location,
      the
      impact of re-measuring assets and liabilities of foreign subsidiaries using
      U.S.
      dollars as their functional currency, and the results of our foreign currency
      hedging activities; for additional discussion of hedging activities, see Note
      15.







***Derivative
      Financial Instruments***





From
      time
      to time, the Company enters into foreign exchange forward contracts to minimize
      the short-term impact of foreign currency fluctuations. Such transactions are
      not material, and gains and losses from such activities are not significant.
      However, there can be no assurance that these activities will eliminate or
      reduce foreign currency risk. Gains/losses on derivative contracts are
      reclassified from accumulated other comprehensive income (loss) to current
      period earnings in the line item in which the hedged item is recorded at the
      time the contracts are settled.




***Accounts
      Receivable***





Accounts
      receivable balances represent customer trade receivables generated from the
      Company’s operations. To reduce the potential for credit risk, the Company
      evaluates the collectibility of customer balances based on a combination of
      factors but does not generally require significant collateral. The Company
      regularly analyzes significant customer balances, and, when it becomes evident
      a
      specific customer will be unable to meet its financial obligations to the
      Company for reasons including, but not limited to, bankruptcy filings or
      deterioration in the customer’s operating results or financial position, a
      specific allowance for doubtful accounts is recorded to reduce the related
      receivable to the amount that is believed reasonably collectible. The Company
      also records an allowance for doubtful accounts for all other customers based
      on
      a variety of factors including the length of time the receivables are past
      due,
      the financial health of the customer and historical experiences. If
      circumstances related to specific customers change, estimates of the
      recoverability of receivables could be further adjusted.




***Inventories***





Inventories
      are stated at the lower of cost (valued using the first-in, first-out (FIFO)
      or
      last-in, first-out (LIFO) method) or market. Cost includes raw materials, labor
      and manufacturing overhead. LIFO is utilized for certain wire harness and
      assembly inventories. For the years ended December 31, 2004 and 2005, the
      percentage of consolidated net inventories valued at LIFO was 32% and 31%,
      respectively. (See Note 21 Subsequent Events.)




Inventories
      would have decreased by approximately $4,454 and $4,266 at December 31,
      2004 and 2005, respectively, had the FIFO method been used to
      determine inventory cost of all inventories. During 2005, certain inventory
      quantity reductions caused a liquidation of LIFO inventory values. The
      liquidation increased net loss by $275 (net of $0 income taxes).




***Property,
      Plant and Equipment***





Property,
      plant and equipment are recorded at cost. Repairs and maintenance that do not
      extend the useful life of an asset, are charged to expense as incurred. The
      useful lives of leasehold improvements are the lesser of the remaining lease
      term or the useful life of the improvement. When assets are retired or otherwise
      disposed of, their costs and related accumulated depreciation are removed from
      the accounts and any resulting gains or losses are included in the operations
      for the period. Depreciation is computed using the straight-line method over
      the
      estimated useful lives of the related assets as follows:




Building
            39-50
                yearsLeasehold
                improvements
            10-12
                yearsMachinery,
                equipment, systems and other
            3-10
                years





***Deferred
      Financing Costs***





Deferred
      financing costs, consisting of fees and other expenses associated with debt
      financing, are amortized over the term of the related debt using the
      straight-line method, which approximates the effective interest
      method.




***Income
      Taxes***





The
      Company accounts for certain items of income and expense in different periods
      for financial reporting and income tax purposes. Provisions for deferred income
      taxes are made in recognition of such temporary differences, where applicable.
      A
      valuation allowance is established against deferred tax assets unless the
      Company believes it is more likely than not that the benefit will be
      realized.




***Intangible
      Assets***




Intangible
      assets consist primarily of identifiable intangibles acquired and goodwill
      arising from the excess of cost over the fair value of net assets acquired.
      Amortization of identifiable intangible assets acquired is computed using
      systematic methods over the estimated useful lives of the related assets as
      follows:




**Life**
            **Method**Developed
                technologies
            15
                years
            Double-declining
                balance





***Impairment
      of Long-Lived Assets***





In
      reviewing goodwill for impairment under SFAS No. 142, potential impairment
      is
      identified by comparing the fair value of a reporting unit with its carrying
      amount, and if the fair value is less than the carrying amount, an impairment
      loss is recorded as the excess of the carrying amount of the goodwill over
      the
      implied fair value. The implied fair value of goodwill is determined by
      allocating the fair value of the reporting unit to all of its assets and
      liabilities, with any excess of fair value of the reporting unit over the
      amounts allocated representing the implied fair value of that unit's goodwill.
      This review is performed at the Company's reporting unit's level. Reporting
      units are either an operating segment as defined in SFAS No.131 or one level
      below the operating segment.




The
      Company reviews the carrying amounts of long-lived assets other than goodwill
      for potential impairment whenever events or changes in circumstances indicate
      that the carrying amount of an asset may not be recoverable. In evaluating
      the
      recoverability of assets, long-lived assets are grouped at the lowest level
      for
      which identifiable cash flows are largely independent of the cash flows of
      other
      assets, then management compares the carrying amounts of such each asset groups
      with the its estimated undiscounted future operating cash flows. In the event
      an
      impairment exists, an impairment charge would be measured as the amount by
      which
      the carrying amount of the long-lived asset group exceeds its fair value. In
      addition, the remaining useful life of an impaired asset group would be
      reassessed and revised if necessary.




***Product
      Warranties***





Provisions
      for estimated expenses related to product warranties are made at the time
      products are sold. These estimates are established using historical information
      on the nature, frequency and average cost of warranty claims.




**Revenue
      Recognition**





The
      Company recognizes revenue when all of the following criteria are satisfied: persuasive
      evidence of an arrangement exists; risk of loss and title transfer to the
      customer; the price is fixed and determinable; and collectibility is reasonably
      assured. Sales and related costs of goods sold are included in income when
      goods
      are shipped to the customer in accordance with the delivery terms, except in
      the
      case of vendor managed inventory arrangements, whereby sales and the related
      costs of goods sold are included in income when possession of goods is taken
      by
      the customer. All services are performed prior to invoicing customers for any
      products manufactured by the Company. Reserves for product returns are recorded
      based on historical trend rates at the time of sale.




***Shipping
      Costs***





Costs
      incurred by the Company to ship finished goods to our customers are included
      in
      Selling, general and administrative on the Consolidated Statement of Operations.
      These costs were $3,575, $6,598 and $10,664 in 2003, 2004, and 2005,
      respectively.





***Environmental
      Costs***





Accruals
      for environmental matters are recorded in operating expenses when it is probable
      that a liability has been incurred and the amount of the liability can be
      reasonably estimated. Accrued liabilities do not include claims against third
      parties and are not discounted. Costs related to environmental remediation
      are
      charged to expense. Other environmental costs are also charged to expense unless
      they increase the value of the property and/or mitigate or prevent contamination
      from future operations, in which event they are capitalized.




***Use
      of Estimates***





The
      preparation of these consolidated financial statements requires us to make
      estimates, assumptions and judgments that affect the reported amounts of assets,
      liabilities, net sales and expenses and related disclosure of contingent assets
      and liabilities. On an on-going basis we evaluate our estimates, including:
      allowance for bad debts; valuation and recoverability of inventory; amortization
      periods; recoverability of long-term assets, intangible assets and goodwill;
      income taxes; and litigation. We base our estimates on historical experience
      and
      on various other assumptions which we believe to be reasonable under the
      circumstances, the results of which form the basis for making judgments about
      the carrying values of assets and liabilities that are not readily apparent
      from
      other sources. Actual results may differ from these estimates under different
      assumptions or conditions.





***Fair
      Value of Financial Instruments***





The
      fair
      market values of the Company’s long-term obligations are as
      follows:




**December 31,****2004**
            
            **2005**Senior
                Subordinated Notes due 2011
            
            $
            196,000
            
            $
            191,750Credit
                Agreement
            
            $
            267,995
            
            $
            262,350





The
      Company determined the 2004 and 2005 fair values of the Senior Subordinated
      Notes due 2011 using published market values from third party sources. The
      Company determined the 2004 and 2005 fair values of the credit agreement using
      the credit agreement trading values from a third party source. In addition,
      the
      Company has various other insignificant long-term obligations, and the fair
      values of these obligations are estimated by management to be equal to the
      carrying value.




***Employee
      Stock-Based Compensation***





SFAS
      No.
      148, *Accounting
      for Stock-Based Compensation-Transition and Disclosure, an Amendment of FASB
      Statement No. 123* ,
      was
      issued to provide alternative methods of transition of an entity that
      voluntarily changes to the fair value based method of accounting for stock-based
      employee compensation. It also amends the disclosure provisions of SFAS No.
      123, *Accounting
      for Stock-Based Compensation,* to
      require prominent disclosure about the effects on reported net income of an
      entity’s accounting policy decisions with respect to the stock-based employee
      compensation and it amends Accounting Principles Board Opinion (“APB”) No. 28, *Interim
      Financial Reporting,* to
      require disclosure about those effects in interim financial
      information.




Group,
      the holding company parent of Viasystems, maintains a stock option plan. The
      Company records expenses attributable to Group’s stock option plan. In
      connection with the Company’s plan of reorganization pursuant to chapter 11 of
      the United States Bankruptcy Code (the “Reorganization”), the Company terminated
      its 1997 and 2001 stock option plans and adopted the 2003 stock option plan.
      The
      options issued under the 2003 stock option plan have a fixed exercise price
      of
      $12.63 per share and vest one-third at the grant date, one-third on the 24-month
      anniversary of the grant date and one-third on the 36-month anniversary of
      the
      grant date. As a result of the termination of the 1997 and 2001 stock option
      plans and the adoption of the 2003 stock option plan, under provisions of
      Financial Interpretation Number (“FIN”) No. 44, *Accounting
      for Certain Transactions Involving Stock Compensation an Interpretation of
      APB
      Opinion No. 25* ,
      certain
      options issued under the 2003 stock option plan were treated as “variable”
options. As a result, the Company recorded non-cash compensation expense of
      $1,383 for the year ended December 31, 2003.




Effective
      January 1, 2004, the Company adopted the fair value recognition provisions
      of
      SFAS No. 123. Under the modified prospective transition method selected by
      the
      Company as described in SFAS No. 148, compensation cost recognized for the
      year
      ended December 31, 2004 is the same as that which would have been
      recognized had the fair value method of SFAS No. 123 been applied from its
      original effective date. As a result, the Company recorded non-cash compensation
      expense of $3,837 and $6,793, for the years ended December 31, 2004 and
      2005, respectively. For the year ended December 31, 2004, the stock
      compensation expense was $3,387, of which, $3,722 related to selling, general
      and administrative expenses and $115 related to cost of goods sold. For the
      year
      ended December 31, 2005, the stock compensation expense was $6,793, of
      which, $6,555 related to selling, general and administrative expenses and $238
      related to cost of goods sold. As required under SFAS No. 123, the pro forma
      effects of stock-based compensation on net (loss) income are as
      follows:




**2003**
            
            **2004**
            
            **2005**Net
                (loss) income, as reported
            
            $
            (164,309
            )
            $
            5,748
            
            $
            (81,229
            )Plus:
                Stock-based employee compensation expense
              included
                in reported net (loss) income, net of related
              tax
                effects
            
            
            1,383
            
            
            3,837
            
            
            6,793Less:
                Total stock-based employee compensation
              expense
                determined under fair value based method for
              all
                awards, net of related tax effects
            
            
            (15,932
            )
            
            (3,837
            )
            
            (6,793
            )Pro
                forma net (loss) income
            
            $
            (178,858
            )
            $
            5,748
            
            $
            (81,229
            )





The
      fair
      value of each option grant is estimated on the date of the grant using the
      Black-Scholes option-pricing model using the following assumptions:




**2003**
            **2004**
            **2005**Expected
                life of options
            5
                years
            5
                years
            5
                yearsRisk-free
                interest rate
            4.01%
            3.50%
            4.00%Expected
                volatility of stock
            50%
            50%
            50%Expected
                dividend yield
            None
            None
            None








***Recently
      Issued Accounting Pronouncements***





In
      June
      2005, the FASB issued SFAS No. 154, *Accounting
      Changes and Error Corrections; a replacement of APB Opinion No. 20 and SFAS
      No.
      3* .
      SFAS
      No. 154, among other items, requires an entity to provide specific details
      in
      the footnotes to the financial statements when an entity has a change in
      accounting principle, change in accounting estimate or correction of an error
      in
      previously issued financial statements. Adoption of SFAS No. 154 is
      required for all fiscal years beginning after December 15, 2005, with early
      adoption permitted. The Company does not expect the adoption of SFAS No. 154
      to
      have an impact on the Company’s consolidated financial position, results of
      operations or cash flows.





In
      March
      2005, the FASB issued Staff Position (“FSP”) No. FIN 46(R)-5. FSP No. FIN
      46(R)-5 addresses whether a reporting enterprise should consider whether it
      holds an implicit variable interest in a variable interest entity (“VIE”) or
      potential VIE when specific conditions exist. The Company does not have
      interests in structures commonly referred to as VIEs. Adoption of FSP No.
      FIN46(R)-5 is required for all fiscal years beginning after June 15, 2005,
      with
      early adoption permitted. Adoption of FSP No. FIN 46(R)-5 will not have an
      impact on the Company’s consolidated financial position, results of operations
      or cash flows.





In
      March
      2005, the SEC issued Staff Accounting Bulletin (“SAB”) No. 107. SAB No. 107
      expresses views of the staff regarding the interaction between SFAS No. 123(R)
      (revised 2004), *Share-Based
      Payment* and
      certain SEC rules and regulations. In particular, SAB No. 107 provides guidance
      related to share-based payment transactions with non-employees, the transition
      from nonpublic to public entity status, valuation methods, the accounting for
      certain redeemable financial instruments issued under share-based payment
      arrangements, the classification of compensation expense and non-GAAP financial
      measures. The Company adopted the provisions of SFAS No. 123 on January 1,
      2004.
      Adoption of SAB No. 107 is required for all fiscal years beginning after
      December 15, 2005. Therefore the Company will adopt SAB No. 107 effective
      January 1, 2006. The Company is evaluating what effect the adoption of SFAS
      No.
      123(R) or SAB No. 107 will have on its consolidated financial position, results
      of operations or cash flows.





Financial
      Accounting Standards Board (FASB) Interpretation No. 47, “Accounting for
      Conditional Asset Retirement Obligations (as interpretation of FASB Statement
      No. 143)” was issued in March 2005. This Interpretation provides clarification
      with respect to the timing of liability recognition for legal obligations
      associated with the retirement of tangible long-lived assets when the timing
      and/or method of settlement of the obligation is conditional on a future event.
      This Interpretation requires that the fair value of a liability for a
      conditional asset retirement obligation be recognized in the period in which
      it
      occurred if a reasonable estimate of fair value can be made. We have determined
      that conditional legal obligations do not exist for any of our worldwide owned
      and leased facilities. This is primarily due to our large international presence
      (95.0% of net sales) being in the low cost areas of the world, where there
      are
      no local environment laws and regulations that pertain to our facilities and
      manufacturing operations.





In
      November 2004 (revised in December 2004), the FASB issued SFAS No. 151, *Inventory
      Costs -- an amendment of ARB No. 43, Chapter 4* to be
      effective for inventory costs incurred during fiscal years beginning after
      June
      15, 2005, with early adoption permitted. SFAS No. 151 amends the guidance in
      Accounting Research Bulleting (“ARB”) No. 43, Chapter 4, “Inventory Pricing,” to
      clarify the accounting for abnormal amounts of idle facility expense, freight,
      handling costs, and wasted material (spoilage). Paragraph 5 of ARB 43, Chapter
      4, previously stated that “. . . under some circumstances, items such as idle
      facility expense, excessive spoilage, double freight, and rehandling costs
      may
      be so abnormal as to require treatment as current period charges. . . .” SFAS
      No. 151 requires those items be recognized as current period charges regardless
      of whether they meet the criterion of “so abnormal.” In addition, FAS No. 151
      requires the allocation of fixed production overheads to the costs of conversion
      be based on the normal capacity of the production facilities. SFAS No. 51 shall
      be effective for inventory costs incurred during fiscal years beginning after
      June 15, 2005. Earlier application is permitted for inventory costs incurred
      during fiscal years beginning after November 2004. The adoption of SFAS No.
      151
      will not have an impact on the financial position or results of operations,
      as
      the Company does not have any “abnormal” costs that are currently included in
      inventory.





**2.
      Supplemental Cash Flow Disclosure**





Cash
      paid
      for interest for the years ended December 31, 2003, 2004 and 2005 was
      $31,497, $26,315 and $39,703 respectively. For the years ended December 31,
      2003, 2004 and 2005, net cash paid for income taxes was $4,894, $5,437 and
      $2,357, respectively.




**3.
      Inventories**





The
      composition of inventories at December 31 is as follows:




**2004**
            
            **2005**Raw
                materials
            
            $
            40,803
            
            $
            38,518Work
                in process
            
            
            20,767
            
            
            22,913Finished
                goods
            
            
            42,334
            
            
            44,522Total
            
            $
            103,904
            
            $
            105,953





**4.**  **Property
      held for sale**





At
      December 31, 2005, Property held for sale includes land and buildings
      related to the closed operations of (i) Richmond, Virginia,
      (ii) Montreal, Canada (2 facilities), (iii) Granby, Canada,
      (iv) Mishawaka, Indiana, and (v) Echt, the Netherlands. At
      December 31, 2004, Property held for sale included land and buildings
      related to the closed operations of (a) Richmond, Virginia and
      (b) Granby, Canada. Currently, the Company is actively marketing this real
      estate and currently has contracts relative to the real estate in (i) Richmond,
      Virginia, (ii) Montreal, Canada (2 facilities), and (iii) Granby, Canada, but
      there is no certain disposal date. On March 14, 2006, the Company sold the
      real
      estate in Mishawaka, Indiana and the Company received net proceeds of
      approximately $630 which approximates carrying value.





**5.
      Goodwill and Other Intangible Assets**





As
      required by the provisions of SFAS No. 142, the Company performs an annual
      impairment evaluation of goodwill and other indefinite lived intangible assets.
      As demonstrated in the following table, for the year ended December 31,
      2003 the evaluation resulted in the recognition of impairment in the Company’s
      European Printed Circuit Boards reporting unit of $22,697. No impairments were
      recorded for the years ended December 31, 2004 and 2005.




**China
                  Printed**
                **Circuit
                  Boards**
              
              **North**
                **American**
                **Printed**
                **Circuit
                  Boards**
              
              **European**
                **Printed**
                **Circuit
                  Boards**
              
              **Assembly**
              
              **Total**Goodwill
                  at December 31, 2002
              
              $
              79,232
              
              $
              —
              
              $
              19,920
              
              $
              30,549
              
              $
              129,701Impairment
                  under SFAS No. 142
              
              
              —
              
              
              —
              
              
              (22,697
              )
              
              —
              
              
              (22,697
              )Effect
                  of foreign exchange rates
              
              
              346
              
              
              ―
              
              
              2,777
              
              
              ―
              
              
              3,123Goodwill
                  at December 31, 2003
              
              
              79,578
              
              
              ―
              
              
              ―
              
              
              30,549
              
              
              110,127Effect
                  of foreign exchange rates
              
              
              (147
              )
              
              ―
              
              
              ―
              
              
              ―
              
              
              (147
              )Goodwill
                  at December 31, 2004
              
              
              79,431
              
              
              ―
              
              
              ―
              
              
              30,549
              
              
              109,980Effect
                  of foreign exchange rates
              
              
              258
              
              
              ―
              
              
              ―
              
              
              ―
              
              
              258Goodwill
                  at December 31, 2005
              
              $
              79,689
              
              $
              ―
              
              $
              ―
              
              $
              30,549
              
              $
              110,238




The
      components of intangible assets subject to amortization were as
      follows:




**December 31,
                2004**
            
            **December 31,
                2005****Gross**
              **Carrying**
              **Amount**
            
            **Accumulated**
              **Amortization**
            
            **Gross**
              **Carrying**
              **Amount**
            
            **Accumulated**
              **Amortization**Developed
                technologies
            
            $
            20,397
            
            $
            (11,237
            )
            $
            20,423
            
            $
            (12,248
            )Other
            
            
            1,352
            
            
            (527
            )
            
            1,581
            
            
            (920
            )Total
            
            $
            21,749
            
            $
            (11,764
            )
            $
            22,004
            
            $
            (13,168
            )





The
      Company paid $439 and $229 for acquisitions of patents during the years ended
      December 31, 2004 and 2005, respectively. In addition, the Company impaired
      $7,850 in developed technologies and $1,374 in trademarks at December 31,
      2003 (see Note 11).




Expected
                future annual amortization expense for the next five fiscal years
                is as
                follows:2006
            
            $
            1,1662007
            
            
            1,1152008
            
            
            1,0982009
            
            
            1,0242010
            
            
            944Thereafter
            
            
            3,489





**6.
      Property, Plant and Equipment**





The
      composition of property, plant and equipment at December 31 is as follows
      (See Note 21 Subsequent Events):





**2004**
            
            **2005**Land
                and buildings
            
            $
            100,327
            
            $
            51,308Machinery,
                equipment and systems
            
            
            549,793
            
            
            382,149Construction
                in progress
            
            
            17,074
            
            
            10,723Leasehold
                improvements
            
            
            22,699
            
            
            30,587689,893
            
            
            474,767Less:
                Accumulated depreciation
            
            
            (456,129
            )
            
            (219,113
            )Total
            
            $
            233,764
            
            $
            255,654





**7.
      Accrued and Other Liabilities**





The
      composition of accrued and other liabilities at December 31 is as
      follows:




**2004**
            
            **2005**Accrued
                payroll and related costs
            
            $
            26,726
            
            $
            17,841Accrued
                restructuring
            
            
            4,856
            
            
            6,097Accrued
                interest
            
            
            13,447
            
            
            15,461Deferred
                taxes
            
            
            4,311
            
            
            4,311Product
                warranties
            
            
            2,018
            
            
            2,556Accrued
                other
            
            
            17,184
            
            
            22,223Total
            
            $
            68,542
            
            $
            68,489





**8.
      Long-Term Debt**





The
      composition of long-term debt at December 31 is as follows:




**2004**
            
            **2005**Credit
                Agreement:Term
                Facilities
            
            $
            265,000
            
            $
            262,350Revolver
            
            
            —
            
            
            —Senior
                Subordinated Notes due 2011
            
            
            200,000
            
            
            200,000Capital
                lease obligations
            
            
            555
            
            
            185465,555
            
            
            462,535Less:
                Current maturities
            
            
            (2,929
            )
            
            (2,828
            )Total
            
            $
            462,626
            
            $
            459,707





The
      schedule of principal payments for long-term debt at December 31, 2005, is
      as follows:




2006
            
            $
            2,8282007
            
            
            2,6572008
            
            
            2,6502009
            
            
            254,4002010
            
            
            —Thereafter
            
            
            200,000Total
            
            $
            462,535





***Credit
      Agreement***





On
      January 31, 2003, Group, as guarantor, and Viasystems, as borrower, entered
      into
      a senior credit facility (the “2003 Credit Agreement”). The 2003 Credit
      Agreement provided for:


(a)
            a
                $69,433 term loan facility (the “Tranche A Term Loan”), which was later
                extinguished in 2003;


(b)
            a
                $378,468 term loan facility (the “Original Tranche B Term Loan”), which
                was later partially extinguished in 2003 and then replaced in 2004;
                and


(c)
            a
                $51,289 revolving credit facility (the “2003 Revolving Loans” or
                “Revolver”), which includes a $15,000 letter of credit commitment.





In
      December 2003, the Company completed an offering of $200,000 of 101⁄2% Senior
      Subordinated Notes due 2011. The Company used the proceeds from the Senior
      Subordinated Notes due 2011 to extinguish the Tranche A Term Loan and to pay
      down the Original Tranche B Term Loan to $242,401.




On
      October 7, 2004, Group, as guarantor, and Viasystems as borrower, amended the
      2003 Credit Agreement to provide for a new $265,000 term loan facility (the
      “Replacement Tranche B Term Loan” or “term loan facility”). The Company used the
      proceeds from the Replacement Tranche B Term Loan to extinguish the Original
      Tranche B Term Loan. The Replacement Tranche B Term Loan matures on September
      30, 2009.




Borrowings
      under the Replacement Tranche B Term Loan bear interest at floating rates,
      which
      vary according to the interest option selected by the Company. Base rate terms
      available to the Company are either (a) the then effective base rate plus
      3.25%, or (b) the then effective euro currency rate plus 4.25%. The
      weighted average interest rate on outstanding borrowings under the 2003 Credit
      Agreement was 6.6% and 7.7% as of December 31, 2004 and 2005,
      respectively.




Revolving
      credit loans bear interest, at the Company’s option, at the then effective base
      rate plus 3.50% or the then effective euro currency base rate plus 4.50%. The
      Company pays a commitment fee equal to 0.5% on the undrawn portion of the
      commitments in respect of the 2003 Revolving Loans. The availability of
      borrowings under the Revolver at December 31 is as follows:





**2004**
            
            **2005**Total
                available Revolver borrowing capacity
            
            $
            50,084
            
            $
            50,720Portion
                of Revolver available for letters of credit
            
            $
            13,795
            
            $
            14,431





The
      Company may optionally prepay the term loans from time to time in whole or
      in
      part, without premium or penalty. At the Company’s option, the 2003 Revolving
      Loans may be prepaid, and revolving credit commitments may be permanently
      reduced, in whole or in part, at any time.




Viasystems’
      obligations under the 2003 Credit Agreement are unconditionally and irrevocably
      guaranteed by Group and each existing and future domestic subsidiary of
      Viasystems. In addition, the 2003 Credit Agreement is secured by a perfected
      first priority security interest in all of the capital stock of Viasystems
      and
      each of its direct and indirect domestic subsidiaries and 65% of each first
      tier
      foreign subsidiary of Viasystems and its domestic subsidiaries.




The
      2003
      Credit Agreement requires Viasystems to maintain certain conditions, affirmative
      covenants and negative covenants (including financial covenants), including
      the
      following financial covenants: (1) minimum interest coverage,
      (2) maximum total leverage and (3) maximum capital
      expenditures.




The
      2003
      Credit Agreement also contains a number of covenants that, among other things,
      generally restrict the ability of Group and its subsidiaries to: (a) incur
      additional indebtedness; (b) create liens on assets; (c) incur
      guarantee obligations; (d) enter into mergers, consolidations or
      amalgamations or liquidate, wind up or dissolve; (e) dispose of assets;
      (f) pay dividends, make payment on account of, or set apart assets for, a
      sinking or analogous fund or purchase, redeem, defease or retire capital stock;
      (g) make capital expenditures; (h) make optional repurchases of
      subordinated debt or modify terms of preferred stock; (i) make advances,
      loans, extensions of credit, capital contributions to, or purchases of any
      stock, bonds, notes, debentures or other securities; (j) engage in certain
      transactions with affiliates; and (k) enter into certain sale and leaseback
      transactions.




The
      2003
      Credit Agreement contains customary events of default including:
      (a) failure to pay principal on any loan when due or any interest or other
      amount that becomes due within five days after the due date thereof;
      (b) any representation or warranty made or deemed made is incorrect in any
      material respect on or as of the date made or deemed made; (c) the default
      in the performance of negative covenants; (d) a default in the performance
      of other covenants or agreements for a period of thirty days; (e) default
      in other indebtedness or guarantee obligations with a principal amount in excess
      of $20,000 beyond the period of grace; (f) events of insolvency;
      (g) ERISA events; and (h) other customary events of default for
      facilities similar to the 2003 Credit Agreement.




Viasystems
      must prepay the term loan facility and reduce the commitments under the
      revolving credit facility by the following amounts (subject to certain
      exceptions):




·
            an
                amount equal to 100% of the net proceeds of any incurrence of indebtedness
                by Viasystems or any of its
                subsidiaries;




·
            an
                amount equal to 75% of the net proceeds of any equity issuances (other
                than (1) equity of the Company issued in connection with incentive
                plans and (2) common equity infusions from certain existing equity
                holders and their respective affiliates) by the Company or any of
                its
                subsidiaries;




·
            an
                amount equal to 100% of the net proceeds of any sale or other disposition
                by Viasystems or any of its subsidiaries of any material assets,
                except
                for (1) the sale of inventory or obsolete or worn-out property in the
                ordinary course of business, (2) the proceeds of certain specified
                asset sales, (3) transfers resulting from casualty or condemnation
                and (4) other customary exceptions;
                and




·
            if
                Viasystems’ cash and cash equivalents on hand as of December 31 of
                each year (commencing with December 31, 2003) exceeds certain
                amounts, an amount equal to the lesser of (1) 50% of excess cash flow
                and (2) the amount of cash and cash equivalents on hand as of such
                date in excess of $87,500.




The
      lenders under the 2003 Credit Agreement will apply each mandatory prepayment
      to
      any outstanding borrowings under the term loan facility. Once Viasystems pays
      all outstanding borrowings under the term loan facility, it must cash
      collateralize the letters of credit and permanently reduce the commitments
      in
      respect of the revolving credit facility.




On
      March
      19, 2003, the Company executed a first amendment to the 2003 Credit Agreement.
      The primary purpose of this amendment was to get clearer definitions on specific
      items.




On
      December 3, 2003, the Company executed a second amendment to the 2003 Credit
      Agreement. Among other provisions, the amendment defined uses of the
      $200,000 Senior Subordinated Notes due 2011 and amended certain financial
      covenants.




On
      October 7, 2004, Group, as guarantor, and Viasystems, as borrower, amended
      the
      2003 Credit Agreement to provide for a new $265,000 term loan facility (new
      “Tranche B Term Loan”). The proceeds from the New Tranche B Term Loan were used
      to extinguish the original Tranche B Term Loan.




On
      April
      22, 2005, Group as guarantor, and Viasystems, as borrower, amended the 2003
      Credit Agreement to amend certain covenants under the credit agreement. The
      amendment modifies the definition of earnings before interest, taxes,
      depreciation and amortization to exclude the operating losses and cash
      restructuring cost up to $26,100 related to the closure the Company’s western
      world PCB fabrication facilities. The amendment further allows the Company
      to
      fund the cash costs of those facility closures.




***Senior
      Subordinated Notes due 2011***





In
      December 2003, Viasystems completed an offering of $200,000 of 10 1⁄2 %
      Senior
      Subordinated Notes due 2011 (the 2011 Notes).




Interest
      on the 2011 Notes is due semiannually. The 2011 Notes may be redeemed at any
      time prior to January 15, 2008 at the redemption price of 100% plus a
“make-whole” premium (as defined). In the event of an Initial Public Offering
      (as defined), 35% of the 2011 Notes may be redeemed at any time prior to
      January 15, 2007 at the redemption price of 110.5%, plus accrued and unpaid
      interest, if any, to the redemption date. In the event of a Change in Control
      (as defined), the 2011 Notes may be redeemed at a redemption price of 101%,
      plus
      accrued and unpaid interest.




The
      indenture governing the 2011 Notes contains restrictive covenants which, among
      other things, limit the ability (subject to exceptions) of Viasystems and its
      Guarantors (as defined) to: (a) incur additional debt; (b) pay
      dividends or distributions on, or redeem or repurchase, its capital stock;
      (c) create certain liens without securing the notes; (d) make
      investments; (e) engage in transactions with affiliates; (f) transfer
      or sell assets; (g) guarantee debt; (h) restrict dividends or other
      payments to the Company or any Restricted Subsidiaries (as defined);
      (i) consolidate, merge or transfer all or substantially all of its assets
      and the assets of its subsidiaries; and (j) engage in unrelated
      businesses.




***Department
      of Trade and Industry Notes***





In
      conjunction with the Company’s plan of reorganization approved by the Bankruptcy
      Court, a £12 million (approximately $18 million) loan guaranteed by the Company
      was cancelled and in exchange the Department of Trade and Industry (the DTI)
      received a note in an amount equal to £9.0 million with interest payable
      semi-annually in cash on a current basis at an annual interest rate of three
      percent for periods up to September 30, 2008 and at an annual interest rate
      equal to the Bank of England Base Rate plus two percent for periods thereafter
      and principal payable from December 31, 2008 through December 31,
      2010. In May 2004, the DTI Note was discharged in full as a result of proceeds
      received by the noteholder in connection with the liquidation of Viasystems
      Tyneside Limited, resulting in a reorganization expense reversal of
      $9,798.




**9.
      Guarantor Subsidiaries**




The
      2011
      Notes are fully and unconditionally (as well as jointly and severally)
      guaranteed on an unsecured, senior subordinated basis by each subsidiary of
      Viasystems other than its foreign subsidiaries. Each of the guarantor
      subsidiaries and non-guarantor subsidiaries is wholly owned by the
      Company.




The
      following condensed consolidating financial statements of the Company include
      the accounts of the Company, the combined accounts of the guarantor subsidiaries
      and the combined accounts of the non-guarantor subsidiaries.







**Balance
      Sheet as of December 31, 2004**




**Viasystems,
                Inc.**
            
            **Total**
              **Guarantor**
            
            **Total
                Non-**
              **Guarantor**
            
            **Eliminations**
            
            **Viasystems,
                Inc.**
              **Consolidated****ASSETS**Cash
                and cash equivalents
            
            $
            10
            
            $
            80,256
            
            $
            32,625
            
            $
            —
            
            $
            112,891Accounts
                receivable, net of allowance for doubtful accounts
            
            
            —
            
            
            45,110
            
            
            95,508
            
            
            —
            
            
            140,618Inventories
            
            
            —
            
            
            42,548
            
            
            61,356
            
            
            —
            
            
            103,904Property
                held for sale
            
            
            —
            
            
            6,500
            
            
            413
            
            
            —
            
            
            6,913Other
                current assets
            
            
            (7,764
            )
            
            11,866
            
            
            10,705
            
            
            —
            
            
            14,807Total
                current assets
            
            
            (7,754
            )
            
            186,280
            
            
            200,607
            
            
            —
            
            
            379,133Property,
                plant and equipment, net
            
            
            245
            
            
            5,681
            
            
            227,838
            
            
            —
            
            
            233,764Investment
                in subsidiaries
            
            
            219,693
            
            
            (260,414
            )
            
            —
            
            
            40,721
            
            
            —Other
                assets
            
            
            (21,797
            )
            
            66,345
            
            
            92,964
            
            
            —
            
            
            137,512Total
                assets
            
            $
            190,387
            
            $
            2,108
            
            $
            521,409
            
            $
            40,721
            
            $
            750,409**LIABILITIES
                AND STOCKHOLDER’S EQUITY (DEFICIT)**Current
                maturities of long-term debt
            
            $
            2,650
            
            $
            188
            
            $
            91
            
            $
            —
            
            $
            2,929Accounts
                payable
            
            
            —
            
            
            35,617
            
            
            115,630
            
            
            —
            
            
            151,247Accrued
                and other liabilities
            
            
            9,842
            
            
            30,412
            
            
            33,225
            
            
            —
            
            
            73,479Total
                current liabilities
            
            
            12,492
            
            
            66,217
            
            
            148,946
            
            
            —
            
            
            227,655Long-term
                debt, less current maturities
            
            
            462,350
            
            
            185
            
            
            91
            
            
            —
            
            
            462,626Other
                non-current liabilities
            
            
            (22,880
            )
            
            7,061
            
            
            19,413
            
            
            —
            
            
            3,594Intercompany
                (receivable)/ payable
            
            
            (316,496
            )
            
            (319,023
            )
            
            635,519
            
            
            —
            
            
            —Total
                liabilities
            
            
            135,466
            
            
            (245,560
            )
            
            803,969
            
            
            —
            
            
            693,875Stockholder’s
                equity (deficit) excluding accumulated
              and
                other comprehensive income (loss)
            
            
            70,368
            
            
            219,693
            
            
            (260,414
            )
            
            40,721
            
            
            70,368Accumulated
                other comprehensive income (loss)
            
            
            (15,447
            )
            
            23,759
            
            
            (22,146
            )
            
            —
            
            
            (13,834
            )Total
                liabilities and stockholder’s equity (deficit)
            
            $
            190,387
            
            $
            (2,108
            )
            $
            521,409
            
            $
            40,721
            
            $
            750,409







**Balance
      Sheet as of December 31, 2005**




**Viasystems,
                Inc.**
            
            **Total**
              **Guarantor**
            
            **Total
                Non-**
              **Guarantor**
            
            **Eliminations**
            
            **Viasystems,
                Inc.**
              **Consolidated****ASSETS**Cash
                and cash equivalents
            
            $
            432
            
            $
            12,553
            
            $
            22,938
            
            $
            —
            
            $
            35,923Accounts
                receivable, net of allowance for doubtful accounts
            
            
            —
            
            
            51,774
            
            
            90,116
            
            
            —
            
            
            141,890Inventories
            
            
            —
            
            
            44,383
            
            
            61,570
            
            
            —
            
            
            105,953Property
                held for sale
            
            
            —
            
            
            7,099
            
            
            9,484
            
            
            —
            
            
            16,583Other
                current assets
            
            
            (4,329
            )
            
            12,407
            
            
            14,609
            
            
            —
            
            
            22,687Total
                current assets
            
            
            (3,897
            )
            
            128,216
            
            
            198,717
            
            
            —
            
            
            323,036Property,
                plant and equipment, net
            
            
            177
            
            
            6,976
            
            
            248,501
            
            
            —
            
            
            255,654Investment
                in subsidiaries
            
            
            756,922
            
            
            373,416
            
            
            —
            
            
            (1,130,338
            )
            
            —Other
                assets
            
            
            (11,499
            )
            
            54,585
            
            
            92,168
            
            
            —
            
            
            135,254Total
                assets
            
            $
            741,703
            
            $
            563,193
            
            $
            539,386
            
            $
            (1,130,338
            )
            $
            713,944**LIABILITIES
                AND STOCKHOLDER’S EQUITY (DEFICIT)**Current
                maturities of long-term debt
            
            $
            2,650
            
            $
            178
            
            $
            —
            
            $
            —
            
            $
            2,828Accounts
                payable
            
            
            —
            
            
            38,389
            
            
            120,880
            
            
            —
            
            
            159,269Accrued
                and other liabilities
            
            
            (7,049
            )
            
            28,156
            
            
            48,097
            
            
            —
            
            
            69,204Total
                current liabilities
            
            
            (4,399
            )
            
            66,723
            
            
            168,977
            
            
            —
            
            
            231,301Long-term
                debt, less current maturities
            
            
            459,699
            
            
            8
            
            
            —
            
            
            —
            
            
            459,707Other
                non-current liabilities
            
            
            (7,380
            )
            
            7,734
            
            
            24,310
            
            
            —
            
            
            24,664Intercompany
                (receivable)/ payable
            
            
            297,248
            
            
            (268,243
            )
            
            (29,005
            )
            
            —
            
            
            —Total
                liabilities
            
            
            745,168
            
            
            (193,778
            )
            
            164,282
            
            
            —
            
            
            715,672Stockholder’s
                equity (deficit) excluding accumulated
              other
                comprehensive income (loss)
            
            
            (4,068
            )
            
            756,922
            
            
            373,416
            
            
            (1,130,338
            )
            
            (4,068
            )Accumulated
                other comprehensive income (loss)
            
            
            603
            
            
            49
            
            
            1,688
            
            
            —
            
            
            2,340Total
                liabilities and stockholder’s equity (deficit)
            
            $
            741,703
            
            $
            563,193
            
            $
            539,386
            
            $
            (1,130,338
            )
            $
            713,944







**Income
      Statement as of December 31, 2003**




**Viasystems,
                Inc.**
            
            **Total**
              **Guarantor**
            
            **Total
                Non-**
              **Guarantor**
            
            **Eliminations**
            
            **Viasystems,
                Inc.**
              **Consolidated**Net
                sales
            
            $
            —
            
            $
            328,641
            
            $
            488,632
            
            $
            (65,790
            )
            $
            751,483Operating
                expenses:Cost
                of goods sold
            
            
            —
            
            
            293,892
            
            
            369,444
            
            
            (65,790
            )
            
            597,546Selling,
                general and administrative
            
            
            267
            
            
            30,085
            
            
            33,767
            
            
            —
            
            
            64,119Stock
                compensation expense
            
            
            1,383
            
            
            —
            
            
            —
            
            
            —
            
            
            1,383Depreciation
            
            
            —
            
            
            3,406
            
            
            62,664
            
            
            —
            
            
            66,070Amortization
            
            
            195
            
            
            —
            
            
            2,870
            
            
            —
            
            
            3,065Restructuring
                and impairment charges
            
            
            2,089
            
            
            15,201
            
            
            48,909
            
            
            —
            
            
            66,199Goodwill
                impairment
            
            
            —
            
            
            (155
            )
            
            22,852
            
            
            —
            
            
            22,697Loss
                on dispositions of businesses, net
            
            
            —
            
            
            114
            
            
            1,112
            
            
            —
            
            
            1,226Operating
                loss
            
            
            (3,934
            )
            
            (13,902
            )
            
            (52,986
            )
            
            —
            
            
            (70,822
            )Other
                expenses (income):Interest
                (income) expense net
            
            
            22,621
            
            
            (31,115
            )
            
            38,223
            
            
            —
            
            
            29,729Amortization
                of deferred financing costs
            
            
            104
            
            
            —
            
            
            —
            
            
            —
            
            
            104Reorganization
                expenses
            
            
            55,255
            
            
            —
            
            
            —
            
            
            —
            
            
            55,255Loss
                from debt forgiveness
            
            
            1,517
            
            
            —
            
            
            —
            
            
            —
            
            
            1,517Other
                expense (income), net
            
            
            16,627
            
            
            28,850
            
            
            (38,595
            )
            
            —
            
            
            6,882Equity
                (loss) earnings in subsidiaries
            
            
            (49,517
            )
            
            (47,046
            )
            
            —
            
            
            96,563
            
            
            —(Loss)
                income before income taxes
            
            
            (149,575
            )
            
            (58,683
            )
            
            (52,614
            )
            
            96,563
            
            
            (164,309
            )Income
                taxes (benefit)
            
            
            14,734
            
            
            (9,166
            )
            
            (5,568
            )
            
            —
            
            
            —Net
                (loss) income
            
            $
            (164,309
            )
            $
            (49,517
            )
            $
            (47,046
            )
            $
            96,563
            
            $
            (164,309
            )







**Income
      Statement as of December 31, 2004**




**Viasystems,
                Inc.**
            
            **Total**
              **Guarantor**
            
            **Total
                Non-**
              **Guarantor**
            
            **Eliminations**
            
            **Viasystems,
                Inc.**
              **Consolidated**Net
                sales
            
            $
            —
            
            $
            407,551
            
            $
            599,020
            
            $
            (105,208
            )
            $
            901,363Operating
                expenses:Cost
                of goods sold
            
            
            —
            
            
            357,043
            
            
            476,414
            
            
            (105,208
            )
            
            728,249Selling,
                general and administrative
            
            
            442
            
            
            32,564
            
            
            44,971
            
            
            —
            
            
            77,977Stock
                compensation expense
            
            
            3,837
            
            
            —
            
            
            —
            
            
            —
            
            
            3,837Depreciation
            
            
            —
            
            
            1,588
            
            
            46,644
            
            
            —
            
            
            48,232Amortization
            
            
            124
            
            
            —
            
            
            1,446
            
            
            —
            
            
            1,570Restructuring
                and impairment charges
            
            
            1,374
            
            
            508
            
            
            (869
            )
            
            —
            
            
            1,013Goodwill
                impairment
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —Loss
                (gain) on dispositions of businesses, net
            
            
            —
            
            
            300
            
            
            (765
            )
            
            —
            
            
            (465
            )Operating
                (loss) income
            
            
            (5,777
            )
            
            15,548
            
            
            31,179
            
            
            —
            
            
            40,950Other
                expenses (income):Interest
                expense (income), net
            
            
            30,225
            
            
            (31,014
            )
            
            38,607
            
            
            —
            
            
            37,818Amortization
                of deferred financing costs
            
            
            1,305
            
            
            —
            
            
            —
            
            
            —
            
            
            1,305Reorganization
                reversals
            
            
            (9,776
            )
            
            —
            
            
            —
            
            
            —
            
            
            (9,776
            )Other
                expense (income), net
            
            
            1,570
            
            
            80,297
            
            
            (82,854
            )
            
            —
            
            
            (987
            )Equity
                earnings (loss) in subsidiaries
            
            
            (10,367
            )
            
            36,911
            
            
            —
            
            
            (26,544
            )
            
            —Income
                (loss) before income taxes
            
            
            (39,468
            )
            
            3,176
            
            
            75,426
            
            
            (26,544
            )
            
            12,590Income
                taxes (benefit)
            
            
            (45,216
            )
            
            13,543
            
            
            38,515
            
            
            —
            
            
            6,842Net
                income (loss)
            
            $
            5,748
            
            $
            (10,367
            )
            $
            36,911
            
            $
            (26,544
            )
            $
            5,748







**Income
      Statement as of December 31, 2005**




**Viasystems,
                Inc.**
            
            **Total**
              **Guarantor**
            
            **Total
                Non-**
              **Guarantor**
            
            **Eliminations**
            
            **Viasystems,
                Inc.**
              **Consolidated**Net
                sales
            
            $
            —
            
            $
            425,298
            
            $
            564,238
            
            $
            (41,018
            )
            $
            948,518Operating
                expenses:Cost
                of goods sold
            
            
            —
            
            
            381,363
            
            
            448,495
            
            
            (41,018
            )
            
            788,840Selling,
                general and administrative
            
            
            501
            
            
            31,117
            
            
            50,306
            
            
            —
            
            
            81,924Stock
                compensation expense
            
            
            6,793
            
            
            —
            
            
            —
            
            
            —
            
            
            6,793Depreciation
            
            
            70
            
            
            2,635
            
            
            48,881
            
            
            —
            
            
            51,586Amortization
            
            
            182
            
            
            —
            
            
            1,254
            
            
            —
            
            
            1,436Restructuring
                and impairment charges
            
            
            —
            
            
            10,306
            
            
            17,628
            
            
            —
            
            
            27,934Goodwill
                impairment
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —Loss
                (gain) on dispositions of businesses, net
            
            
            —
            
            
            
            
            
            —
            
            
            —
            
            
            —Operating
                loss
            
            
            (7,546
            )
            
            (123
            )
            
            (2,326
            )
            
            —
            
            
            (9,995
            )Other
                expenses (income):Interest
                expense (income), net
            
            
            30,292
            
            
            (26,219
            )
            
            36,687
            
            
            —
            
            
            40,760Amortization
                of deferred financing costs
            
            
            1,613
            
            
            —
            
            
            —
            
            
            —
            
            
            1,613Reorganization
                expenses (reversals)
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —Other
                expense (income), net
            
            
            578,432
            
            
            110,420
            
            
            (675,956
            )
            
            —
            
            
            12,896Equity
                earnings (loss) in subsidiaries
            
            
            537,229
            
            
            633,830
            
            
            —
            
            
            (1,171,059
            )
            
            —Income
                (loss) before income taxes
            
            
            (80,654
            )
            
            549,506
            
            
            636,943
            
            
            (1,171,059
            )
            
            (65,264
            )Income
                taxes (benefit)
            
            
            575
            
            
            12,277
            
            
            3,113
            
            
            —
            
            
            15,965Net
                (loss) income
            
            $
            (81,229
            )
            $
            537,229
            
            $
            633,830
            
            $
            (1,171,059
            )
            $
            (81,229
            )







**Statement
      of Cash Flows as of December 31, 2003**




**Viasystems,**
              **Inc.**
            
            **Total**
              **Guarantor**
            
            **Total
                Non-**
              **Guarantor**
            
            **Eliminations**
            
            **Viasystems,**
              **Inc.**
              **Consolidated**Net
                cash provided by (used in) operating activities
            
            $
            (46,735
            )
            $
            60,661
            
            $
            34,484
            
            $
            —
            
            $
            48,410Net
                cash provided by (used in) investing activities
            
            
            —
            
            
            (23,075
            )
            
            (23,949
            )
            
            —
            
            
            (47,024
            )Net
                cash provided by (used in) financing activities
            
            
            (15,082
            )
            
            (142
            )
            
            221
            
            
            —
            
            
            (15,003
            )Effect
                of exchange rate changes on cash and cash
              Equivalents
            
            
            —
            
            
            —
            
            
            (6,767
            )
            
            —
            
            
            (6,767
            )Net
                change in cash and cash equivalents
            
            $
            (61,817
            )
            $
            37,444
            
            $
            3,989
            
            $
            —
            
            $
            (20,384
            )










**Statement
      of Cash Flows as of December 31, 2004**




**Viasystems,**
              **Inc.**
            
            **Total**
              **Guarantor**
            
            **Total**
              **Non-**
              **Guarantor**
            
            **Eliminations**
            
            **Viasystems,**
              **Inc.**
              **Consolidated**Net
                cash provided by (used in) operating activities
            
            $
            (983
            )
            $
            (13,366
            )
            $
            80,266
            
            $
            —
            
            $
            65,917Net
                cash provided by (used in) investing activities
            
            
            —
            
            
            (1,050
            )
            
            (70,883
            )
            
            —
            
            
            (71,933
            )Net
                cash provided by (used in) financing activities
            
            
            —
            
            
            56,436
            
            
            (32
            )
            
            —
            
            
            56,404Effect
                of exchange rate changes on cash and cash
              Equivalents
            
            
            —
            
            
            —
            
            
            (173
            )
            
            —
            
            
            (173
            )Net
                change in cash and cash equivalents
            
            $
            (983
            )
            $
            42,020
            
            $
            9,178
            
            $
            —
            
            $
            50,215





**Statement
      of Cash Flows as of December 31, 2005**





**Viasystems,**
              **Inc.**
            
            **Total**
              **Guarantor**
            
            **Total**
              **Non-**
              **Guarantor**
            
            **Eliminations**
            
            **Viasystems,**
              **Inc.**
              **Consolidated**Net
                cash provided by (used in) operating activities
            
            $
            3,372
            
            $
            (65,621
            )
            $
            73,895
            
            $
            —
            
            $
            11,646Net
                cash provided by (used in) investing activities
            
            
            —
            
            
            (1,787
            )
            
            (83,235
            )
            
            —
            
            
            (85,022
            )Net
                cash provided by (used in) financing activities
            
            
            (2,950
            )
            
            (295
            )
            
            —
            
            
            —
            
            
            (3,245
            )Effect
                of exchange rate changes on cash and cash
              Equivalents
            
            
            —
            
            
            —
            
            
            (347
            )
            
            —
            
            
            (347
            )Net
                change in cash and cash equivalents
            
            $
            422
            
            $
            (67,703
            )
            $
            (9,687
            )
            $
            —
            
            $
            (76,968
            )





**10.**  **Prepackaged
      Plan of Reorganization**





***Summary
      of the Plan***





On
      October 1, 2002, Group and Viasystems filed a joint prepackaged plan of
      reorganization, as modified on January 2, 2003 (the Plan), pursuant to a
      voluntary petition for relief under chapter 11 of the U.S. Bankruptcy Code
      (the
      Bankruptcy Code) in the United States Bankruptcy Court for the Southern District
      of New York (the Bankruptcy Court). Other than Viasystems, none of Group’s
      subsidiaries filed for protection under the Bankruptcy Code.




On
      January 14, 2003, the Bankruptcy Court entered an order approving and confirming
      the Plan. Subsequently, on January 31, 2003, the Plan became effective and
      in
      accordance with the terms and conditions of the Plan:




·
            Viasystems’
                outstanding Credit Agreement debt was reduced by $77,400 from proceeds
                of
                the Rights Offering and Exchange described below and was restructured
                to
                provide for an aggregate term loan facility of $447.9 million and
                a
                revolving facility of $51,300 with a letter of credit subfacility
                of $15.0
                million (the Exit Facility);




·
            Viasystems’
                Senior Unsecured Notes were cancelled, and in exchange the holders
                thereof
                received (a) approximately 1.2 million shares of New Junior Preferred
                Stock (as defined below) having a liquidation preference of $120.1
                million
                and (b) approximately 1.6 million shares of New Common Stock (as
                defined below);




·
            Claims
                held by the Department of Trade and Industry of the United Kingdom
                (the
                DTI), pursuant to a guaranty made by Viasystems with respect to a
£12.0
                million loan made by the DTI to Viasystems Tyneside Limited (VTL),
                were
                cancelled, and in exchange the DTI received a note (the DTI Note)
                in an
                amount equal to £9.0 million with interest payable semi-annually in cash
                on a current basis at an annual interest rate of three percent for
                periods
                up to September 30, 2008 and at an annual interest rate equal to
                the Bank
                of England Base Rate plus two percent for periods thereafter and
                principal
                payable from December 31, 2008 through December 31, 2010
                (provided all amounts due and owing under the Exit Facility are not
                paid
                in full prior to October 1, 2008); provided, however, proceeds received
                by
                the DTI pursuant to the liquidation of VTL were used to reduce the
                outstanding principal under the DTI
                Note;




·
            Viasystems’
                Subordinated Notes in the principal amount of $500.0 million were
                cancelled, and in exchange the holders thereof received 17.2 million
                shares of the New Common Stock;




·
            Claims
                held by the general unsecured creditors of Group were cancelled,
                and in
                exchange such holders were given the right to receive the lesser
                of
                (a) its pro rata share of 55,540 shares of the New Common Stock and
                (b) shares of the New Common Stock having a value equal to the amount
                of such holder’s claim;




·
            Claims
                held by the general unsecured creditors of Viasystems were cancelled,
                and
                in exchange the holders thereof will receive non-transferable subordinated
                promissory notes in amounts equal to 100% of such claims with interest
                payable semi-annually in cash on a current basis at an annual interest
                rate of three percent for periods up to September 30, 2008 and at
                an
                annual interest rate equal to the prime commercial lending rate per
                annum
                published in The Wall Street Journal, New York City edition, for
                periods
                thereafter and principal payable from December 31, 2008 through
                December 31, 2010;




·
            The
                Series B Preferred Stock of Group was cancelled, and in exchange
                the
                holders thereof received warrants (the New Warrants) to purchase
                approximately 1.4 million shares of the New Common Stock at a purchase
                price of $25.51 per share;




·
            The
                existing common stock, options and warrants of Group were cancelled,
                and
                the holders thereof did not receive any distribution under the Plan;
                and




·
            Group
                adopted an incentive option plan authorizing the issuance of stock
                options
                to purchase up to approximately 2.8 million shares of New Common
                Stock to
                employees of Group and its subsidiaries, and, on the effective date
                of the
                reorganization, issued options to acquire approximately 2.2 million
                of
                such shares to employees at an exercise price of $12.63 per share.
                The
                value of these shares was determined by a third party, on the basis
                of
                total enterprise value of approximately
                $828,000.




In
        addition, under the terms of the plan of reorganization, (1) Group issued
        rights to purchase approximately 4.3 million shares of Group class B senior
        convertible preferred stock at an aggregate purchase price of $53,700 to
        Hicks,
        Muse, Tate and Furst, Incorporated (“HMTF”), certain affiliates of GSCP (NJ),
        Inc. (“GSC”), TCW Share Opportunity Fund III, L.P., and other holders of the
        Subordinated Notes (the “Rights Offering”) and (2) $23,700 of bank debt
        outstanding under the 2002 Credit Agreement held by HMTF was exchanged for
        approximately 1.9 million shares of New Common Stock. Affiliates of HMTF,
        certain affiliates of GSC, and TCW Share Opportunity Fund III, L.P. severally
        committed to purchase all of the Group class B senior convertible preferred
        stock offered in the Rights Offering. In consideration for their commitment,
        the
        parties received an aggregate fee of approximately $1,000. All proceeds of
        the
        Rights Offering were applied to reduce the outstanding indebtedness under
        the
        2003 Credit Agreement.


The
      reorganization did not qualify for “Fresh-Start” accounting as the holders of
      existing voting shares immediately before confirmation received more than 50%
      of
      the voting shares of the emerged entity due to the exchange of debt securities
      held by such holders and their participation in the Rights Offering described
      above.




On
      January 31, 2003, in accordance with the terms and conditions of the Plan,
      Group
      issued approximately 20.7 million shares of common stock of Group (the New
      Common Stock), approximately 4.3 million shares of senior convertible preferred
      stock of Group (the New Senior Convertible Preferred Stock), approximately
      1.2
      million shares of junior preferred stock of Group (the New Junior Preferred
      Stock), New Warrants to purchase approximately 1.4 million shares of New Common
      Stock of Group, and options under the Incentive Option Plan to purchase
      approximately 2.2 million shares of New Common Stock. All the agreements and
      other documents evidencing the previously outstanding rights of any holder
      of an
      equity interest in Group, including options and warrants to purchase equity
      interest, were cancelled. Additionally, all of the agreements and other
      documents evidencing the rights of any holder of a claim against Viasystems
      or
      Group in respect to the Senior Notes and the Subordinated Notes of Viasystems
      were cancelled.




***Liabilities
      Subject to Compromise***





The
      Company incurred reorganization expenses as follows:





**December 31,****2003**Professional
                and bank fees
            
            $
            4,391Issuance
                of a promissory note to the DTI, net (1)
            
            
            7,735Write-off
                of deferred financing fees, discount and premium related to
              debt
                forgiveness (1)
            
            
            42,593Other
                reorganization expenses (1)
            
            
            536Total
            
            $
            55,255


______________


(1)
      Non-cash item.





**11.
      Restructuring and Impairment Charges**





In
      light
      of the economic downturn that began in 2000 and continued into early 2003
      related to many of the Company’s key telecommunication and networking customers,
      and the shift of production demand from high cost countries to low cost
      countries, the Company initiated restructuring activities during 2001 to adjust
      its cost position compared to anticipated levels of business. The Company also
      reviewed the carrying value of the related assets. These actions resulted in
      plant shutdowns and downsizings as well as asset impairments. These actions
      continued through 2005. The following table summarizes the restructuring and
      impairment charges taken during the years ended December 31:





**Charges
                (Reversals)****2003**
            
            **2004**
            
            **2005**Personnel
                and severance
            
            $
            827
            
            $
            2,057
            
            $
            23,378Lease
                and other contractual commitments
            
            
            —
            
            
            (5,861
            )
            
            2,733Other
            
            
            —
            
            
            253
            
            
            —Asset
                impairments
            
            
            65,372
            
            
            4,564
            
            
            1,823Total
            
            $
            66,199
            
            $
            1,013
            
            $
            27,934





***2003
      Restructuring and Impairment Charges***





During
      the quarter ended September 30, 2003, the Company recorded a personnel and
      severance restructuring charge of $827 related to the downsizing of the
      Montreal, Canada printed circuit board fabrication facilities.




Over
      the
      past several years, beginning in 2001, the telecommunications and computer
      markets have experienced a significant economic downturn. Due to this downturn
      the Company has closed and restructured numerous plants under the belief that
      this downturn was temporary and the cost structure had to be reduced in light
      of
      the market’s decreased demands. To compound the negative impact of such
      downturn, the U.S. dollar (“USD”) weakened during the second half of 2003. This
      weakening caused the cost of certain local currencies (primarily the Canadian
      dollar and the Euro) to increase. As the Company’s costs are primarily in local
      currencies and their sales are primarily in USD, its cash flows have been
      negatively impacted.




During
      the quarter ended June 30, 2003, an impairment charge of $6,588 was recorded
      to
      write down the assets held for sale related to the Richmond, Virginia printed
      circuit board fabrication facility, to an offer price received by the Company
      for the property by a third party. This transaction ultimately failed to close.
      The Company continues to actively market this property. As of December 31,
      2004 and 2005, this facility is included in Property held for sale in the
      Company’s consolidated balance sheet.




During
      the quarter ended September 30, 2003, in connection with the closure of the
      Granby, Canada printed circuit board fabrication facility in 2002, the Company
      also recorded an asset impairment charge of $358 to write down to fair value
      the
      assets being held for sale related to the operation. The Company is actively
      marketing this property. As of December 31, 2004 and 2005, this facility is
      included in Property held for sale in the Company’s consolidated balance
      sheet.




During
      the Company’s 2004 budgeting process conducted in the quarter ended
      December 31, 2003, the Company concluded that the cash flows at Echt, the
      Netherlands and Montreal, Canada would be impacted beyond the near term. In
      addition, due to business conditions at the Company’s Milwaukee, Wisconsin
      facility, the Company expected the facility to fail to generate meaningful,
      if
      any, cash flow in the foreseeable future.




Based
      on
      the Company’s future cash flow analysis prepared under SFAS No. 144, the Company
      determined that the fixed asset groupings at Echt, Montreal, and Milwaukee
      were
      impaired. The Company utilized recent auction prices or appraisals for similar
      equipment and buildings as a basis for the fair value of the individual pieces
      of equipment and buildings. Accordingly, the fixed asset grouping at Echt,
      Montreal, and Milwaukee were written down by $28,285, $12,305 and $8,612,
      respectively.




***2004
      Restructuring and Impairment Charges***





During
      the quarter ended June 30, 2004, the Company reversed an $85 personnel accrual
      and a $10 miscellaneous accrual for previous restructuring at its printed
      circuit board fabrication facility located in Granby, Canada. In addition,
      the
      Company reversed a $6,069 restructuring accrual based on its release from an
      operating lease contract of a closed business.




During
      the quarter ended December 31, 2004, the Company completed the following
      restructuring activities:




·
            Downsizing
                of the Montreal, Canada printed circuit board fabrication facilities
                requiring the recognition of a personnel and severance charge of
                $81.




·
            Downsizing
                of the corporate offices requiring the recognition of a personnel
                and
                severance charge of $508.




·
            Downsizing
                of the Echt, the Netherlands printed circuit board fabrication facilities
                requiring the recognition of a personnel and severance charge of
                $1,553.




Throughout
      the year ended December 31, 2004, the Company recognized $263 in
      restructuring expense in connection with the upkeep of assets being held for
      sale related to the closure of the Granby, Canada printed circuit board
      fabrication facility in 2002. Additionally, the Company recognized $208 in
      restructuring expense in connection with satisfying contractual commitments
      of
      the previously closed Coventry, England manufacturing facility.




During
      the Company’s 2005 budgeting process conducted in the quarter ended
      December 31, 2004, the Company concluded that the cash flows at Echt, the
      Netherlands and Montreal, Canada would be impacted beyond the near term. The
      expected future cash flows of the facilities were reviewed under the provisions
      of SFAS No. 144 resulting in an impairment charge of $3,121 and $1,443 for
      Echt
      and Montreal, respectively.




***2005
      Restructuring and Impairment Charges***




On
      February 25, 2005, the Company announced the intention to close the printed
      circuit board manufacturing facilities located in Echt, the Netherlands and
      Montreal, Canada. At the time of announcement of the closures, the Company
      estimated that total closure costs would approximate $50,000, with $23,000
      being
      related to headcount reduction costs and the remainder being related to asset
      impairments and other contractual commitments. The Company now estimates that
      total closure costs will approximate $28,000 to $30,000, with $23,000 being
      related to headcount reduction costs and the remainder being related to other
      contractual commitments and closure costs. As of December 31, 2005, the
      restructuring is substantially completed with the only remaining item being
      costs related to the sale of the land and buildings.




On
      July
      8, 2005, the Company announced the closure of the manufacturing facility located
      in Mishawaka, Indiana. The Company estimated that the restructuring charges
      related to the closure would total approximately $375, and actual costs were
      $272. The restructuring activities pursuant to this closure are substantially
      completed at December 31, 2005.




For
      the
      year ended December 31, 2005, the Company recorded personnel and
      restructuring charges of $10,309, $12,797 and $272 related to the closure of
      the
      facilities in Echt, the Netherlands, Montreal, Canada, and Mishawaka, Indiana,
      respectively. In addition, for the year ended December 31, 2005, the
      Company recorded a restructuring charge of $1,823 related to the impairment
      of
      specific pieces of manufacturing equipment and buildings, and $2,089 for costs
      incurred with the early termination of outstanding contracts related to the
      closure of the two facilities in Montreal, Canada.




The
      restructuring actions in 2005 reduced employees by 702 in Montreal, Canada,
      461
      in Echt, the Netherlands, and 65 in Mishawaka, Indiana.




For
      the
      year ended December 31, 2005, the Company has written off a total of $3,495
      of inventory to costs of goods sold related to the plant closures. The Company
      disposed of the inventory in conjunction with the write-off.




Below
      are
      tables summarizing restructuring and impairment accruals and the related
      activity as of and for the years ended December 31, 2003, 2004 and
      2005:







**Year
                Ended**
            
            **Cumulative****December 31,
                2003**
            
            **Drawdowns****Balance**
            
            
            
            
            
            
            
            **Balance****at**
            
            
            
            **Cash**
            
            **Non-Cash**
            
            **at****12/31/02**
            
            **Charges**
            
            **Reversals**
            
            **Total**
            
            **Payments**
            
            **Charges**
            
            **12/31/03**Restructuring
                Activities:Personnel
                and severance
            
            $
            10,460
            
            $
            827
            
            $
            —
            
            $
            827
            
            $
            (7,211
            )
            $
            —
            
            $
            4,076Lease
                and other contractual commitments..
            
            
            11,768
            
            
            —
            
            
            —
            
            
            —
            
            
            (2,208
            )
            
            —
            
            
            9,560Other
            
            
            481
            
            
            —
            
            
            —
            
            
            —
            
            
            (467
            )
            
            —
            
            
            14Asset
                impairments
            
            
            —
            
            
            65,372
            
            
            —
            
            
            65,372
            
            
            —
            
            
            (65,372
            )
            
            —Total
                restructuring and impairment charges
            
            $
            22,709
            
            $
            66,199
            
            $
            —
            
            $
            66,199
            
            $
            (9,886
            )
            $
            (65,372
            )
            $
            13,650











**Year
                Ended**
            
            **Cumulative****December 31,
                2004**
            
            **Drawdowns****Balance**
            
            
            
            
            
            
            
            **Balance****at**
            
            
            
            **Cash**
            
            **Non-Cash**
            
            **at****12/31/03**
            
            **Charges**
            
            **Reversals**
            
            **Total**
            
            **Payments**
            
            **Charges**
            
            **12/31/04**Restructuring
                Activities:Personnel
                and severance
            
            $
            4,076
            
            $
            2,142
            
            $
            (85
            )
            $
            2,057
            
            $
            (2,924
            )
            $
            —
            
            $
            3,209Lease
                and other contractual commitments
            
            
            9,560
            
            
            208
            
            
            (6,069
            )
            
            (5,861
            )
            
            (2,052
            )
            
            —
            
            
            1,647Other
            
            
            14
            
            
            263
            
            
            (10
            )
            
            253
            
            
            (267
            )
            
            —
            
            
            —Asset
                impairments
            
            
            —
            
            
            4,564
            
            
            —
            
            
            4,564
            
            
            —
            
            
            (4,564
            )
            
            —Total
                restructuring and impairment charges
            
            $
            13,650
            
            $
            7,177
            
            $
            (6,164
            )
            $
            1,013
            
            $
            (5,243
            )
            $
            (4,564
            )
            $
            4,856








**Year
                Ended**
            
            **Cumulative****Balance**
            
            **December 31,
                2005**
            
            **Drawdowns**
            
            **Balance****at**
            
            
            
            **Cash**
            
            **Non-Cash**
            
            **at****12/31/04**
            
            **Charges**
            
            **Reversals**
            
            **Total**
            
            **Payments**
            
            **Charges**
            
            **12/31/05**Restructuring
                Activities:Personnel
                and severance
            
            $
            3,209
            
            $
            23,378
            
            $
            —
            
            $
            23,378
            
            $
            (21,798
            )
            $
            —
            
            $
            4,789Lease
                and other contractual commitments
            
            
            1,647
            
            
            2,733
            
            
            —
            
            
            2,733
            
            
            (3,072
            )
            
            —
            
            
            1,308Asset
                impairments
            
            
            —
            
            
            1,823
            
            
            —
            
            
            1,823
            
            
            —
            
            
            1,823
            
            
            —Total
                restructuring and impairment charges
            
            $
            4,856
            
            $
            27,934
            
            $
            —
            
            $
            27,934
            
            $
            (24,870
            )
            $
            1,823
            
            $
            6,097





The
      restructuring and impairment charges were determined based on formal plans
      approved by the Company’s management using the best information available to it
      at the time. The amounts the Company may ultimately incur may change as the
      balance of the plans are executed. Expected cash payout of the accrued expenses
      is as follows:





**Year
                Ended December 31,**
            
            **Cash**
              **Payments**2006
            
            $
            4,7232007
            
            
            5502008
            
            
            2062009
            
            
            2062010
            
            
            206Thereafter
            
            
            206Total
            
            $
            6,097





***Identifiable
      Intangibles Impairment***





In
      connection with the Company’s 2003 annual impairment testing required by SFAS
      No. 142, impairment was recognized on the Company’s intangible assets. When the
      Company acquired Echt and Montreal, the excess purchase price was allocated
      to
      goodwill, developed technologies and assembled workforce. Due to rapid
      technological changes as well as strategic decisions to migrate from western
      world manufacturing facilities to China-based manufacturing facilities, it
      became apparent that the remaining developed technologies balances, of $4,430
      for Montreal and $3,420 for Echt, were impaired and should be written
      off.




As
      part
      of acquiring numerous printed circuit board assembly facilities, the Company
      was
      required to buy a license from the Lemelson Medical, Education & Research
      Foundation, Limited Partnership which is required in the inspection process
      of
      this product. This license was capitalized as an intangible and was being
      amortized over its life. On January 26, 2004, a U.S. District Court in Las
      Vegas
      ruled the 14 patents asserted by the Lemelson Partnership were invalid and
      unenforceable. Therefore as part of this analysis, the Company wrote off $1,374
      related to this license in 2003.




No
      identifiable intangibles were deemed to be impaired during the annual impairment
      testing required by SFAS No. 142 for the years ended December 31, 2004 and
      2005.




**12.
      Commitments**





The
      Company leases certain building and transportation and other equipment under
      capital and operating leases. Included in property, plant and equipment as
      of
      December 31, 2004 and 2005, were $1,671 and $1,050, respectively, of cost
      basis and $1,030 and $156, respectively, of accumulated depreciation related
      to
      equipment held under capital leases. Total rental expense under operating leases
      was $6,870, $8,022 and $10,015 for the years ended December 31, 2003, 2004
      and 2005, respectively. Future minimum lease payments under capital leases
      and
      operating leases that have initial or remaining noncancelable lease terms in
      excess of one year are as follows:








**Year
                Ended December 31,**
            
            **Capital**
            
            **Operating**2006
            
            $
            186
            
            $
            12,0212007
            
            
            7
            
            
            8,2512008
            
            
            —
            
            
            6,2932009
            
            
            —
            
            
            5,1762010
            
            
            —
            
            
            5,050Thereafter
            
            
            —
            
            
            16,420Total
            
            $
            193
            
            $
            53,211Less:
                Amounts representing interest
            
            
            8Capital
                lease obligations
            
            $
            185





**13.
      Contingencies**





The
      Company is a party to contracts with third party consultants, independent
      contractors and other service providers in which the Company has agreed to
      indemnify such parties against certain liabilities in connection with their
      performance. Based on historical experience and the likelihood that such parties
      will ever make a claim against the Company, such indemnification obligations
      are
      immaterial.




The
      Company provides that none of the directors and officers of the Company bear
      the
      risk of personal liability for monetary damages for breach of fiduciary duty
      as
      a director except in cases where the action involves a breach of the duty of
      loyalty, acts in bad faith or intentional misconduct, the unlawful paying of
      dividends or repurchasing of capital stock, or transactions from which the
      director derived improper personal benefits.




The
      Company has fully and unconditionally guaranteed the operating lease payments
      of
      the Milwaukee, Wisconsin facility through the year 2010. The total maximum
      payments from this guarantee are $8,558. As of December 31, 2005, no
      liability related to this guarantee has been established.




The
      Company is subject to various lawsuits and claims with respect to such matters
      as product liability, product development and other actions arising in the
      normal course of business. In the opinion of the Company’s management, the
      ultimate liabilities resulting from such lawsuits and claims will not have
      a
      material adverse effect on the Company’s financial condition and results of
      operations and cash flows.




The
      Company believes it is in material compliance with applicable environmental
      laws
      and regulations and that its environmental controls are adequate to address
      existing regulatory requirements.




**14.
      Income Taxes**





The
      Company accounts for income taxes in accordance with the provisions of SFAS
      No.
      109, *Accounting
      for Income Taxes* .
      The
      provision for income taxes for the years ended December 31, 2003, 2004 and
      2005, consists of the following:




**2003**
            
            **2004**
            
            **2005**Current:Federal
            
            $
            (3,784
            )
            $
            (7,553
            )
            $
            —State
            
            
            —
            
            
            —
            
            
            900Foreign
            
            
            4,989
            
            
            9,669
            
            
            11,3261,205
            
            
            2,116
            
            
            12,226Deferred:Federal
            
            
            —
            
            
            —
            
            
            —State
            
            
            —
            
            
            —
            
            
            —Foreign
            
            
            (1,205
            )
            
            4,726
            
            
            3,739(1,205
            )
            
            4,726
            
            
            3,739Total
            
            $
            —
            
            $
            6,842
            
            $
            15,965





A
      reconciliation between the total income tax provision at the federal statutory
      income tax rate and at the effective tax rate for the years ended
      December 31 is summarized below:





**2003**
            
            **2004**
            
            **2005**U.S.
                Federal statutory rate
            
            $
            (57,508
            )
            $
            4,406
            
            $
            (22,842
            )State
                taxes, net of Federal benefit
            
            
            (4,561
            )
            
            (1,866
            )
            
            (2,488
            )Foreign
                taxes in excess of U.S. statutory rate
            
            
            (2,611
            )
            
            (9,936
            )
            
            9,564Amortization
                of intangibles
            
            
            (1,317
            )
            
            1,599
            
            
            (861
            )Gain/(Loss)
                on investment in subsidiaries
            
            
            (30,501
            )
            
            178,830
            
            
            (33,799
            )Change
                in the valuation allowance for deferred tax
              assets
            
            
            130,637
            
            
            (308,339
            )
            
            67,156Cancellation
                of indebtedness income
            
            
            8,649
            
            
            —
            
            
            —Capital
                losses
            
            
            (39,325
            )
            
            129,250
            
            
            (20,917
            )Foreign
                tax credit carry forward
            
            
            —
            
            
            (3,678
            )
            
            (1,224
            )Non-deductible
                items
            
            
            —
            
            
            7,032
            
            
            9,987Deemed
                dividend inclusions in US income
            
            
            —
            
            
            16,111
            
            
            —Branch
                and partnership loss
            
            
            —
            
            
            (3,937
            )
            
            8,135Other
            
            
            (3,463
            )
            
            (2,630
            )
            
            3,254$—
            
            
            
            
            $
            6,842
            
            $
            15,965








The
      tax
      effects of significant temporary differences representing deferred tax assets
      and liabilities at December 31 are as follows:





**2003**
            
            **2004**
            
            **2005**Deferred
                tax assets:Accrued
                liabilities not yet deductible
            
            $
            18,779
            
            $
            11,129
            
            $
            18,460Net
                operating loss carryforwards
            
            
            485,164
            
            
            320,086
            
            
            388,433AMT
                credit carryforwards
            
            
            802
            
            
            —
            
            
            —Property,
                plant and equipment
            
            
            52,923
            
            
            30,983
            
            
            1,120Capital
                loss carryforwards
            
            
            165,716
            
            
            37,246
            
            
            58,163Foreign
                tax credit carry forward
            
            
            —
            
            
            3,678
            
            
            4,902Other
            
            
            14,702
            
            
            412
            
            
            3,278738,086
            
            
            403,534
            
            
            474,356Valuation
                allowance
            
            
            (707,289
            )
            
            (398,950
            )
            
            (466,106
            )30,797
            
            
            4,584
            
            
            8,250Deferred
                tax liabilities:Intangibles
            
            
            (5,825
            )
            
            (283
            )
            
            (283
            )Property,
                plant and equipment
            
            
            (12,827
            )
            
            (2,033
            )
            
            (3,704
            )Inventory
            
            
            (7,894
            )
            
            (4,305
            )
            
            (4,301
            )Other
            
            
            —
            
            
            —
            
            
            (5,738
            )(26,546
            )
            
            (6,621
            )
            
            (14,026
            )Net
                deferred tax assets (liabilities)
            
            $
            4,251
            
            $
            (2,037
            )
            $
            (5,776
            )





The
      current deferred tax assets are included in prepaid expenses and other and
      the
      long-term deferred tax assets, consisting of net operating loss carryforwards,
      are in other assets in the consolidated balance sheets. The current deferred
      tax
      liabilities are included in accrued and other liabilities in the consolidated
      balance sheets.




Approximate
      domestic and foreign income (loss) before income tax provision are as
      follows:




**Year
                Ended December 31,****2003**
            
            **2004**
            
            **2005**Domestic
            
            $
            (86,788
            )
            $
            14,433
            
            $
            (98,319
            )Foreign
            
            
            (77,521
            )
            
            (1,843
            )
            
            33,055$
            (164,309
            )
            $
            12,590
            
            $
            (65,264
            )





As
      of
      December 31, 2005, the Company had the following net operating loss (NOL)
      carryforwards: $803,299 in the U.S., $260 in China, $68,930 in Luxembourg,
      $128,294 in Canada, $23,811 in Hong Kong, $27,562 in the U.K., and $15,898
      in
      the Netherlands. The U.S. NOLs expire in 2019 through 2025 and the Canada NOLs
      expire in 2007 through 2012. All other NOLs carry forward indefinitely. Canada
      has an investment tax credit carryforward of $1,191 that will expire in 2010
      and
      a capital loss of $181,762 that will carry forward indefinitely. The Company
      has
      not recognized and does not anticipate recognizing a deferred tax liability
      for
      approximately $23,175 on undistributed earnings of its foreign subsidiaries
      because the Company intends to indefinitely reinvest the earnings.




In
      connection with the Reorganization completed on January 31, 2003, the Company
      believes more than a 50% change in ownership occurred under Section 382 of
      the
      Internal Revenue Code of 1986, as amended, and regulations issued thereunder.
      As
      a consequence, the utilization of the U.S. NOLs is limited annually to
      approximately $19,700 per year (except to the extent the Company recognizes
      certain gains built in at the time of the ownership change), with any unused
      portion carried over to succeeding years. Any NOLs not utilized in a year can
      be
      carried over to succeeding years.




The
      Company has a tax holiday in China, in certain of the Company’s subsidiaries,
      that allows a two-year tax exemption and three-year 50% reduction in the tax
      rate. If not for such tax holiday, the Company would have had $3,787, $3,674
      and
      $5,587 of additional income tax expense for December 31, 2003, 2004 and
      2005, respectively, based on the applicable rates ranging from 15% to
      27%.




On
      October 22, 2004, President Bush signed the American Jobs Creation Act (the
      “Act”), which includes numerous provisions that may affect business practices
      and accounting for income taxes. Management has determined that the Act will
      not
      have an effect on the Company.




**15.
      Derivative Financial Instruments**





The
      Company accounts for derivative financial instruments under the provisions
      of
      SFAS No. 133, *Accounting
      for Derivative Instruments and Hedging Activities,* as
      amended by SFAS No. 137 and SFAS No. 138 (collectively, the Statement). The
      Statement requires all derivatives to be recognized in the statement of
      financial position at fair value, with changes in the fair value of derivative
      instruments to be recorded in current earnings or deferred in accumulated other
      comprehensive loss, depending on whether a derivative is designated as and
      is
      effective as a hedge and on the type of hedging transaction.




The
      Company uses derivative instruments, primarily foreign exchange forward
      contracts, to manage certain of its foreign exchange rate risks. The Company’s
      objective is to limit potential losses in earnings or cash flows from adverse
      foreign currency exchange rate movements. The Company’s foreign currency
      exposure arises from the transacting of business in a currency that is different
      from the currency that the Company incurs the majority of its costs.




Generally,
      the Company applies hedge accounting as allowed by the Statement. For hedged
      forecasted transactions, hedge accounting is discontinued if the forecasted
      transaction is no longer intended to occur, and any previously deferred hedging
      gains or losses would be recorded to earnings immediately. Earnings impacts
      for
      all designated hedges are recorded in the consolidated statement of operations
      generally on the same line item as the gain or loss on the item being hedged.
      The Company records all derivatives at fair value as assets or liabilities
      in
      the consolidated balance sheet, with classification as current or long-term
      depending on the duration of the instrument.




At
      December 31, 2005, the net deferred hedging gain in accumulated other
      comprehensive (loss) income was $75 as the contracts entered into during
      2005 had either expired or were offset with a corresponding opposite position.
      There was no hedge ineffectiveness during the years ended December 31,
      2003, 2004 and 2005. In addition, there were no hedging instruments outstanding
      at December 31, 2003 or 2004.




Notional
                  Amount
              
              Weighted
                  Average Remaining Maturity in
                Months
              
              Average
                  Exchange
                RateCash
                  flow hedges:To
                  Buy: Canadian Dollar
              
              C$
              1,500
              
              
              1.0
              
              
              1.1640To
                  Sell: Canadian Dollar
              
              C$
              1,500
              
              
              1.0
              
              
              1.2355Fair
                  Value
              
              $
              75




**16.
      Business Segment Information**





SFAS
      No. 131, *Disclosures
      about Segments of an Enterprise and Related Information* ,
      establishes standards for reporting information about operating segments in
      annual financial statements and requires selected information about operating
      segments in financial reports issued to stockholders. It also establishes
      standards for related disclosures about products and services, geographic areas
      and major customers. Operating segments are defined as components of an
      enterprise about which separate financial information is available that is
      evaluated regularly by the chief operating decision maker or decision making
      group in deciding how to allocate resources and in assessing
      performance.




The
      Company has four reportable segments for the years ended December 31, 2003,
      2004 and 2005: (i) China Printed Circuit Boards, (ii) North America
      Printed Circuit Boards, (iii) European Printed Circuit Boards and
      (iv) Assembly, which includes our harness business. (See Note 21 Subsequent
      Events.) The other operating segment includes certain North American EMS
      operations. Following the planned closure of the North American and European
      Printed Circuit Board operations in 2005, the Company expects to have two
      remaining reportable segments - China Printed Circuit Boards and
      Assembly.




China
      printed circuit boards, consists of the Company's printed circuit board
      fabrication manufacturing facilities located within China. These facilities
      provide comprehensive front-end engineering services, including, circuit board
      layout and related design services leading to manufacturing of multi-layer
      printed circuit boards and backpanels.




Until
      the
      third quarter of 2005, the Company's western world printed circuit board
      fabrication manufacturing facilities - North American Printed Circuit Board
      located in Montreal, Canada and European Printed Circuit Boards located in
      Echt,
      the Netherlands provided comprehensive front-end engineering services,
      including, circuit board layout and related design services leading to
      manufacturing of multi-layer printed circuit boards and backpanels. On February
      25, 2005 the Company announced its plan for the closure of the facilities
      located in Echt, the Netherlands and Montreal, Canada. See further discussion
      of
      the closures in Note 11.




The
      Assembly segment is composed of the assembly operations for three operating
      segments, which have been aggregated under SFAS No. 131, including wire
      harnesses and cable assemblies, backpanel assembly, printed circuit board
      assembly, custom enclosures and full system assembly and test. These assembly
      operations are conducted in facilities located in China and Mexico. (See Note
      21
      Subsequent Events).




Following
      is the Company’s reportable segment information for the years ended
      December 31, 2003, 2004 and 2005. Intersegment sales are fully eliminated
      in consolidation. General corporate operating expenses are allocated to each
      operating segment based on sales. The accounting policies of the segments are
      the same as those described in Note 1. Segment data includes intersegment
      revenues and is eliminated in consolidation.




**China**
              **Printed**
              **Circuit**
              **Boards**
            
            **North**
              **American**
              **Printed**
              **Circuit**
              **Boards****(1)**
            
            **European**
              **Printed**
              **Circuit**
              **Boards****(1)**
            
            **Assembly**
            
            **Other**
            
            **Eliminations**
            
            **Total****Net
                Sales:**Year
                ended December 31, 2003
            
            $
            288,018
            
            $
            55,650
            
            $
            50,673
            
            $
            306,978
            
            $
            76,502
            
            $
            (26,338
            )
            $
            751,483Year
                ended December 31, 2004
            
            
            343,880
            
            
            56,163
            
            
            41,993
            
            
            397,094
            
            
            96,772
            
            
            (34,539
            )
            
            901,363Year
                ended December 31, 2005
            
            
            420,131
            
            
            29,351
            
            
            13,120
            
            
            414,835
            
            
            87,630
            
            
            (16,549
            )
            
            948,518**Operating
                Income (Loss):**Year
                ended December 31, 2003
            
            
            36,409
            
            
            (59,793
            )
            
            (45,867
            )
            
            24,334
            
            
            (25,905
            )
            
            —
            
            
            (70,822
            )Year
                ended December 31, 2004
            
            
            32,689
            
            
            (14,386
            )
            
            (21,908
            )
            
            37,703
            
            
            6,852
            
            
            —
            
            
            40,950Year
                ended December 31, 2005
            
            
            9,726
            
            
            (21,457
            )
            
            (27,755
            )
            
            38,757
            
            
            (9,266
            )
            
            —
            
            
            (9,995
            )**Total
                Assets:**Year
                ended December 31, 2003
            
            
            310,926
            
            
            48,126
            
            
            63,486
            
            
            179,093
            
            
            92,704
            
            
            —
            
            
            694,335Year
                ended December 31, 2004
            
            
            356,168
            
            
            43,918
            
            
            26,584
            
            
            171,960
            
            
            151,779
            
            
            —
            
            
            750,409Year
                ended December 31, 2005
            
            
            419,713
            
            
            21,236
            
            
            2,210
            
            
            169,090
            
            
            101,695
            
            
            —
            
            
            713,944**Total
                Capital Expenditures:**Year
                ended December 31, 2003
            
            
            26,883
            
            
            4,428
            
            
            5,258
            
            
            10,147
            
            
            790
            
            
            —
            
            
            47,506Year
                ended December 31, 2004
            
            
            49,495
            
            
            5,714
            
            
            4,650
            
            
            10,928
            
            
            1,219
            
            
            —
            
            
            72,006Year
                ended December 31, 2005
            
            
            67,927
            
            
            1,877
            
            
            651
            
            
            12,789
            
            
            1,788
            
            
            —
            
            
            85,032**Total
                Depreciation:**Year
                ended December 31, 2003
            
            
            24,019
            
            
            15,589
            
            
            11,007
            
            
            9,767
            
            
            5,688
            
            
            —
            
            
            66,070Year
                ended December 31, 2004
            
            
            27,252
            
            
            4,112
            
            
            5,086
            
            
            9,199
            
            
            2,583
            
            
            —
            
            
            48,232Year
                ended December 31, 2005
            
            
            34,508
            
            
            2,202
            
            
            1,890
            
            
            10,631
            
            
            2,355
            
            
            —
            
            
            51,586**Total
                Amortization:**Year
                ended December 31, 2003
            
            
            1,666
            
            
            632
            
            
            469
            
            
            —
            
            
            298
            
            
            —
            
            
            3,065Year
                ended December 31, 2004
            
            
            1,444
            
            
            2
            
            
            —
            
            
            —
            
            
            124
            
            
            —
            
            
            1,570Year
                ended December 31, 2005
            
            
            1,253
            
            
            —
            
            
            —
            
            
            —
            
            
            183
            
            
            —
            
            
            1,436





(1)
            On
                February 25, 2005 the Company announced the intention to close the
                printed
                circuit board manufacturing facilities in Echt, the Netherlands and
                Montreal, Canada. See further discussion of the closures in Note
                11.





Net
      sales
      by country of destination are as follows:


**Year
                Ended December 31,****2003**
            
            **2004**
            
            **2005**United
                States
            
            $
            384,786
            
            $
            416,457
            
            $
            443,076China
            
            
            101,890
            
            
            120,902
            
            
            105,421Mexico
            
            
            27,008
            
            
            86,382
            
            
            86,115Germany
            
            
            80,395
            
            
            84,530
            
            
            59,215France
            
            
            18,375
            
            
            22,326
            
            
            43,936Canada
            
            
            25,841
            
            
            31,682
            
            
            40,120Belgium
            
            
            11,582
            
            
            15,846
            
            
            26,157Hong
                Kong
            
            
            8,695
            
            
            9,345
            
            
            22,995South
                Korea
            
            
            269
            
            
            440
            
            
            20,291Malaysia
            
            
            37,673
            
            
            26,474
            
            
            14,021Singapore
            
            
            5,481
            
            
            9,387
            
            
            8,458United
                Kingdom
            
            
            16,020
            
            
            12,210
            
            
            7,032Spain
            
            
            325
            
            
            3,878
            
            
            6,525Other
            
            
            33,143
            
            
            61,504
            
            
            65,156Total
            
            $
            751,483
            
            $
            901,363
            
            $
            948,518




Net
        sales
        by product offering are as follows:
 
 **Year
                  Ended December 31,****2003**
              
              **2004**
              
              **2005**Printed
                  circuit boards
              
              $
              373,260
              
              $
              420,512
              
              $
              447,652Wire
                  harnesses and electro-mechanical solutions (See Note 21)
              
              
              378,223
              
              
              480,851
              
              
              500,866Total
              
              $
              751,483
              
              $
              901,363
              
              $
              948,518
 Property,
        plant and equipment, net by country are as follows (See Note 11 and Note
        21):





**Year
                Ended December 31,****2004**
            
            **2005**China
            
            $
            181,394
            
            $
            231,364Mexico
            
            
            20,048
            
            
            19,877United
                States
            
            
            5,704
            
            
            4,413Canada
            
            
            14,652
            
            
            —Other
            
            
            11,966
            
            
            —Total
            
            $
            233,764
            
            $
            255,654





**17.
      Concentration Of Business**





During
      the years ended December 31, 2003, 2004 and 2005, sales to General Electric
      were 12.1%, 11.3% and 13.2%, respectively of net sales. No sales to any other
      customers represented over 10.0% of net sales for the years ended December
      2003,
      2004 and 2005.




The
      Company holds cash amounts in excess of federally insured amounts in certain
      bank accounts.




**18.
      Retirement Plans**





The
      Company has a defined contribution retirement savings plan (the Retirement
      Plan)
      covering substantially all domestic employees who meet certain eligibility
      requirements as to age and length of service. The Retirement Plan incorporates
      the salary deferral provision of Section 401(k) of the Internal Revenue Code
      and
      employees may defer up to 30% of compensation or the annual maximum limit
      prescribed by the Internal Revenue Code. The Company may contribute 1% of
      employees’ salaries to the Retirement Plan and matches a percentage of the
      employees’ deferrals. The Company may also elect to contribute an additional
      profit-sharing contribution to the Retirement Plan at the end of each year.
      The
      Company’s contributions to the Retirement Plan were $503, $506 and $564 for the
      years ended December 31, 2003, 2004 and 2005, respectively.




**19.
      Research And Development**





Research,
      development and engineering expenditures for the creation and application of
      new
      products and processes were approximately $2,882, $3,320 and $4,115 for the
      years ended December 31, 2003, 2004 and 2005, respectively. Research and
      Development is included in the selling, general and administrative line item
      on
      the statement of operations.




**20.
      Related Party Transactions**





***Monitoring
      and Oversight Agreement***




The
        Company entered into a ten-year monitoring and oversight agreement with an
        affiliate of HMTF, effective as of January 31, 2003. The monitoring and
        oversight agreement obligates the Company to indemnify HMTF, its affiliates,
        and
        their respective directors, officers, controlling persons, agents and employees
        from and against all claims, liabilities, losses, damages, expenses and fees
        and
        disbursements of counsel related to or arising out of or in connection with
        the
        services rendered under the monitoring and oversight agreement and not resulting
        primarily from the bad faith, gross negligence, or willful misconduct of
        HMTF.
        The Statement of Operations includes expenses of $1,375, $1,500 and $1,500
        for
        the years ended December 31, 2003, 2004 and 2005 respectively. During 2005,
        the company made a cash payment of $3,625 to HMTF related to these expenses.
        HMTF and its affiliates have a commitment of $5,000 and $5,000 of debt under
        the
        2003 Credit Agreement as of December 31, 2004 and 2005,
        respectively.


***Consulting
      Arrangement***





In
      connection with the Company’s restructuring activities, commencing December
      2001, the Company engaged Katia Advisors LLC to provide sales and marketing
      consulting services related to strategic marketing opportunities. Such services
      were provided on a month-by-month basis and effective December 1, 2004 the
      Company discontinued using these services. As of December 1, 2004, the Company
      had paid Katia Advisors an aggregate of $520. These services were provided
      by
      Richard McGinn, a partner of Katia and a member of the board of directors of
      the
      Company.




***Compensation
      of Directors***





The
      chairman of the board receives an annual fee of $120 and directors (other than
      the Chairman) who are not executive officers receive an annual fee of $30.
      In
      addition, each audit committee member receives an annual fee of $10 and the
      Chairman of the audit committee receives an additional fee of $5. Directors
      are
      reimbursed for out-of-pocket expenses incurred in connection with attending
      meetings of the board and its committees and receive a per diem fee of $1 for
      additional time spent on the Company’s business. The Company also has granted
      55,000 stock options with an exercise price of $12.63 per share, which vest
      over
      a period of three years, to each of Mr. Steffen, Mr. McGinn, Mr. Vieser and
      Ms.
      Gulyas as compensation for their services as members of the board. In addition,
      Mr. Steffen received 50,000 options with an exercise price of $12.63 per share,
      which vest over a period of 3 years for his service as Chairman of the
      Board.




***Rights
      Offering***





On
      October 7, 2004, Group completed a Rights Offering whereby they sold 5,555,555
      shares of common stock at $9.00 per share to current holders of stock. The
      proceeds, net of issuance costs, of $47,069, were contributed to the Company.
      The proceeds from such offering are being used for general working capital
      purposes and in the expansion of our printed circuit board operations in
      China.




***Other***





Certain
      affiliates of GSC are stockholders of Group and have the right together with
      certain other stockholders of Group to designate certain members of Group’s
      board of directors. An affiliate of GSC had a commitment in the amount of $5,000
      and $5,000 of debt under the 2003 Credit Agreement as of December 31, 2004
      and 2005, respectively.




In
      2000,
      the Company acquired all of the outstanding shares of Wirekraft Industries,
      Inc., a wholly owned subsidiary of International Wire Group, Inc.
      (“International Wire”), an affiliate HM Capital Partners. International Wire
      continued as an affiliate of HM Capital Partners until all interests were
      terminated in November of 2004. Mr. Hamwee and Mr. Cummings, both members of
      the
      Company’s board of directors, are affiliates of GSC. GSC owns 16.9% of
      International Wire and Mr. Hamwee was formerly Chairman of the Board of
      International Wire and now serves as a director of International Wire. As of
      November 2004, HM Capital Partners was no longer affiliated with International
      Wire.




The
      Company’s wire harness operations, in accordance with negotiated contract terms,
      purchased an aggregate of $34,077, $37,730 and $42,147 of product from
      International Wire Group, Inc. in 2003, 2004 and 2005 respectively. Viasystems
      had amounts due to International Wire. of $6,510 and $5,732 at December 31,
      2004 and 2005, respectively.




The
      Company has a receivable of $3,707 as of December 31, 2005 and $3,564 as of
      December 31, 2004 from Group relative to certain expenses paid by the
      Company for the benefit of Group.




**21.
      Subsequent Events**





On
      March
      21, 2006, we entered into an agreement to sell our wire harness business to
      Electrical Components International Holdings Company (“ECI”), a newly formed
      affiliate of Francisco Partners, L.P., a private equity firm. Under the terms
      of
      the stock purchase agreement, ECI will purchase all of the outstanding capital
      stock of Wire Harness Industries, Inc., the entity through which we conduct
      the
      wire harness business, for approximately $320 million. The closing, which is
      subject to certain conditions, including obtaining regulatory and third party
      consents or approvals, is expected to be consummated by the end of the second
      calendar quarter 2006.





The
      sale
      will result in the disposition of most of our operations in Mexico and a small
      portion of our China operations, and will result in the reduction of our
      employee head count, as of December 31, 2005, from 25,738 to
      18,642.





The
      estimated net proceeds from the sale of our wire harness business of
      approximately $310 million will be applied to the repayment of all of our
      outstanding bank debt, with the remainder to be held for reinvestment in our
      ongoing businesses.





Results
      of the Wire Harness Division are included in the assembly market
      segment.





The
      following table summarizes the carrying values of the assets and liabilities
      of
      the Wire Harness Division included in the Consolidated Balance
      Sheets:





2004
            
            2005AssetsCurrent
                Assets
            
            $
            71,359
            
            $
            75,135Property,
                plant and equipment
            
            
            22,159
            
            
            21,277Goodwill
            
            
            30,549
            
            
            30,549Other
                Intangibles, net
            
            
            -
            
            
            -Other
                assets
            
            
            390
            
            
            942Total
                assets disposed
            
            $
            124,457
            
            $
            127,903LiabilitiesCurrent
                liabilities
            
            $
            56,083
            
            $
            57,476Non-current
                liabilities
            
            
            5,932
            
            
            7,169Total
                liabilities disposed
            
            
            62,015
            
            
            64,645Net
                Assets
            
            $
            62,442
            
            $
            63,258








The
      following table summarizes the operating results of the Wire Harness Division
      included in the Statement of Operations.




2003
            
            2004
            
            2005Net
                Sales
            
            $
            233,861
            
            $
            271,328
            
            $
            295,704Operating
                income
            
            $
            25,046
            
            $
            38,673
            
            $
            36,951Income
                before income taxes
            
            $
            24,597
            
            $
            38,656
            
            $
            37,162








**ITEM
      9.*****Changes
      in and Disagreements with Accountants on Auditing and Financial
      Disclosure***





None.





**ITEM
      9A.*****Controls
      and Procedures***





As
      required by Rule 13a-15 under the Securities Exchange Act of 1934, we carried
      out an evaluation under the supervision and with the participation of our
      management, including the Chief Executive Officer and Chief Financial Officer
      of
      the effectiveness of the design and operation of our disclosure controls and
      procedures. There are inherent limitations to the effectiveness of any system
      of
      disclosure controls and procedures, including the possibility of human error
      and
      the circumvention or overriding of the controls and procedures. Accordingly,
      even effective disclosure controls and procedures can only provide reasonable
      assurance of achieving their control objectives. Based upon our evaluation,
      our
      Chief Executive Officer and our Chief Financial Officer concluded that our
      disclosure controls and procedures were effective to provide reasonable
      assurance that information required to be disclosed by us in the reports that
      we
      file or submit under the Securities Exchange Act of 1934 is recorded, processed,
      summarized and reported, within the time periods specified in the applicable
      rules and forms, and that it is accumulated and communicated to our management,
      including our Chief Executive Officer and Chief Financial Officer, as
      appropriate, to allow timely decisions regarding required
      disclosure.





Our
      management is responsible for establishing and maintaining adequate internal
      control over financial reporting. Internal control over financial reporting
      is a
      process designed to provide reasonable assurance regarding the reliability
      of
      financial reporting and the preparation of financial statements for external
      reporting purposes in accordance with accounting principles generally accepted
      in the United States of America. Because of its inherent limitations, internal
      control over financial reporting may not prevent or detect misstatements. Our
      management has assessed the effectiveness of our internal control over financial
      reporting as of December 31, 2005. Our management concluded that based on
      its assessment, our internal control over financial reporting was effective
      as
      of December 31, 2005.





There
      has
      been no change in our internal control over financial reporting during the
      quarter ended December 31, 2005 that has materially affected, or is
      reasonably likely to materially affect, our internal control over financial
      reporting.





**ITEM
      9B.*****Other
      Information***





**None.**





**PART
      III**





**ITEM
      10.*****Directors
      And Executive Officers Of The Registrant*******





The
      following table sets forth the names and ages of each of the directors and
      the
      executive officers of Viasystems and , followed by a description of their
      business experience during the past five years. The positions held by the
      directors and executive officers are with Group and Viasystems, unless indicated
      otherwise. All executive officers are appointed by the board of directors of
      Group and Viasystems and serve at its pleasure. There are no family
      relationships among any of the executive officers. Unless indicated otherwise,
      each of the directors and executive officers is a U.S. citizen and the business
      address of each individual is 101 South Hanley Road, Suite 400, St. Louis,
      Missouri 63105.




Pursuant
      to the terms of the Stockholders’ Agreement, the board of directors of Group
      will consist of at least nine members, including the chief executive officer
      of
      the company, five designees of affiliates of HMTF and three designees of
      affiliates of GSC and other non-HMTF stockholders. See "Certain Relationships
      and Related Party Transactions — Stockholders Agreement."







**Name**
            **Age**
            **Position***Non-Employee*
              *Directors*Christopher
                J. Steffen (1) (2)*
            64
            ChairmanJack
                D. Furst
            47
            DirectorAndrew
                S. Rosen (1)
            37
            DirectorRobert
                F. Cummings Jr. (2)
            56
            DirectorDiane
                H. Gulyas (2)
            49
            DirectorRobert
                A. Hamwee (1)
            35
            DirectorRichard
                A. McGinn (1) (2)
            59
            DirectorRichard
                W. Vieser (2)
            78
            Director*Executive
                Officers*David
                M. Sindelar
            48
            Chief
                Executive Officer and DirectorTimothy
                L. Conlon
            54
            President,
                Chief Operating Officer and DirectorDavid
                J. Webster
            43
            Chief
                Administrative Officer and President of Wire Harness
                DivisionGerald
                G. Sax
            45
            Senior
                Vice President and Chief Financial OfficerSteven
                S.L. Tang
            50
            President
                — Asia Pacific Group




________





(1)  Member
      of
      the Group compensation committee.





(2)  Member
      of
      the Group audit committee.





*
      Denoted
      financial expert of the audit committee and independent director.





***Christopher
      J. Steffen*** has been
      Chairman of the board of directors since December 2003 and a director since
      October 2003. Mr. Steffen has been an advisor to Wall Street Management and
      Capital, Inc. since 2002. From 1993 to 1996, Mr. Steffen served as the Vice
      Chairman and Director of Citicorp and its principal subsidiary, Citibank, N.A.
      In 1993, Mr. Steffen served as Senior Vice President and Chief Financial Officer
      of Eastman Kodak. From 1989 to 1993, Mr. Steffen served as Executive Vice
      President and Chief Financial and Administrative Officer and Director of
      Honeywell, Inc. Mr. Steffen serves as director of Accelrys, Inc. He formerly
      served as Chairman of the board of directors of Veltri Metal Products, director
      and Chairman of the audit committee of Seminis, Inc. and as director and
      Chairman of the audit committee of UCMS Pty.




***Jack
        D. Furst*** has been
        a Partner of Hicks, Muse, Tate & Furst Incorporated since 1989, the year in
        which it was formed. Mr. Furst has approximately 20 years experience in
        leveraged acquisitions and private investments. Mr. Furst is involved in
        all
        aspects of HMTF’s business and has been actively involved in originating,
        structuring and monitoring its investments. Prior to joining HMTF, Mr. Furst
        served as a Vice President and subsequently a Partner of Hicks & Haas from
        1987 to 1989. From 1984 to 1986, Mr. Furst was a Merger and
        Acquisitions/Corporate Finance Specialist for The First Boston Corporation
        in
        New York. Before joining First Boston, Mr. Furst was a Financial Consultant
        at
        PricewaterhouseCoopers. Mr. Furst serves on the Boards of Directors of Home
        Interiors & Gifts, Inc. and Activant Solutions Inc.


***Andrew
      S. Rosen*** ,
      is a
      Partner of Hicks, Muse, Tate and Furst, Incorporated and has been with the
      firm since 1993. Mr. Rosen has over 15 years of private equity experience.
      Prior
      to joining HMTF, Mr. Rosen was with The Carlyle Group. Mr. Rosen is a graduate
      of the University of Pennsylvania and the Wharton School of
      Business.




***Robert
      F. Cummings, Jr*** *.* **** has
      been
      a director since January 2003. Mr. Cummings joined GSCP (NJ), Inc. (“GSC”)
      in 2002 as Senior Managing Director and is Chairman of the GSC Risk Committee
      and a former member of the GSC Advisory Board. For the prior 28 years, Mr.
      Cummings was with Goldman, Sachs & Co., where he was a member of the
      Corporate Finance Department, advising corporate clients on financing, mergers
      and acquisitions and strategic financial issues. Mr. Cummings was named a
      Partner of Goldman Sachs in 1986. He retired in 1998 and was retained as an
      Advisory Director by Goldman, Sachs & Co. to work with certain clients on a
      variety of banking matters. Mr. Cummings is a director of ATSI Holdings, GSC
      Capital Corp., Precision Partners, Inc. and RR Donnelley & Sons
      Company.




***Diane
      H. Gulyas*** has been
      a director since January 2003. Ms. Gulyas is Chief Marketing & Sales
      Officer of E.I. DuPont de Nemours and Company and has held such position since
      April 2004. Before being appointed Chief Marketing & Sales Officer, she was
      Group Vice President of DuPont Electronics and Communication Technologies,
      a
      position she had held since February 2002. Prior to that appointment, Ms. Gulyas
      served as Vice President and General Manager of the DuPont Advanced Fibers
      Businesses. Since 1978, Ms. Gulyas has held various positions with DuPont
      including Executive Assistant to the Chairman of the board and Global Business
      Director.




***Robert
      A. Hamwee*** has been
      a director since January 2003. Mr. Hamwee joined GSC at its inception in
      1994 and became a Managing Director in 2000. He currently manages the day-to-day
      activities of the controlled distressed debt securities group. Mr. Hamwee was
      previously with The Blackstone Group from 1992 to 1994 where he worked in the
      Merchant Banking Division. In addition, he worked on a wide range of assignments
      in the Mergers and Acquisitions and Restructuring Departments. Mr. Hamwee is
      Chairman of the board of APW Ltd. and ATSI Holdings. Mr. Hamwee also currently
      serves as a director of the following companies: Burke Industries, Inc., Dukes
      Place Holdings, L.P., International Wire Group, Inc., Precision Partners, Inc.,
      Seaton Insurance Company and Stonewall Insurance Company.




***Richard
      A. McGinn*** has been
      a director since January 2003. Mr. McGinn has been a General Partner at RRE
      Ventures (a private company that invests in entrepreneurial information
      technology companies) since August 2001. From 1997 to October 2000,
      Mr. McGinn served as Chief Executive Officer of Lucent Technologies, Inc. From
      1996 to 1997, Mr. McGinn served as President of Lucent Technologies, Inc. Mr.
      McGinn is a director of American Express Company.




***Richard
      W. Vieser*** has been
      a director since 1997. Mr. Vieser is the retired Chairman of the board of Varian
      Medical Systems where he served from April 1999 to February 2003. From
      June 1985 to December 1989, Mr. Vieser served as Chairman of the board
      and Chief Executive Officer of FL Industries, Inc. (a manufacturer of electrical
      components). From September 1986 to December 1989, Mr. Vieser served
      as Chairman of the board and Chief Executive Officer of FL Aerospace (a
      manufacturer and developer of aviation lighting). From March 1987 to
      December 1989, Mr. Vieser served as Chairman, President and Chief Executive
      Officer of Lear Siegler, Inc. (a diversified manufacturing company). From
      April 1984 through June 1985, he served as President and Chief
      Operating Officer of McGraw-Edison Company. Mr. Vieser is Chairman Emeritus
      of
      Varian Medical Systems and is a director of Fisher Scientific.




***David
      M. Sindelar*** has been
      a director since August 2001 and Chief Executive Officer since
      July 2001. Mr. Sindelar served as a director and executive officer when we
      filed for bankruptcy under chapter 11 of the United States Bankruptcy Code
      and
      throughout the bankruptcy proceedings described in “Our Bankruptcy and
      Reorganization.” He is the managing partner of Hanley Partners, Inc. (a firm
      that specializes in the acquisition and operation of commercial and industrial
      manufacturing companies). He also served as Senior Vice President from
      January 1997 through June 2001 and Chief Financial Officer since our
      inception through June 2001. Mr. Sindelar was Chief Executive Officer of
      International Wire Group, Inc. (a designer, manufacturer and marketer of bare
      and tin-plated copper wire and insulated copper wire) from July 2001 to
      September 2003, which filed for protection under chapter 11 of the United
      States Bankruptcy Code on March 24, 2004. He was Chief Executive Officer of
      LLS Corp. from August 1999 to November 2002, which filed for
      protection under chapter 11 of the United States Bankruptcy Code on
      January 16, 2002. Mr. Sindelar was Senior Vice President and Chief
      Financial Officer of Berg Electronics Corp. from March 1993 through
      October 1998 and of Crain Industries, Inc. and Crain Holdings Corp. (a
      manufacturer, fabricator and distributor of polyurethane foam and foam products)
      from August 1995 through December 1997 and of Jackson Holding Company
      from February 1993 through August 1995.




***Timothy
      L. Conlon*** has been
      a director, President and Chief Operating Officer since October 1998. Mr.
      Conlon served as a director and executive officer when we filed for bankruptcy
      under chapter 11 of the United States Bankruptcy Code and throughout the
      bankruptcy proceedings described in “Our Bankruptcy and Reorganization.” He is a
      partner of Hanley Partners, Inc. Prior to joining us, Mr. Conlon was employed
      as
      President and Chief Operating Officer of Berg Electronics Corp. from
      January 1997 through October 1998. Mr. Conlon also served as Executive
      Vice President and Chief Operating Officer of Berg Electronics Group, Inc.,
      a
      wholly-owned subsidiary of Berg Electronics Corp., from October 1993
      through January 1997. Prior to joining Berg Electronics Group, Inc., Mr.
      Conlon was employed as President of the Cutting and Welding Division of
      Thermadyne Industries, Inc. from April 1993 through October 1993.
      Prior to joining Thermadyne Industries, Inc., Mr. Conlon spent nine years in
      the
      electronic connector industry including serving as General Manager of the
      Information Technologies and Spectra strip divisions of Amphenol Corporation
      from 1990 through July 1992 and President of Cambridge Products (a
      manufacturer of electronic and communications connector products) from 1988
      through 1989.




***David
      J. Webster*** was
      named as the President of the Company’s wire harness division in June of 2005.
      Mr. Webster has also serves as Chief Administrative Officer since May 2004.
      Mr.
      Webster served as an executive officer when we filed for bankruptcy under
      chapter 11 of the United States Bankruptcy Code and throughout the bankruptcy
      proceedings described in “Our Bankruptcy and Reorganization.” He also served as
      Senior Vice President from 1997 through May 2004. From 1997 to 2004, Mr. Webster
      was an executive officer of International Wire Group, Inc., which filed for
      protection under chapter 11 of the United States Bankruptcy Code on
      March 24, 2004. Mr. Webster has been a partner of Hanley Partners, Inc.
      since its inception in 2001. From August 1999 through November 2002,
      Mr. Webster was Senior Vice President and a member of the board of directors
      of
      LLS Corp., which filed for protection under chapter 11 of the United States
      Bankruptcy Code on January 16, 2002. From 1997 through 2001, Mr. Webster
      was a partner of Mills & Partners, Inc., and from 1997 through 1998 served
      as Senior Vice President of Berg Electronics Corp. During 1997, Mr. Webster
      served as Senior Vice President of Crain Industries, Inc. Prior to 1997, Mr.
      Webster was a partner in the law firm of Weil, Gotshal & Manges
      LLP.




***Gerald
      G. Sax*** has been
      Senior Vice President and Chief Financial Officer since August 2005. Mr. Sax
      served as Senior Vice President — Supply
      Chain from February 2003 to August 2005. He also served as Senior Vice President
      — Europe from July 1999 to January 2003. Mr. Sax served as an
      executive officer when we filed for bankruptcy under chapter 11 of the United
      States Bankruptcy Code and throughout the bankruptcy proceedings described
      in
“Our Bankruptcy and Reorganization.” Mr. Sax joined us in November 1998 in
      the position of Vice President — Corporate Controller. Prior to joining us, Mr.
      Sax was Vice President — Corporate Controller for Berg Electronics Corp. from
      September 1995 to October 1998.




***Steven
      S.L. Tang*** has been
      President — Asia Pacific since June 1999 and is responsible for the overall
      operations of our facilities on the continent of Asia. Mr. Tang served as an
      executive officer when we filed for bankruptcy under chapter 11 of the United
      States Bankruptcy Code and throughout the bankruptcy proceedings described
      in
“Our Bankruptcy and Reorganization.” Prior to joining us, Mr. Tang served as a
      Managing Director for the Asian division of Utilux Asia Limited, an Australian
      connector manufacturing company, from January 1995 to July 1999. Prior
      to 1995, Mr. Tang held various positions, all in Asia, with companies such
      as
      Amphenol, Pace Inc., National Semiconductor and Honeywell. Mr. Tang is a
      director of Wanji Pharmaceutical Holdings Limited.




**Code
      of Ethics and Business Conduct**





The
      Company has adopted a Code of Ethics applicable to its Chief Executive Officer
      and senior financial officers. A copy of the Code of Ethics has been filed
      with
      the SEC as an exhibit to the Company’s Annual Report on Form 10-K for the fiscal
      year ended December 31, 2005.





**ITEM
      11.*****Executive
      Compensation*******





**Compensation
      of Directors and Executive Officers**





The
      Chairman of the Board receives an annual fee of $120,000 and directors (other
      than the Chairman) who are not executive officers receive an annual fee of
      $30,000. In addition, each compensation and audit Committee Member receives
      an
      annual fee of $10,000 and the Chairman of the compensation and audit Committee
      receives an additional fee of $5,000. Directors are reimbursed for out-of-pocket
      expenses incurred in connection with attending meetings of the board and its
      committees and receive a per diem fee of $1,000 for additional time spent on
      our
      business beyond six regular meetings during a calendar year. We also have
      granted 55,000 stock options with an exercise price of $12.63, which vest over
      a
      period of three years, to each of our non-employee directors as compensation
      for
      their services as members of our board. In addition, the Chairman of the Board
      received an additional 50,000 options with an exercise price of $12.63, which
      vest over a period of three years.




The
      following table sets forth the cash and non-cash compensation earned during
      the
      years ended December 31, 2003, 2004 and 2005 by our Chief Executive Officer
      and our four other most highly compensated executive officers.




**Summary
      Compensation Table**





**Long-Term****Annual**
              
              **Compensation****Compensation**
              
              **Awards****Securities
                  Underlying**
              
              **All
                  Other****Name
                  and Principal Position**
              
              **Year**
              
              **Salary**
              
              **Bonus
                  (1)**
              
              **Options
                  (2)**
              
              **Compensation
                  (3)**David
                  M. Sindelar
              
              
              2005
              
              $
              860,661
              
              $
              533,600
              
              
              —
              
              
              —Chief
                  Executive Officer
              
              
              2004
              
              
              679,827
              
              
              1,076,400
              
              
              70,000
              
              
              —2003
              
              
              583,994
              
              
              598,000
              
              
              350,000
              
              
              —Timothy
                  L. Conlon
              
              
              2005
              
              
              572,663
              
              
              319,000
              
              
              —
              
              
              —President
                  and Chief
              
              
              2004
              
              
              572,663
              
              
              643,500
              
              
              70,000
              
              
              —Operating
                  Officer
              
              
              2003
              
              
              572,663
              
              
              357,500
              
              
              330,000
              
              
              —David
                  J. Webster
              
              
              2005
              
              
              486,997
              
              
              177,190
              
              
              —
              
              
              —Chief
                  Administrative Officer
              
              
              2004
              
              
              352,414
              
              
              357,435
              
              
              40,000
              
              
              —Chief
                  Administrative Officer
              
              
              2003
              
              
              316,997
              
              
              126,750
              
              
              260,000and
                  President of the Wire
                Harness
                  BusinessGerald
                  G. Sax
              
              
              2005
              
              
              315,334
              
              
              99,470
              
              
              125,000
              
              
              —Senior
                  Vice President and
              
              
              2004
              
              
              278,578
              
              
              153,270
              
              
              15,000
              
              
              —Chief
                  Financial Officer
              
              
              2003
              
              
              262,834
              
              
              81,250
              
              
              60,000
              
              
              —Steven
                  S. L. Tang
              
              
              2005
              
              
              431,807
              
              
              125,035
              
              
              —
              
              
              —President
                  — Asia Pacific
              
              
              2004
              
              
              430,324
              
              
              251,740
              
              
              70,000
              
              
              —2003
              
              
              423,903
              
              
              137,769
              
              
              150,000
              
              
              —


__________




(1)
            The
                bonus amounts listed for 2003, 2004 and 2005 were paid in 2004, 2005
                and
                2006 respectively. 
 (2)
            Reflects
                options granted under our 2003 Stock Option
                Plan. 
 (3)
            We
                provide perquisites and other personal benefits to certain executives.
                The
                aggregate incremental costs of these benefits to us do not exceed
                the
                lesser of either $50,000 or 10% of the total of annual salary and
                bonus
                reported for each executive officer.


***Aggregated
      Option Exercises in 2005 and Year End Option Values***





The
      following table summarizes the number of options exercised during the year
      ended
      December 31, 2005 for the above named executive officers and the value of
      unexercised options as of December 31, 2005.





**Shares**
              **Acquired**
              **on
                Exercise(#)**
            **Value**
              **Realized($)**
            **Number
                of Securities**
              **Underlying
                Unexercised**
              **Options
                at**
              **Year
                End(#)**
              **Exercisable/Unexercisable**
            **Value
                of Unexercised**
              **In-the-money
                Options at**
              **Year
                End (1)**
              **Exercisable/Unexercisable**David
                M. Sindelar
            —
            —
            256,667/163,333
            $0
                / $0Timothy
                L. Conlon
            —
            —
            243,333/156,667
            $0
                / $0David
                J. Webster
            —
            —
            186,667/113,333
            $0
                / $0Gerald
                G. Sax
            —
            —
            86,666/113,334
            $0
                / $0Steven
                S. L. Tang
            —
            —
            123,333/96,667
            $0
                / $0








(1)  Based
      on
      a fair market value of $9.00 per share, which was determined to be a reasonable
      estimate of Group's stock price as of October 1, 2004, the date of rights
      offering. For more information on the rights offering, see Note 20 of the
      consolidated financial statements. As of December 31, 2005, none of the
      options held by the named executive officers were in-the-money.





**Benefit
      Plans**





***2003
      Stock Option Plan***





The
      Group
      2003 Stock Option Plan provides for the award of incentive stock options, or
      ISOs, and non-qualified stock options, or NSOs. Subject to adjustment in the
      event of certain corporate transactions or events, a maximum of 2,777,778 shares
      of Group’s common stock is issuable under the 2003 Stock Option Plan. As of
      December 31, 2005, options to purchase an aggregate of 2,698,800 shares of
      common stock were outstanding. The exercise price of all outstanding options
      is
      $12.63 per share. Options issued under the plan that expire, are forfeited
      or
      otherwise terminate will again be available for grant under the 2003 Stock
      Option Plan. The plan is administered by the compensation committee of the
      board
      of directors of Group.




Generally,
      each option granted under the 2003 Stock Option Plan is required to expire
      on or
      before the tenth anniversary of the date of grant. The exercise price of each
      ISO is required to be not less than 100% of the fair market value of the
      underlying stock subject to the option on the date of grant. This minimum
      exercise price provision is increased, and other conditions and restrictions
      apply, with respect to awards granted to persons who own or are deemed to own
      more than 10% of the total combined voting power of all classes of stock of
      Group.




The
      2003
      Stock Option Plan provides for payment of the exercise price of options in
      the
      form of cash or, subject to the discretion of the compensation committee of
      the
      board of directors of Group, by delivery of shares of Group common
      stock.




The
      2003
      Stock Option Plan provides for the grant of ISOs only to employees of Group
      and
      its affiliates. NSOs may be granted to employees, or other persons providing
      services for Group or its affiliates.




***Incentive
      Compensation Plan***





Officers
      and other key employees designated by our chief executive officer are eligible
      to participate in our annual incentive compensation plan. The plan is
      administered by the compensation committee of our board of directors and
      participants under the plan may receive cash awards based on annual performance
      targets set by the compensation committee. The compensation committee may also
      make discretionary awards under the plan. The plan remains effective until
      terminated by the compensation committee.







***Option
      Grants to Certain Non-Employee Directors***





During
      2003, certain non-employee members of our board of directors, consisting of
      Mr.
      Steffen, Ms. Gulyas, Mr. McGinn and Mr. Vieser, were granted an option to
      purchase 55,000 shares of our common stock at an exercise price of $12.63 per
      share.




During
      2004, Mr. Steffen was granted an additional option to purchase 50,000 shares
      of
      our common stock at an exercise price of $12.63 per share.




**Employment
      Agreements**





***David
      M. Sindelar Executive Employment Agreement***





Mr.
      David
      M. Sindelar entered into an amended and restated executive employment agreement
      with Group and certain of its subsidiaries as of October 13, 2003, as amended.
      Pursuant to his employment agreement, Mr. Sindelar will serve as Chief Executive
      Officer of Group through January 31, 2007, unless terminated earlier by Group
      or
      Mr. Sindelar. Mr. Sindelar is required to devote the amount of time reasonably
      necessary to faithfully and adequately supervise the overall management of
      Group
      and its subsidiaries. Subject to the foregoing limitation on his activities,
      Mr.
      Sindelar is free to participate in other business endeavors.




The
      compensation provided to Mr. Sindelar under his executive employment agreement
      includes an annual base salary of not less than $920,000 (reduced by any amount
      of salary actually received by Mr. Sindelar in respect of his severance
      arrangement with International Wire Group, Inc. from October 13, 2003 to April
      15, 2005), subject to upward adjustment at the sole discretion of the chairman
      of the board of directors of Group, and additional compensation that may be
      used
      by Mr. Sindelar to own and maintain an automobile, as well as those other
      benefits customarily accorded the executives of Group as long as the executive
      employment agreement is in force. In addition, Mr. Sindelar is entitled to
      an
      annual bonus in an amount determined in accordance with our incentive
      compensation plan for senior executives.




Mr.
      Sindelar's executive employment agreement also provides that if Mr. Sindelar's
      employment is terminated without cause, Mr. Sindelar will continue to receive
      his then current salary, which shall not be less than $920,000, together with
      his annual bonus amount, for a period of eighteen months following such
      termination. The executive employment agreement terminates upon Mr. Sindelar's
      death or his inability to perform his duties due to mental or physical
      incapacity for six consecutive months or any one hundred working days out of
      a
      twelve month period, and no further compensation shall be payable except that
      he
      or his estate, heirs or beneficiaries, as applicable, shall receive his then
      current salary, together with his annual bonus amount, for a period of 18
      months, in addition to benefits otherwise specifically provided for. The
      agreement also provides medical benefits for his and his spouse's
      lifetime.




***Timothy
      L. Conlon Executive Employment Agreement***





Mr.
      Timothy L. Conlon entered into an amended and restated executive employment
      agreement with Group and certain of its subsidiaries as of January 31, 2003.
      Pursuant to his employment agreement, Mr. Conlon will serve as President and
      Chief Operating Officer of Group through January 31, 2007, unless terminated
      earlier by Group or Mr. Conlon. Mr. Conlon is required to devote the amount
      of
      time reasonably necessary to faithfully and adequately supervise the overall
      financial management of Group.




The
      compensation provided to Mr. Conlon under his executive employment agreement
      includes an annual base salary of not less than $550,000, subject to upward
      adjustment at the sole discretion of the Chief Executive Officer of Group,
      and
      additional compensation that may be used by Mr. Conlon to own and maintain
      an
      automobile, as well as those other benefits customarily accorded the executives
      of Group as long as the executive employment agreement is in force. In addition,
      Mr. Conlon is entitled to an annual bonus in an amount determined in accordance
      with our incentive compensation plan for senior executives.




Mr.
      Conlon's executive employment agreement also provides that if Mr. Conlon's
      employment is terminated without cause, Mr. Conlon will continue to receive
      his
      then current salary, which shall not be less than $550,000, together with his
      annual bonus amount, for a period of eighteen months following such termination.
      The executive employment agreement terminates upon Mr. Conlon's death or his
      inability to perform his duties due to mental or physical incapacity for six
      consecutive months or any one hundred working days out of a twelve month period,
      and no further compensation shall be payable except that he or his estate,
      heirs
      or beneficiaries, as applicable, shall receive his then current salary for
      a
      period of eighteen months, in addition to benefits otherwise specifically
      provided for. The agreement also provides medical benefits for his and his
      spouse's lifetime.




***David
      J. Webster Executive Employment Agreement***





Mr.
      David
      J. Webster entered into an amended and restated executive employment agreement
      with Group and certain of its subsidiaries as of January 31, 2003. Pursuant
      to
      his employment agreement, Mr. Webster will serves as Chief Administrative
      Officer of Group through January 31, 2007, unless terminated earlier by Group
      or
      Mr. Webster. Mr. Webster is required to devote the amount of time reasonably
      necessary to faithfully and adequately supervise the overall management of
      Group
      and its subsidiaries. Subject to the foregoing limitation on his activities,
      Mr.
      Webster is free to participate in other business endeavors.




The
      compensation provided to Mr. Webster under his executive employment agreement
      includes an annual base salary of not less than $470,000 subject to upward
      adjustment at the sole discretion of the Chief Executive Officer of Group,
      and
      additional compensation that may be used by Mr. Webster to own and maintain
      an
      automobile, as well as those other benefits customarily accorded the executives
      of Group as long as the executive employment agreement is in force. In addition,
      Mr. Webster is entitled to an annual bonus in an amount determined in accordance
      with our incentive compensation plan for senior executives.




Mr.
      Webster's executive employment agreement also provides that if Mr. Webster's
      employment is terminated without cause, Mr. Webster will continue to receive
      his
      then current salary, which shall not be less than $470,000, together with his
      annual bonus amount, for a period of eighteen months following such termination.
      The executive employment agreement terminates upon Mr. Webster's death or his
      inability to perform his duties due to mental or physical incapacity for six
      consecutive months or any one hundred working days out of a twelve month period,
      and no further compensation shall be payable except that he or his estate,
      heirs
      or beneficiaries, as applicable, shall receive his then current salary, together
      with his annual bonus amount, for a period of 18 months, in addition to benefits
      otherwise specifically provided for. The agreement also provides medical
      benefits for his and his spouse's lifetime.




On
      June
      15, 2005, in addition to his office as Chief Administrative Officer, Mr. Webster
      was named as the President of the company’s wire harness division and his
      employment agreement was amended, conditioned upon the sale of the wire harness
      business. Additionally, on June 15, 2005, Group and Mr. Webster entered into
      a
      Letter Agreement that entitles Mr. Webster to an employment agreement payout
      and
      a transaction bonus of $995,987 upon consummation of the sale of the wire
      harness business.





***Gerald
      G. Sax Executive Employment Agreement***





Mr.
      Gerald G. Sax entered into an amended and restated executive employment
      agreement with Group and certain of its subsidiaries as of August 15, 2005.
      Pursuant to his employment agreement Mr. Sax will serve as Senior Vice President
      and Chief Financial Officer of Group until his termination pursuant to the
      terms
      of his employment agreement. Mr. Sax is required to devote the amount of time
      reasonably necessary to faithfully and adequately supervise the overall
      financial management of Group.





The
      compensation provided to Mr. Sax under his executive employment agreement
      includes an annual base salary of not less that $360,000, subject to upward
      adjustment at the sole discretion of the Chief Executive Officer of Group,
      and
      additional compensation that may be used by Mr. Sax to own and maintain an
      automobile, as well as those other benefits customarily accorded the executives
      of Group as long as the executive employment agreement is in force. In addition,
      Mr. Sax is entitled to an annual bonus in an amount determined in accordance
      with our annual incentive compensation plan for such executives.




Mr.
      Sax’s
      employment agreement also provides that if Mr. Sax’s employment is terminated
      without cause, Mr. Sax will continue to receive his then current salary, which
      shall not be less than $360,000 for a period of eighteen months following such
      termination. The executive employment agreement terminates upon Mr. Sax’s death
      or his inability to perform his duties due to mental or physical incapacity
      for
      six consecutive months or any one hundred working days out of a twelve month
      period, and no further compensation shall be payable except that he or his
      estate, heirs or beneficiaries, as applicable, shall receive his then current
      salary for a period of eighteen months, in addition to benefits otherwise
      specifically provided for. The agreement also provides medical benefits for
      his
      and his spouse’s lifetime.




**Compensation
      Committee Report on Executive Compensation**





*Compensation
      Committee Responsibility and Policies*





Group
      has
      established a compensation committee that consists of four directors. Each
      member of the Compensation Committee is a non-employee director within the
      meaning of Rule 16b-3 under the Exchange Act and an outside director within
      the
      meaning of Section 162(m) of the U.S. Internal Revenue Code of 1986, as amended.
      The Compensation Committee annually reviews and recommends to the full Board
      of
      Directors of Group compensation for the Chief Executive Officer, Chief Operating
      Officer, Chief Financial Officer and each of the five most highly compensated
      executive officers of the Company,  including,
      without limitation, (a) the annual base salary, (b) the annual incentive bonus,
      including the specific goals and amount, (c) equity compensation, (d) employment
      agreements, severance arrangements, and change in control agreements/provisions,
      and (e) any other benefits, compensation or arrangements. In recommending
      compensation for the Chief Executive Officer, Chief Operating Officer, Chief
      Financial Officer and each of the five most highly compensated executive
      officers of the Company, the Committee sets annual performance related
      goals.





The
      Company’s executive compensation program is designed to enable the Company to
      recruit, retain and motivate the high quality employees it needs. As a result,
      the Compensation Committee has determined that executive compensation
      opportunities should create incentives for superior performance.





The
      Company’s executive compensation mix includes a base salary, annual bonus
      awards and stock options. Through this compensation structure, the Company
      aims
      to:





·
            attract
                and retain highly qualified and talented
                executives,





·
            provide
                appropriate incentives to motivate executives to maximize stockholder
                returns by producing sustained superior performance,
                and





·
            reward
                them for outstanding individual contributions to the achievement
                of the
                Company’s near-term and long-term business
                objectives.





The
      Compensation Committee’s policy is that a significant portion of the executive’s
      compensation opportunities must be tied to achievement of annual objectives
      of
      the Company. Executive officers and other key employees are eligible to
      participate in the Company’s annual incentive compensation plan. Under the plan,
      executive officers and other key employees may receive increasing cash bonuses
      based on reaching annual performance target thresholds set by the Compensation
      Committee. The Compensation Committee may make discretionary awards under the
      plan. As of December 31, 2005, the Company reached and exceeded its minimum
      performance target, and the bonuses were approved by the Compensation
      Committee based on the thresholds achieved. A total of 125,000 stock
      options were awarded to executive officers in 2005.





*Compensation
      of the Chief Executive Officer*





The
      Compensation Committee regards compensation of the Chief Executive Officer
      to be
      among its most important responsibilities. The Chief Executive Officer should
      be
      properly incentivized and properly rewarded. The Compensation Committee gives
      incentive to the Chief Executive Officer to lead the business in a direction
      that will maximize stockholder value over the long-term, not just the next
      year.





In
      structuring and reviewing the Chief Executive Officer compensation, the
      Compensation Committee considered the Company’s financial performance in Fiscal
      2003 and 2004, stockholder return, the total compensation package and value
      of
      incentive awards to Chief Executive Officer’s at comparable companies, and Mr.
      Sindelar’s performance during his tenure with the Company.





Mr.
      David
      M. Sindelar became the Chief Executive officer in July of 2001. For 2005, Mr.
      Sindelar was paid an annual salary of $860,661 and an annual bonus of $533,600
      paid under Group’s annual incentive compensation plan. Mr. Sindelar’s bonus was
      determined based on, among other things, the financial performance target
      thresholds reached by the Company and other factors, including, but not limited
      to, his involvement in pursuing management’s objectives relative to the overall
      performance of the Company.





THE
                COMPENSATION COMMITTEE
              
              Richard
                A. McGinn - Chair
              
              Andrew
                S. Rosen - Member
              
              Robert
                A. Hamwee - Member
              
              Christopher
                J. Steffen - Member








**ITEM
      12.** ***Security
      Ownership Of Certain Beneficial Owners And Management*** ****





Group
      owns 100% of our capital stock. The following table sets forth, as of
      December 31, 2005, information regarding the beneficial ownership of
      Group's common stock by each person who beneficially owned more than 5% of
      any
      class of Group's voting securities and by its directors and named executive
      officers, individually, and by its directors and executive officers as a
      group.





**Amount
                and****Nature
                of****Beneficial**
            
            **Percent
                of****Ownership
                (1)**
            
            **Common**
              **Stock***5%
                Stockholders:*HMTF
                Parties (2)
            
            
            16,898,517
            
            
            44.3
            %c/o
                HM Capital Partners
              200
                Crescent Court, Suite 1600
              Dallas,
                Texas 75201GSC
                Parties (3)
              c/o
                GSC Partners
              500
                Campus Drive, Suite 220
              Florham
                Park, New Jersey 07932
            
            
            10,283,157
            
            
            27.0
            %Fidelity
                Parties(5)
              82
                Devonshire Street
              Boston,
                Massachusetts 02109
            
            
            2,053,390
            
            
            5.4
            %*Officers
                and Directors:*Jack
                D. Furst (4)
            
            
            16,898,517
            
            
            44.3
            %Andrew
                S. Rosen
            
            
            —
            
            
            —Richard
                W. Vieser (6)
            
            
            55,000
            
            
            *Robert
                F. Cummings
            
            
            —
            
            
            —Diane
                H. Gulyas (6)
            
            
            55,000
            
            
            *Robert
                A. Hamwee (3)
            
            
            10,283,157
            
            
            27.0
            %Richard
                A. McGinn (6)
            
            
            55,000
            
            
            *Christopher
                J. Steffen (6)
            
            
            53,332
            
            
            *David
                M. Sindelar (6)
            
            
            373,333
            
            
            1.0
            %Timothy
                L. Conlon (6)
            
            
            353,333
            
            
            *David
                J. Webster (6)
            
            
            273,333
            
            
            *Steven
                S. L. Tang (6)
            
            
            173,333
            
            
            *Gerald
                G. Sax (6)
            
            
            106,665
            
            
            *All
                executive officers and directors as a group (13 persons)
            
            
            28,680,003
            
            
            75.2
            %





__________





*
      Represents less than 1%





(1)
            Beneficial
                ownership is determined in accordance with the rules of the Securities
                and
                Exchange Commission and generally includes voting or investment power
                with
                respect to securities. Shares of common stock and options, warrants
                or
                other convertible securities (such as the class B senior convertible
                preferred stock) that are currently exercisable or exercisable within
                60
                days of December 31, 2005, are deemed to be outstanding and to be
                beneficially owned by the person holding those options, warrants
                or other
                convertible securities for the purpose of computing the percentage
                ownership of that person, but are not treated as outstanding for
                the
                purpose of computing the percentage ownership of any other
                person.




(2)
            These
                figures include:




·
            3,454,094
                shares of common stock held of record by Hicks, Muse, Tate & Furst
                Equity Fund III, L.P., a limited partnership, of which the ultimate
                general partner is Hicks, Muse Fund III Incorporated, an affiliate
                of
                HMTF. ·
            93,681
                shares of common stock held of record by HM3 Coinvestors, L.P., a
                limited
                partnership of which the ultimate general partner is Hicks, Muse
                Fund III
                Incorporated, an affiliate of HMTF. ·
            601,355
                shares of common stock held of record by HMTF Equity Fund IV (1999),
                L.P.,
                a limited partnership of which the ultimate general partner is Hicks,
                Muse
                (1999) Fund IV, LLC, an affiliate of
                HMTF. ·
            32,014
                shares of common stock held of record by Hicks, Muse PG- IV (1999),
                C.V.,
                of which the ultimate general partner is HM Fund IV Cayman, LLC,
                an
                affiliate of HMTF. ·
            14,785
                shares of common stock held of record by HM 4-SBS (1999) Coinvestors,
                L.P.
                a limited partnership of which the ultimate general partner is Hicks,
                Muse
                (1999) Fund IV, LLC, an affiliate of
                HMTF. ·
            9,826
                shares of common stock held of record by HM 4-EQ (1999) Coinvestors,
                L.P.,
                a limited partnership of which the ultimate general partner is Hicks,
                Muse
                (1999) Fund IV, LLC, an affiliate of
                HMTF. ·
            4,259
                shares of common stock held of record by HMTF Private Equity Fund
                IV
                (1999), L.P., a limited partnership of which the ultimate general
                partner
                is Hicks, Muse (1999) Fund IV, LLC, an affiliate of
                HMTF. ·
            9,873,369
                shares of common stock and 2,177,356 shares of class B senior convertible
                preferred stock (currently convertible into 2,815,134 shares of common
                stock) held of record by Pearl Street II, L.P., a limited partnership
                of
                which the ultimate general partner is Hicks, Muse Fund III Incorporated,
                an affiliate of HMTF.


(3)
            These
                figures include:




GSC
      Recovery II, L.P. (“Recovery II”) owns 4,160,887 shares of common stock (which
      includes 2,893,887 shares of common stock and 1,267,000 shares of common stock
      issuable upon conversion of 979,957 shares of Class B Senior Convertible
      Preferred Stock); GSC Recovery IIA, L.P. (“Recovery IIA”) owns 5,007,889 shares
      of common stock (which includes 4,357,448 shares of common stock and 650,613
      shares of common stock issuable upon conversion of 503,215 shares of Class
      B
      Senior Convertible Preferred Stock); GSC Partners CDO Fund, Limited (“CDO”) owns
      654,801 shares of the Company’s common stock; and GSC Partners CDO Fund II,
      Limited (“CDO II”) owns 459,408 shares of the Company’s common stock. By virtue
      of his relationship (described below) with Recovery II, Recovery IIA, CDO,
      and
      CDO II, Mr. Hamwee may be deemed to have shared voting and investment power
      over, and be the indirect beneficial owner of, the shares of common stock of
      the
      Company owned by Recovery II, Recovery IIA, CDO, and CDO II. Mr. Hamwee
      disclaims beneficial ownership of the Company’s common stock except to the
      extent of his pecuniary interest in such stock.




Recovery
      II is a Delaware limited partnership. GSC Recovery II GP, L.P. is the general
      partner of Recovery II. GSC RII, LLC is the general partner of GSC Recovery
      II
      GP, L.P. GSCP (NJ) Holdings, L.P. is the managing member of GSC RII, LLC. GSCP
      (NJ), L.P. is the manager of Recovery II. GSCP (NJ), Inc. is the general partner
      of GSCP (NJ), L.P. and GSCP (NJ) Holdings, L.P.




Recovery
      IIA is a Delaware limited partnership. GSC Recovery IIA GP, L.P. is the general
      partner of Recovery IIA. GSC RIIA, LLC is the general partner of GSC Recovery
      IIA GP, L.P. GSCP (NJ) Holdings, L.P. is the managing member of GSC RIIA, LLC.
      GSCP (NJ), L.P. is the manager of Recovery IIA. GSCP (NJ), Inc. is the general
      partner of GSCP (NJ), L.P. and GSCP (NJ) Holdings, L.P.




CDO
      and
      CDO II are Cayman Islands corporations. GSCP (NJ), L.P. is the collateral
      manager of CDO and CDO II; GSCP (NJ), Inc. is the general partner of GSCP (NJ),
      L.P.




Each
      of
      Keith W. Abell, Alfred C. Eckert III, Robert A. Hamwee, Richard M. Hayden,
      Frederick H. Horton, Thomas V. Inglesby, Matthew C. Kaufman, Christine K. Vanden
      Beukel, and Andrew J. Wagner are the executive officers and stockholders of
      GSCP
      (NJ), Inc. and the limited partners of GSCP (NJ), L.P. and GSCP (NJ) Holdings,
      L.P.




By
      virtue
      of each of the above entities’ and individuals’ relationship with Recovery II,
      Recovery IIA, CDO and CDO II, each may be deemed to have shared voting and
      investment power over, and be the indirect beneficial owner of, the shares
      of
      common stock of the Company owned by Recovery II, Recovery IIA, CDO and CDO
      II.
      Each of the above entities and individuals disclaims beneficial ownership of
      the
      Company’s common stock except to the extent of each entity’s and individual’s
      pecuniary interest in such common stock.




(4)
            Mr.
                Furst is a partner, stockholder and member of the management committee
                of
                HMTF and, accordingly, may be deemed to beneficially own all or a
                portion
                of the shares of Holding Common Stock beneficially owned by the HMTF
                Parties described above. Mr. Furst disclaims beneficial ownership
                of
                shares of Group’s Common Stock not owned of record by
                him.




(5)
            These
                figures include:




The
      Fidelity entities identified above are either an investment company or a
      portfolio of an investment company registered under Section 8 of the Investment
      Company Act of 1940, as amended, or a private investment account advised by
      Fidelity Management & Research Company (“FMR Co.”). FMR Co. is a
      Massachusetts corporation and an investment advisor registered under Section
      203
      of the Investment Advisers Act of 1940, as amended, and provides investment
      advisory services to each of such Fidelity entities identified above, and to
      other registered investment companies and to certain other funds which are
      generally offered to a limited group of investors. FMR Co. is a wholly-owned
      subsidiary of FMR Corp., a Delaware corporation.




(6)
            Represents
                shares of common stock issuable upon the exercise of options that
                are
                exercisable within 60 days.




**ITEM
      13.** ***Certain
      Relationships And Related Transactions*** ****





**Purchases
      from International Wire Group, Inc.**




In
        March 2000, Viasystems acquired the wire harness business of International
        Wire,, which at the time was an affiliate of HMTF. Our wire harness operations,
        in accordance with a supply agreement entered into in connection with our
        acquisition of the wire harness business, purchased an aggregate of $42.1
        million of insulated wire products from International Wire in the year ended
        December 31, 2005. The terms of the supply agreement are consistent with
        terms prevailing in an arms length transaction. The negotiated terms of the
        supply agreement include the pricing, purchase commitment, payment, quality
        and
        liability terms. On December 31, 2005, the supply agreement with
        International Wire expired by its terms. On March 21, 2006, Viasystems agreed
        to
        sell its wire harness business. See “Management’s Discussion and Analysis of
        Financial Condition and Results of Operations—Recent Developments”.
  Mr.
        Hamwee and Mr. Cummings, both members of our board of directors, are affiliates
        of GSC. GSC owns 16.9% of International Wire and Mr. Hamwee is a member of
        the
        Board of Directors of International Wire. As of November 2004, HMTF was no
        longer affiliated with International Wire.
  Under
        the
        terms of the purchase agreement, International Wire agreed to indemnify
        Viasystems for various matters associated with the pre-acquisition operations
        of
        the wire harness business, including product liability claims related to
        hose
        assemblies manufactured by one of the acquired companies through 1997. Certain
        claims have been asserted against International Wire by insurers as subrogees
        of
        their insured homeowners with respect to property damages arising from the
        failure of allegedly defective washing machine hose assemblies manufactured
        by
        one of the acquired companies. International Wire and its insurers to date
        have
        defended and/or settled all such claims consistent with their indemnity
        obligations. International Wire filed for protection under chapter 11 of
        the U.S
        Bankruptcy Code on March 24, 2004. On August 5, 2004, International Wire’s
        plan of reorganization was confirmed and on October 20, 2004, International
        Wire
        emerged from bankruptcy. Under the terms of International Wire’s plan of
        reorganization, it assumed the obligations under its indemnity to us. While
        International Wire has advised us that it believes that it will be financially
        capable of honoring any further claims, there can be no assurance of the
        foregoing, in which case insurers could potentially assert claims directly
        against one of the acquired companies.
  **Stockholders
        Agreement**
 
 On
        January 31, 2003, we entered into a Stockholders Agreement with certain persons
        acquiring shares of Group capital stock in connection with the Reorganization,
        including HMTF, which controls a majority of the voting stock of Group, and
        certain affiliates of GSC.
  The
        Stockholders Agreement provides that our board of directors will be comprised
        of
        at least nine members as follows: our chief executive officer; five members
        designated for election by affiliates of HMTF; and three members designated
        for
        election by affiliates of GSC and the other stockholder parties to the
        Stockholders Agreement other than HMTF. In addition, affiliates of HMTF,
        on the
        one hand, and affiliates of GSC and the other stockholder parties to the
        Stockholders Agreement other than HMTF, on the other hand, have the right
        to
        jointly designate additional members to our board of directors. The five
        directors designated by affiliates of HMTF are Mr. Furst, Mr. Rosen, Mr.
        McGinn,
        Mr. Vieser and Mr. Conlon. The three directors designated by affiliates of
        GSC
        and other non-HMTF stockholders are Mr. Cummings, Mr. Hamwee and Ms. Gulyas.
        Mr.
        Steffen is a jointly nominated director and Mr. Sindelar holds the remaining
        seat as our chief executive officer. The Stockholders Agreement also provides
        that the compensation committee of our board of directors will be comprised
        of
        two members designated by the HMTF board designees and one member designated
        by
        the GSC and non-HMTF stockholders’ board designees, so long as such individuals
        are qualified to serve in such capacity.
  To
        the
        extent that the affiliates of HMTF or the affiliates of GSC and the other
        non-HMTF stockholders dispose of shares of common stock held by them, such
        constituency’s right to designate directors for election (and to appoint
        compensation committee members) shall be reduced as follows:




**Stockholders
      Agreement**





On
      January 31, 2003, we entered into a Stockholders Agreement with certain persons
      acquiring shares of Group capital stock in connection with the Reorganization,
      including HM Capital Partners, which controls a majority of the voting stock
      of
      Group, and certain affiliates of GSC.




The
      Stockholders Agreement provides that our board of directors will be comprised
      of
      at least nine members as follows: our chief executive officer; five members
      designated for election by affiliates of HM Capital Partners; and three members
      designated for election by affiliates of GSC and the other stockholder parties
      to the Stockholders Agreement other than HM Capital Partners. In addition,
      affiliates of HM Capital Partners, on the one hand, and affiliates of GSC and
      the other stockholder parties to the Stockholders Agreement other than HM
      Capital Partners, on the other hand, have the right to jointly designate
      additional members to our board of directors. The five directors designated
      by
      affiliates of HM Capital Partners are Mr. Furst, Mr. Rosen, Mr. McGinn, Mr.
      Vieser and Mr. Conlon. The three directors designated by affiliates of GSC
      and
      other non-HM Capital Partners stockholders are Mr. Cummings, Mr. Hamwee and
      Ms.
      Gulyas. Mr. Steffen is a jointly nominated director and Mr. Sindelar holds
      the
      remaining seat as our chief executive officer. The Stockholders Agreement also
      provides that the compensation committee of our board of directors will be
      comprised of two members designated by the HM Capital Partners board designees
      and one member designated by the GSC and non-HM Capital Partners stockholders’
board designees, so long as such individuals are qualified to serve in such
      capacity.




To
      the
      extent that the affiliates of HM Capital Partners or the affiliates of GSC
      and
      the other non-HM Capital Partners stockholders dispose of shares of common
      stock
      held by them, such constituency’s right to designate directors for election (and
      to appoint compensation committee members) shall be reduced as
      follows:




**Percentage
                of Common Stock**
              **Disposed
                of by Affiliates of HMTF**
            **Number
                of**
              **Designated**
              **Directors**
            **Number
                of**
              **Compensation**
              **Committee**
              **Members**More
                than 20% but equal to or less than 40%
            4
            2More
                than 40% but equal to or less than 60%
            3
            2More
                than 60% but equal to or less than 80%
            2
            1More
                than 80% but equal to or less than 90%
            1
            1More
                than 90%
            0
            0





**Percentage
                of Common Stock**
              **Disposed
                of by Affiliates of GSC and**
              **Other
                Non-HMTF Stockholders**
            **Number
                of**
              **Designated**
              **Directors**
            **Number
                of**
              **Compensation**
              **Committee**
              **Members**More
                than 30% but equal to or less than 60%
            2
            1More
                than 60% but equal to or less than 90%
            1
            1More
                than 90%
            0
            0








**Rights
      Offering**





On
      October 7, 2004, Group completed a Rights Offering whereby they sold 5,555,555
      shares of common stock at $9.00 per share to current holders of stock. The
      proceeds, net of issuance costs, of $47.1 million, was contributed to
      Viasystems.




**Monitoring
      and Oversight Agreement**




Viasystems
        entered into a ten-year monitoring and oversight agreement with an affiliate
        of
        HMTF, effective as of January 31, 2003. Under the monitoring and oversight
        agreement, Viasystems is required to pay HMTF an annual fee, payable quarterly,
        for oversight and monitoring services equal to the lesser of (1) 2% of its
        consolidated EBITDA for such year and (2) $1.5 million. The fee is payable
        for
        the preceding year following the completion of the audited financial statements
        for the preceding year, provided that HMTF may elect to defer the payment
        of
        their fees, in which case these amounts will become due and payable at such
        time
        as HMTF elects to require the payment of these obligations. The monitoring
        and
        oversight agreement makes available the resources of HMTF concerning a variety
        of financial and operational matters. Historically, these services have been
        provided not only by Mr. Furst and Mr. Rosen, outside the scope of their
        duties
        as our directors, but also from numerous other principals and employees of
        HMTF.
        Mr. Furst and Mr. Rosen are each principals of HMTF. HMTF has performed various
        monitoring and oversight services, including providing input in management’s
        establishment of Viasystems’ financial and strategic acquisition plans. HMTF
        monitors the viability and implementation of Viasystems’ strategic plan through
        actions such as review of monthly financial data, management briefings and
        facility visits. HMTF is also entitled to reimbursement for any expenses
        incurred by it in connection with rendering services under the monitoring
        and
        oversight agreement. In addition, Viasystems has agreed to indemnify HMTF,
        its
        affiliates, and their respective directors, officers, controlling persons,
        agents and employees from and against all claims, liabilities, losses, damages,
        expenses and fees and disbursements of counsel related to or arising out
        of or
        in connection with the services rendered by HMTF under the monitoring and
        oversight agreement and not resulting primarily from the bad faith, gross
        negligence, or willful misconduct of HMTF.


**Consulting
      Arrangement**





In
      connection with our restructuring activities, commencing December 2001,
      Viasystems, Inc. engaged Katia Advisors LLC to provide sales and marketing
      consulting services related to strategic marketing opportunities. Such services
      were provided on a month-by-month basis and effective December 1, 2004,
      Viasystems, Inc. discontinued using these services. As of December 1, 2004,
      Viasystems had paid Katia Advisors an aggregate of $520,000. These services
      were
      provided by Richard McGinn, a partner of Katia and a member of our board of
      directors.




**ITEM
      14.** ***Principal
      Accountant Fees and Services*** ****







The
      Audit
      Committee has considered whether the provision by PricewaterhouseCoopers LLP
      of
      the services covered by the audit fees is compatible with maintaining the firm’s
      independence and concluded that it is compatible.






The
      Audit
      Committee is responsible for pre-approving all auditing services and permitted
      non-auditing services to be performed by the Company’s independent
      auditors.






**Principal
      Accounting Fees**






The
      following table sets forth fees billed to the Company during the years ended
      December 31, 2004 and 2005 by the Company’s principal accounting firm
      PricewaterhouseCoopers LLP:




**Year
                ended December 31,****2004**
            
            2005Audit
                fees (1)
            
            $
            1,429
            
            $
            1,096Audit
                related fees (2)
            
            
            214
            
            
            114Tax
                fees (3)
            
            
            41
            
            
            —All
                other fees
            
            
            —
            
            
            —Total
            
            $
            1,684
            
            $
            1,210




(1)
            Includes
                professional services rendered for the audit of the Company’s consolidated
                annual financial statements and review of financial statements in
                the
                Company’s reports on Form 10-Q and services normally provided in
                connection with various accounting matters and statutory audit services
                and assistance with and review of documents filed with the Securities
                and
                Exchange Commission.




(2)
            Includes
                professional services rendered for procedures performed in connection
                with
                due diligence and audit for divestitures and consultation concerning
                Sarbanes-Oxley.




(3)
            Includes
                professional services rendered for preparation of tax returns and
                consultation with the Company on various tax
                matters




**Financial
      Information Systems Design and Implementation Fees**




PricewaterhouseCoopers
      LLP did not perform any services and therefore billed no fees relating to
      operating or supervising the operation of the Company’s information systems or
      local area network or for designing or implementing the Company’s financial
      information management systems during 2005.







**PART
      IV**





**ITEM
      15.** ***Exhibits,
      Financial Statement Schedules, and Reports on Form
      8-K***





*1.
      Financial Statements*





The
      information required by this item is included in Item 8 of Part II of this
      Form
      10-K.





*2.
      Financial Statement Schedule*





**Schedule
      II — Valuation and Qualifying
      Accounts**


**For
      the Year Ended December 31**


**(In
      thousands)**




**Allowance
                  for doubtful**
                **accounts**
              
              **Beginning**
                **Balance**
              
              **Acquisitions/**
                **(Distributions)**
              
              **Charges
                  to**
                **Cost**
              
              **Accounts**
                **written
                  off**
              
              **Translation**
                **Adjustments**
              
              **Balance
                  at**
                **End
                  of**
                **Period**2003
              
              $
              10,893
              
              $
              (942
              )
              $
              6,259
              
              $
              (7,228
              )
              $
              1,046
              
              $
              10,0282004
              
              $
              10,028
              
              $
              (296
              )
              $
              7,699
              
              $
              (3,932
              )
              $
              328
              
              $
              13,8272005
              
              $
              13,827
              
              $
              —
              
              $
              2,511
              
              $
              (5,525
              )
              $
              (81
              )
              $
              10,732
 
  **Valuation
                  Allowance for**
                **deferred
                  tax assets**
              
              **Beginning**
                **Balance**
              
              **Acquisitions/**
                **(Distributions)**
              
              **Charges
                  to**
                **Cost**
              
              **Extraordinary**
                **Items**
              
              **Translation**
                **Adjustments**
              
              **Balance
                  at**
                **End
                  of**
                **Period**2003
              
              $
              576,654
              
              $
              0
              
              $
              130,635
              
              $
              0
              
              $
              0
              
              $
              707,2892004
              
              $
              707,289
              
              $
              0
              
              $
              (308,339
              )
              $
              0
              
              $
              0
              
              $
              398,9502005
              
              $
              398,950
              
              $
              0
              
              $
              67,156
              
              $
              0
              
              $
              0
              
              $
              466,106


*3.*
            *Exhibits*





The
      following exhibits are filed as part of this Registration Statement or
      incorporated by reference herein:




**Exhibit
                No**.
            **Exhibit
                Description**2.1
            (1)
            Prepackaged
                Joint Plan of Reorganization of Group, Inc. and Viasystems, Inc.
                under
                chapter 11 of the Bankruptcy Code, dated August 30,
                2002.2.1(a)
            (1)
            Amended
                Motion of Debtors for Order Approving Modification to the Debtors’
                Prepackaged Joint Plan of Reorganization, dated January 2,
                2003.2.1(b)
            (4)
            Stock
                Purchase Agreement between Electrical Components International Holdings
                Company, Viasystems Group, Inc., Wire Harness Holding Company, Inc.
                and
                Wire Harness Industries, Inc. dated March 21, 2006.3.1
            (1)
            Third
                Amended and Restated Certificate of Incorporation of Group,
                Inc.3.2
            (1)
            Amended
                and Restated Bylaws of Group, Inc.3.3
            (3)
            Amended
                and Restated Certificate of Incorporation of Viasystems, Inc.3.4
            (1)
            Amended
                and Restated Bylaws of Viasystems, Inc.4.1
            (1)
            Indenture,
                dated as of December 17, 2003, among Viasystems, Inc., the Guarantors
                party thereto, and The Bank of New York, as Trustee.4.2
            (1)
            Form
                of 101⁄2% Senior Subordinated Note (included as Exhibit A to the Indenture
                filed as Exhibit 4.1 hereto).10.1
            (1)
            Credit
                Agreement, dated as of January 31, 2003, among Group, Inc.,
                Viasystems, Inc., the several banks and other financial institutions
                party
                thereto, and JPMorgan Chase Bank, as Administrative Agent.10.1(a)
            (1)
            First
                Amendment, dated as of March 19, 2003, to the Credit Agreement, dated
                as of January 31, 2003, among Group, Inc., Viasystems, Inc., the
                several banks and other financial institutions party thereto, and
                JPMorgan
                Chase Bank, as Administrative Agent.10.1(b)
            (1)
            Second
                Amendment, dated as of December 3, 2003, to the Credit Agreement,
                dated as of January 31, 2003, among Group, Inc., Viasystems, Inc.,
                the several banks and other financial institutions party thereto,
                and
                JPMorgan Chase Bank, as Administrative Agent.10.1(c)
            (3)
            Third
                Amendment, dated as of October 7, 2004, to the Credit Agreement,
                dated as of January 31, 2003, among Group, Inc., Viasystems, Inc.,
                the several banks and other financial institutions party thereto,
                and
                JPMorgan Chase Bank, as Administrative Agent.10.1(d)
            (3)
            Fourth
                Amendment, dated as of March 17, 2005, to the Credit Agreement, dated
                as
                of January 31, 2003, among Group, Inc., Viasystems, Inc., the several
                banks and other financial institutions party thereto, and JPMorgan
                Chase
                Bank, as Administrative Agent.10.2
            (1)
            Guarantee
                and Collateral Agreement, dated as of January 31, 2003, among Group,
                Inc., Viasystems, Inc., the subsidiaries party thereto, and JPMorgan
                Chase
                Bank, as Collateral Agent.10.3
            (1)
            Group,
                Inc. 2003 Stock Option Plan.10.4
            (1)
            Amended
                and Restated Executive Employment Agreement, dated October 16, 2003,
                among Group, Inc., Viasystems, Inc., Viasystems Technologies Corp.
                LLC,
                the other subsidiaries party thereto, and David M. Sindelar.10.5
            (1)
            Amended
                and Restated Executive Employment Agreement, dated January 31, 2003,
                among Group, Inc., Viasystems, Inc., Viasystems Technologies Corp.
                LLC,
                and Timothy L. Conlon.













**Exhibit
              No.**
            
            **Exhibit
              Description**10.6
            (1)
            Amended
                and Restated Executive Employment Agreement, dated January 31, 2003,
                among Group, Inc., Viasystems, Inc., Viasystems Technologies Corp.
                LLC,
                the other subsidiaries party thereto, and David J. Webster.10.7
            (4)
            Amended
                and Restated Executive Employment Agreement made and entered into
                effective as of August 15, 2005, among Group, Viasystems, Inc., Viasystems
                Technologies Corp., LLC and Gerald G. Sax.10.8
            (1)
            Monitoring
                and Oversight Agreement, made and entered into effective as of
                January 31, 2003, among Group, Inc., Viasystems, Inc., the
                subsidiaries party thereto, and Hicks, Muse & Co. Partners,
                L.P.10.9
            (5)
            Letter
                Agreement dated June 15, 2005 between Group and David J.
                Webster10.10
            (2)
            Stockholders
                Agreement.10.11
            (2)
            Amendment
                to Stockholders Agreement.10.12
            (2)
            Annual
                Incentive Compensation Plan.10.13
            (6)
            Group
                Stock Option Plan.14.1
            (3)
            Code
                of Ethics for the Principal Executive Officer and Senior Financial
                Officers filed on Exhibit to Registrant’s Report on Form 10-K for the year
                ended December 31, 2004.21.1
            (6)
            Subsidiaries
                of the Registrant.31.1
            (6)
            Chief
                Executives Officer’s Certification required by Rule
                13(a)-14(a).31.2
            (6)
            Chief
                Financial Officer’s Certification required by Rule
                13(a)-14(a).32
            (6)
            Chief
                Executive Officer and Chief Financial Officer Certification pursuant
                to 18
                U.S.C. 1350, as adopted to section 906 of the Sarbanes-Oxley Act
                of
                2002.


_________________




(1)
            Incorporated
                by reference to Registration Statement No. 333-113664 on Form S-1
                of
                Group, Inc. filed on April 28, 2004. 
 (2)
            Incorporated
                by reference to Registration Statement No. 333-114467 on Form S-4/A
                filed
                on June 22, 2004. 
 (3)
            Incorporated
                by reference to 2004 Annual Report on Form 10-K of Viasystems, Inc.
                filed
                on March 30, 2005. 
 (4)
            Incorporated
                by reference to the Quarterly Report on Form 10-Q of Viasystems,
                Inc.
                filed on November 11, 2005. 
 (5)
            Incorporated
                by reference to the Company’s Form 8-K filed on March 22,
                2006. 
 (6)
            Filed
                herewith.









SIGNATURES





Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the registrant has duly caused this report to be signed on its behalf
      by
      the undersigned, thereunto duly authorized, in the City of Clayton, State of
      Missouri, on the 31st day of March, 2006.





Viasystems,
      Inc.





/s/
                David M. Sindelar
            
            /s/
                Gerald G. SaxDavid
                M. Sindelar
            
            Gerald
                G. Sax*Chief
                Executive Officer*
            
            *Senior
                Vice President and Chief Financial Officer*
              *Principal
                Accounting Officer*





Pursuant
      to the requirements of the Securities Act of 1934, this Report on Form 10-K
      has
      been signed by the following persons in the capacities indicated on the 31st
      day
      of March, 2006.








/s/
                Christopher J. SteffenChristopher
                J. Steffen
            
            *Chairman
                of the Board of Directors*Jack
                D. Furst
            
            *Director*/s/
                Andrew S. RosenAndrew
                S. Rosen
            
            *Director*Robert
                F. Cummings, Jr.
            
            *Director*/s/
                Diane H. GulyasDiane
                H. Gulyas
            
            *Director*Robert
                A. Hamwee
            
            *Director*Richard
                A. McGinn
            
            *Director*/s/
                Richard W. VieserRichard
                W. Vieser
            
            *Director*/s/
                David M. SindelarDavid
                M. Sindelar
            
            *Chief
                Executive Officer and Director*/s/
                Timothy L. ConlonTimothy
                L. Conlon
            
            *President,
                Chief Operating Officer and
                Director*